Sunday, November 3, 2013

What have I learned about money?

money (Photo credit: 401(K) 2013)
I've been using money my whole life, just like you. So we're equally qualified there. What I'm doing that you may not be doing is dedicating my attention and this blog to making major money changes in my life.

My blog is here for a reason. My purpose is to chronicle and share my voyage from the same crappy financial place so many people are to where I will end up: financially resourceful, capable, equipped to live on my terms. I guarantee that that is where I'm heading. My trajectory is up-up-up.

As I'm starting this blog, I'm in a rather typical-to-worse-than-average place. My net worth is negative, I have tens of thousands of dollars in student debt (but no degree), I've filed bankruptcy once (losing my house), and I'm in process of having my second divorce. I'm 34.

At this point I have taken some solid lessons:

  • Having money is better than not having money.
  • Conventional money advice is often not so good, because it gets conventional results: not so good.
  • Student loans are a dangerous, only take them if you are practically guaranteed a high enough income right out of school to meet all your expenses and pay off loans and interest quickly.
  • Accepting help is a skill you need.
  • Use a budget or lose your money.
  • Knowing your numbers is crucial. Credit score, net worth, debt, interest rates, monthly expenses, etc.
  • A safety cushion will save you tons of cash.
  • Learning to spend as little money as possible is freeing.
  • Investments will take care of you.
  • Owning capital is the way to go.
  • Your attitude is probably a bigger problem than your income (or lack thereof).
  • Getting your hands on lots of money is the same as getting your hands on lots of ability to do what matters to you.
  • You can't win if you don't play by the rules. Know what the rules are.
  • Don't take advice from people who don't manage their money as well as you. If you don't know their financial situation, then ask or assume you can manage yourself better than they could.
  • Believe you deserve financial health, and you have the power to create it.
I just pinpointed some things I strongly believe about money, I'll make sure to expand on those in future posts, where you can read my reasoning in case you're interested. I hope sincerely that my sharing (and often over-sharing) through this site helps others to feel good about money, about life, and to make the most of their own money and life.

As I write, my net worth is -$25,466.59, assets are $29,317.46, debts are -$54,781.05. And I wouldn't know these numbers everyday if it weren't for
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Thursday, October 31, 2013

Why people don't talk about money

Oh, man, am I ever learning as I go. I really am.

Sometimes I feel like obvious things get past me. Here's an example, as illustrated by a true story.

About a week ago, I was at a party. It's October, so it was a pumpkin carving party. I had a great time. Tons of friendly people, a push-up contest, eating pumpkin macaroni and cheese and talking about gratitude and love. All the proper ingredients to a good party.

I also met a charming and handsome gentleman whom I had great conversation with. He was my main entertainment at the party, and very easy on the eyes. We were both into talking about money. This last year I've been highly focused on improving my finances, and that came up in conversation. Some of the things I mentioned were that I use a budget, my net worth is important to me, I save 20% for retirement, and that I work to keep my expenses down. I also told him I've been trying for about a year to get a group together to talk openly about finances. We just don't understand why money talk is so taboo! And so we declare ourselves immune to the perceived dangers of money talk!

The cute guy, who I'll call Mr. Handsome for our purposes, congratulates me on my dedication to using a budget. He doesn't do that. He says I appear to have my financial head on my shoulders straight. That feels good, and I like to think so too.

Then Mr. Handsome tells me that he's stopped saving for retirement. I thought, oh no, this will not do! At only 30 years old, this is the time to save! I'm thinking of compound interest with reinvested dividends, employer matching and the function of time in these matters. As a wise old lady of 34 years, I tell him my advice that he should be saving now, no matter how much he's already socked away. Trust me, young man, I'm wise in these matters.

The conversation swims around in this general area for a bit, and he mentions that he's maintaining a net positive monthly right now (making more than he's spending), and feels good about his $200,000 he's got put away. Plus he's renting out two of his high-price condos and living somewhere more modest. Cool. Right on. We continue chatting.

