16 posts tagged “money”

I'd love any input on my latest lemon zest post about figuring out how to not sell out and still make a good living... 

from lemon zest

The Economy. Is anyone not worried about keeping their financial boat afloat this year? Only the very wealthy are relatively safe when the words Great Depression start floating around. There are things we all can do now to help ourselves and others get through this.

   
1. Don't Panic! Don't sell your house, don't sell your stocks, don't liquefy your retirement account. Remember? Buy low. Sell high. Now is the time to buy.

   
2. If you lose your job, consider it an opportunity. There are opportunities for training programs for the unemployed and an even bigger opportunity to consider what you really want to do with your life. Was that job really all that?

   
3. Consider sustainability. Some industries are more sustainable than others. Are you on a sinking ship? If so, head for the life raft sooner than later. Look into the industries and occupations that will flourish in the new new economy.

   
4. Help others. Donate time, food, and money to help the very poor. They are the ones who really need a bailout.

   
5. Think local. Invest in local farmers and small businesses - they are the tiny life rafts that will stay afloat even as the big ships sink. Supporting your local economy also helps keep people (including you) stay employed.

   
6. Start your own business. This is an excellent opportunity for entrepreneurship, especially in areas of innovation.

   
7. Stock up. We are likely to see super-inflation sometime this year, so buy what you can now. It can't hurt to have some dry goods and batteries and bottled water for emergencies. Plus, buying things stimulates the economy. Go shopping!

   
8. Be creative. Think of unconventional strategies you could use to come out of this better than you started. Sell some stuff on eBay. Self-publish your novel. Learn to knit.

   
9. Remember money does not equal happiness. Sometimes less is more. Simplify, move to a smaller space, donate things to Goodwill, work on your relationships, get some exercise, and stop watching the news.

   
10. Hunker down. This is not going to last forever. By March it may seem that the sky is falling. It isn't. Things will get better. Just weather the storm however you can and use the opportunity to make your quality of life better, even if you are temporarily less wealthy.

Sometimes the distractions clear away and my time becomes a vacuum, pulling anything it can into it - mostly sleep if I let it. It's this time of year that no matter how much time I spend alone, it never seems to be enough - and yet I don't want to be alone. Life is simpler without money. It narrows the options.  I will have money again in 10 days. I sold some stock last week to have some cash available so I don't have to live on credit cards. And I got a raise (my 3-month review went well - they like me!) So maybe I can play catch up in November... but that will mean still being more frugal. I need to learn to live well within my means. So how do I fill this vacuum without becoming a vegetable of some kind... or dating...? I'll tell you.

1. Apartment therapy
2. Poverty Party
3. NaNo
4. Develop a personal yoga practice
5. Go to the gym now and then
6. Plan a dinner party

This should keep me busy at least til the end of November!

If I were queen of the universe, here are some ways I might consider improving the economy by throwing a shit ton of money at it:

1. Pay off every outstanding student loan in the US. This not only gets the lenders a big chunk o' change, but the people who start their adult lives enslaved to debt would have some breathing room to go consume stuff.
2. Invest in smart housing programs that build sustainable, affording housing for first time home buyers and low-income families.
3. Give it to the small business administration and infuse small to medium sized businesses with capital to grow toward sustainable local economies that do not rely on mega-corporations for anything. Compete with Wal-Mart at a grassroots level. Better products, lower overhead. These loans would of course be paid back with interest.
4. Fix the healthcare system. Buy out the Insurance giants and fund a sustainable, regulated and fair system. Sustainable means it does not lose money, but it is also not profit-driven.
5. Invest in technology and education. Compete globally in scientific and technological advancements.
6. Pay back China.
7. Invest in sustainable energy sources which will not fail to be economically viable in the years to come.
8. Invest in infrastructure, like trains. Look at Europe.
   

Just some ideas. Since you can't vote for me, vote for Obama. Thanks.

As Americans, we tend to develop some very dysfunctional relationships with money.  It is such a cultural force that it becomes strangely tied to our perceptions of self and self-worth.  For the last 15 years I have spent more than I have made. I am not proud of this, and it has been by choice more than by necessity, but here's why:

