Uncategorized Archives - The Broke Professional

Tax Filing Open Season Is ON!

It’s actually tax season!

People love the new year for many boring reasons.  You can lament the past year (2016 wasn’t THAT BAD.  Famous people die every year).

A new year also signifies a fresh start.  That could mean a new healthy diet or starting to break some bad habits.

But most New Years resolutions die fast, so I like the new year for a different reason.  TAX TIME!

And it’s not because I’m getting a big refund.  I try to get as small of a refund as possible.  That’s because getting a large refund means you had the government hold your earned money last year.  But that’s for another post.

I just enjoy getting tax related letters in the mail and having a nice folder at the end of February with all of my financial information from 2016.  Doesn’t get much better than that.

That being said, today is a big day for me.

January 23, 2017 is the first day the IRS will accept tax returns.  This includes paper and e-file.  And why are you still using paper??

Here are some other key dates to remember:

January 31, 2017: Date by which you should have received your W-2 from your employer.

February 16, 2017:  Financial and investment institutions must mail out their various forms, including 1099’s which report any withdrawals from retirement accounts.

April 18, 2017: Tax Day!  Last day to file federal income tax returns and any extension requests.

October 15, 2017:  Last day to file federal taxes for those who had approved extensions.

This post is simply a public service announcement for the start of tax filing.

Next week I will outline where you can get your taxes done, and how it can possibly be FREE!

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The One Service That Finally Let Me Cut Cable

Pittsburgh Steelers v Tennessee Titans

Change is tough.  Changing something I’ve been used to my entire life is especially tough.  For me, that something was cable TV.

Having “background TV” on has always been a normal thing growing up.  Though probably not the best thing to grow up around, it was what we grew up around nonetheless.  After I got married and moved out on my own, it was just assumed we would sign up for a cable package.

After all, how else would I watch basketball and football?  And how else would we be able to DVR our favorite TV shows?

It turns out that there are now tons of ways to do this.  I’ve actually previously written about the benefits of cutting cable a couple of years ago.  Despite the obvious financial and anti-commercialism benefits cutting cable would provide, I just couldn’t bring myself to do it.

My main hangup was how I was going to watch sports.  If I can’t get NFL network, ESPN or any local channels I would have to invade people’s homes who did have cable.  That’s not a way to live life.

But I’m happy to say that I did finally cut the cord a couple of months ago.  And with great results.  We’re saving money every month and only watching those things we want to.  And it was a specific service that helped me finally take the plunge.

Playstation Vue FTW

There was always a video game system in my house growing up.  It all started with the original 8-bit Nintendo, then Super Nintendo, Nintendo 64, Gamecube and then the Playstations.

I currently have a Playstation 3 but I honestly haven’t used it to play a video game in years.  Being a full time doctor, husband and father will do that to you.  And I wouldn’t have it any other way.

But the PS3 is still being extensively used to watch shows on Netflix and Amazon Video.  We watch almost all of our TV shows on these two services.

And now the PS3 being used a lot more because my 3 year old son ended up downloading a free trial of Playstation Vue.  And it changed everything.

I heard of Vue from ads here and there but never really thought anything of it.  But as I dug into it more I realized it will solve my biggest hurdle in cutting cable: watching sports.  I particularly love watching NFL football and NBA basketball.  The main channels I watched on cable were ESPN, ESPN2, NFL Network, TNT, TBS and local channels for live games.

And guess what.  Playstation Vue has them all!  For $35/month I could get all these channels along with a bunch of other great ones (Comedy Central, CNN and MSNBC to name a few) streaming on my PS3.

And that’s exactly what I did.  This made cutting cable really easy and a no brainer.  Even with the Playstation Vue monthly price I’m saving a healthy amount per month from what I was paying before.  And I don’t have to pay for the DVR and the laundry list of TV related taxes.

Not Missing Anything

Between Netflix, Amazon Video and Playstation Vue, we don’t miss our cable package at all.  We get more shows than we could ever watch with Netflix and Amazon, and I get my fill of sports with the Playstation Vue options.

