Are you an Optimist or a Pessimist?
Check out this video (click link below). Do you relate?
Optimism Baseball Commercial
Check out this video (click link below). Do you relate?
Optimism Baseball Commercial
Our Holistic Journey |
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Are you an Optimist or a Pessimist?
Check out this video (click link below). Do you relate? Optimism Baseball Commercial
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Growing up, my mom always used something she referred to as the "Envelope System" -- I suppose she was a product of growing up with parents who went through the Great Depression where keeping cash hidden throughout the house in different places was the norm. My mom never shifted those behaviors and therefore continued them as she managed her own money as an adult. Being her child and seeing this money management system, I grew up doing the same thing -- I actually didn't have a bank account until college even though I started working at the age of 12. I had my own safe and kept cash from my earnings in different envelopes labeled with things such as Clothes, Christmas Gifts, Gas, etc. If I wanted to go shopping for clothes, I took the money from my "Clothes" envelope and shopped with that, not a penny more. That's just how it worked and I never thought anything of it... until I moved to a college dorm and all of the sudden had a roommate I didn't know. You can't keep super secret cash in your super secret safe in a dorm room the size of a closet. So I went out and got a checking account. In fact, I went out and got multiple checking accounts... one for each of my envelopes.
It's funny to think about how natural that was for me and how I just thought "Well, of COURSE I want all of these checking accounts." I mean how could I not have all of these separate accounts -- how on earth would I ever keep track of what money is meant for Christmas gifts if it isn't separate from the money I will use to buy gas, etc? Looking back on it now, I'm sure the person who opened those accounts for me at the bank thought I was half crazy. But -- what did I know and so really, what did I care? Not one bit. It worked for me, and so this was my system. I graduated college with no debt other than student loans and having never sacrificed going out, buying gifts for others and traveling. Simply put, this system just worked for me. Then I moved across the country, started my first job outside of college and felt like I was rolling in cash having a salary paid position. But my student loans started asking for re-payment, my trusty Jeep that got me through college started having trouble, I had to pay my own health insurance, rent was no longer part of student loan payments -- AND I still lived the same lifestyle in regards to never sacrificing going out, buying gifts for others and traveling. I was a college graduate with a secured career job, and even a second job working at a ski resort to earn a little extra cash -- and it just simply wasn't cutting it. When I moved, I never re-implemented my envelope system - I only had one bank account for my direct deposits and I didn't have a budget because I was working two jobs, and just living my normal lifestyle, not at all having awareness of where my money was going. In 2 short years, this ridiculously fiscally responsible woman built up more than $20,000.00 in CREDIT CARD DEBT. It was an absolute nightmare. Don't get me wrong, I was having the time of my life - enjoying every single moment, traveling to Maine, Montreal, South Carolina, Michigan, Chicago and anywhere else I felt like it -- going out to dinner and the bars with new friends, dropping money at weddings to show how much they mean to me and how much I support their future together, etc, etc. I worked hard, but I played hard and I somehow very easily got off track in a really negative way. When I moved back home to help raise my then 14 year old brother, I came home without a job, with +$20k in credit card debt and a car payment because my trusty old Jeep finally crapped out on me. Ouch. It was ugly. My stress level was astronomical at that time -- my mother had just passed away, I all of the sudden had a teenage kid to take care of, no job and no money... how in the world was I ever going to bounce back from this!? Well, when you are faced with trouble and you are built like I am, you go back to the basics of what you know and simply get to work and that is what I did. I took whatever job I could find -- thankfully I found one in my career, but it had me traveling more than an hour each way -- but it was what it was. I also re-visited my "envelope system" with bank accounts -- opened up multiple bank accounts and got to work with budgeting my money all over again. In two short years (felt endless at the time, but as I look back, it was just a short moment), I had all of my credit card debt paid off and was beginning to build a savings account. I took advantage of my employer's benefits package to help pay for my Master's Degree and I took every odd job that I could on the side to help me get back ahead ether it be dog-sitting, babysitting, bookkeeping, cleaning houses, party planning -- whatever. Being a hard worker with no pride helped... but what truly saved me was having my envelope/checking account system in place. I made a budget and I stuck to it regardless of what was happening in my life. If my friends were going out for dinner and I didn't have enough money in my grocery account -- I didn't go to dinner. It was really that simple. And I have decided that even though it may seem ridiculous to others to have to reconcile 7 back accounts every month, I wouldn't change it for the world because it works for me and keeps me in check! I have every confidence in the world that no matter what situation I face, whether it be losing a job, moving to a new place, having a child -- whatever comes -- I will always be able to manage my money and will never get into any kind of debt again because I will never waiver from my money management system ever again. I've also learned that I need to pay myself first (meaning my savings account) before I go dividing my money up amongst the rest of the accounts. This assures me that I am living within my means. A little insight into my accounts for your own use should you choose to try this system: Checking account for Groceries/Food Checking account for Abbey (dog) -- and I will totally have one for each kid when I start my family Checking account for Household (Rent/Utilities) Checking account for Vehicle (Payment/Gas/Maintenance/Insurance) Checking account Personal (all my leftover money for whatever else I need like clothes, toiletries, leisure, etc.) -- Side Note*** when I get married, I will always have my OWN personal account so I don't have to ask permission to buy a shirt. I truly believe everybody should do this. Just because you get married, doesn't mean you have to marry ALL of your finances. Remember, money is a marital stressor -- finding ways to alleviate any stress associated is only going to benefit you in the long-run. Savings account (20% minimum) Savings account for Vacation Each paycheck, I put a certain dollar amount into each account based on my budget that I made in the beginning of the year. I figured out my budget using percentages based on my income each week. For example: Every week, I put $30 into my Grocery account because that it what I budgeted for. When I go to the grocery store, I use my grocery debit card. Sometimes I spend more than $30, sometimes I spend less -- doesn't matter because whatever is in the account, has already been budgeted for food. If I ever get close to the bottom of the account, it's time to get creative with the stuff already in the cabinets. Same for my dog. Every week, I put $25 into her account even though she doesn't cost me that much each week. However, when I go to buy her food or need to take her to the vet, there is money in her account that allows for me to afford to get whatever it is that I need to get for her. It's like an insurance plan for my dog without having to pay a premium. This actually has saved my butt a few times because Abbey had to undergo a series of 7 surgeries when she was just a few months old. There are lingering complications where we frequent the vet -- and never do I have to stress over where I am going to come up with the money because she has her own account and the money is already there for her use. |
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