Creating a Happy, Colorful, Handmade Home & life on the shores of lake superior

January 7, 2013

Money Talks: A Peek into Our Finances


I'm finally starting my new series, "Money Talks."  Every now and then, I'll be sharing some of our financial wins and woes, tips and tricks.  I'm no expert (far from it), so I'm not spouting any advice.  I'm just telling you what we're up to and what we've learned.  It's my . . . two cents (you knew that was coming). 

A little about us:

Hubby is 30, employed full-time, and I'm 28, employed part-time and doing my PhD (on a scholarship).  Our income is on par with the Canadian average household income for a child-less, non-retired couple (I googled it), and we pool our incomes.  We rapid fire paid off student loans years ago, paid off our car loan and now our only debt is a mortgage.  We're doing something right (and have also been really lucky).  We have emergency and short term savings, but we save in spurts, not regularly, or enough, as we should.  We pay for everything with a cash back credit card, which we pay off each month in full, but I'm starting to doubt the system.  We created a spreadsheet to record our spending, but it went the way of the dinosaurs.

We could do better.  I could do better (I feel like a dead weight at times, spending more and earning less).

Hubs and I have a date next week to think about our goals and come up with a plan.  How much should we save each month?  What's the smart way to save for retirement?  Is a credit card best for us?  What should our monthly budget be?  How can we save money on the things we have to buy?  What charitable donations do we want to make this year?  We'll be figuring things out this year.  I'll be sharing all this, plus what we've already tackled (like how we said good-bye to student debt faster).  Until then, I have a plan of my own. 

The topic on my mind right now:

Having lived out of a 50lb suitcase for four months, I am totally overwhelmed by the amount of stuff we have in the townhouse.  I've realized I fritter away money on little purchases here, there and everywhere.  In Hungarian there is a saying, "sok kicsi sokra megy," which means: "lots of little makes a lot".  Ish.  Don't trust my translation (google says it means "many a little makes a mickle").  I interpret it to mean that all the little bits here and there that I buy without thinking about could all add up to one of these instead:

Yum.

We've wanted a vintage muscle car for ages, but it always seemed like a distant dream.  Pricing them out and looking at all the surplus stuff I've bought over the years was a little horrifying.  I realized we could have one already.  I have to change my ways so I don't rob us of big ticket things we'd like (including retirement!).

With a concrete picture and goal in mind, I am hoping I can put a moratorium on mindless shopping.  When I'm ogling something, I'm going to whisper "vroom" (and possibly look at the picture I printed and now keep in my wallet).  "Self," I will say, "Do you want the thing you're currently hugging more than some vehicular goodness that will see Hubby and you grinning like millionaires every day?"  Nope.



We have always had goals, some silly and indulgent, some more respectable, but they always seemed vague and irrelevant to our life right now.  I'm going to stop thinking about them as a "someday" things and start thinking about them as "soon as we get the cash together" things.  This applies to our next house, future renovations, more travel, retirement, charitable donations - everything.  I'm definitely not advocating we throw retirement planning to the wind and just buy something extravagant (although that is the advice my investment planner gave me after his stroke, shortly before he retired).  I just think that with clearer goals in mind, including a super fun one that makes me want to save, I might be able to take charge of my spending more.  My goal is to think big picture and make sure that money I spend is going to things we really want or need.

I'm going to work on changing how I think ("sok kicsi sokra megy"), have my Money Talks date with Hubs, and pull out my Mustang photo next time I'm petting towels I don't need at Winner's.  How about you?

P.S. I'm linking up here: Serenity Now 
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38 comments

  1. I have a mental image of you standing in a dept store aisle, petting towels and whispering 'vroom!vroom!' :-) I think being debt-free (by luck or sheer determination) is an essential step. thanks for sharing!

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    1. Haha, with my new tactic for seriously considering purchases, I may not be allowed in my favorite stores. They'll think I'm totally nutty.

      I'll be sharing how we're debt free in upcoming posts - definitely a combo of luck and hard work. The student debt was tough.

