My Personal Finance Journey

All posts by Jacob A Irwin

The Dangers of Lifestyle Inflation

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Click here to enter my free $65.84 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to charity! Deadline to enter is May 31st, 2013.

The following post is by MPFJ staff writer, Kelly Gurnett. Kelly runs the blog Cordelia Calls It Quits, where she documents her attempts to rid her life of the things that don’t matter and focus more on the things that do. You can also follow her on Twitter and Facebook.

Have you ever wondered why, no matter what you manage to accomplish financially, you can never seem to “get ahead”?

You could get a raise, pay down a debt, receive a sudden windfall, but it never seems to make a difference in the grand scheme of things. No matter how much better off you are than you were a few years ago, it never feels like you’re better off. You keep finding yourself waiting for that hazy time in the future when you finally feel like you’ve “made it.”

Well, I’ve got some unfortunate news for you: you’re never going to “make it,” at least not as long as you define “making it” as reaching some perfect point when you have more—more money, more luxury, more stuff that will finally make you perfectly satisfied.

Because it’s that “more” mentality that will keep you from ever reaching that point. It’s a mentality leads to a phenomenon known as lifestyle inflation, and many of your friends and neighbors have succumbed to it.

Have you?

Forget Keeping Up with the Joneses

Lifestyle inflation is more like keeping up with yourself—with the idea in your head of a future self who will be wealthier, savvier, cooler, than the you of today is. You always feel like there’s more out there, and you know that if you can just get it, then you’ll be happy. So as soon as you find yourself with a little extra money in hand, you’re off like a shot chasing that goal.

The thing is, like the proverbial carrot on a string, that goal will always be one step ahead of you. Because no matter how much your standard of living improves, it can always be better. And constantly using all your resources to chase that never-ending goal will only make you less happy in the long run.

When you were in college, scraping by on Raman noodles and stale cafeteria coffee, getting together a few extra bucks to see a concert feels like a real treat, even if you have to cram into a junker car with six of your friends to get there. Then you become a member of the full-time working class, and suddenly a shoestring concert seems like nothing. Now you can afford concerts, concert merchandise, occasional road trips to out-of-town concerts, etc…You’re bringing in real money now, and you can start living a little. So you do.

Except the thrill of a snazzier concert experience fades after a while, and then you’re left envying your friends who are starting to go on week long vacations to sandy, sun-dipped locales. Some day, you think, when I get that promotion, I’m booking my own Caribbean vacation! And why not? You’ll have worked hard to get to that point, so why shouldn’t you enjoy the fruits of your labor?

The problem is that, as your standard of living increases with each pay increase, your sense of enjoyment fails to increase along with it. You might feel momentarily happier as you adjust to your new, cushier lifestyle, but it won’t last. New things and new experiences get tired quickly, and eventually you’re back to barely getting the bills paid, staring at your sad savings account, and wondering how anyone ever manages to put aside for retirement.

Because that’s the other problem with lifestyle inflation: not only does it ultimately fail to make you happy; it also keeps you from ever reaching a place of financial security and freedom. Because when every spare dollar is being put towards chasing that end of the rainbow, none of it is being put aside for the future.

What’s a Dreamer to Do?

The temptation to live larger as your paycheck grows is only natural. Our culture is saturated with images of celebrities and strangers on TV commercials living the high life and loving the heck out of it, so we can’t help but feel like if we can only get to where they are, we’ll be truly happy, too.

But if you really want to achieve happiness with your money, the secret is in finding a sense of balance.

By all means, enjoy an extra dinner out or take that sunny vacation if you can afford it now. You have worked hard for your money, and you certainly deserve to enjoy it. But at the same time, make sure you’re also putting aside a healthy amount towards an emergency fund, your kids’ education, and whatever other savings goals you have.

By using your money smartly, you can still enjoy the occasional live-it-up splurge without sacrificing your future financial happiness and security. Plus, if you treat yourself strategically instead of maxing out your lifestyle every time you get a raise, those treats are more likely to leave you feeling satisfied, pampered, and truly “rich.”

How about you all? Have you been tempted by lifestyle inflation? 

 How have you dealt with it?


Share your experiences by commenting below!

***Photo courtesy of http://www.flickr.com/photos/94328679@N03/8585451509/

Carnival of MoneyPros – May 12th, 2013 Mother’s Day Edition

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Click here to enter my free $65.84 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to charity! Deadline to enter is May 31st, 2013.

 Welcome everyone to the Mother’s Day, 2013 edition of the Carnival of MoneyPros! 

To celebrate Mother’s Day, in this edition, I’ve sprinkled in between the posts a few images of me and my Mom together in various locations throughout the world dating back to 2007.

I hope you enjoy the pictures, the posts, and can come back to visit My Personal Finance Journey on my non-carnival days as well. If this is your first time stopping by the site, you might take a look at the “About” or “First-Time Visitor” pages so we can get more acquainted! Thanks! – Jacob

Alexis @ FITnancials writes I Want a Credit Card – But I Have No Credit – I want a credit card. Yes, I just said that! I’ve been on the hunt for one, and I’ve even applied for some, but I’ve gotten denied. I have no credit (I’m 19, my car loan isn’t in my name, and I have no other credit cards), so it is hard for me to find a card to get approved for.

Michelle @ Making Sense of Cents writes $7,859 in April Extra Income and Goals – April was another awesome month. I wasn’t able to crack the $8,000 level of extra income just yet (this is after expenses), and I was actually $3 lower than last month’s amount. Still great to me though

Emily @ Evolving Personal Finance writes Money Management Systems Visualized – Visual representations of four basic money management systems couples use.

Michael @ Financial Ramblings writes Effect of the Internet Sales Tax – It’s looking more and more like the Internet sales tax is going to happen. I’m talking here of course about Congress giving states more power to collect sales taxes that people should already be paying. But what effect will that have on small businesses?

Tori @ Money Life and More writes Saving Money On Weddings: If It Sounds Too Good To Be True… – I was so proud of myself for saving lots of money and getting a fabulous wedding dress! About 3 weeks after placing my order my dress arrived at my future mother in law’s house! Deep in my gut I could tell something was not quite right when she called and told me it had arrived, but in a small box…..

Mike @ The Financial Blogger writes Since When is Paying off Your Debts is a Good Thing? – Have you ever borrowed money to accelerate your asset building?

Green Panda @ Green Panda Treehouse writes Jobs to Watch Out For So That You Don’t Get Scammed – There are certain jobs that you need to watch out for when you’re in your 20s.

Martin @ Studenomics writes How Do You Survive Financially in a Large City Without Losing Your Pants? – How does one survive?

Pete @ Intelligent Speculator writes Facebook (FB), Still A Good Buy At These Levels? – What are your thoughts on Facebook?

Steven @ MyDividendStocks writes Use Fast Cash Methods for ‘Needs’ Not ‘Wants’ – A good way to consider good financial health is to have enough money to meet our basic needs and live a comfortable life. However, as humans, we have material desires and we want that extra dough to fulfil those wants. Be it the next fancy gadget or a fast sports car. We all have a list of things we want.

Daniel @ Sweating the Big Stuff writes How Much Do You Need To Save To Retire 1 Day Early? – Do you want to retire earlier? Find out how much you need to save today to be on the golf course one day earlier.

Amanda L Grossman @ Frugal Confessions writes How to Extend Your Cell Phone or Smart phone’s Package Almost for Free – Unlimited data, texting, and talking are a pipe dream for some, especially the unlimited data.

Corey @ 20s Finances writes Tax Deductions for Having a Baby – Your life changes dramatically when you have a baby. Your taxes change too.