1. I grew up poor.  My mom and I usually ran out of money to eat the last few days of the month.  I got all of my school clothes and supplies care of other relatives or from St. Vincent de Paul.  When I started supporting myself at the age of 18 I suddenly had access to more cash than I'd ever seen before and I spent all of it.  Saving seemed like a luxury of the wealthy.  I was living in an expensive city earning minimum wage, so I was stretched every month, but I still bought Lattes and CDs and Doc Martens because I could.
2. Then I got a credit card.  I had been making it on my meager salary for a few years before I was offered my first Visa card.  I wasn't stupid - I planned to pay it off every month and never ever carry a balance.  But then the temptation to buy things I needed... like a bed, a toaster, a sharp knife, a tv.... became too strong with that plastic in my pocket.  Ok, I'll pay it off over a few months. But then there were some vet bills and I broke up with my boyfriend and had to make a deposit on a new apartment.  Soon enough, it was all I could do to keep up with the minimum payments.
3. I married a collector.  My ex-husband and I shopped to feel vital.  He collected records, bicycles, hi-fi equipment, kitchen utensils, sweaters.  I shopped for clothes and books on a weekly basis.  Neither of us was financially organized.  We bounced checks, we covered bills with credit cards.  We went out drinking to forget about it and spent hundreds of dollars a week on alcohol. And we both bought overpriced groceries.
4. I got divorced.  When we split up we had planned a trip to Paris that I took alone.  I paid hundreds of dollars in fees to cancel the package and re-book for myself. Not to mention the cost of living in Paris for 10 days.  Again, I had to pay first and last month rent plus deposit on a new apartment, and I still had no savings, so up went my debt.  I got behind on income taxes from working as an independent contractor for three years and owed a few thousand dollars to the IRS.
5. I was single.  I did a lot of going out for a couple of years after my divorce, indulging in all kinds of expensive things.  I bought myself a whole new wardrobe, several times over.  I was now making enough money to almost match my spending habits, so my debt kind of levelled off, but it is still much higher now than it was when I got divorced.
6. Denial.  Last year I made about twice as much as I ever had in one year.  Even in Seattle, the land of the Microsoftees, I did fair-to-middlin. And yet I found myself on numerous occasions overdrawn because I got too ambitious with credit card payments and did not control my random $200 trips to Whole Foods or Ikea or REI or American Apparel.  As long as I was buying useful things, right?

I spend money because I think I deserve or need... something.  Another black t-shirt? Some new kind of bath product? More books?  I have begun to understand just how fruitless this kind of spending is.  I don't wear 1/3 of the clothes I buy.  I have stacks of books to read, and there's a library. I can't fit any more shelves in my apartment, and I already spend way too much time tending to my stuff.  So the only answer is to change my relationship with money and to spend less than I make.

I have a lot of money in my checking account, after receiving my severance pay and vacation pay-out.  I must remember that I need to live on that (plus unemployment) until I'm earning again.  That means avoiding the strong urge to go shopping.  I haven't been avoiding that urge since my last day.  It seems I needed a new wardrobe...  New clothes help ease transitions.

So next week I am going to limit my spending to groceries and bus fare.  No coffees (can't have coffee on my new regimen anyway), no books, no CDs, no shoes, no $40 shampoo, no meals out, no movies, no online shopping, and definitely no clothes.  I have to start Monday because this weekend I plan to go to a bowling party, go for a long bike ride, and eat at Benihana for a six-year-old's birthday - all of which entail costs of some kind.  So, Monday thru Sunday: no spending.

I've done this before when I was broke, and I must say it is rather relaxing to not spend.  Buying things becomes nearly compulsive at times.  It think we are conditioned to think of consumerism as self-improvement and purchases as accomplishments.  Spending can be positive, certainly, but taking a break can be good for perspective on what we think we need.

I like free money as much as the next guy/gal, but it strikes me as a bit ludicrous that the US gov't plans to send several hundreds of dollars to every tax payer.  How about this?  Take those x billions of dollars and put them into a healthcare system that doesn't involve sky-high premiums paid to insurance megacorps and ludicrously expensive prescription medication.  Then, all the money that individuals don't spend on that can be spent on crap imported from China (which seems to be the point of this "stimulus" - hey! shopping spree!)  Or maybe put some funding into social programs to help homeless, alcoholic, mentally ill people develop skills that will allow them to do work in exchange for homes, psychiatric care, medication, addiction treatment, clothing, cell phones, transportation, education... etc.  Then, many of those people can become consumers too! Of course, the idea is to avoid a recession.  I used to get into arguments with my economics professor, so I probably don't know what I'm talking about.  Mine will be paying for hotel rooms in Europe, so I'm not sure I'm being very helpful...

I did not answer yesterday's QOTD about prenuptial agreements, but the answer is yes, I would happily sign one.  Marriage is a legal arrangement, and it behooves everyone to make sure their respective asses are covered from a legal standpoint, no matter what happens.  It's not as if my future wealthy husband is going to make me sign one because he plans to divorce me in a few months.  That would be daft.

Today I distributed our special bonuses at work.  I ran them through the payroll system to deduct taxes, and everyone gets a direct deposit, so I sent out a little "yay, here's your bonus!" email.  One of my colleagues responded: "Direct deposit = spousal confiscation."

I could give a seminar on why it's a bad idea for married (or unmarried for that matter) couples to have a single joint checking account.  I've done it, and I've experienced pretty much every negative aspect, like:

• Your spouse, no matter how much they love you, is not always going to agree with how you spend your money.  This can become a very prickly source of marital tension.
• Two people traipsing about with debit cards is a recipe for accidental overdrafts.
• Financial dependency happens - if one person makes more than the other, then dependency ensues and both parties could begin to feel trapped in a situation.  I have been in the situation of not being able to afford to leave a relationship... and now I have a lot of credit card debt, because I did not let that stop me either time.