Since the channels are streaming there is the occasional hiccup like with any Internet connection, but that is a once a week occurrence.  The TV watching experience is almost identical as with a traditional cable package, and it will only get better as Internet reliability improves over time.

And because of certain broadcast rules, some channels are not allowed to show commercials during breaks.  This is actually an added blessing since we won’t be influenced by a barrage of ads and it actually forces us to talk to each other during commercial breaks.

In short, we don’t miss our former cable package in the least.

Actual Savings

$150.43= Old monthly cable bill (includes TV, Internet, home phone, DVR rental and various random taxes)

$72.59= New monthly cable bill (includes faster Internet, home phone and no random taxes)

$34.99= Monthly payment for Playstation Vue

$42.85= Money saved per month.  And our lives are actually a little better because of the faster internet and fewer commercials.

I could say I can’t believe we waited this long to cut the cord, but there were not many good options available to watch sports until recently.

But with services like Playstation Vue, Sling TV and even a good old fashioned antenna depending on where you live, you can still get your favorite channels and then some.

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Life Insurance Brings Peace of Mind

“With all of these financial and insurance considerations, one tool that gets lost in the shuffle is life insurance.  This is a shame since a good life insurance plan will provide peace of mind for you and your family, while being a financial cornerstone for your loved ones.”

Read the rest of my post about the importance of life insurance over at FineTunedFinances.  Life insurance is so easy to sign up for nowadays and is very cheap compared to most other types of insurance.  Checking your rate is really a no brainer.

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Digit: Save Money Easily and Automatically

An emoticon I can get behind

An emoticon I can get behind

This post may contain affiliate links

America has a savings problem.  No, not the annoying habit of trying to save every country from themselves.  That’s for another blog.  The savings problem is that Americans are just not saving enough money.

The personal savings rate in 2015 was found to be 4.8%.  This rate includes retirement account savings, such as a 401(k).  Saving 5% into your 401(k)  alone is not going to get most people anywhere close to a comfortable retirement, so this is a scary stat.

Another scary number?  62% of Americans have less than $1,000 in their savings account.  This means that many many people in this country are not able to fork over $1,000 in case of an emergency.  They will have to resort to credit cards or loans to make up the difference.  And more debt is not the answer.

The answer: make saving automatic.

If you’re eager to start saving automatically sign up here!

Enter Technology

Automatic savings has been the backbone of my finances.  Deductions from my paycheck into my 401(k).  Monthly transfers from my checking account into my savings account.  Direct debit monthly student loan payments, which also gives me a slight interest rate deduction.

The beauty of automating your finances is that the money goes where it needs to go.  I never have to worry about it being spent or disappearing into the financial ether.

But if you have read any of my posts, especially some of the earlier gems like this one, you’ll know I’m not perfect.  Some months may have different cash flow needs than usual, and as a result I have money just sitting in my checking account doing absolutely nothing.

This is where Digit has made a big impact in my life.  I first heard about it while listening to an interview on the awesome Stacking Benjamins podcast a while back.  I tried it and fell in love.

The basic idea behind Digit is that once you sign up and link your checking account, Digit uses some fancy algorithm to analyze your transactions.  After a couple of days, it is able to determine how much you can safely save and sends that amount to your Digit account, which is FDIC insured.

If you happen to be spending a lot that month, Digit will adjust accordingly and not take as much money out of your checking.  When you have some extra money sitting around, then they will save a little bit more.  If your account happens to overdraw because of Digit, which is exceedingly rare, they will reimburse you for the fee.

Easy to Use

Accessing the money is easy.  You can just use their new mobile app to withdraw funds back into your regular checking account, or their traditional way of communicating through text messaging.  I use the texting currently because they update you periodically on how much you have in your Digit account and in your checking account.  They also send funny pictures once in a while to keep things lively.

Once a month I will transfer the money from Digit into my emergency savings account.  This gives me a little savings boost each month which I otherwise didn’t have.

It’s a nearly pain free way to save.  It’s not useful for everyone, like those people who keep track of every single cent in their account (you know, THOSE people).

But it is a great service for those who have trouble saving anything, or those who would like to be a little more efficient with their savings, like me.