Arnel Ariate @ Money Soldiers writes What Makes You Shy Away from Stock Trading? – Here are some of the reasons that compel people to avoid stock trading. Though the stock market now spells good prospects for the companies as well as for the investors, yet most people prefer to stay away from it.

SFB @ Simple Finance Blog writes How Much House Can You Afford – Most of the problems happening these days in the real estate market are mainly because of the homeowners outstretching their budgets to own the houses they really couldn’t afford but desired.

Ted Jenkin @ Your Smart Money Moves writes The Drug Of Buying ‘Stuff’ – The weather is warm and in the United States we are about to start enjoying some of the national pastimes of our country.

CAPI @ Creating a Passive Income writes For Rent: Do’s and Don’ts of Renting Out Your Space – So you’ve decided to rent out your space! This can be a great income source if you do it right. Here are some do and don’t tips of renting out your space.

Tony @ We Only Do This Once writes The 80/20 Rule and Procrastination – The 80/20 Rule has been one of the most helpful concepts for my time and life management. Also called the Pareto Principle after the Italian economist, Pareto recognized that people in his society were divided into two group. The vital few were the top 20 percent in terms of money and influence, and the trivial many, the bottom 80 percent.

Kevin @ 20smoney.com writes The Marshmallow Experiment and your Finances – While many people who possess large amounts of money are very smart, others are not necessarily but where able to be at the right place at the right time.

Mike @ Personal Finance Journey writes Free of Charge – Saving on Credit Cards – Credit card news and how it can save or cost you money.

Wayne @ Young Family Finance writes Computers for kids: The Pros & Cons – Children see computers all around them. As soon as they start school they will use a computer in the classroom, and many toddlers are used to using tablets from their early days.

Kanwal @ Simply Investing writes Want To Invest Successfully In Only 15 Minutes a Month? – Here’s how you can invest successfully and spend only about 15 minutes a month on your investments: Keep it simple Ignore the media noise on TV, Internet, Radio, and Magazines Reduce the fees you are currently paying (knowingly and unknowingly) on your mutual funds Keep it simple Invest in quality dividend-paying companies when they are undervalued.

Sam @ Simplefinancialfreedom writes Cost Saving Ways to Reward Employees – In a down economy, many companies are going through financial hardship, freezes, and eliminating bonuses.

Ryan @ Cash Money Life writes PayPal vs. Dwolla: Which is Right for You? – PayPal has been around a long time, but Dwolla has really low transaction rates – which should you choose? Here’s a comparison of the two!

Don @ MoneySmartGuides writes How to Fund the Purchase of a Car – Despite being such an expensive investment of our money, cars have become a crucial part of our everyday lives.

Brock Kernin @ Clever Dude writes Is Overspending Worth It To Help My Son Fit In? – I could have bought cheaper b-ball cleats, but I didn’t…Would you spend more to help you son/daughter fit in?

Crystal @ Married (with Debt) writes Who’s Your Real “Head of Household”? – My husband’s name appears under “head of household” on our tax forms. But his actual role doesn’t exactly fit this title.

Crystal @ Budgeting in the Fun Stuff writes Become a Product Tester for Free Swag – If you are not interested in medical studies. then below are some legitimate, non-compromising, product testing opportunities for you.

Tushar @ Finance TUBE writes Want To Save More Money? Look At Your Waste – Hi! Today I will be talking about if Want To Save More Money? Look At Your Waste. How many pounds do you think the average American waste in food each week? Well according to ABC news the US waste in food each week is 14 pounds.

BARBARA FRIEDBERG @ Barbara Friedberg Personal Finance writes DO YOU NEED A FINANCIAL ADVISER? – Should I hire a financial adviser? Learn the basics of hiring a financial planner.

Robert @ The College Investor writes Better Know a Young Millionaire – Ali Maadelat – Ali Maadelat was nominated as one of the 2012 Marketers of the Year by the American Business Awards, and Forbes Magazine recently named him as one of the Top Ten Consultants who Stop the B.S.

Robert @ Entrepreneurship Life writes Retirement Planning for Self-Employed Entrepreneurs – While there are many amazing benefits of working for yourself, there is one big pitfall compared to people who work for large companies: retirement plans. Small business owners don’t have 401(k) plan matching, but you do have some options to put away money in a tax advantage account.

Robert @ Beat the 9to5 writes Are You a Pessimist, Optimist, or Realist? – I’ve been exposed to all three lately, and I’m a believer that your mindset directly determines the emotional outcome of any situation.

MR @ Money Reasons writes Everything Goes Trash Night – Bizarro Christmas Year 3 – Once a year, we have a trash night in my community where everything can be put out. Oddly, I’ve come to enjoy this day, and so far each year the stuff I toss out is better and better. I enjoy giving stuff to people who are opportunistic and clever!

Jay @ The First Million is the Hardest writes How to Invest Without A Lot of Money – Proving that it doesn’t “take money to make money” and showing how you can get started investing with as little as $100

Kyle @ The Penny Hoarder writes Put Your Pet to Work for You – If you find that your beloved Fido or Fluffy has a natural knack for acting, you might want to consider putting them to work for you. While it can take some time and and does require a lot of effort on your part, it is possible to make your pet the next star if you try.

MMD @ My Money Design writes The Pension vs 401k – The 401k Did Not Kill Retirement – You can compare a pension vs 401k all you want, but the 401k didn’t kill retirement. There are still lots of great options for saving for retirement.

Lauren @ L Bee and the Money Tree writes I Wasted Too Much Time on Boys – I am blinded by the fact that for most of my college career I spent WAY too much time on boys. Time I could have spent becoming better friends with the people I now wish I kept in touch with, or at least time I could have used to do school work, perform in more plays, or keep better track of my finances.

Cash Flow Mantra @ Cash Flow Mantra writes You Get What You Pay For – Quality is often reflected in price. How many times have you tried to save money buying a cheaper item and had it break right away? You often end up spending more money replacing something multiple times where a more expensive initial purchase could have saved money in the long run

Penny Thots @ Penny Thots writes 4 Reasons Why You Should Quit Your Job – Just because the economy is tough, it doesn’t mean you shouldn’t be looking for greener pastures if your current job is intolerable. Here are four reasons why you should begin looking for a new job sooner rather than later.

harry campbell @ Your PF Pro writes 5 Ways to Save Money at Amusement Parks: Sea World San Diego – For some reason, the April showers haven’t quite hit San Diego like they normally do and the weather has been fantastic lately. Warm days and a nice breeze are why I love living in Socal and this past weekend I decided it would be a good time to take my sister(age 5) to Sea World. Even though it wasn’t too crowded, there was still a ton of people there and I couldn’t help but think about how much money everyone was spending.

JP @ My Family Finances writes Alternative Ways to Invest Your Family’s Assets – If you find yourself looking for an alternative investment market or other opportunities to spread your risks, one of the options below might be a good fit for you.

Jason @ Live Real Now writes I Accidentally Bought a Bus – We jumped into buying a bus with no real plan, but there are a few ways we could make our money back. I’m expecting a healthy profit on a pretty short timeline.

Evan @ My Journey to Millions writes How Much Do We Really Know about the Businesses We “Know”? – You could buy stock in these 10 parent companies and basically own every consumer good in existence! Even crazier is to find out that your favorite “pure” product is owned by a ridiculously huge conglomerate.

Ray @ Squirrelers writes Waterfront Living is Not Always Worth the Risks – Many people aspire to living on the shores of water. However, like many things, there are risks that come along with the potential benefits – as this post discusses!

TTMK @ Tie the Money Knot writes Making Small Talk Valuable – Sometimes just being friendly and making small talk can open up some opportunities to make some money!

