Back in the beginning of the year I posted on some of the things I am looking forward to in2009 and considering that we are now about half way through the year I figured I would post an update of where I stand. The past few months have been pretty interesting and quite a bit has happened so I will get right down to it.
Getting back in shape: I have been going to the gym for 5 months or so now. Lately I have been getting up early in the morning and going to work out four or five days a week. My gym is closed on Sundays thorough the summer so I am really only missing one or two days per week that the gym is available. Since the gym closed for Sundays a couple weeks ago I have been working to get outside and do something on Sundays as well. Overall I now: get a pretty good amount of exercise, have quite smoking for over a year and do not drink. My diet is still a bit unhealthy and I tend to overeat and have a sweet tooth but I am making progress.
No more car payments: Next month will be my final full payment followed by a half payment in August and that will be done. I am very much looking forward to not owing money to my ex-girlfriend any more and am looking even more forward to having the extra cash every month!
Giving my site a new look: I have changed my theme twice and am thinking I will settle with this one for a little bit. So far so good I think.
Paying off my credit card: I no longer carry a balance on my credit card from month to month! I am still getting to a point where I do not spend at all on it but my balance of nearly $2,000 that was carrying over and accruing interest fees is now gone!
Rebuilding my savings account: I am getting there. I have my own little emergency fund challenge for 2009 running to give myself some public incentive and accountability to get my savings account back in shape. Right now I am up to $250 in the emergency fund and am aiming to reach $1,000 before the end of the year.
So far 2009 has been a pretty productive year and I am really looking forward to seeing how it all wraps up. I am hopeful that my personal financial situation will continue to improve. My girlfriend has also been taking some pretty impressive steps to improve her financial fitness as well and has impressed me with her ability to reach her goals as well. I think that right now she has more in savings than I do and was telling me the other day that now that she has the money in savings she does not want to touch it. Needless to say – I am proud of her and am awed by her ability to accomplish her goals.
A couple of months ago I pulled most of my cash out of savings and applied it to my credit card debt. While this eliminated the debt it put me back in the position that many Americans today are stuck in: not having an emergency fund. I could always fall back on my credit card in an emergency but I really feel much more comfortable having a little bit of money in savings in case something comes up. One of my goals is to reestablish my starter emergency fund and while thinking about it last night I thought that I would invite any readers trying to get their emergency funds up and running to join me!
The challenge is pretty informal and is geared to help hold me accountable to rebuilding my emergency fund and to help anyone else out there that would like the additional encouragement! To take part feel free to leave a comment, contact me here, or even send me an email to: matt at myfinancialrecovery dot net. Just drop me a line somewhere along the way with a goal you would like to reach by the end of the year. Then send over an update at the end of each month from June – December and I will post updates monthly of my progress and will also post your progress in the process.
My goal is to build back up to the $1,000 starter fund recommended by Dave Ramsey in The Total Money Makeover by the end of the year. My current status is that I have $108 in my online savings account that I have had set aside as an emergency fund. In order to reach my goal of getting it back up to $1,000 I do not want to drastically impact our family budget in any given month. In fact - I would like to reach the goal without any noticeable impact on the family. Here is my plan so far to accomplish my goal:
Communicate with my girlfriend about where we are at financially: Setting money aside will effect both of us and I find life is a lot better when we are both on the same page. Usually checking in once every week or two works fairly well for us on financial matters.
Pay attention to my spending: Identify areas that I buy things for myself that I could go without and make a few sacrifices.
Make small weekly transfers to savings: In stead of trying to make a big monthly payment work on making small weekly ones – $25 per week seems much more manageable than $100 in one shot.
Keep an eye open for any extra opportunities to save a little bit extra.
Discuss budgeting based on my base salary with my girlfriend and put a couple months of commissions into the bank.
Based on the math I would have (including June) 7 months to reach this goal and would need to save about $125 per month to do so. At the same time I intend to continue paying off my current debts by making at least minimum payments. I also have one other variable coming up in August when I send my last payment to an ex-girlfriend for the car she lent me money for – which will free up another $400 per month. Overall the goal should be easily attainable based on my current income and expenses and I should have it completed by the end of summer or so.
So now the question is – does anyone else out there want to join me in starting, rebuilding or increasing their emergency fund?
Early last month I was pretty excited to report that I had paid off my credit card balance to Capital One. So I thought I would give everyone a quick update on where I am at this month: the card is still paid off.
The plan that my girlfriend proposed involved paying off the credit card balance and working to curb spending to keep the balance low. The result for me was a pretty empty checking account and we figured that we would use the card for expenses but would keep a closer eye on spending. So far it has worked out. Since my initial pay off of the large balance I have seen two statements.
