Monday, April 28, 2008

Off the personal finance wagon: a confession

I have a confession to make: I've fallen off of the personal finance wagon.

When I look at my posts from last summer, I see a young woman who had financial goals and plans, who had a system for tracking expenses, who made extra debt payments. I see someone in control of her finances.

How is it that now, with more money to my name, I'm so much less in control?

Over the past couple of months



  • I haven't made a single extra debt repayment. My stated goal when I got started was to pay down my debt, and somehow that has just gotten completely lost in the course of my life.


  • I haven't made a budget. This is probably part of the reason I haven't seen the money that should have gone to debt reduction. All the money comes in, all the money goes out. Any money I "save" with grocery coupons or by cutting my electric bill just seems to disappear into the cash flow.


  • I haven't tracked my expenses. Not only haven't I budgeted for my monthly expenses, I really couldn't even tell you what they are. Have I cut my electric bill? I have no metric for comparison.



I'm sure there are many other ways in which I've lost control of my monthly finances, but I'm not even organized enough to know what they are. And yet . . . and yet. . . in a saner, more financially literate frame of mind, I set up a few idiot-proof systems for myself, so that despite all this, I'm better off than I was a year ago. I started investing in my 403(b) to the match, I set up and autodraft to a high interest savings account (for my summer emergency fund) and another autodraft to a mutual fund. I switched my student loan repayment plan from extended to standard. My money is doing what it needs to do.

But I'm not. I feel like I'm completely out of control when it comes to my finances. It's not a lack of money so much as a lack of a system. I want to get back to where I was last year, when I could discourse intelligently on interest rates, but I just feel so overwhelmed and behind that I don't know where to begin.

Help please?

6 comments:

traineeinvestor said...

You should begin by giving yourself a pat on the back for taking the steps you have already implemented - auto-saving is great and it helps to make things simpler.

If I could make one suggestion - budget some time for your finances. Setting aside 1 hour once a week when the tv and radio are turned off, the phone is diverted and the children have gone to bed is enough for most people to get their finances sorted. Short "to do lists", a simple budget, keeping the bills etc in one place to be reviewed and paid - I find I can do all of these with an hour a week most weeks.

The "to do" list is the most important task. Keeping the list short and realistic and focusing on getting one task done at a time (even if it is only one trivial task a week) is the key to making things happen.

Hope this helps.

Cheers
traineeinvestor

Anonymous said...

Have you seen this site? People are confessing their sins online at http://iconfessmyself.blogspot.com

jr said...

well you can use my method...whenever you feel things are tighting up on you, just freak out and panic your entire household (including yourself) into feeling that you are on the edge of bankrupcy unless every tightens their belts up IMMEDIATELY! a few little luxuries will be passed up...and before long the checking account will be up to 20k again.

story girl said...

Ahem. Sounds familiar, jr

basicfinancial said...

First off, you are able to fix your situation. Remember, you have done it before. Secondly, you have plenty of people here to cheer you on a you make those steps towards being fiscally responsible. The one thing I am sure you know is that you are not alone in a) your situation, or b) in wanting to fix it.

It will take some of your free time. I am very early into fixing my similar situation. I have all but stopped some of my older time/money wasting habits because I am wanting to better my finances. But no matter what your eact situation is, you are able to fix your situation.

Remember, knowing is half the battle! Now, go out there and kick some financial ass!

Anonymous said...

You know? Really good tools sometimes can make the difference between wanting to do things and doing them, and nowhere can this be more true then in the area of personal budgeting.

We all know that budgeting is crucial if we are to be and stay in control of our money, and we all know that budgeting is not a one time proposition but a way of life, but how on earth do we get ourselves to stick with this boring chore called budgeting, and to track expenses all the time?

A good tool is what made it happen for me. I was told about a year ago about this little online budgeting site that is totally free and also anonymous to use, I have used it since, and I am a dedicated budgeter for over a year now and it no longer feels like a dreaded chore either.

It's called Out Of The Dark (OOTD) on the web at:
http://www.myexp.org/OOTD_gate.php

Happy budgeting, you can do it.