The solution is simple.  Each person keeps a personal account, into which all of their income is deposited. After doing a budget, a monthly transfer is set up to happen automatically from each personal account into the joint checking account (and any shared savings plans).  Anything left in each party's personal account is theirs to spend or save at their discretion. There's no need to fight about money again!

For some reason, the married people I know are unwilling to suggest such things to their partners, even if they think it's a good idea.  So I have to hear them whine about the fact that their wife won't let them buy this or their husband threw a fit when they brought home that.  I say, why don't you have a personal slush fund? And they agree it's a great idea, but they can't do it.

Personally, I will never retire my personal account again.  I don't care if I become surgically attached at the hip to my beloved, I won't make the same mistake a third time.

At the end of the year I get a profit based bonus that should be pretty dandy this year.  Meanwhile, we just landed a big project with an insane deadline, and my boss has decided to give us all a bonus bonus for agreeing to give up the rest of our collective summer and many of our evenings and weekends.  Right now I'm going to watch a dvd and eat dinner, but after that I will be working for another couple of hours. Earning my bonus.  So what do I do with a bonus bonus?

1. Pay for a radioactive iodine treatment for my old, hypothyroid ex-cat.
2. Pay off my taxes for the last two years.
3. Pay down my highest interest credit card.
4. Put money in my IRA for the first time in 6 years.
5. Get a massage.
6. Renew my yoga membership.
7. Shop for back to school wardrobe.
8. Order those brown boots.
9. Order that brown bag.
10. Buy a laptop case.
11. Buy a few fresh cosmetics.
12. Buy a telephoto lens.

That should do.

When I quit drinking it was a simple exercise: I can do what I like as long as it isn't alcohol (or drugs).  I'm good at self-imposed deprivation and quitting drinking was not really a problem.

It took a couple of months after I quit drinking for me to start looking at the things that I drank to avoid thinking about.  Getting my financial situation in order has been much more painful than quitting drinking, and I can't really say that it is in order, but I have discovered that this is another exercise in deprivation.  If I spend my paycheck on whatever strikes my fancy I will never get to a place where I feel financially solid.  I'm on a plan now, to pay off my debt and get a 6-month cushion in my bank account.  Then I can start investing, traveling, buying cars and houses.  This will take at least 5 years if my financial situation does not change.  Monetarily speaking, those are the things I want, and not necessarily new jeans or coffee & pastries.  If I keep my mind on my priorities and what I really want out of life, it doesn't feel like deprivation.

Part of this plan is putting myself on a cash allowance.  It seems ridiculous, but if I use my debit card there's no way I will keep track of how much I'm spending.  I've had enough overdraft fees to know this is true.  So each week I get $xxx in cash, and I am frankly amazed on how fast it disappears.  On what? Groceries, lunch, coffee & pastries, an occasional book or CD, dinner... that's about it.  I don't have anything left to save up for trips or shoes or other things I want to buy now.  So this naturally leads me to ask: what can I live without?

I'm an emotional shopper.  I buy things, including scones, to make myself feel better.  Two of the things I buy in almost humorous quantities are lipstick and pens.  It's not like I'm obsessively out shopping for lipstick or pens every day, or even every month, but I pick them up here and there.  I'm always looking for the right lipstick or the perfect pen, and I never seem to be quite satisfied.  I have a small drawer for pens and last time I cleaned out my bags (another item I tend to buy repeatedly, looking for the right one) the pen drawer became too full to close.  I'm guessing there are at least 100 pens in there. 

I'm also an emotional grocery shopper.  Cheese, chocolate, $5 Olive Bread, organic avocados, overpriced cookies with no hydrogenated oils, $15/lb wild caught salmon:  these are all comfort foods and all things I can probably do without if I have to.  Since I have quit drinking I have relied heavily on treats to compensate. Chocolate cake. Creme brulee. Cherry almond scones and an Americano for breakfast.  If I have the money in my wallet I will buy these things.  I don't feel guilty about this, nor do I think I should stop having these things, but I do think I should stop using food for emotional support on a daily basis.  Now and then, sure, have some ice cream to make up for a bad day/ year/ life.  Just not every day.  I need to be getting some other kind of satisfaction out of my life.  Food should be for nourishment and for pleasure, but not for therapy, and certainly not the only thing that gives me joy.

I'm fasting this week to try to break myself out of my comfort food addiction. I'm also giving my body a chance to detox a bit more.  It's surprising how much detoxing there is to do after 15 years of regular alcohol intake.  Yesterday I had only water with lemon.  Today I add fruit juice and herbal tea, tomorrow I add fresh fruit, and the next day I add steamed rice and steamed vegetables, and I will stick with that until the end of the week.  Fasting is grueling, but it feels great afterward.  All the sluggishness that comes with processing rich foods disappears, and the mind becomes much more clear and focused.

Deprivation is no fun, but when the long-term reward is greater than immediate gratification it is well worth the effort.