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  2. We really like the budget software You Need a Budget and the way it thinks about budgeting. They also have free webinars all the time. We actually pool our income,but we each have fun money or allowance a small amount each month,but that way my husband and I can save up for things we want that we really don't need and don't have to worry about going into other budgets. We are trying to save up to buy a house and so we are also wanting to make sure we are putting enough money into those savings on a monthly basis.

    Jessicarwarfield at gmail dot com

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    1. I will have to check out that software. We just used excel and it worked well until we got lazy. And we started not liking the totals that added up (such a bad reason to stop budgeting).

      I like your idea of each having "fun" money too. That's something that might help me feel like we each take an equal piece of the pie (right now I'm the hungrier one I think).

      Good luck with saving for your house!! It sounds like you are both already super on top of your finances :D

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    2. I also enjoy using You Need A Budget software (www.youneedabudget.com) software to track my expenses.

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    3. Oooo, really? Sounds like it's a hit! I'll definitely look into it.

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    4. Yes! YNAB is the best money you will spend. Buy it, and then get the smartphone app. You put the software on a computer and then the two of you can use the smartphone app and have it sync with the computer. Great for discouraging impulse buys.

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    5. I started reading the online guide (I love the background story to YNAB) and I'm already learning things!! It's great to hear it's been so helpful for you!

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  3. I'm really looking forward to this, as I've recently had a similar realisation about my finances! I'm currently tracking everything I spend (and restricting spending to what's left after direct debits and savings). It really makes you realise how much it all adds up!

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    1. Writing it down really does make you realize how it adds up! I think that's why we stopped, lol. It sounds like you're already doing things right! I NEED to get back to writing things down and sticking to a budget, every single month. You're inspiring me to start recording again - knowing other people do it makes me want to get to it right now!

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  4. I'm looking forward to your post on student loans! I've paid off more than half of mine, but still have a few years to go. I'd like it gone NOW, haha.

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    1. I know the feeling!! It really weighed on us and felt impossible. We had to pinch ourselves when it was paid off. And we feel we really should have gotten some kind of prize, lol.

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  5. Good for you. It sounds like you're doing a great job with finances so far in life. Looking forward to seeing photos of you driving in your dream car soon!

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    1. Oh, if we buy this puppy and I'm still blogging (hope so), expect a VIDEO!!! It will be too rumbly for photos alone. Sigh.

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  6. Love what you said about thinking about your dream purchases before making small purchases. We've been discussing our next house a lot lately, and getting our finances figured out so that we can make that next step, maybe I'll find a picture of our dream house and put it in my wallet! Thanks for the tip :)

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    1. So exciting that you are thinking about your next house! I'm happy this little tip is helpful. I think it's something a lot of us struggle with: the big goals vs. the little purchases. Congrats on taking steps toward your dream home!! And good luck :)

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  7. We are on the same plan tanya.
    I needlessly spend too much. The worst is my coffee habit it is a ridiculous number i cant even begin to say out loud. I would love a real vacation or visit family more than having a shiny new object to fill another space in my house. My motto for the year is use what we have and make do. Lets support each other in this goal. Vroom vroom
    Amy

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    1. Yay. I'm happy to hear other folks struggle with this, although I'd be happier if none of us did. I like your motto, Amy, "use what you have and make do". I am definitely glad to have a blog-friend on the same page, because I think I will have moments of weakness and could use the support (which I'm happy to offer right back). I hope so much that this year you'll be able to have a real vacation and see family more, because that sounds just lovely. Go us!!

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  8. When Hubs and I were saving to buy our place, I wrapped a small list of things I wanted from a house around my credit card. That way, I had to physically remove the list if I wanted to make a purchase. When we moved in, I framed that slip of paper and put it on the wall. When we have financial mis-steps, I look at that for motivation. The Money Talks posts are such a great idea! Esp since money can be such a hush hush thing in our society, its good to get it out there and will help a lot of people. Kudos!

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    1. I'm excited to talk about it and hear everyone's tips and ideas. Sometimes I find advice a little one-size-fits-all, or else spouted by folks who WANT my money. So I'm looking forward to the discussions (I've already learned things from readers!).

      I like your idea of wrapping the credit card! That is definitely a good way to remind oneself of bigger goals. Even if buying something essential, the reminder is good to have. The fact that you framed it is so perfect. I just LOVE that idea so much.

