View Full Version : When you get excited about a project~
Through this web site I discovered MMM and I'm finally nearly through the blog. I was already on that trajectory, but a lot of things really gave me good direction to start researching. My practice in general is read a blog, then go and read what the blog was about (ie, index funds). So, it takes me a while to get through it!
After starting on MMM learning, my friend told me about this site/budgeting software: you need a budget (http://youneedabudget.com). Looks like a really cool way to budget, and easier than my spreadsheet (which was taking me ages to configure properly). She's been running her business on those principles and has see great financial results, and since I was struggling with certain aspects of our business budget, she recommended it. I have just started reading and working with it, and I'm already seeing areas where I lacked understanding to really make my money work!
I'm really excited about this! DH and I looked at how we can better utilize the money in the business as well as how to better utilize the money we bring home from the business! So cool!
I'm looking forward to learning so much more -- and I feel really. . . proud . . . of myself for just continuing to go deeper into this.
I wish I hadn't been such a chicken about money as a 20-something. We did do things like live within our means, learn to live on a single income, etc etc etc. But we weren't as detailed or as determined with our finances as we are now. I know I'm 37 so rather late to a lot of those parties, but it looks like the budget will allow me to meet my "pay off the student loan debt" goal very quickly. :)
When did you get excited about doing this sort of financial work?
What excites you about the financial/simplicity work that you do now?
Rate from a scale of 1-10 (one being :P and ten being "awesome sauce!") how working on your finances makes you feel!
It makes me feel awesome sauce!
Well, I love numbers and spreadsheets so any money stuff, even bill paying, rates very highly with me. 9-10 depending what I'm doing. Especially exciting if I think of a new calculation or spreadsheet to do.
I'd give myself a 6 on the scale.
Even after more than a year of using our chosen financial software (See Finance (http://www.scimonocesoftware.com/seefinance/)), I'm still tweaking categories and definitions a bit to more accurately report our spending. Data entry is pretty much a habit now. I don't just shuffle through the bills anymore; I'm more likely to catch the odd charge or the extra-high/-low use of a product or service -- and the detective work figuring out why it's there interests me (in fact, it was a subject in my most recent blog). Streamlining the billing/payment process is something I find interesting, too, though at this point we're largely on autopilot for the big bills (except groceries). This level of tracking does make it easier to do some what-ifs: what if DW took a job at lower pay? How much quicker could we pay off the mortgage if we added $n to the regular monthly charge? Is our mobile-phone usage still low enough to make prepaid a good option? So far I'd say the work is worth it.
I would prefer, though, if the investment world wasn't quite so complicated. It's easier to identify our requirements for, say, a refrigerator, buy one, and know that, for the next umpty years, we'll get something that does what we bought it to do. Hardly anyone offers such guarantees in the investment world. And the cacophony of voices -- many shilling for what's good for them, not us -- makes it much harder to be satisfied that we've done enough homework to be able to count on the result of our spending (investment). At least this way, though, we know exactly how much we're gaining or losing. :-p
I'll say 5-6.
On one hand I'm totally into all kinds of spreadsheets and budgets. I use Mint.com for a pretty accurate picture of all my accounts overall. I use YouNeedABudget for my budget (I agree, it really is a good program), I have my own "rolling budget" to account for my variable expenses as a free-lancer. It helps me project my cash flow and how to prioritize my bills.
But I'm not what you'd call a financial nerd really. I'm more a "word" person than a "numbers" person, so that's how my rating kind of evens out.
I have ALWAYS written down exactly where my money goes. I used to use a little memo book and I'd do weekly tallies. It's probably a control issue.
iris lilies
7-18-13, 9:09pm
...Rate from a scale of 1-10 (one being :P and ten being "awesome sauce!") how working on your finances makes you feel!