It’s risk free to try.  If you’re not happy with it, you can just withdraw your money and close the account on their website.

Signing up is really easy:

  • Join by clicking here and enter some demographic information
  • Link your primary checking account
  • Give Digit a few days to analyze your spending and enjoy the newfound savings!
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How I’m Pursuing Freedom

pursuing freedom screenshot

Being smart with personal finance is not difficult.  There are a few key steps to take which will put you light years ahead of the average American.  My goal is to make personal finance simple and actionable for professionals and anyone else who cares to listen.

Find out some more about what makes The Broke Professional tick by reading my interview at It Pays Dividends.  While you’re there check out the rest of Thias’ site.  It’s jam packed with great financial information.

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4 Things You Forgot About Personal Finance

mr-forgetful

We all forget simple things sometimes.  The other day when I was trying to login to my system at work, I could not remember my password for the life of me.  I always typed it in without hesitation and without thinking about it.  But for some reason that day I could not remember it.

My memory lapse (aka brain fart) was so bad I even had to get my password reset.  And when I remembered it later that day I couldn’t believe I forgot it in the first place.

But it happens.  We are fallible.  Even billionaires like Donald Trump make mistakes.  Or lots of them.

The same thing applies to personal finance.  I have done so much reading on finance the past few years sometimes I forget the basics.  And I know others do the same.  Life happens and sometimes we can lose sight of what’s important.

So here are four fantastic pieces of personal finance knowledge that we may have forgotten:

1. No interest is better than low interest

It is very easy to get into debt in our society.  If I wanted to, I could just visit a few websites and sign up for a car loan, mortgage and personal loan in just a few hours.  And if you have kneecaps that you don’t mind losing, payday loans are always an option!

Debt has become such a normal part of society, that people don’t really mind keeping “low” interest debt laying around.  This especially includes tax friendly debts such as mortgage debt and student loan debt.  What’s the harm in keeping around a mortgage that is “only” at 4% and where you can deduct the interest paid from your taxes?

The harm is that you are effectively giving the bank a dollar so you can get back a quarter.  If you have the funds to pay off debt quickly, you will be SO MUCH farther ahead if you pay down the principal faster rather than keep the debt around because you can save some money on taxes.  The only one’s getting richer in that situation are the banks.

Debt is so easy to obtain and even more dangerous to keep around, even the “low interest” kind.  Don’t get lackadaisical in  and pay it off as quick as you can.

2. Delayed gratification really works

Awesome personal finance habits can take a while to learn.  That’s why they’re called habits.  Depends on what school of thought/guru you follow, habits can take 21 days, 28 days, 30 days, 40 days or 2 months to fully form.

The bottom line is that they take time, and this really applies to the essential habit of delayed gratification.

But the problem is that our society is very impatient.  We want things now, now now.  And waiting to buy something you want just seems silly to most people.  But if you keep spending money every time you see something you like, you are sabotaging your financial future.

Spending money frivolously means you can’t put extra money towards debt paydown.  It means you can’t make that home improvement you’ve always wanted.  It means you don’t have enough money to start your business.  But if you save money for a period of time and live lean, you can do whatever your heart desires.

The best way to delay gratification is to save until it hurts.  If you’re saving so much money into your retirement plans, savings accounts HSA’s and self education that you can’t seem to find the money to buy that new Apple Watch, you’re doing well.  Just know that over time those accounts will grow and grow and you can do whatever you want with your money

3. Marketers know us better than we know ourselves

Walk into any major department or clothing store in the country, and you will be bombarded by sights, smells and sounds that are engineered to keep you in there.  Lights will accentuate the sharp curves of the newest smartphone.  Catchy music will be playing at a volume that will keep your ears perked up just enough.

And you will quickly forget that you popped into the store to pick up just one thing.

Making a list before going out to help keep your spending under control is a tried and true personal finance hack.  But companies know this and they hire very smart people that know how to keep us engaged.

Knowing this really is half the battle.  We need to realize that these companies need to keep making higher and higher profits every year, so they will keep looking for innovative ways to keep us in the store and handing over our money.  Keep this in mind next time you get caught in their web!

