Tuesday, May 26, 2015

Financial Mistakes vs. Financial Setbacks



We're all bound to make mistakes at some point in our lives.  Wearing that hideous hairstyle.  Staying in the wrong relationship for way too long.  Or overdrawing our bank account.

Finances are not immune from the human tendency towards error, so during our lifetimes, we will make mistakes.  But it would be an injustice to label every financial misfortune as such.  Sometimes we experience circumstances outside of our control that put us in a bad place with our money.  

I prefer to classify these differently, as the lessons we can learn from them are just as important, but should be analyzed using a separate system.  I prefer to call these financial setbacks.

How to Learn from Financial Mistakes

Financial mistakes are when we did something against our better judgement.  We took some cold, hard numbers and made an emotional decision with them that was against our best interest.  Maybe it was investing in the US housing market in early 2007 with a mortgage you couldn't afford.  Maybe it was trusting that your company would do what was best for your own retirement account.  Maybe it was something as simple as not keeping a budget and racking up overdraft fees.

When we make a mistake, it's because we could have done something better, but chose not to.  The good news is that we can learn from these mistakes, and hopefully do things the right way the next time.  Take note of what didn't work.  Take personal responsibility for messing up.  And then determine  what you would do if you were caught in that situation again.

How to Learn from Financial Setbacks

Financial setbacks happen when circumstances outside of our control mess up our financial lives.  Perhaps you lost your job, got in a car accident caused by another, or the cost of living suddenly and abruptly went up in your area.  These are things that you don't have control over, and  that you shouldn't internalize.  If you internalize them and blame yourself, you'll go around in circles asking yourself what you could do better if it happened again.  The fact of the matter is the answer is probably, "Nothing."

While the setbacks themselves are anything but fun, finding solutions to them can be.  Setbacks can force us to get creative with how we spend or earn our money.  They force us to use our imaginations to get out of a rough situation.  They force us to research, learn, and grow outside of ourselves rather than reconciling our inner shopaholic demons like mistakes do.  

We can also collapse under their pressure.  We can give up, quit, and move no where but backwards for an unforeseeable amount of time.  When we get creative and move forward, we empower ourselves.  We may even come up with solutions that help others when they come across a similar set of circumstances, making the world a better place.




If you've made a mistake, own it.  Learn from it.  Do what you know you've got to do . But if you meet a setback, don't beat yourself up over it.  Make a conscious decision to take control over the situation, as unpleasant as it may be, rather than letting it take control over you.  You may find out you're stronger, brighter, and more creative than you ever thought you were.

Tuesday, May 19, 2015

Why Spending More on Food Now is Better For Your Retirement


In our home, we've been wanting to eat more organically for a while now.  We know all the benefits, or rather, lack of negatives that come with eating the right type of farm-fresh.  No GMOs.  Nothing grown with harmful-to-human pesticides.  No hormone-pumped chicken.  Grass-fed everything.

But something's been holding us back.  That something is money.  Eating organically is expensive.  We have our grocery budget at a comfortable level right now, and changing our shopping list would cause us to have to cut back in other areas, most notably our savings rate.

The more I think about it, the more I think it would be worth it, anyways.  What good is retirement if you're too sick to enjoy it?  Or even worse, if your life is over before you get a chance to enjoy it?

I live in a nation that's been dubbed the fattest in the world (go USA!), so our food choices and consumption obviously need to change as a whole.  However, obesity is not only a problem in the US.  Diabetes is the fastest growing chronic condition in Australia, with a majority of the cases being Type 2.

Being overweight can cause other significant health problems such as heart disease, breathing problems, high blood pressure, osteoarthritis, and even cancer of the breast, colon, gall bladder, or endometrium.  (Hormones added to meat and dairy products have been associated with some of these cancers, as well.  So you could look perfectly fit, but still run into issues if you regularly consume hormone-pumped meat.)


These are all serious health problems.  If you don't have your health, you don't have anything.  You could have all the money in the world, but your body may not be functioning in a way you could enjoy the spoils of your lifetime of hard work.

When I hit retirement, I don't want to be rich, or even just comfortable, but confined to a wheelchair, constantly on pain killers, hooked up to a breathing machine, or worse.  I'd rather be poor and healthy, able to enjoy the world around me even if financially my options were limited.

