Archive | April, 2013

Hidden Costs of Fun

28 Apr

I made a decision a few weeks ago to attend a Jesus Culture One Nights concert. The band was going to be just a couple of hours away, and I felt like it would be a wonderful getaway. I invited a girlfriend to go with me and purchased my ticket. I thought, “It’s only $25. I can work that into my budget.” Well, I was mistaken.

I didn’t really take into account all the other expenses that would go along with this day trip. I knew I couldn’t afford to stay the night in Birmingham. And I was okay with the sacrifice of being a little tired on the way home. What I forgot to account for – shame on me – was the cost of gas, and the dinner, and the CD I just couldn’t avoid purchasing (and probably overpaid), and the snacks on the way home that would help me feel like I might “stay awake.”

Really, the hidden costs of a purchase have often been my downfall. If I buy this item for this price, I can totally afford it. Then, I need this accessory, and oh, wait, I need to buy this item that will make the item I originally purchased that much cooler. I can’t just purchase this one item. I need all the other gadgets that go with it.

So, how do I avoid the hidden costs of a purchase? I think the first thing I can do is to write down all the possible purchases that need to be made to go along with my original purchase. This process may be as simple as an ironing board to go along with the iron I need. Or, it may be an extra controller and video games to go along with the PS3 I purchased two years ago. Anyway, you get the idea!

Next, I need to do some research on the product I’m buying. If I had done a little more research on the purchase of the concert ticket, I would have thought about paying for parking, and the cost of the meal I might purchase. I also would have thought about the CD I might want or concessions. I usually go into an event with the plans not to purchase anything from the concession stand. And I usually forget that plan as soon as I smell the hot dog in the bun. What is it with hot dogs??? I don’t like to eat them at home, but put me in a ball park, and I jump in line as soon as I’m able!

Then, I need to ask myself how much I really need the item I plan on purchasing. At this point in my baby steps (Step 2), I don’t need to do ANYTHING extravagant, and extravagant right now is anything that exceeds my spending envelope. This reality is especially difficult for me because I LOVE, LOVE, LOVE going to sporting events. For the next few years, I have to pretty much kiss those goodbye. But, this will not be my reality forever. It’s only temporary!

The good thing about going through this process is I may very well talk myself out of the purchase by the time I’m finished. It’s a lot of work to do this much research around a purchase!

Sheepishly, I admit that not only did I forget to take into account the hidden costs of the concert. I also blew my budget by about $40. I would like to be able to say it was worth it, but is staying in debt longer really worth it? I think the resounding answer is NO.

With that being said, please see the pictures from the concert taken from my phone. I really did have a wonderful time. It was so refreshing to see so many people going after the Lord. If you’re not familiar with Jesus Culture, I highly recommend that you check them out. I assure you that you will not be disappointed!

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Dream Retirement

24 Apr

20130424-153750.jpgIn the yard, you can see several cars. There are kids running around the front and backyard. The pool is clean, and the water slide is running. Laughter can be heard outside and inside the home. Adults are milling around sharing the latest news, and hugs are given with ease. The brick ranch-style home has a wrap around porch filled with rocking chairs in full swing, as my children and grandchildren chat freely.

Inside, people gather around the big screen TV to watch the latest sporting event, preferably a Braves game or a college football game. In the kitchen, couples prepare their favorite meals on a spider eye stove and store their food in the stainless steel side by side refrigerator. On my desk, you will find a stack of envelopes. These are not bills, though. These are gifts ready to be mailed. The checks were written with ease, with no apprehension or question about where the money should go. A quick check of my bank statement shows several months of living expenses saved up in an emergency fund. As a matter of fact, this fund has changed the definition of “emergency” for my entire family. My kids are debt free and are funding their kids college and retirement. On my husband’s bedside table are two tickets to an exotic location. The hotel is booked and the rental car is in place, all paid for in cash. There are several more trips lined up, including a cruise and a trip to South Korea. A family trip is scheduled to the beach, too! In the three-car garage are three paid for cars, and money is set aside for repairs and a fund has been set aside for the next cars – a Lexus for me and whatever car my sweet husband wants.

We are both retired comfortably and are looking forward to the travels and to giving to those who are in need. Our retirement accounts contain enough to allow a comfortable life. We lay our heads down at night knowing we gave all that we could – of our time and our finances.

That’s what my dream retirement looks like. What about yours?

Dust off My Finances

14 Apr

The road is long and dusty. I’ve traveled it many times. I should know where the potholes and bumps in the road are by now, but no, I continue to slam into the same spots.  I have flats at the same time and in the same place.   The windows are down on my car and my hand dangles out the window, as I try to capture some of the emotions and freedom of my youth – before I had car loans and student loans.  Now, I’m traveling on this road, hoping I can put both hands on the wheel and can navigate through this treacherous course.  The dust is climbing up, until I can’t see what’s ahead of me.  I know where I’m going, and I know about how long it’s going to take me to get there.  I just don’t seem to totally understand HOW I should approach the road.  I could drive slowly and carefully, that way I can somewhat predict what lies ahead.  Or, I could drive at breakneck speed with little regard to the comfortable life I’ve created.  I may hit more bumps in the road; I may end up on the side of the road with a busted radiator. But if everything goes just right, I could get to the end of the road much more quickly than I originally thought. 

I am considering how I can quickly get out of debt. I could get a second job, but I feel that I have some work to do internally before I can take on a second job.  Or, I could ignore the work that is required of me and suck it up for a couple of years. 

Which approach is best?

What You See is what You Get

7 Apr

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We’ve all heard this phrase many times.  Most of the time, we hear this in regards to a person who is transparent.  What you see with that person is what you get.  I won’t go into a diatribe about how that’s probably not true ever because people are deeper than we ever give them credit for.  I will, however, take a look at this statement from a different angle.

Have you ever noticed that your perception of yourself, another person, or a situation can determine how you react to the situation?  Sometimes an innocent or harmful statement made by someone can actually be interpreted differently by the person who hears it.  It’s the age old battle of sender/receiver.  Men joke that women often take a compliment offered by their mate and turn it into an insult.  “You look nice today, dear” can quickly turn into “Are you saying I don’t look nice every day?”  How much fun are those conversations, guys?  

The philosopher John Locke said that words have no power until we assign them the power.  I believe that firmly.  And I believe that the power of the words spend and save have to change if I am ever going to have Financial Peace.  When I am out ready to make a purchase, what power controls me? Is it my desire to be debt free? Or is it my desire to have what I want without waiting?  The answer is most likely, “YES!!!”  Sometimes I choose to answer the debt free question, and sometimes I choose to want without waiting.  Last year, I would have simply “wanted” without worrying about my debt.  I’m growing every day in the way I spend and save.  I still feel like a newborn horse stumbling around and trying to get my feet underneath me.  But I will be galloping before I know it, readers!  I look forward to sharing those gallops with each of you.

I am enrolled in Financial Peace University right now, and Dave Ramsey talked about the power of the emergency fund.  He says that when the emergency fund is in place, emergencies just don’t seem to happen.  Perhaps that is true, or maybe emergencies just have a different appearance when an emergency fund is in place.  I can’t really speak on this because I don’t have the 3-6 month emergency fund Dave recommends – yet.  I think there’s a chance that what you see in an emergency is indeed what you get.  As an example, before I had my small emergency fund set aside, a major car repair would have been a major setback.  Now, I have some peace knowing that if a minor emergency came up I would be okay. 

I’m walking this journey to be debt free, and I’m changing the lexicon of my life.  I will continue to redefine spending and saving for myself until they actually match up to the definition of someone who has financial success.  So…how do you define spending? Saving?

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