I've met lots of people in lots of income brackets. I've lived in a homeless shelter and had a close friend who was a multi-millionaire. I am pretty convinced that I can be completely understanding of our minor difference as I go on having fun and feeling good. And I do. It's a fun night.

Then the next day comes. The next four days come, actually. And they're all the same. I'm depressed. So depressed I quit doing my school work (that's right, haven't done it yet) and even call out from work one day. So I can stay numbly in bed and eat ice cream. Lots of it.

I didn't get what was up my rump at first, but as I washed between anger and sadness and grief and self pity, it showed itself to me. I was taking a bumpy ride on the my-life-sucks train. I work hard to make ends meet, and that's cool. I wasn't feeling hurt because I'm poor or because Mr. Handsome isn't. I think Mr. Handsome is a super good guy and he deserves good stuff too. I recognize that there are people he seems poor next to and people that I look rich next to. It's all relative.

Takin' it to the BANK$Y
Takin' it to the BANK$Y (Photo credit: guano)
I was sad because I want to have money to donate to causes that I care about, money to free me from work so I can volunteer and travel, and money to do important, kind things for friends, family and strangers. I want to always know that I can afford the vet care my bird needs. I want to fully believe that I am capable of taking care of myself and my loved ones. And I've placed blame on people other than myself for my not having that money.

Completely true. Up to the moment as I write, I still do. Instead of building my net worth, getting a useful education, and making good money decisions, I spent my whole life so far being wounded and healing, unable to move past trying to make it another day. I spent my teens depressed and my 20s crazy. Really.

I had a rough childhood, I had fleas and was filthy and had no breakfast or lunch, and really really crappy things happened from there. I've been diagnosed with Major Depressive Disorder, Body Dysmorphic Disorder (for believing my face was so ugly that it made other people feel pain, get sick and die), and Post Traumatic Stress Disorder (we'll not be discussing that here, or ever probably). I've been homeless in multiple states, sold sex to get shelter, and generally had a hard time staying alive and also believing that I wanted to be alive. Life was tough, violent, and scary. I was sober, but my mind was cluttered. I was distracted. You might have seen me smelling horrid and talking to myself as I putzed down the street.

By the way, I'm good now. No need to worry about me. Not only am I not crazy, but I'm actually a very happy, stable person in general. Time, therapy, food and shelter: it really works.

But now I feel like I wasn't given a fair chance. I'm years behind all the other smart, capable members of society, and basic evidence suggests that I may not be smart and capable. But I am. I was really supposed to be a prodigy. Stephen Hawking was supposed to hang out and play chess with me. I'm supposed to have created life-saving technologies. And also have a car.

So now I get something I didn't get before. The reason people don't talk about money is because it touches their wounds. There is probably no one who doesn't wish their money situation was better than it is. We're eternally unsatisfied with our finances. Must be better! Get more! I deserve better, more and faster! Do I not have it because I'm unworthy? Am I horrible and useless?

Nope. You're not bad, and neither am I and neither is Mr. Handsome. Money is not distributed based on worthiness as a human. It's important to keep that in mind if we want to talk about money in ways that are helpful to us. And not end up eating nothing but ice cream for days on end.

As of now my net worth is -$25,051.18 assets $29,844.87 debts $54,896.05.

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Taking money advice

Celia says #57 (lock)
Celia says #57 (lock) (Photo credit: Brett Jordan)
I've started taking some financial advice. I'm 34 and not impressed by my finances. This blog is the result of my dedication to making a change.

I've recently taken the advice to start using a budget, specifically's software. I started about six months ago and my finances have already improved dramatically. But a lot has happened for me financially in that time.

I'm taking Mr. Money Mustache's advice on the news and transportation, although I already had the same opinions as him. So now I'm going to scour more of his wisdom for application in my life.

I've poorly (in my opinion) decided to take general society's advice about college (pay to buy a paper that most people your age have and no one needs). So I'm in a place of regret there, but I'm looking at what I can do better from here on out.

So here I'm going to share what happens as I take advice, don't take advice, and fight for my financial health.

Today, my net worth is -25,051.18 with $29,844.87 assets and $54,896.15 debts

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