IMB @ Investing Money writes Companies With No Debt: Are They a Good Investment? – Today we look at a group of companies that have no debt and large cash balances. They look good at first glance, but there can be some downsides. Read here.

Roger the Amateur Financier @ The Amateur Financier writes 15 More Organic Homemade Cleaning Products – I noticed as I was going through the feedback from my Earth Day post last week that (a) people like being able to save the planet, read more for an interesting story!

Michelle @ The Shop My Closet Project writes Yearly reviews are like getting a colonic. They suck. – It’s that time of year again when employees are brought into their direct supervisor’s office and given their yearly review. If they’re lucky, they would have been receiving feedback throughout the year and the review will be a series of good bad, good bad scenarios.

Tushar @ Start Investing Money writes 3 Things You Absolutely Must Do if an Investment Fails – However good you are at picking investments, you will have one that fails every now and then. It is impossible to go through life picking all the right investments and never tripping up.

Jon Haver @ Pay My Student Loans writes Recent Graduates Pay Off Student Loans – With the cost of a college education reaching record highs, it is no wonder that college graduates are burdened by huge amounts of debt. In addition to the high cost of living for most students, there is also the additional expenses associated with student loans. Ready For Zero has created a tool that will help recent graduates pay off their student loans in a timely manner and avoid the penalties that can occur as the result of non-payment.

Kevin @ Passiveincometoretire writes Could Someone Have a Life Insurance Policy On Me Without My Knowledge? – It is highly unlikely, but yes it is possible. Almost all circumstances, however, would prove fraudulent and today’s insurance companies are quite savvy when it comes to debunking such activity.

Little House @ Little House in the Valley writes Compounding Calculations for the Lackadaisical Retirement Planner – This past year I’ve been focused on paying off debt. But, soon I’ll be able to hone-in on retirement savings. Using a simple compound return calculator (because the big retirement calculators scare me!), I’ve calculated some simple savings figures that are much more palatable for scared folks like myself.

Debt Guru @ Debt Free Blog writes Stuck in a Rut? How to Get Out of Unemployment – Stuck in the unemployment rut? We feel for you. That’s why we’ve provided some good, helpful tips on how to get out of unemployment. Read here to find out!

Everything Finance @ Everything Finance Blog writes Home Ownership: Would You Move to a Lower Cost of Living Area? – Sure, location is everything, but we’re considering not just changing location within the suburbs of Chicago, but changing location by getting out of the city and the high cost of living. A three hour drive in any direction would put us in an area with much more affordable housing, where we could buy our dream home for less than $200,000 and pay property taxes of less than $5,000 every year. Is it worth it?

David Leonhardt @ The Happy Guy writes Laundry costs and how to save money – Put clothes to the smell test. If they smell like sweat, put them in the laundry. If they don’t smell like sweat, they are still good to wear. If a person is in the habit of tossing their PJs in the wash each morning, they could save close to $100 per year just by wearing them 3 nights. $100 per person. A family of five could save $500 a year.

Lazy Man @ Lazy Man and Money writes Committing to a Credit Card? Don’t Underestimate Annual Fees – OK, so are no annual fee credit cards always better to carry? Well, yes and no… It used to be that cards that required an annual fee offered more rewards, cash back and points than the competition that didn’t require these fees; American Express used to be the go-to example. Over the last several years however, the gap in quality between the two categories of cards has become less and less obvious.

Hank @ Money Q&A writes How To Use Prepaid Debit Cards To Budget For Big Purchases – Sometimes a trick can save you money on purchases. One of my favorite techniques is using prepaid debit cards to budget for big purchases!

Peter @ Bible Money Matters writes 5 Signs You Are Financially Ready to Retire – If you retire before your finances are in order, there is a good chance that you will outlive your money. Before you quit your job, make sure that you are truly ready to retire:

krantcents @ KrantCents writes Extreme Retirement Is Fool’s Gold! – The usual definition for extreme includes words like serious, hazardous, dangerous, highest degree, exceptional, severe, physical or mental risk or hardship. I realize that retirement as a goal may be worthwhile enough to take risks, but extreme may be too far.

LaTisha @ Young Finances writes How to Save Like The Terminator – Saving money doesn’t have to hurt your wallet. The key to saving money and saving lots of it, is to make your savings automatic.

Miss T. @ Prairie Eco Thrifter writes Why You Should Be Skeptical of Financial “Rules of Thumb” – Rules of thumb are often used to make various financial decisions. While they can be helpful when it comes finding a starting point, rules of thumb should be approached with a degree of skepticism.

Investor Junkie @ Investor Junkie writes Jemstep Review – Portfolio Manager Tool for Retail Investors – Jemstep is a web based service to help the do-it-yourself investor plan for retirement. With the recent move by many to dump their financial advisor, Jemstep targets a well needed niche. But the question is: Can Jemstep’s automated guidance replace a financial advisor?

SBB @ Simple Budget Blog writes The Good and Bad Sides of Coupons – Looking to save money? Maybe you’re big with coupons. We have some good news and bad news about coupons. Read here to learn about this common money saver.

Suba @ Broke Professionals writes Sold! How We Got An Offer On Our House In Less Than 2 Weeks – Our house spent six months on the market in 2012; here’s how we managed to sell it in 2013 in less than two weeks!

Nick @ A Young Pro writes The Biggest Financial Mistakes I’ve Made in My Career (So Far) – I’ve made a few mistakes in my career that have already cost me a lot of money. Read on to learn how you can avoid making them too.

Maria @ The Money Principle writes Shopping for Satisfaction – This week Alex discusses shopping for food. When one is unemployed they should shop smart not hard but could young people today do it?

DPF @ Digital Personal Finance writes Finding a Way to Get Things for Free – Being frugal can be rewarding, not only in terms of saving money, but also with the satisfaction of finding ways to get things for a bargain. Or, even better, for free!

Paul @ The Frugal Toad writes Why Pay for Cable When You Can Use Free and Cheap Streaming Video? – With cable bills averaging over $50 and Internet-TV combo packages costing over $100 you may be asking yourself is it time to ditch the cable. Before you make that decision you will need to make sure you have the right equipment and that your favorite programs are available. If you are a news junkie or a sports fan the options are limited however, if you want a good selection of TV Shows and movies you’ll want to look at these options.

Mr. Frenzy @ Frenzied Finances writes 10 Ways to Work Toward Financial Independence – Achieving financial independence relieves stress that people suffer in their lives. Looking to become financially independent? Here are 10 how-to tips.

TRL @ The Retired Landlord writes Who receives your property when you die? – When you die, your property is often one of the biggest pieces of estate that gets passed on. Of course, if you’re a landlord, you likely own more than one property; such as your own residence and those you let out.

Jester @ The Ultimate Juggle writes Organization is key to balancing family life with a career – It’s tough juggling family life with a career and sometimes the pressure of it all can make you feel unappreciated, even desperate. The frantic commute back and forward to work each day seems to take forever and the boss demands more and more of your time.

Grayson @ Debt RoundUp writes When I Would Rather Spend Than Save – Every since I started paying off my credit cards 4 years ago, I have leaned on the side of saving my money. I had wasted it away on credit card payments and I wanted to build my net worth. Each and every night, I would ask myself the simple question of “should I spend or should I save?”

CF @ The Outlier Model writes Got ovaries?? Work Less!! – A look at job expectations and why women shouldn’t be treated differently in the work force.

Mel @ Mel’s Money writes Save Cash And The Environment- Energy Saving Tips – Simple but effective ways to save some cash on energy bills.

Mark @ Modest Money writes Why the Rich Stay Rich, and the Poor Stay Poor – Why do so few people have real wealth? Certainly, there must be some fundamental differences between the rich and the poor that can account for the differing levels of success.