4. Focus on the big wins in life

As the old saying goes, don’t lose sight of the forest for the trees.  Going through life day to day, it can be easy to lose sight of our big goals.  We’ll hear a co-worker or family member talk about this amazing sale or this incredible new way to save some money on groceries.

The fact is, our brain bandwith is finite, so it’s important to keep the bigger goals in mind.  Things like debt repayment, family and friends and spirituality are some of the important things in my life.  But it’s easy to lose sight of that when the latest savings fad or mind numbing game or TV show comes around.

The things that have made people lots of money in the past are pretty much the same things that make people lots of money today.  Getting an advanced degree, building a business, paying off debt and investing are still the best ways to become richer.

Obsessing over things like cutting out lattes and draining the last bit of toothpaste out of the tube will save you some money in the short term.  But it could come at the expense of the real big wins.  Keep your actions geared towards those.

Personal finance has been an evolving subject for me.  I learn new things all the time and that’s really exciting.  But some things I’ve learned on day 1 are still the most important.  Sometimes all you need is a refresher!

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Everyone Should Consider Student Loan Refinancing

Unshackle your life

Unshackle your life

Few opportunities in life will allow you to keep more of your own money year after year with very little work on your part.

You can call your cable company to negotiate a better price.  That can save you $50 bucks or so per month.  But you have to look for new deals every few years and stay on top of the company to make sure they don’t tack on any extras.

Negotiating down a price for a car is another example.  You can potentially save thousands of dollars off the sticker price, but cars go way down in value anyway and you have to rinse and repeat when it’s time to buy another one.

These are both great ways to save money but do require a good amount upfront work and some checking in to make sure you’re not getting fleeced.

But for recent graduates with student loan debt, there is an even better way to create perpetual savings with very little work or maintenance:

Refinance your student loans.

Why You Should Consider Refinancing

Student loans are a big problem in this country.  While student loan interest rates are not nearly as high and murderous as credit card rates, a LOT of people are saddled with student loan debt and the amount of debt is pretty high.  Professional school debt can easily get into six digits (hence, The Broke Professional)

How high?  About $1.3 trillion.  You can even see it go up every second if you have some free time.  Pretty cool.  But also NOT COOL.

The other big issue is that it can take time for many graduates to actually get their careers going.  But lenders really don’t care.  They will give a few months grace period and then you need to start paying.

There also used to be a time when student loan interest rates were really low.  During my undergraduate years in the early 2000’s they hovered around 1-2%.  Now the rates are around 5-7% or even higher depending on the type of loans you take out.

So higher rates and higher balances that affect a large chunk of the population.  This is a problem.

Student loan refinancing is a great potential solution.  While it may not be the final solution for everyone (some value the various government benefits that come with federal loans), every single person with student loan debt needs to look into refinancing.

Refinancing may not be the right option for everyone.  But it doesn’t hurt to get some quotes and find out!

Benefits of Refinancing

Some people are a little confused about what a student loan refinance is.  Really simply, the company you decide to refinance with will send a check to your original lenders and pay off your loans.  You are now a customer of the refinancing company and you have to make payments to them.

Pretty simple, but what are the benefits of moving your debt from one entity to another?  There are many, but the biggest benefit is that you will (most likely) be paying much less in interest payments over the life of the loan.  The bigger the interest rate difference from your original lender and your new lender, the more beneficial refinancing will be for you.

Depending on the interest rate difference and the amount of your balance, you can potentially save a lot of money.

As a real life example, let me walk you through how much I saved with my refinance.  Since my time in school spanned some interest rate changes, I had some loans with lower rates and some with higher rates.

I decided it would be most beneficial to refinance my one loan which had a higher interest rate than the rest and had the largest balance as well.  Let’s do some simple math to check out the savings I received:

Original loan:  $36,667 @6.8% interest

Original term:  25 years

Total payments:  $76,346 ($39,679 interest)

That’s a long time to be in debt and a lot of extra interest to pay.  Now here are the terms of the refinanced loan:

Refinanced loan:  $36,667 @3.45% interest

Refinanced term: 20 years

Total payments:  $50,811 ($14,144 interest)

So over the life of the loan, I would end up saving $25,535 in interest payments!