The only "work " I do on finances is to review our net worth statement once or twice a year and usually with a glass of wine in my hand. But let me tell ya, it's a fun time! I'd say it is a 9! Even when the market plunges and we lost assets, it was still pleasing to have an updated net worth statement. I love the neatness and tidiness of it and how it pulls all relevant data into an executive summary.
My daily accountant (DH) does all of the check writing and moving investments around. For some of our investments he works with an advissor. For others, we make the decisions ourselves. For others, we just park the money there and don't look back.
So I may not do much with hands on of our finances, but I will tell you that the net worth statement is my idea. I asked for it more than a decade ago when DH was chattering about this bit of money and that investment and etc, and I could not follow what he was talking about. I told him to please put it all in writing in a simple summary form. So now we've got a two page document that lists all of our accounts and holdings and it includes valuations of real estate, personal property, automobiles as well as financial instruments.
iris lilies
7-18-13, 9:26pm
I will also add that Zoebird and Kestra are weird little geeky number crunchers, who gets pleasure out of spreadsheets and budgets!!!!????? haha! If I had children I would want them to be you girls!
I will also add that Zoebird and Kestra are weird little geeky number crunchers, who gets pleasure out of spreadsheets and budgets!!!!????? haha! If I had children I would want them to be you girls!
Thanks for the compliment. Everyone knows that geeks get into way less trouble and have much better lives than the average person.
that sounds cool, IL. I'm looking at getting a financial advisor for how we want to use some of our cash/investments/savings/retirement/whatever you want to label it just because -- well as Steve says, it is really complicated. But some things are easy -- like the index funds, CDs, and mutual funds that we currently utilize. Oh, and the money market account.
Anyway, I used to be completely "ostrich"-y about finances. I didn't want to know, just wanted to make sure I had enough in my account to cover the bills. I"d just check it about twice a month when I needed to pay, and then whenever I would take out cash I'd get an account balance. That was about all that I can handle. It wasn't good. DH handled the finances, and he didn't like it.
Then I read the Two Income Trap and Rich Dad, Poor Dad. The first one really got me going. It was kind of how we were already living, but I got really excited about organizing that way. RDPD taught me about passive income -- so even if it wasn't that great of a book, I hadn't really understood passive income opportunities (outside of investments, adn I didn't really understand those). I started to look at business models where it wasn't just me working X-million classes for money. So, at least it got the wheels turning.
About two years after that, DH and I *really* got into simplicity. I was still years out from having the kiddo, but besides from living on one income, we wanted to live "well within the means" of that income and pay down debt. So, we did a loose budget. Like Catherine, we did it all by hand each week in a notebook. I couldn't get excel to to work for me, or quicken, or whatever else. It was *super annoying*. But, doing it by hand was good.
The hard part was the emotions. DH was struggling with it. His family treats money in a "panic and upset!" mode. Seriously, it's weird. So, even though we were doing really well financially (on paper), the simplicity elements were hard on DH (and he's very frugal), and he would get ANGRY about finances. Like "THE POWER BILL IS SO ANNOYING!" and I'm like...wha? Anyway. Then, when he would get cranky, I would get upset because I needed him emotionally to "back me up" while I confronted the finances, which was scary for me.
Then, I came to NZ on a work holiday, and when I returned, my rabbit died and we decided to have a baby. During the pregnancy, I used some RDPD techniques to keep the income coming in while I was going to take a year off with DS. I also kept a few clients that I could see, and when DS was 1 month old, I pushed that to 4 classes. It was great, really. Best of all worlds. And, when we got the idea to move to NZ.
When I started working on business planning, that's when I got serious about budgeting. I'll be honest, I do NOT understand how accounting works. Like, on paper from the accountant, my business *looks* completely different than my experience of it AND my spreadsheet of it. So, that's confusing. I've done several meetings with her to try and get it, and I think I'm just dumb or not ready or something.
We looked at all of our finances, and since being here, we've been EXTREMELY diligent in learning how to budget for the business and for ourselves. But it's still rudimentary -- and not as dynamic as the YNAB process. It's been really amazing.