Sean @ One Smart Dollar writes Financial Rules Stay-At-Home Spouses Need to Know – If you are a stay-at-home parent you will want to make sure you are following a few basic rules.

John S @ Frugal Rules writes Online Brokerages I Use: OptionsHouse Review – There are many online brokerages to use as you look to invest in the stock market. The good ones are there to meet your needs and help make sure you’re doing what you can to be investing for things like retirement.

Mr.CBB @ Canadian Budget Binder writes Financially Savvy Teen Budgets Her Money Using The Cash Envelope System – At just 17 years old Eva is well on her way to becoming financially independent because she is investing in building her knowledge up about personal financial literacy. Teens today really do need a kick-start like Eva has gotten from her parents from a young age. Now she budgets her money using the envelope system. Enjoy this inspiring story as it brings upon you strength, a desire and a passion to see the children of tomorrow succeed.

Jon @ Novel Investor writes Anatomy Of Market Interest Rates – Interest rates play a big role in your finances. The factors used to set market interest rates affect what you earn on investments and pay on loans.

SB @ One Cent at a Time writes Helping you to Prevent Credit Card Fraud and Scams – Credit card scam is a pretty broad ranging term which encompasses theft as well as fraud which are committed through the use of a credit or any other payment mechanism. This article talks about few scam methods and how to prevent them before you become a victim

Abbie @ Finance Junkie writes Saving On Your Weekly Shopping Budget – Obvious ways to save money that we all tend to ignore when shopping!

Glen @ Monster Piggy Bank writes Do You Trust Your Partner With Money? – A post about trusting your partner with money and making financial decisions.

Thomas @ Finance Inspired writes The Benefits of Having a SIPP – I feel we already pay enough taxes these days, so here’s a way to cut out some unnecessary payments that can easily be avoided.

Will Van Hartog @ The Color of the Money writes Is there a Return on Investment in Call Centres? – Call Centres in some form have been in operation for decades, but how the consumer reacts to Call Centres is what really matters to decide if there is a return on investment in your call centre operation

Glen Craig @ Free From Broke writes Multi-Generational Living – Is a Next Generation Home for You? – Multi-generational living is becoming more popular these days as families look for ways to deal with the economy.

Glen @ Credit Card Smarts writes Blue Cash Preferred Card from American Express Review – Extra Cash Back and More – The Blue Cash Preferred Card from American Express offers up some nice cash back categories, just make sure your rewards make up for the annual fee.

Philip @ PT Money writes The Gerber Grow Up Plan: Sound Investment or Scheme for Suckers? – There are a few good reasons to have life insurance for your child. Read to decide if the Gerber Grow Up Plan is right for your family.

JC @ Passive-Income-Pursuit writes Stock Valuation Method – Dividend Discount Model – Continuing on with my series on stock valuation methods, I take a closer look at the Gordon Growth Model and Dividend Discount Model. Being a dividend growth investor, this is one of my favorite valuation techniques from a pure dividend value standpoint. There’s even free calculators you can use to run your own analyses.

Bob @ Christian Personal Finance writes Where is America Borrowing From? – The total United States government debt – also known as the national debt – currently stands at about $16.8 trillion, but don’t lock into that number – it’s growing by roughly another $100 billion each month. Where is the United States borrowing all this money from?

Michael Kitces @ Nerd’s Eye View writes Coverdell Education Savings Accounts Vs 529 Plans For College Savings – With the recent fiscal cliff legislation making Coverdell Education Savings Accounts permanent, more and more people must choose between them and 529 plans to determine which type of tax-preferenced college savings account makes sense, and plan their savings accordingly!

John @ All Things Finance writes Investing for Beginners | Newbie Mistakes to Watch Out For – Newbie investors are likely to make some mistakes when starting out. Here are five of the most common ones.

Marie at Family Money Values @ Family Money Values writes What is Leadership? – WHAT KINDS OF LEADERS DOES YOUR FAMILY NEED?

Irfan Ahamed @ Everything About Investment writes 5 Apps That Help You Manage Your Money – Most people are not accountants, financial advisers or qualified money managers. The normal person is not always equipped with the knowledge needed to maintain their personal finances. And with the economy in flux, responsible money management has never been more important. Luckily, there are several financial apps available to help you manage your money.

Todd @ Fearlessmen.com @ Fearless Men writes How Much To Spend On An Engagement Ring – There’s too many opinions on how much to spend on an engagement ring.I’ve heard that a gentleman should spend 2-4 months salary on an engagement ring.How true is that?

Marvin @ Brick By Brick Investing writes Waging War – Stock Direction – Sun Tzu’s Art of War principles on waging war compared to stock market trends in order to capitalize on bullish or bearish trends.

Reader Profile – Roger From Asset Allocation Central

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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Today, in the ongoing Reader Profile Series, we’re getting to know MPFJ.com reader and enthusiastic commenter (especially on my long-winded asset allocation analysis posts!), Roger, from the site, Asset Allocation Central. Let’s all give Roger a big round of applause for sharing his life with us and listen to his story. Enjoy!

Also, if you’re interested in sharing your own financial story/journey with us in a reader profile of your own, just shoot me a quick email, and we can get the ball rolling!

1. PLEASE TELL EVERYONE A LITTLE BIT ABOUT YOURSELF (BACKGROUND, EDUCATION, FAMILY SITUATION, ETC).

My name is Roger, and I live in a suburb of Philadelphia with my wife, Lisa, and our dog, Bailey. I have two adult sons, Ben and Nathan, that both live near me. Ben works at an American Red Cross lab that tests genetic compatibility for bone marrow transplants. Nathan is still in college and is majoring in computer science. He has a partial academic scholarship and an Army ROTC scholarship.

I was born and raised in suburb of Detroit and had a happy childhood. I was really lucky that I had frugal parents that taught me from a young age to live below my means.

I earned a BA in Psychology from the University of Michigan and graduated into a high unemployment (greater than 10%) economy in 1982. I had a brilliant (not) idea of moving to North Carolina to improve my chances of finding a good job. I ended up working in a crappy retail store making minimum wage.

I decided that I needed to get qualified for something better, so I got an MBA from Duke University in 1985. I sort of liked the coursework, but I fell in love with PCs, which had just come out. After getting married and graduating, Lisa and I decided we wanted to leave North Carolina (too conservative) and move to Washington DC or Philadelphia. I got a job at Scott Paper company as a Financial Analyst in Philadelphia. The job was kind of boring but I still loved PCs, so I started taking Computer Science courses at Villanova University and eventually earned a Masters Degree. From then on, I was a software engineer working for my own company or other companies.

2. DESCRIBE YOUR CURRENT FINANCIAL SITUATION (WHO WORKS IN YOUR FAMILY, HOW YOUR INCOME IS, YOUR EXPENSES, ETC.).

I retired early at age 52, and I highly recommend early retirement to anyone who asks!! Lisa loves being a personal trainer and yoga teacher, so she still works part-time.

We have no debt (mortgage or otherwise), and we have a nest egg that supports our relatively frugal lifestyle.

3. WHAT ARE THE CURRENT FINANCIAL CHALLENGES YOU ARE FACING (SAVING, PAYING OFF DEBT, STUDENT LOANS, MERGING FINANCES AFTER RECENTLY BEING MARRIED, ETC.)?

My biggest financial challenge is managing our investments so that our money will outlast our retirement. I spend a lot time studying investing and asset allocation in pursuit of alpha. I also spend time figuring out how to further reduce expenses without eroding our happiness. I’m often amazed at how little money I really need to be happy compared to what I thought I needed.

