2012 Financial Goals: Update

It's been a long time since I've done one of these but I'm back! I have had a lot of changes to my finances, mainly I'm in the process of buying my first home!  From a purely financial standpoint this may not have been the best decision, however the home is in an ideal neighborhood, I LOVE the house and can see myself (and my fiance and future family) there for a long time, so I'm comfortable with my choice.



Save $4000 by January 2013 I've added about $2200 to my savings this year and so far I haven't touched any of the money that has been added to my savings account since I opened it.  I'm scheduled to close on the house in about 2 weeks and unfortunately I will have to pull out about $1500 for closing.

Maintain a buffer of $100 in my monthly budget. From March to May I maintained about a $400 buffer each month.  In June I went on a vacation and had some minor expenses relating to the house (ex paying for a home inspection) so this buffer was only $49.  I did put down a $1000 deposit to secure the venue for my wedding next year, but I didn't include this in my monthly budget because I have been saving cash and gifts from family members in an envelope labeled Wedding Fund (old school, I know).

Maintain $0 credit card debt.
I used my credit card for my regular monthly expenses (grocery, gas, etc.) and pay the balance in full by the end of the month.  So far this year I've gotten a $50 Gift Card using my credit card reward points and by next month I should have enough points for another $25 card!

Open a Roth IRA

Haven't done this yet. 

Money Lesson: Stay Busy

source

I love the feeling of having plans.  Nothing is more exciting--or makes the workweek go by more quickly--than having something to look forward to on the weekend. I also find that having weekend plans keeps my spending in check.  On the days where I have nothing to do, my boredom leads me to the mall or browsing the aisles of Target...and we all know how tempting it is to spend once you set foot in the stores!

I've also noticed that I'm more prone to constant snacking and mindless eating on those lazy days where I just stay in the house reading blogs and watching Netflix.  There's a saying that goes "the Devil finds work for idle hands to do” and I think there may be a little truth to it.  When there is something on my calendar, even if it's something like a visit from family or plans to attend an event, I'm usually occupied for a number of hours, engaged in some activity that doesn't require me to spend money, and I'm not even tempted to spend any money.  Sometimes I get engrossed in a good book or working to craft a blog post and the next thing I know, I've had a "no-spend" weekend!

If you are like me and are tempted to shop out of pure boredom, find ways to stay busy! Visit your loved ones, spend more time on hobbies, and find budget-friendly activities to occupy your weekend!

Money in your 20s: 5 Things Everyone Should Know

I am participating in the first annual Women’s Money Week, a project to empower women to take control of their finances.   Today's topic is Money in your Twenties/Thirties/Forties/Fifties/Retirement. Check out the Women's Money Week 2012 website for more posts from some amazing Women Money Bloggers!    

For some this period may represent your glory days while others may refer to it as a Quarter Life Crisis, but your 20s is a time of amazing transformation. The bridge connecting adolescence and adulthood, your 20s may bring your first (full-time) job, first love, first major purchase (ex- a new car), and first experience with recurring bills (student loans anyone?).  With all these “firsts,” it is important to make sure you are making smart choices and creating good habits to carry you through the rest of your life…ESPECIALLY when it comes to your finances.    Here are a few things that I believe everyone should know about money before leaving your 20s to put you on the path to financial security:

How to create a budget.

You have probably heard this before, but the budget is one of the basic principles of personal finance. For some, this may be your first experience making enough money to actually support yourself.  In order to manage this new fortune, you need to keep track of the money you have coming in (income), the money you have going out (expenses), and make sure that your income is always greater than your expenses.  

Avoid the credit trap!

When I was in college, there were credit card companies all over the campus offering free t-shirts, mugs, etc.  just for signing up.  In that setting I was eager to sign up for my first credit card, but luckily I refrained from actually using the card for over a year and truly considered it a tool to be used for emergencies (and the occasional tattoo—don’t judge me lol).  Your 20s is a time for establishing and building your credit. Because you probably have little to no credit already, you probably won’t have the best credit rates, so spending recklessly on your card and carrying a credit card balance from month to month means that you may face hefty interest charges.  That spring wardrobe you caught on sale might not be that good of a deal if you buy it on credit and have to pay an extra 10-20% over the course of a year.  Also, don’t mess up your credit early by applying for a lot of different credit cards, maxing out card, and missing payments.  Not only do these immediately hurt your credit score (which would affect your future interest rates on home/auto loans), but they create bad financial habits that become more and more difficult to break.

2012 Financial Goals: February Update

Save $4000 by January 2013 I contributed $210 to my savings account this month through automatic direct deposit. I also took part of my tax refund along with some of my "buffer" in my checking account and added $600 to savings, so I've already saved about $1000 so far this year!

Maintain a buffer of $100 in my monthly budget. I've really been sticking to this one, and February was almost as good as January.  By the end of the month I had an extra $650 left over after expenses and savings!

Maintain $0 credit card debt.
I used my credit card for my regular monthly expenses (grocery, gas, etc.) and paid the balance in full by the end of the month.

Open a Roth IRA

Haven't done this yet. 

Money Lesson: Stop Torturing Yourself

 I have a confession...sometimes I procrastinate and allow issues to linger instead of tackling them right away. A few weeks ago, I was working on a task at my job but I just could not get myself to take the actions needed to finish it. For some reason, I felt this task was so daunting and so time consuming that I just wanted to avoid it at all costs. i knew I would have to finish the project eventually, but at the time I chose to let it sit on my desk for a few days while I kept myself busy with other work that was equally as important but probably less urgent. The problem is that each day it sat on my desk, my anxiety regarding the work increased and what should have been a proverbial "molehill" quickly became a "mountain" in my head. Finally, one day I came to my senses. I asked myself, Why am I spending all of this time agonizing over this work when I can just buckle down and finish it?

I've created similar scenarios while working on my finances. I know I have spent more hours worrying about how much I owe in studnt loans than actually creating a solid plan to pay them off quickly. I've purchased items that I quickly realize that I will never use, but instead of going to get a refund, I would just put things away in my closet as I worry about going over my budget for the month.

 Some of you may have the same problem that I have of putting myself through unnecessary suffering. Do you find ourself avoiding the mailbox because of the many final notices you get, or notice your heart racing when the phone rings for fear that it may be a bill collector...BUT you go shopping every weekend faithfully(and never coming home empty handed, might I add)? Or maybe you feel yourself drowning in debt, but rather than reaching out for assistance (negotiating new loan terms, exploring economic hardship provisions, getting credit counseling or financial planning assistance) you suffer in silence  day after day.

 Well I'm here to tell you: Stop torturing yourself! Do whatever is needed to rid you of the burden of your financial worries. Action is the first step in obtaining freedom, so imagine how good you will feel when you trade in your procrastination, avoidance, and associated stress for knowledge, progress, and ultimate achievement!