With the refinanced loan, I had the option of a 5, 10 or 20 year term.  For the sake of the example I showed the 20 year term since the monthly payments were just slightly higher than the original loan.

Simply getting a lower interest rate with pretty much the same monthly payment would save me about $25,000 over the life of the loan!

But I want to get out of debt quick, so I went with the 5 year option since I could handle the increased monthly payment.  Going with this option will save me $36,374 in total payments.  I’m liking the sound of that.

I only had one loan with an interest rate of 6.8%.  Graduates nowadays have multiple loans with interest rates around 6%.  Being able to refinance their entire balance with an interest rate cut in half can produce significant savings.

Another great benefit of going with a new company to refinance your student loans is better customer service.

I’ve dealt with a number of refinance companies and every single one had better customer service than my original lender, whose customer service is almost non-existent.

My original lender would do shady things like apply extra payments towards interest and not the principal, even though I specifically asked them not to.  And it took forever to get a live person on the phone.

Many of these new refinance companies are young and growing, so they put customer service at the forefront of their business plan.  My two favorite companies, SoFi and Earnest, have phenomenal customer service and very user friendly websites.

Who Should I Refinance With?

There are a lot of student loan refinance companies popping up nowadays, but the two that are at the top of the industry and that I highly recommend are Earnest and SoFi.  They are essentially 1 and 1A.

If you’re already convinced and want to get the refinance train moving, click here to get a quote from Earnest, the company that ultimately got my business on my first refinance.  (If you end up getting approved for a refinance by using this link, we both get a $200 bonus)

I also recommend clicking through SoFi, as they have slightly different underwriting standards and you may receive different quotes from either.  (If you use this link and get approved, you will get a $100 bonus)

I would suggest comparing the two and going with the company that gives you the most favorable rate.  They are both very good.

If you still need a little more hand holding, my next post will detail the step by step process of refinancing your student loans and I will tell you why I went with Earnest for my first student loan refinance.

Until then, get some quotes and save some money!

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Educating from the Exam Room to the Blogosphere

Blogging is not as easy as most people make it out to be. It takes consistent time and effort to produce a quality blog, let alone one that makes some money.

But the most important thing needed to become a successful blogger is passion for your subject. Dr. Jennifer Lyerly, a fellow optometrist from North Carolina, blogs about various issues in the field of optometry. Her knowledge and passion for the profession is evident from every post she puts up on her blog, Eyedolatry.

I asked Dr Lyerly some questions about her life and blogging career. Read on to learn more about what drives Dr Lyerly to produce consistent quality content for fellow optometrists and anyone looking to learn more about the profession:

Tell me a little about yourself and your career:

profile

I graduated from the Southern College of Optometry in 2011 and started blogging right after graduation. I’ve been working in group private practices since graduating, and I’ve found I really enjoy working with a team of doctors and having a personal relationship with a boss who is also an optometrist. I’m constantly learning from doctors with more experience where I work at Triangle Visions Optometry, and I also feel like I bring something new and insightful to the table as a millennial doctor on the team.

When and why did you start blogging and who is your primary audience?

I was studying to take North Carolina boards, and also organizing my thoughts on patient care for my first job when I decided to write my first blog post. The blog was a great way to think about a topic and work out how I would describe a medical condition or an optics question to a patient. Most readers on my blog are curious patients, wanting to learn more about their eyes. Since I’ve been putting more focus on women’s issues in optometry, I have seen a huge influx of readers that are new graduates and student ODs. My goal is to make the blog informative to people with various levels of education in eyecare, so that an optometrist, a student, and someone completely inexperienced with our profession would all feel like they took away valuable information from a post.

How do you manage your time between blogging and seeing patients?

It’s difficult! My rule is that I never mix blogging with work. At work I see patients and am a doctor only. When I leave the office, I don’t take home patient care so I’m free to work on anything I want. I try to write 1 good quality post a week. More than that, and I just don’t have time to research and edit enough to feel like I’m delivering quality information.