I'm not saying we should forgo retirement saving altogether.  We should without a doubt make it a priority.  But when we're looking at our spending, we should be putting our health first, because without it we won't be able to enjoy any of the other line items in our budget.  So often our health starts with what we consume and put into our body.

So this season, I'm going to be revamping my family's grocery list.  I'm going to try to cook and feed everyone healthier.  I'm going to get creative with my budget, but also try to remember that when it comes down to eating well or retiring early, eating well should be invested in first.

I'm not saying this change will be completely successful.  We'll probably slip.  I'll probably make a mistake or two, purchasing something for too much because I'm not totally familiar with this sector of the market yet, or buying something I think is good for us, but is really just marketed well.  Will-power may ebb.  I'm human.  And so is my family.

But we're really going to try.  Because this is really important.  And I want to be healthy when I'm 70, even if it means I'm not as wealthy as I'd like to be.

Monday, May 11, 2015

What Becoming a Mother Has Taught Me About Money



Yesterday was Mother's Day, and it got me thinking about all the ways my life has changed since I became a mother myself.  In many ways, my children have changed me for the better, and my finances are no exception.

1. Time is More Important Than Money

I feel comfortable certifying myself as a workaholic.  I get a lot of self-esteem from my career and work ethic, even when I'm going through rocky patches of it.  If I can put in a hard day's work, I'm happy. 

At least I used to be.  Since having kids, I've started recognizing a stress I didn't have in my life before.  When I work a full-day, I'm a bit depressed that I only get to see them for a few hours before bed.  Where I used to be satisfied if I felt like I did great at work that day, now that satisfaction is waning because the lifestyle I'm currently leading doesn't allow a lot of family time.  (This is a temporary lifestyle. As my husband goes through school, we only have one day a week where we're all together.  I'm not happy we're going through it, but am happy we're establishing what we really want out of life now while we still have some time to engineer things a bit better rather than realizing what we missed out on ten years down the road.)

I used to be willing and able to find any amount of time to trade for money.  Now I find myself on the other side of the coin willing to sacrifice money for time.

2. Sometimes, experiences are worth it.

I used to be very frugal when it came to spending money on events.  Then, Yo Gabba Gabba was coming to town.

It was a financially foolish decision on paper.  Which is all that used to guide me.  We paid an embarrassing amount of money to see an over-priced children's show.  But if you could have seen my children's faces....

It's not something we do everyday.  It's not something we do every year.  But while there are plenty of ways to have fun for free, every once in a while splurging for someone you love is worth every penny.

3.  It's Okay To Accept Help

I know no other role that will humble you more quickly than motherhood.  I am used to being fiercely independent.  I like doing things on my own so that no one can hold anything over my head.

But there was no way I was going to be able to do this thing by myself.  My mother and in-laws help immensely with free babysitting.  My sibling sometimes takes some of our laundry to wash so we don't have to spend a ton in our coin-op building.  My children have an aunt that love to buy them clothing, and a lot of their wardrobe has also come from hand-me-downs of very generous friends.  

I haven't washed every dirty dish in my house.  I haven't taught my children every valuable life lesson that I've learned thus far.  My children are the amazing people they are today because of the influence of those generous people in our lives.  The stubborn, "independent" me of yesterday is gone as I'm replaced with a more humble and grateful version of myself.



What financial lessons has parenthood taught you?

Tuesday, May 5, 2015

Family Entertainment on A Budget



Budgeting for entertainment is doable.  Especially when you're single.  Hang out with friend without going to crazy expensive concerts.  Cut how much you eat out.  Seek out happy hours for drinks.  Small events with lower ticket prices are doable.

But when you have a family, suddenly every single cost is multiplied.  If you have two kids and a partner, you can multiply even those lower-cost attraction and event tickets by four.  Eating out at all suddenly becomes a complete budget buster.  And entertainment geared towards children has prices inflated to the price they know parents will pay to make their kids' childhood fun and memorable.

There are ways to have a fun, fulfilling family life without boredom or financial ruin.  Getting creative and seeking out money saving opportunities can allow everyone to have relationship-building experiences that won't bust the bank.

Schedule a Family Night

Designate one night per week that is family night.  The night may have to switch with seasons depending on your kids' extracurriculars, but setting one night a week where no one goes out, has a sleepover, or picks up any extra work can do wonders for building family relationships.