4. WHAT ARE YOUR PLANS FOR THE FUTURE (RETIRE EARLY; BUILD YOUR CAREER, ETC.)?

Lisa and I plan on downsizing our 4 bedroom, 2.5 bath house to something significantly smaller after Nathan graduates. We also want to travel, and we’re going on a 15-day European Riverboat Cruise for our 30th wedding anniversary next year.

I would like to live in some foreign countries, but I’m not sure that I can convince Lisa. I’m looking for a little adventure!

I plan on spending time playing with software development with an emphasis on the word “playing”. I like to build fun stuff because I’m an engineer at heart!

5. WHAT’S YOUR BEST PIECE(S) OF FINANCIAL ADVICE AND/OR YOUR GENERAL PHILOSOPHY ON PERSONAL FINANCES?

I have several pieces of advice that have served me well:

You need to realize that more “stuff” will not make you happier. Meaningful work, helping others, interesting experiences, and good relationships will make you happy and these are cheaper than most “stuff”.

Always live below your means and work hard to eliminate all debt. The more you do this, the faster your savings and investments will grow.

Spend time learning how to invest. As your assets grow, your investment knowledge will literally pay bigger and bigger dividends.

***Photo courtesy of AssetAllocationCentral.com

Can My Son Earn a Computer by Mowing Lawns?

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Click here to enter my free $65.84 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to charity! Deadline to enter is May 31st, 2013.

The following post is by MPFJ staff writer Travis.  Travis is a customer blogger for CareOne Debt Relief Services, and also appears weekly at Enemy of Debt,  Travis candidly shares his personal journey to pay off $109,000 of credit card debt and the tips he’s learned along the way. As a father and husband he provides a unique perspective on balancing debt, finances, and family.
A few days ago, my teenage son revealed to me his largest yet financial goal. 
About a year ago, we purchased a new desktop computer with a large flat screen monitor after our outdated one limped along for years.   Tristan instantly took a liking to it for online gaming with his friends.  The problem is, other people in the family need to use the computer as well and he doesn’t really like sharing it.  I’ve told him over and over that there’s a simple solution to this problem: save your money, and buy your own computer.
He’s finally latched onto the idea of saving up to buy his own computer, however the cost is prohibitive with his current income.   The kind of computer he has in mind will cost him about $1000, and with a weekly allowance of $14 (we give the kids $1 for each year of age) it would take him over a year to save up enough money, and that’s only if he didn’t spend a single cent of his allowance.
To speed up the process, he’s looking for additional sources of income.
One thing that instantly popped in my my mind was mowing the lawn.   I’ve been telling him he was going to get involved in helping out with this for the last two summers, but it just hasn’t happened. I would gladly pay him some cash to save me that time once a week.
I way I see it, I have two options when it comes to payment for this job:

Pay Per Mowing 

Pay him a reasonable rate, and encourage him to go out and find other jobs as well.  Our lawn is a good sized city lot that takes me about ninety minutes to mow.  I believe that $20 would be a fair amount to pay him for each mowing. 
Pros: This path would be a very real world example of making the actual numbers visible to him and leaving it up to him as to whether he wants to look for extra work, if he wants to wait longer to get his own computer, or lower his expectations as to what kind of computer he will buy.
Cons:  He may just give up thinking it will take too long.  That would totally be his choice, but then we would still have a computer collision problem.

Balloon Payment

Make a deal with him that he mows the lawn whenever it needs it, and at the end of the summer he would be rewarded with a computer of his own.
Pros: He would have his own computer guaranteed at the end of the summer as long as he fulfills his end of the deal.  This could be very motivating for him.
Cons: This would likely be more expensive for me, and doesn’t give him the exposure to real numbers in regards to saving up for a goal.
I’m leaning towards the Pay Per Mowing option.  He’s fourteen, and old enough to learn not only about hard work, but also that everything is not just handed to you and sometimes patience is required to get what you want.  It most likely means more clashes with him about computer usage, but I believe he’s ready for this lesson.

How about you all? If you had a teenager, what option would you choose?

 Share your experiences by commenting below!

***Photo courtesy of worradmu / FreeDigitalPhotos.net

Budget and the Beast – Can They Really Work Together?

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The following is a guest post by fellow blog reader, Mr.CBB, who is the voice behind Canadian Budget Binder. His motto is that, “It’s not about how much money you make, it’s how you save it.”  

Mr.CBB shares budgeting tips, frugal lifestyle, relationships, recipes, parenting, personal finance and so much more for his over 4500 fans all around the world. After all “money is money, debt is debt” no matter where you live. Come join him on Facebook, Twitter, and Pinterest. Enjoy!
Putting a budget together for us was the easy part, but the beast not so much. The beast, in this case, is our personal finances, so in other words, the money. Can we really make a budget work with the money that we bring in each month?
As a newly married couple going back a few years now we hadn’t really thought about using a budget. We didn’t have much debt except for paying our every day expenses. It’s not like we have never had debt in our lives, we just never felt the need to track it because we thought we were so good with money. That was our first mistake.

A Budget Is Not For Everyone 

That’s right, and I used to think I didn’t need a budget because I could tally up all the people I owed money to in my head. Heck, it was simple to save money as long as I spent less than I earned, so who needs a budget?
I needed a budget, that’s who, and shortly after getting married, we knew we would have to put a budget together. We not only had a mortgage and bills to worry about together as a married couple, but we also had 2 incomes and plenty more responsibility than when we rented.

Living in the UK

When I lived in the UK, I owned my first house (which was a flat) at the age of 21. What I bought was not a house, rather, it was comparable to a condo or a fancy apartment.
It wasn’t a million dollar mansion, but it was my little kingdom and I owned it. I didn’t need to have 3 bathrooms and a kitchen fit for a king. If the flat had four walls, a proper kitchen, running water, and a toilet that flushed, I was chuffed.
From there, I sold my flat and bought a 600sq ft house. Now, I know you are thinking it was small, and it was, but it was perfect for me. Considering the cost of real estate in the UK (which is very pricey in some areas), I didn’t think I did too badly.
When I moved to Canada, I don’t think I was prepared for all the expenses that were coming my way with new laws and regulations, taxes, insurances, and home repairs. There are many things about housing in Canada that differ from the UK, and I needed to get up to speed.

Dreams

I’ve always believed that if you have an opportunity to do what you love, don’t give up on your dream. My dream was to go back to school to learn something new, and I did just that, as scary as it was for me.
When it came time to buy our house (after much deliberation of whether we should rent or buy a house), it meant we needed to work together to get our finances on track and the money working for us.

Paying Off the Mortgage

Not only did we want to design our own budget, but we wanted to kill our mortgage as fast as we could. We saved for a nice down payment on our Canadian home, which gave us a head start in the mortgage payoff game.
We are both demons when it comes to owing people money even if it is just the mortgage. We’d rather work hard, play tough, and reap the rewards along the way. The budget was set up to help us speed up the mortgage pay-off process.

Tracking Expenses

No more guessing how much money we had left or scribbling notes on paper. Instead, we designed our own 10 step budgeting series and budget spreadsheet. When we bought our house, we paid $265,000, which left us with a mortgage of $185,000 to pay off.

Mortgage Freedom 

It may not sound like a lot, especially with today’s low interest rates, but you can imagine how much money in interest we are paying. That was enough for us to get serious about our mortgage.
This was a huge debt for us, so we worked hard to save as much as we could to balance the budget and pay extra pre-payments on the mortgage. We have also been investing in our retirement funds along the way.
Sure, we haven’t invested to the max, but now that it’s 2013 and only 4 years since we bought our house, we will be mortgage free hopefully by June. That’s the plan at least for now, which leaves us plenty of time to put money into our RRSP’s and other investments.
Some people have their own reservations about paying the mortgage off and would rather invest, but I say just do what feels right. A friend of mine always reminds me to make sure that I diversify my portfolio, so that is the plan.