For example, because we wanted to tighten up our home budget in terms of food -- but not reduce the amount of quality that we purchased -- we discovered seasonal eating. There was a learning curve, but it was less expensive from week 1. Then, we began to really count everything out to get *exactly* the amount of *everything* that we needed. No left overs week to week. No pieces rotting or going bad before we get to them. basically? no food waste. That's been really amazing! Just learning to do that saves us $75/wk!
So, what happened over the last three years is that I'm so dedicated to making sure that this business works, that I really, truly had to face my fear of my finances. It was such a source of anxiety. But now that both DH and I are educated and we can see how budgets/etc work for us and create outcomes nearly immediately (we love that instant gratification), when we discover something new or a method of having our money work for us or what have you, we get REALLY excited about it.
I'm really excited about it right now, in fact.
It's funny because when I mention it to friends of mine (my age), no one is interested. But when I mention it to my 22-25 yr old friends, they are really onto it! And when I mention it to my parents, they get hesitant.
BUT, since my dad is looking to retire into a consultant's business in three years, he needs this stuff. So, I've been helping him out with business planning and financial planning and gathering people to help him the the relevant tax and legal implications of his work. I think he'll be able to retire, hire my mom (who has long worked as a report writer where my dad works), and then do quite well for themselves in retirement. Looking at the forecasting and market research, he needs to only work 10 hrs a week to earn what he earns now, and an additional 4 hrs a week to earn what my mother earns -- making it possible for both of them to retire at the same time. Both will also be over 65, so they'll qualify for medicare, too.
I'm easing them in with their household budget, so that they can get a sense of how to make the money work for them. Over the last 3 years, they've been inspired (so they say) by me to get completely debt free, which they now are. Their plan is to buy a place near my sister (cheap houses, seriously!), and then work from home there. I'm encouraging them not only to save as much as they can over this next three years, but also put aside money for the house -- see if they can buy one outright. The neighborhoods that the are looking at near my sister have nice houses for $85-100k. I think it's definitely possible for them to reach that number in 3 years based on what they already have -- now that they aren't spending money that they don't have without really realizing it.
Hence, budgeting.
Mom and dad say that I"m a little scary. But, you know, when retirement is looming, there's NO time to waste. And dad has major health issues, which means he's going to need some assets for long-term, in-home care. My sister and I have already insured him and my mother (it's only $15/mo for us to pay it -- and it covers all 4 of us -- it was an interesting deal), but we want mom and dad to take that one themselves as well -- just so that they hvae another financial buffer at their disposal.
fidgiegirl
7-18-13, 10:59pm
I used to be a 9, but now it feels more like a 5. I don't track as diligently as I did. Funny that it was most exciting when we were paying off debt. Maybe because I could really see the progress, or could concretely feel us moving toward a mutually held goal?
I have written quite a bit about this as of late, but I believe this is because DH and I don't currently have a defined financial goal. And when I put a really ambitious goal out there several months back, and was talking a lot about it and mistakenly thought he was on board, it was too much for him. Too scary. We had a huge fight about it, really the only fight I can ever remember (the others, you know, they are just quibbles and they pass and after some months/years, they are not even remembered). And we have not approached it again. And as in the "RHW isn't doing it for me" thread, some of the YMOYL techniques aren't meeting our needs anymore, either, even though I remain a devotee of the concepts in the book.
I wonder if switching to YNAB might be a good way to shake it up. I believe in close attention to finances, but am not walking the walk. I remember looking into the program some years ago, but if I remember right it was just an Excel spreadsheet at that time. We use Moneydance, and it works well when I remember to get in there and do the tracking. Mint won't work for us because it won't interface with our small credit union. Maybe YNAB is the answer to a different lens for money for us. Sounds like those of you who use it think it's worth the price? It's on sale for $39.99 until the 22nd.