What do you do on these nights?  The sky is your limit!  Play board games.  Put on a play.  Make a craft.  Do a hands-on, kid-friendly science experiment.  If you run out of ideas, run to Pinterest where you'll find no shortage of fun ideas to riff off of.  If you have children that are old enough and capable, have everyone participate in the planning process.  Setting up a rotating schedule for planning responsibilities each week allows everyone to showcase their own favorite activity, and will take a little more stress off of you as a parent.

Seek Out Lower Cost (or Free!) Events

It's amazing how many free events are out there.  Many of them will be one-time or seasonal, though, so you'll have to do the leg work to seek them out.  If you're in ACT, a great page to check out is the local government's event page.

Right now, you could take the family to see the Warlpiri Drawings at the National Museum for free, or you could take them to a free movie screening at the National Portrait Gallery on May 9.  (This specific screening is for Beneath Hill 60, so this particular event is better for families with older children.)  You could also take a free, behind-the-scenes tour of The National Portrait Gallery on May 17, or take a free trip to the Mt Stromlo Observatory on May 22nd to get a closer look at the stars.

There are opportunities for low-cost, quality, out-of-the-house fun and learning; you just have to be willing to look for them.

Make Meal Time Fun

Eating out can be a real temptation, but it can be detrimental to your budget.  When it's treated as an occasional treat, it can be fun, but affording it regularly can be a nightmare.  To make meals at home more entertaining, get everyone involved at age-appropriate levels.  Have younger children help mix pre-measured ingredients.  As they get older, they can measure them themselves.  As they get older still, they'll be able to cook for the family as they've grown up learning how to do it.  I don't know any parent that wouldn't enjoy that!

During warmer months, take your meals outside.  Whether you're packing up a picnic or simply having dinner on your patio, getting outdoors to eat can spice up your regular routine.

Getting everyone involved in meal planning is a fun option, too.  You can use the experience as an exercise in budgeting and grocery shopping, and also have a lot of fun trying new foods that you wouldn't normally cook.


How do you keep your family entertained on a budget?

Tuesday, April 28, 2015

You Might Have Enough If...



When you're striving for great things financially, it gets easy to get caught up in the race towards the next big thing.  If you're a planner, a dreamer, or both, reaching the next big thing may not be enough.  Because once you get there, you'll find a sense of disillusionment.  You'll notice something out of the corner of your eye.  It's a peak in the distance, and you'll set your heart on making it the next goal to summit.

If you continue along this path, it's easy to lose your life to the pursuit of riches at the cost of other things in your life.  It's easy to always be striving, and never really enjoy the satisfaction that should come in accomplishing major goals.  It's easy to  never be satisfied, to never be content.  And that's no way to live life.

You may have enough if...

...all of your basic needs are met, and you are making contributions to investments that will one day be able to cover your retirement.

...you are able to meet reasonable goals without living pay check to pay check.  (If you aren't, the answer may not be more work.  It may be better money management habits.)

...you have healthy relationships with your family and within your community while the above conditions are met.

...you feel fulfilled in the aspects of your life and person that are most important to you, and are okay with the other areas that may not bring as much fulfillment, but are not as high on your priority list.  (An example:  maybe you never wanted kids, but love your career and really feel like your work matters.  Or perhaps you have a family that is really close-knit and has a lot of fun together, so you deal with a boring job that provides you the resources you need to spend more time with them.)

You may have too much if...

Oftentimes in striving to have "enough" we fail to realize when we have "too much."  I'm not going to say we have too much money, because resources are hardly ever a bad thing when used properly.  But if we're working too hard to obtain those resources, we might have too much.  Too much work.  Too much stress.  Too many extraneous goals that don't really need to be reached in order to have a happy, fulfilling lifestyle.

You may have too much if...

...the idea of taking on more work makes your head spin because you're already hustling with no time to take a breather.

...your familial relationships are suffering even while you're working overtime to provide your family with an "even better" lifestyle.

...in your quest to get to tomorrow's goals at a quicker pace, you're missing all of the beautiful things that could be happening in your life right now.

...you don't have time to contribute to causes you support, but figure that your monetary donation will suffice.  While they may be equal in the eyes of the organization you're donating to, giving of your time allows you to have a richer experience and face-to-face interaction with people that support the same causes  you do.  Never underestimate the importance of human interaction in determining the gravity of our experiences here in life.

...your idea of happiness is definitively tied to a number attached to a dollar sign with no room for error or flexibility.


Do you feel like you have enough?  Or too much?  What things make you feel sated, and what feels extraneous?