How the Budget Helped Our Mortgage

Knowing where our money is going each month and how much we can spend to reach our goals has helped us to save more money. Make informed decisions and talk to a personal finance advisor for help if you need guidance.

So, can the budget and the beast work together?

You bet they can, and here are my tips on how to make the budget and the beast work for you like it has for us.
  • You need to get organized
  • You need to commit to the budget
  • You need to re-visit the budget often
  • You need to evaluate what works and what doesn’t work for you
  • You need to understand the process in order for it to succeed
  • You need not give up when you fall
  • You need to invest in yourself and financial literacy
So, although some people may think a budget is for people on low incomes or who are heavily in debt, think again. There’s no business that I know of that runs its organization without an accountant, so why should you run your household without a budget?
Don’t let the beast rule your budget. Take control of your money and know where, when, why, and how you are spending it each month.

How about you all? Do you have a budget that you track/follow each month? If so, how do you track it?

Do you ever find it hard to make your finances actually fit within your budget?

 Share your experiences by commenting below!

***Photo courtesy of http://upload.wikimedia.org/wikipedia/commons/9/9b/-_Money_01_-.jpg

Five Ways to Deal with Job Burnout

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The following is a post by MPFJ staff writer, Kevin Mercadante, who is professional personal finance blogger, and the owner of his own personal finance blog, OutOfYourRut.com. He has backgrounds in both accounting and the mortgage industry.

Job burnout is something that affects most workers sooner or later.

It’s not that you necessarily need a new job – it’s just that there are times when you just feel like you’re stuck in a rut, or even question why you’re in that career at all. This can happen even if you ordinarily like your job and the work you’re doing.

Most often, job burnout isn’t a matter of coming to the end of your rope in your job or career. Like nearly every other facet of life, sometimes it just needs a recharge.

1. Take on new projects at work

Job burnout often comes from the “same old, same old” syndrome. As human beings, we all crave a certain amount of diversity in our activities. It may be that you just need a bit of a new direction in your job.

You can satisfy that need by taking on new projects at work. I’m not talking about “busy work” projects like cleaning out the file room or rearranging the office furniture. You have to take on a project that will make you feel challenged and valuable.

This might involve taking the lead on a new initiative in your department, or taking on a new responsibility that is parallel to your usual job functions. By doing this, you can feel greater control over your career, and that may be enough by itself to put an end to the burnout.

2. Take on new projects outside work

Sometimes, the reasons for job burnout are more related to what is happening in your life outside your job. The boredom or lack of satisfaction that you sense from your personal life may carry over to your professional life.

You can overcome that by taking on new projects and activities outside work. One of the big advantages here is that the activity can be just about anything.

Consider one or more of the following broad categories:

  • Something physical, like an exercise program or joining a gym
  • A creative project, like starting a vegetable garden or creating an e-book
  • Learning something new, like a new language or taking dancing lessons
  • A social activity, such as taking a cooking class or joining a civic organization
  • Volunteering, such as participating in a charity or church group, or helping in a disaster relief effort
  • A sport, like softball, a bowling league or a soccer club
  • Learning a new work skill, such as a computer software application or accounting skills to increase your sense of control over your career
  • Weekend travel, to close-in places that will give you a chance to refresh yourself when you are not at work

Activities such as these can give you a new sense of purpose in your life, and that will make you feel recharged. You’ll almost certainly bring that fresh attitude to your work, and that may put an end to the sense of job burnout. 　

3. Try to offload some responsibilities

These days, what we think of as job burnout may actually have more to do with stress.

Many people are now doing the work of more than one person. Each time a coworker is laid off, their work is distributed to the remaining employees. Over time, you can begin feeling overworked and stressed. If it is possible, talk to your supervisor about letting go of some of your less important responsibilities. Perhaps they can be transferred to another coworker who isn’t as busy, or even gently suggest hiring a part-timer as an overflow person. Since this will be a touchy issue, you’re best to frame it in a positive way. You can do this by suggesting that your productivity on your most important functions will improve if two or three responsibilities were taken away from you.

4. Ask for a job re-assignment

Often, the reason for job burnout isn’t from you.

It could very well be a result of one or more coworkers, your boss, or even circumstances in your department. If on close reflection you believe this to be the case, it will be worth it to you to ask for a transfer to another department if that is an option. It’s often said that 51% of your success on a job is your relationship with your boss. If that relationship is not particularly cordial, finding a way out of the situation may be the only way that you will eliminate the burnout problem.

5. It may be time for a new job

Since this is the most radical solution, I’ve saved it for last.

In truth, since the job market is not as fluid as it once was, you are better off to exhaust all other possibilities before going this route. But the reality is that sometimes you are just over the job. It may have been an ideal situation way back when, but either the situation has changed, or you have changed!

Either way, it may be time to make a change. Some of this may be a matter of personality. Some people are perfectly content to spend their entire working lives on the same job, doing essentially the same work. Others – and I can say this because I’m in this group – need change from time to time. Job burnout may just be an internal sign that it’s time to move on. You can spend time in psychotherapy trying to figure out why this happens to you, but you’ll probably never get a solid answer. You may just be wired that way! I figured this out a while back, and when I accepted it and built it into my work life, things just started going better.

How about you all? Have you ever experienced job burnout? Or are you experiencing it now?

What are you doing (or what did you do) to deal with it? 

 Share your experiences by commenting below!

 ***Photo courtesy of http://www.flickr.com/photos/corneveaux/3248566797/sizes/s/in/photostream/

How To Begin Saving For Retirement At An Older Age

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Welcome to My Personal Finance Journey! If you are new here, please read the “About” or “First-Time Visitor” pages to find out more about us. If you would like to receive free updates on articles like this by email, then sign up here or you can subscribe to the RSS feed. Also, check us out on Twitter or Facebook. Thanks for visiting! Keep on learning!
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The following is a post by MPFJ staff writer, Toi Williams, who is a professional personal finance blogger of Fine Tuned Finances. She has backgrounds in personal finance, sales, and real estate.

There is a crisis facing our nation.

Even though the stock market is near record highs and the economy is showing signs of improvement, many workers in the U.S. have not been able to save nearly enough to be able to have a comfortable retirement. According to a report released by the Employee Benefit Research Institute, nearly 30% of Americans have no confidence that they will have enough money saved to be able to retire comfortably.

Individuals that are trying to save for the future and make their money last are facing a number of powerful financial and demographic forces that make their task very difficult. Rising life expectancies and inflation are ensuring that workers will have to stretch their retirement savings to the max to make ends meet. There are few that can count on a pension from their employer when they retire, and the money obtained from social security payments is not nearly enough to replace an income from working. It is estimated that most people will need 75% to 85% of their current annual income to maintain their lifestyle during their retirement years, while social security payments will only replace about one-third of their income.
So how can you avoid having to work until you are 75? By taking steps now to increase the amount of money you are able to save before you retire. These steps may not be able to ensure that you have the amount of money you want by the time you reach retirement age, but you will increase your financial security to the point where you will not have to be afraid that you will never be able to retire.
If you truly stick to these tips and save as much as you are able, you should be able to retire within a few years of your current target retirement date.

Reduce Your Expenses

One of the best ways to save more money for your eventual retirement is to reduce your current expenses to free up more of your income. Most people have a number of things that they pay for regularly that provide them with very little benefit for their money or doesn’t really add to their quality of life.