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  9. I applaud your diligence and perseverance. After Himself and I had been together for a few months we decided we really needed to discuss financial and life goals, and since we both had exhausting jobs, we used to just collapse when we got home. So we made plans to meet after at a coffee shop where we could have coffee and a sandwich and a quiet talk. By the time we got there after 9 pm, it was closed and the chairs were up on the tables. A few other places nearby were fully booked. We were starving and thirsty by the time we found a place that could feed us. I won't identify the culprit, but it was a place even non-NYers would know, and - well, that restaurant and words like "budget" don't belong in the same sentence. We had a wonderful dinner, we weren't going to order wine but the first course was so good ....

    So my tip is, if you're going to plan regular discussions of a topic that a lot of people find difficult, BE SURE TO HAVE SOMETHING CHEAP AND FILLING TO EAT FIRST.

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    1. Awww, well you have to treat yourself sometime. I'm sure you and he had a lovely time and it was obviously memorable! But, I will heed your advice and we will eat an inexpensive but nutritionally sound meal before we sort out our goals next week ;)

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  10. Have you considered using mint.com? It's a free website that feeds information from your various banking and credit accounts. My husband and I have been using it for a year or so and it's a great way to keep everything in one place, as well as see what your spending trends are (I'm looking at you, favorite but pricey grocery store!). You still have to enter in cash transactions on your own but other than that it's been very convenient!:)

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    1. I hadn't even heard of mint.com, so thanks for the info! It sounds really convenient.

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  11. Love this idea, can't wait for the series. Hubs and I aren't bad with money, we just don't really discuss it, and we should. I'm like you, I spend $600 a month on completely useless crap. That's more than some people MAKE in a month. I feel like I'm very wasteful, even though it's not intentional. When I go full-time with my business (3 more days!) and I'm self-employed, things have to change, big time.

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    1. PS - I should probably add that we live a cash-only lifestyle, so the money I spend is my allowance account. We pool our money, but then have money that's not for bills, savings, paying down the mortgage, etc. and so I have an account that is kind of like "mad money" - I can spend it on whatever I want. I just spend it on dumb stuff most of the time.

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    2. I'm really like the mad money idea and setting aside fun money. We both dip into our joint money, me more than him, but if we had a little separate amount each month for both of us, I think I'd feel a lot less guilt (and spend less too, because I can't spend his share). So exciting you'll be self-employed so soon!! You're awesome, though, so I know you'll adapt quickly.

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    3. We maintain separate fun money. Joint account for family savings gaols and bills. What is left over we each get to play with.

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  12. So on board with you, Tanya! In fact, I'm so on board that I'm in the middle of my investment planner/advisor training right now!! I loved this article!

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    1. Really? That's exciting for you! Can't wait to hear your wisdom :)

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  13. Someone recommended the book _Your Money or Your Life_ to me recently, and I think you might find it useful. It's all about simplifying your life so that you can live your dream life on not very much money. It's pretty inspiring! As is the amazing life that Sarah over at yesandyes.org lives by living that principle.

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    1. I have heard positive things about that book, so I must get my hands on a copy. And I'm off to check out Sarah's website right now. Thanks for these great resources!

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  14. This is awesome. We are overhauling our finances too. Everyone seems to be talking about mint.com right now. It looks like a pretty neat (And free!) platform!!

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    1. I will have to check it out! Thanks for the tip :)

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  15. Hi Tanya,

    What a great article! I like your thinking. Getting your finances in order when you are as young as you are will put you so much ahead of the game...very smart! (Wish we had done it earlier) :/ We are working on our "total money makeover" after reading Dave Ramsey's book by that name. I'm doing a blog series on getting out of debt, making a budget, etc. This week will be about living on cash. I hope you can stop by for a visit! I'm going to follow you...excited about this series!

    Amy
    www.homesweetthriftyhome.com

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    1. I will definitely follow to keep track of your series! Looking forward to reading all about living on cash.

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  16. I came over here from your student loan post. I totally agree. I want to redo our kitchen BAD but my bad habits get in the way. Thanks for things to think about.

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    1. It's so hard to not buy things when we're constantly inundated with advertisements, etc. Good luck saving for your kitchen remodel!!

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