The second statement was about half of the first for amount due so it appears that we have been gradually easing up on credit card use and easing back onto the checking account and debit card. I did have a couple of decent months at work which lead to higher commissions so the balances were paid in full and so far I have not made any transactions on my new statement period (which began in the middle of last month).
All said and done – the little plan my girlfriend put forward has worked pretty well. The process looks like this:
Pay off the entire balance – do not worry about the low checking account balance.
Use the card and stick to your budget for essentials.
Keep tabs on spending, use the card sparingly.
Pay the card off in full again – this time with a lower balance leaving more in the bank.
Repeat
In addition – the plan plays to my emotional well being as well as I generally do not like having to pay with my credit card. The emotional reaction is enough that I will often forgo additional comfort items for myself (do I really need to go out for a coffee?) and stick with the basics.
Over the weekend I discovered that I have a new favorite television network: Planet Green. I had seen a couple of clips from shows on the network but had not sat and watched for an extended period of time until Sunday afternoon. My girlfriend had hurt her back so we were having a mellow afternoon and she told me about a show called Off the Grid she had seen the night before after I had fallen asleep. She said it was pretty cool and that I would have really liked it.
The show is a documentary starring Les Stroud (also known as Survivorman) and his family as they purchase 150 acres of Canadian wilderness and move off the grid. I was just amazed at the lifestyle the family chose and really just could not stop thinking about how cool their plan was.
The best part – they went green on a budget! Obstacles like not being able to drill through bed rock due to cost constraints were real and they faced the challenges like a regular family. Once completed the family produced their own power and water which left them both living green and free of utility bills.
I personally dream of a day when I can go somewhat off the grid with my family in our own home. I do not think we will be using any self composting toilets but I am open to the idea of a gravity feed from collected rain water (provided my better half agrees). However – I do not want to go totally off the grid at this time. While I strongly believe in trying to live a greener lifestyle I also think that we may be able to give back additional power generated if we were to produce our own energy via solar or wind power. From the setup that Les Stroud and his family had it appeared that once their batteries were charged the system just stopped producing energy. I figure that if the system is producing energy anyway and we have the ability to be wired in then why not give some of it back to the power company? I have also heard that the power companies will also reimburse you for the power provided back but my goal would be more in line with providing a little bit of green power back more than making money. Anyway – at this point it is more or less just a wishful dream of mine but I hope someday that it will be a reality. I suppose when the time comes then my girlfriend and I will talk it out and make decisions based on what we can and can not do.
In the mean time – while digging around on the show a little bit I found it over on YouTube. Here is an embedded clip of the show for anyone that wants a preview. For the rest of the episode just head on over to YouTube and search “Off the Grid Les Stroud”.
While stumbling around some of my favorite reads I happened upon a post over at Budgets Are Sexy asking What Would You Do With 3 Financial Do-Overs? which it turns out was an extension from a post over at Your Money Relationship. I know I can not change the past and I am in the midst of dealing with yet another collection agency but if the money genie did happen to stop by my house for a visit I would probably take him or her up on the offer.
After giving it a little thought I think that given the opportunity I would probably wish to:
Have paid for college without loans: Well since it is a wish then when not go all the way? I suppose I would be happy with not having defaulted on student loans in the past as well though. If the genie was unable to get me through college debt free then maybe it could save me from myself right?
Learned about personal finance earlier in life: I really had no clue when I left home for college at all. I could not budget or even balance a checkbook and I had no idea how credit worked. It was not until I read Dave Ramsey’s The Total Money Make Over that I got the basics for the first time and that was about 4 years after graduating from college. I think that knowledge of all personal financial essentials probably would have saved me a few headaches in the past.
Saved more: Only recently have I really started to enjoy saving money. I like to see balances go up for what I have in the bank and debt balances go down. If I had put 10% of what I have earned through my life in the bank and left it there I would probably be sitting pretty happy right now. I can still start doing this but I thought I might as well fill out my third wish.
Really the only thing that I wish I had done differently in my financial past was the way I failed to manage my student loans after college. The rest was a learning experience and while it may have been difficult at the time, I survived. The student loan issue is really the only lingering big financial mistake that I have to deal with and it will pass someday as well. All said – I think that a wish of making it through college without student loan debt would put me in a much different situation today and it is probably the one aspect of my life that I would change if I could.
However – I do keep in mind that by changing the paths I have gone done in life I may not have ended up where I am at today! I have a family that loves me, a place to live, a car to drive and food on the table. If changing my past meant changing my current family situation for any reason I would have to decline the money genie’s generous offer.The people I live with mean more to me than any sum of money – if I had to go through what I have gone through to get where I am today then I would not change a single step along the way.