Examine your monthly expenses carefully to see if there are items that you can eliminate easily. Some people choose to cancel rarely used gym memberships, while some others choose to downgrade their cable package or take their lunches to work instead of eating out. Whatever money is saved should be deposited into your retirement savings account.

Try To Increase Your Income

If you have delayed saving for retirement, you will need to save more to make up for all of the compounding interest that you missed out on earning. Try to find ways to increase your income so that you can dedicate more money to your retirement savings.

When you receive a raise or a bonus at work, consider increasing your contribution to your retirement fund before you begin spending the money on other things. Your future self will thank you for your frugality.

There are many other methods that you can use to increase your income and have more money available for saving for retirement. Taking a part time job for minimum wage at some retailer is not your only option. Some people turn their hobbies into money making ventures, like woodworking, baking or needle crafts. Other people choose to use the skills that they’ve learned throughout their lives to help their friends and neighbors, earning money babysitting children or helping with home repairs. The money making method chosen will depend on your own personal preferences.

Eliminate Your Debts 

Debt will continuously be a drain on your finances. If you are carrying large amounts of debt, the best course of action for you to take will be paying off your debts as quickly as you can so that the money that you were paying in interest can be redirected into your retirement savings account. Every year, large banking institutions earn billions of dollars on the interest they are charging on consumer debt. Instead of securing the future of the bankers, pay off your debts so that your money can go towards making your future better.

Increase Your Contributions To Your Retirement Accounts

Since you are trying to save a lot within a short time period, contribute as much as you can towards your retirement accounts whenever you can. For 2013, the maximum contribution limit for a 401(k) or similar plan for most individual contributors is $17,500. If you are over the age of 50, you can contribute an additional $5,500 each year as a catch-up contribution, for a total of $23,000 annually. For individual retirement accounts, such as a Roth IRA, the maximum contribution limit for 2013 is $5,500. You can contribute an additional $1,000 to the account annually if you are past your fiftieth birthday.

Choose Additional “Safe” Investments

If you believe that you are very far behind in saving for your retirement, you may want to consider choosing additional investments with little risk to bolster your retirement savings. Investing in certificates of deposit, bonds or rental properties can help you ensure a comfortable retirement if the money in your retirement accounts are not quite enough when you are ready to retire. Do not choose risky investments, as you do not want to take a chance on losing a large amount of money so close to your target retirement date because of a steep market downturn.
By following these steps, you can ensure that you have a significant amount of money available to put towards a comfortable retirement.
How about you all? Are you using any of these strategies? How have they worked out for you?



Do you feel pretty comfortable that you will have saved enough by the time your retirement rolls around?

Share your experiences by commenting below!

***Photo courtesy of http://www.flickr.com/photos/68751915@N05/6869770873/

Spring Cleaning Your Personal Finances

 

The following is a guest post written by Holly Wolf. Enjoy! 
It’s the traditional time of year for sweeping out the cobwebs, clearing out the closets, and cleaning out the furthest corners of your home. Your attic might be empty and your basement may be spotless, but spring cleaning shouldn’t stop there.Giving your personal finances a good once-over is a great way to give yourself a fresh financial start for the summer and set yourself up for the year to come. Here are five easy steps to declutter, streamline, and organize your finances.

1.) Go through your paperwork

Most of us find ourselves facing mounds of statements, receipts, and other financial paperwork cluttering up desk drawers, boxes, and files.The paper piles can be overwhelming, and it’s inconvenient to find what you need when you need it. Tackling the paperwork head on is the first step to getting control over your finances. First, gather everything together: be sure to dig out any stray documents that may be hiding in various spots around the house. The first step is to discard any records you don’t need any more. Keep your tax returns and any receipts you might need to support them or future insurance claims. In most cases, a year’s worth of bank statements and pay slips, and a recent copy of credit reports are sufficient: carefully shred the rest to protect yourself from identity theft.

Digitizing essential documents is another great way to cut down on paper. Scan and save PDF files of your most important paperwork so that you can access and print them as you need them.

2.) Automate regular banking tasks with online banking

Setting up online banking is a simple job these days, and it allows you instant, convenient access to your accounts whenever you need it. You can keep a close eye on your finances and quickly transfer money in the case of any shortfall. Setting up Bill Pay or automatic debits for your regular outgoing payments takes some of the work out of managing your monthly finances and helps you avoid late fees and saves you money on postage.

3.) Download helpful apps to streamline your banking

Mobile banking is the newest advance in personal finance management, and many financial institutions are now offering apps for your smart phone. You can now securely access your account from anywhere with a few taps on your touch screen. You can set up alerts to let you know when an account falls below a set balance, or to notify you when a specific check clears. Mobile deposit apps now allow you to deposit checks over the phone. You simply snap a photo of the check and it conveniently uploads directly to your account.

4.) Check your credit report

Knowledge is power, and seeing exactly what your creditors are seeing when you apply for a loan or credit card is half the battle. It also gives you an opportunity to spot and correct any mistakes before they can cost you valuable opportunities. It’s not uncommon for inaccurate or misreported information to affect your credit score, but if you don’t see it, you can’t fix it. You can get a free yearly report from all three of the major credit bureaus (Experian, Equifax, and TransUnion) at www.annualcreditreport.com.

5.) Update your budget and long-term financial plans

Now’s a good time to take a fresh look at your monthly budget. Your financial situation may have changed over the past year, and it’s a good idea to review your expenditures and check on the progress of your long-term goals.Are you prioritizing and paying down high-interest debt? Do you have an active savings account? It’s easy to fall into the habit of using your checking account for everything, but it’s even easier to spend more than you mean to when all your money is in one place. This is also an opportunity to review your retirement plans and insurance policies: are you on track for retirement, and do you have adequate cover? Life changes like a new baby, new job, or significant purchase may mean that your needs have changed, and your strategies might need an adjustment, too.
Following these suggestions will give you a solid foundation for the remainder of the year, and make maintenance easier. It’s easier to keep a clean house clean after a thorough clear out, and it’s exactly the same with your financial house. You can “clean as you go” with simple monthly spot-checks, and schedule another review in about three months. By the time next spring comes around, you should find your personal finances tidy, clear, and orderly.

How about you all? Do you have any regular monthly, quarterly, or yearly steps that you take to ensure your finances are on track? 

If so, what do you do and how do you keep from forgetting to keep up with it?

 Share your experiences by commenting below!

Jacob’s Thoughts – Listed below are my random thoughts as I was reading this article.

  • Lots of good tips in this article, and a fair few that I do myself!
  • As far as going through my paperwork, in general, I tend to keep up with sorting and organizing that pretty well. About once a month, I sort through the papers that have accumulated in my “inbox” and file them accordingly in my personalized financial filing system.
  • Online banking also really helps me to de-clutter my life of paper files and to ensure that all of my bills get paid on time. In fact, I now have things set up so that I don’t actually manually pay any of my monthly bills by paper check. They are all handled online now. The only bill that I pay “manually” is my real estate tax bill that I pay twice a year! Nice!

***Photo courtesy of http://s0.geograph.org.uk/geophotos/02/31/43/2314318_0228a033.jpg

Think You’re Sacrificing to Pay Down Debt? Think Again

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Click here to enter my free $50.53 giveaway for a chance to win 5% of My Personal Finance Journey blog income and give another 5% to a charity of your choosing! Deadline to enter is April 30th, 2013.

The following post is by MPFJ staff writer, Melissa Batai. Melissa is a freelance writer who covers topics ranging from personal finance to business to organics to food.  She blogs at Mom’s Plans where she shares her family’s journey to healthier living and paying down debt.