What has been the biggest challenge in your blogging career?

Dealing with criticism has been tough. When you put yourself out there, you’re going to have people who don’t agree with you. I’ve had a surprising number of people criticize my support of daily contact lenses on the blog, or leave a comment meant to insult me or belittle me about “not being a real doctor.” I was even blocked on Facebook for a few months when someone upset about how many posts I’ve done about daily disposable contact lenses (they wear their Biomedics contact lenses 4-5 months at a time and are just fine!!) reported me as a bad URL.

Any negative feedback I get just drives me to want to write better and better articles. The world is largely uninformed about what we do as optometrists and what is true about their eye health, and I feel like my blog gives patients at least one place where they can get true, medically supported information. Not everyone will agree with the science, but that doesn’t mean they don’t need to hear it.

If you could give some advice to your first year optometry school self, what would you tell her?

I was so focused on classroom excellence in school, I didn’t participate in leadership groups as much as I should have. Looking back now, optometry school is truly a place of social connections as much as learning. As a natural introvert, it took me being out of school and having to talk to new people every 20 minutes in patient care to realize that making connections with people isn’t scary or intimidating — it’s actually pretty easy and very rewarding. I’ve almost become an extrovert at this point and life is so much more fun this way!

What are some of the major challenges that young optometrists face nowadays?

Where I practice in North Carolina, the choices of where to work seem to be getting smaller and smaller every year. Our industry is going through major ownership consolidation and I fear that lack of competition and choice for where to work will drive down our salaries and our quality of life as doctors. Negotiating what you want is essential from your very first contract – not just for you, but for every doctor that comes after you. We have to stand up for what our education and skills are worth.

Have you always enjoyed writing?

In elementary school, I wanted to become an author when I grew up. I haven’t written a book (fail), but blog – author has to count for something.

Are there any blogs you visit regularly?

With industry blogs I consistently read Eye See Euphoria, Maino’s Memos, Eyecing on the Cake, Optomly, and of course, The Broke Professional.

Where do you see yourself professionally in 5 years?

I plan to keep practicing, blogging, speaking, and serving the profession of optometry in anyway that I can. I’m passionate about the success of our profession and I am excited about any opportunity I get to make our future brighter. I hope in 5 years I can look back and feel like I’ve been making a difference in our profession, no matter how small the impact is.

Where do you see your blog in 5 years?

I started the blog as a way to supplement my learning, and I can’t picture a time where there isn’t a topic I want to learn more about. But in addition to educational articles, I also want to use the blog to help our profession. I want to work with companies and industry leaders for the next generation of young female ODs to champion the future of our industry. I’m really passionate about making private practice survive in optometry, and embracing social media is the best way for independent doctors to compete with large corporate entities — you need a personal, unique presence and you need to connect with people!

Through the blog and the social media experience I’ve had, I’ve also started a new business with Dr. Glover at Eye See Euphoria where we are offering social media management for exclusively optometrists at Defocus Media. It’s impossible to know what the social media landscape will be in 5 years, but I want to be right there, representing optometry and connecting with other doctors and patients to grow our profession.

What is your favorite book?

This is always a hard question for me — I love reading and there are so many books that have spoken to me. I really love The Bell Jar by Sylvia Plath because I think many young women go through the feelings the main character has in that book — feeling confused about what and who you’re supposed to become and how you’re supposed to do it all, feeling like what you’re creating or delivering to the world is not valued. Knowing other women before me were overwhelmed with expectations from society, their families, and themselves makes me feel more comfortable with imperfection and not being able to do it all.

What do you enjoy doing when you’re not blogging or seeing patients?

Traveling, eating, and dancing at weddings. Being married to my best friend, I feel like we are always planning our next adventure.

Any words of advice for young professionals seeking to make an online presence?

Don’t judge your worth by the number of readers or number of followers you have. Don’t judge your worth by one person’s negative comment. If you look at what you’re doing online, be it blogging or on social media, and you are proud of it, then you are success! And you know what, if you’re producing good content, your readership and followers will grow naturally anyway.

