I’m working on money right now. We are saving some and we are out of debt, so I am trying to learn about how to maximize what we have. For now it’s all just going into savings because we are saving for some repairs on the house, but eventually we will be saving to build wealth and I’d like to know how to do that.
I am a big believer in the For Dummies books as a place to start. Personal Finance For Dummies was helpful in getting my bill paying and budgeting such under control. Now I’m looking at money management and I’ve turned to them again to get a good grounding in the terms and options for managing our money. Investing 101. Not just the stock market, but bonds and CDs and several other things, creating a trust for the kids, saving for retirement and college for the kids, that sort of thing. It’s a good grounding and I can branch out from it to learn more about the bits that I’m interested in. I was pleased to find definitions of the several different styles of investing (value, dollar cost averaging, etc.). That was helpful. Yes, I sound like an advert for the books, but I can’t stress enough how a good, basic overview book has helped me do things over the years. It gives me a place to start and clears up the confusion of new terms and ideas when I’m just starting to learn about something.
So, we have the beginnings of an emergency fund, we are saving for non-emergency home repairs, we have a good bit going to the retirement fund and we’re going to immediately put at least 15% of whatever I make when I get a job into a retirement account. College for the kids is going to have to wait, but I’m not terribly worried about that. They can get scholarships and work and we’ll be able to pay for at least some of it by that time. It feels like we have money going 17 different ways, and that’s before I have started investing. I am still figuring out my framework for managing where all the money goes and how to keep track of it. I’ll have to try a few different strategies before I find one that works I’m sure. That’s OK though. I’ll get it and then it will be easy to add the investments in when the time comes.
For now we have a money management program that we like that keeps our checkbook straightened out and from which I can budget and move money around however I want to hide it from myself in different unofficial savings accounts. The money stays in my main checking account but I’ve set up targeted savings accounts within the program to save for different things. We keep a sum in actual bank savings that we can access quickly as a sort of overdraft protection. We recently used it to pay for repairs to my husband’s car. It’s not actually an emergency, but it’s over and above what we could normally afford within our budget. It’s also the parking space for the emergency fund money before we transfer it to the other bank. Once it’s built up to a set amount, I’ll transfer it to the emergency fund while leaving some behind for our “overdraft” account. That way we always have some set aside for non-emergency big expenses, but we are also saving to fill out the emergency fund as well.
We’ve gotten a bit complacent about being thrifty. With less time, I have less time to seek out the really good deal. But, that’s why I decided to go green and thrifty, so that it would be ingrained by the time we had more money. I don’t want to live up to our means, I want to live below them. I want to build wealth to take care of us in our old age and maybe even some to pass on to the kids when we die. We may never make a million dollars a year, but it’s got to be possible to build wealth on less. If nothing else, I want to instill thrift into my kids. It’s an uphill battle because the older one grew up and his attitudes formed before we really started trying to be thrifty. His refrain is, “Well, we can just buy one (or another one).” We’re slowly getting there with him though.
It’s also a fine line between being so thrifty that my husband balks, and thrifty enough that I don’t fall into the spending trap again. It’s awfully easy to get into the habit of buying new what you want when you have a little extra money around. Especially when you’re pressed for time. I’m glad I started this when I had a lot more time because now I at least know how to do it and I’m not floundering around trying to figure it out with no time to spare. I refuse to live paycheck to paycheck again. I will have enough money to get us through a lost job or other crisis. And I’ll do it without having to make more money. More money won’t mean living up to it, it’ll mean more security.
My current nemeses are the vending machines in the break room. They have the iced tea that I like, and yummy treats for when I’ve eaten the lunch that I packed. $1.50 doesn’t seem like much. But, it’s the principle of the thing, isn’t it? I have iced tea bags at home. I have treats at home as well. I can bring them to school and get what I want without spending money. I have two different lunch boxes. I can pack both full and have as much lunch as I can possibly eat, with some left over, if I want. I just need to start being conscious of what I’m doing again.