“We learned early on to amuse ourselves and not to have many wants. It’s the wants, not the needs, that do people in. Having less wants creates contentment and one is satisfied with the simple pleasures in life”–Leona M. Osrin, survivor of the Great Depression (Ohio.gov).


Gazelle intensity.  You’ve probably heard of it even if you aren’t a Dave Ramsey fan.  Basically, it means cut your expenses as much as you can so you can pay down your debt as quickly as possible and become debt free in the shortest amount of time.
Many people say they can’t be gazelle intense because it’s too hard to do without for a longer period of time.  They still want to live while paying down debt. That’s okay, too, because to each their own.

Feel Like You’ve Given Up Everything to Be Gazelle Intense?

However, if you’re in gazelle intensity mode and you’re feeling like you have nothing–no enjoyment, no luxuries, I understand. 
We’ve been paying down debt for 17 months, sometimes gazelle intense, sometimes not, depending on what expenses creep up on us.  However, we try to avoid lifestyle inflation and keep our expenses low by doing without.  While my husband and I do each have cell phones, they’re cheap Trac Fones which we rarely use; we only pay for the minutes as we need them.  When my son will need summer uniform shorts in a few weeks, I’ll simply cut his high-water uniform pants he’s getting too tall for and turn them into shorts.  We buy most of our clothes at Goodwill and garage sales.  We go out to eat less than 5 times a year.  We’re living very simply until the debt is paid off.
If you’re gazelle intense, this all might sound very familiar to you.  Sometimes, you may feel sorry for yourself or embarrassed by your situation when you see others getting ready for exciting summer vacations or enjoying busy weekends with their kids going out to eat and to expensive museums and amusement parks.

One thing that has helped me when I feel this way is to look at others who sacrifice far more than we are.
 

This Is True Sacrifice

I recently came across The Ohio Department of Aging and found fascinating stories from those in their 80s and 90s who lived through the Great Depression.  Suddenly, my own life seems luxurious.  Consider this story about shoes:
“I think my mother was the inventor of open-toed shoes. When I outgrew my Sunday black patent leather shoes, my mother cut the toes out. I can still remember the wet feet from the dew on the grass or the rain. A good supply of newspapers or lightweight cardboard cut to fit inside my shoes and a pair of dry socks took care of the problems. If the stitching came loose on the sole, a rubber band took care of the problem – we put it around the toe, stopping it from flapping as I walked” (Ohio.gov).


Seriously, I’m guessing none of us or our children, gazelle intense or not, have had to walk around in shoes like this girl did.  America is such a throwaway society that even on a tight budget, there are shoes to be found at second hand and thrift stores for a very reasonable price.


For another story, think back on your own Christmas last year.  Even if you’re aggressively paying down debt, you likely had a fairly nice Christmas with plenty of gifts.  Contrast that to this girl’s Christmas during the midst of the Great Depression:


“For Christmas, we always had a small tree with homemade paper streamers and popcorn; of course, no Christmas lights. To save on electric, we used candles. Our present was one doll, which we girls took turns playing with. Our biggest surprise on Christmas was that we would have chicken on the table and plenty of fruit” (Ohio.gov).

Final Thoughts

When you’re doing without to apply a lot of your money to pay debts from the past, you might be depressed sometimes or discouraged.  You may feel that you’ve done all you can to curb your expenses, but have you really? 


If you want to be out of debt as quickly as possible, there are always more ways to cut.  Living a simple life in our modern times without a smart phone, video games for the kids, and the latest electronics, may seem impossible, but the stories from the Great Depression show not only that it is possible, but that your life satisfaction may increase as you learn to separate your wants from needs.  Certainly reading these stories has helped me recognize that even with gazelle intensity, my family still has a great deal to be thankful.

How about you all? Do you ever feel like you’re making too many sacrifices to pay down your debt and wonder if it is actually worth it?

What steps do you take to keep yourself on tracking psychologically?

 Share your experiences by commenting below!

***Photo courtesy of http://www.flickr.com/photos/31333486@N00/2173328648/sizes/z/in/photostream/

$65.84 Giveaway – Community and Charity 10% Monthly Blog Income Give Back # 20 – May 2013 Edition

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The 10% give back giveaway fun rolls on for the month of May! 

In case you missed the first 19 editions of the 10% Blog Income Give Back, after doing some thinking at the beginning of October 2011 about what direction I want this blog to grow and evolve towards in the future, I decided that any income made from this blog would have more significance to me at a personal life values level if I knew that a portion were being given back to the following places:

  • 1) The readers – Obviously, without you here to read my articles and interact with my ideas, there would be no blog in the first place (let alone blog income). As such, it is only fitting that you receive a portion of any blog income.
  • 2) Charitable organizations – If you’ve read my blog before, you know that I’m a big believer in donating a portion of my money to charity. Each year, I donate between 5-10% of my income to the National Multiple Sclerosis Society as part of the Bike for MS fundraiser that I do. Beyond the good that is done by donating your money, getting used to contributing to charity is also a good practice to emulate the actions of affluent individuals (T. Harv Eker discusses this in his book, Secrets of the Millionaire Mind, which I would definitely recommend reading if you have a few hours).

Because of these considerations, I’ve decided that each month going forward, I’m going to give away 10% of my net (after-tax) blogging income/profit to My Personal Finance Journey readers (5%) and to charity (5%). Listed below is how the process will work:

  • After each calendar month passes, I’ll tally up my net blog income and determine what Dollar value correlates to 10%.
  • I’ll post the giveaway (similar to this post you’re reading now), and you’ll have approximately 2-3+ weeks to enter.
  • Once the giveaway is over, a grand prize winner will be announced, and that winner will then select what charity they’d like to have 5% of my blog income sent to. Once the giveaway entry window ends, I’ll send out the money to the blog reader winner(s) and personally drop off the charity donation.  
  • So far, I’ve been very happy with the success of the October 2011 – April 2013 give backs. Listed below is a summary of what we’ve accomplished so far with the give backs. 
    • Current total given to charity = $918
    • Current total given to blog readers = $847 

So, that’s the overall flow of things and a brief recap of what’s happened so far with the give back initiative. Now, let’s get in to the specific details for this month’s (May 2013) giveaway. 

Details of May 2013 10% Blog Income Giveaway

  • $65.84 total blog income to give away – $35.84 to a My Personal Finance Journey reader and $30 to the Blue Ridge Chapter of the National Multiple Sclerosis Society. 
    • $35.84 in the form of one prize available to one reader as follows – 
      • 1) Grand Prize = $35.84 cash via PayPal.

    How to Enter the Giveaway – Deadline to Enter is 11:59 PM, May 31st, 2013


    Like last month, I’ve decided to use the RaffleCopter giveaway management tool to handle sign-up facilitation for the May giveaway, so simply go through the steps listed in the widget below to enter the running for the prize and accumulate entry points.

    There is no limit to the amount of points you can earn. If you refer 10 subscribers – your name will have accumulated 170 entry points! Or, if you link to the giveaway more than once, you can accumulate those 10 entry points multiple times. You can also retweet the giveaway and/or share other My Personal Finance Journey articles via social media sites once per day. In the event of a tie, I will be using a random number generator to select the winner.

    Important instructions: After you complete an entry method, make sure to click and fill out the “I Did This” or “Enter” button in the widget so that I have a record of your points.  

    a Rafflecopter giveaway

    Remember, the deadline for entries will end at 11:59 PM, May 31st, 2013 (a little over 3 weeks from today – the start of the give back). Good luck to you all! Please contact me if you have any questions. After the deadline for entries passes, the winner (one with the most points accumulated) will be contacted via email to receive their prize.

    ***Photo courtesy of http://pardonmypublishing.com/nobomeca/blog/images/DSC_0010.JPG

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