I appreciate the suggestion to use YNAB for business tracking. I had never thought of that. Our business tracking is pretty simple right now, but I'd like to be more planful about the future trajectory of the rental business. For example, if we want to acquire more properties, how do we plan to go about amassing the 20% down payment required on that property?
I think it's interesting that you talk about the feeling of it all around paying off debt vs growing wealth. I think that there is a difference in how these things are perceived/felt -- and it's exciting to get out of debt. BUt then you are like "ok, so I put that amount into savings" or whatever. . .instead of making it work for you so that you can reach certain goals.
DH and I have a goal of doing a cross country US trip with DS. We did some research on a basic budget, and it gave us some goals. We'd like to do it when he's 9/10, which is a pretty magical age for things like Yellowstone. So, it gives us 4/5 years to reach that goal. We'd also like to do a year abroad -- possibly as his "gap year" -- travelling the world as a family before he heads out. That gives us 12 years to save. Luckily,a lot of kiwis do this, so there's a lot of information about how much you budget for this sort of thing. :)
We want to do that in addition to MMM recommendation of getting 25X your expenses in index funds, as well as (possibly) getting a house. I think we can do it. It's aggressive and BIG goals, but I think it's possible.
Oh, so maybe THAT'S where I got the advice to put my money in index funds! When I restarted my little retirement pot, I went right to index funds, because I knew I had read that somewhere. Now I know! Thanks!
SteveinMN
7-19-13, 11:06am
Oh, so maybe THAT'S where I got the advice to put my money in index funds!
That's actually pretty common advice, on the assumptions and documentation that most managed funds don't beat the averages of their respective indexes and that not having to buy and sell creatively lowers expenses. The only people I know who will recommend against managed funds make a hobby/living out of the markets. And even with all that effort they're not winning all the time.
ApatheticNoMore
7-19-13, 12:02pm
I have an irresistible temptation to pay someone to manage my money. Stop me before I do it! Because one of these days I'm probably just going to just do it! I can't seem to earn anything on my money. I often think what good it even is, it certainly doesn't inspire me to save more as it earns nothing anyway. In fact it only seems to inspire me to try to think of ways to SPEND my money on something anything that will return more for the future than nothing (education maybe?) Those who manage money promise nothing of course but talk about actual returns ... considering I never budget for any returns on my money in retirement savings, I wonder what it would be like to earn consistent returns. By the way this was after actually meeting with such people (not even on my own account though - I wasn't meeting with them for me). I wonder if trying to do it all ourselves, be experts on yet another thing, isn't just more pointless suffering.
I have an irresistible temptation to pay someone to manage my money. Stop me before I do it! Because one of these days I'm probably just going to just do it! I can't seem to earn anything on my money. I often think what good it even is, it certainly doesn't inspire me to save more as it earns nothing anyway. In fact it only seems to inspire me to try to think of ways to SPEND my money on something anything that will return more for the future than nothing (education maybe?) Those who manage money promise nothing of course but talk about actual returns ... considering I never budget for any returns on my money in retirement savings, I wonder what it would be like to earn consistent returns. By the way this was after actually meeting with such people (not even on my own account though - I wasn't meeting with them for me). I wonder if trying to do it all ourselves, be experts on yet another thing, isn't just more pointless suffering.
I don't know as it's "pointless suffering". :) I see investing as one more life skill that someone may choose (or not choose) to let someone else do for them. We aren't all DIY home repair types or gardeners or musically-inclined. I hire someone to diagnose when I'm sick. If my investments are not "feeling well", I'll find a pro to help me figure out what my treatment options are. By all means hire someone if you want to. Paying someone knowledgeable to help out makes more sense than doing nothing or, worse, losing money on your investments. A quick Web search will guide you in how to pick an advisor who will work for you.
I agree there, Steve.
Right now, my plan is to start on my own and see how it goes. But then after I have a bit sorted, I'll talk to a pro about how to do it better! I'm just starting to learn about and understand index funds. So, we'll see how it goes. :D
I'm so excited!!!!
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