Big thanks to Dr Lyerly for the interview and giving some insight on what it takes to build a successful blog while holding down a full time job.

Her blog is called Eyedolatry.  Check it out for consistent quality information about eye conditions and the field of optometry.

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Financial Lessons Learned During a Blizzard

My Sunday/Monday/Tuesday workout

My Sunday/Monday/Tuesday workout

The East Coast is now recovering and digging out from one of the worst blizzards it has seen in years.  In the MD/DC/VA area we got the brunt of it, so digging out has been a process for sure.

While being at home with my family for days was fun, cabin fever started to set in after a while, especially with my 3 year old son.  He begged us to take him to the nearby park which was covered in snow and he absolutely loved it!

It was an interesting and sometimes character building experience trying to dig ourselves out.  I saw the spectrum of humanity out there.  From neighbors helping each other shovel out of their driveways to guys taking selfies of themselves in their clean driveways and not lifting a finger to help others in need right next door.

Shoveling snow is kind of a cathartic experience because things are very quiet and still all around.  And all you’re left with is your thoughts while repetitively shoveling and pushing snow around.

In between thinking about my mortality and wondering if we had enough eggs to last the next few days, I did draw some financial analogies related to the blizzard:

1.  Debt keeps you from moving forward

Seeing the magnitude of the storm when it was finished and how helpless everything looked, I realized that this is what debt can do to your financial life.  If you have debt lying around all around you, it becomes very difficult to just take a step towards financial freedom.

Once you can stop the debt from piling on, the next action step should be to get rid of that crushing debt so you can actually move on and advance with your life.  Which brings me to my next realization:

2.  Large goals are best completed in stages

Once I got my gear on and opened the door to take a look outside, it was incredible to see how much snow there was.  My Corolla was almost completely covered and the mounds of snow in the driveway and on the sidewalk were enormous.  I thought to myself that we’re never going to be able to get out of this.

But once I started working, I just made a goal to clear off certain sections and take breaks every so often.  Before I knew it, I had most of the driveway clean that day and two days later the car is able to get out and the sidewalk is passable.

This concept can be applied to pretty much anything in life, be it paying off debt or starting a new business.  The final goal can seem daunting and even unattainable at first, but if you break it up into smaller goals and work on them consistently, the end goal will become much clearer.

3.  Focus on your own situation and don’t keep up with the Joneses

It’s interesting to see how differently people approach shoveling.  Some perfectly healthy people can’t be bothered and will hire somebody to clean.  Some people are out during the storm itself and to get a head start.  And some people just wait until the plows come by to get started.

People also have different levels of preparation.  Some are using their rickety old shovels that have lasted them for years.  Others are eager to start up their brand new snowblowers.  Everyone has different situations but my philosophy is to do what you can with your situation and help those who need it.

If you were unprepared for this storm, just do what you can and prepare better for the next storm.  Financially, constantly having your eyes towards those who have more will just make you feel worse and affect how you deal with your current situation.

4.  Having a partner helps.  A LOT.

Shoveling snow by yourself is repetitive, boring and time consuming.  I noticed when I had one or two more people helping, all with the same goal, things were just more fun and work got done more effectively.  Even if one of the other people was my 3 year old son with a sand shovel, it was still fun having him out there.

In the same way, I think it’s important to have a partner when it comes to your finances.  This could be an accountability partner, a spouse who is on the same page or just a friend who enjoys talking about finances (I’m taking applications if you’re looking for one.)

There’s a nice synergy that is created when you’re working with someone towards the same goal.  You feed off of each other and new ideas can be found during the journey.

Luckily the forecast is calling for temperatures to be in the mid 40’s this week, so hopefully we will have a lot less snow to contend with this time next week.

Now only if there was an act of God that could evaporate everyone’s student loan debt…

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Personal Finance Lessons from a Baby

Anyone who has kids will always remember the firsts.  I know I do.  I will never forget the first time my son looked at me and smiled.  I will never forget the first time I got to hold him in this big scary new world.  And I will, of course, never forget when I put my finger near his little hand and he squeezed it tight.  That’s my favorite thing of all time.

Another reason I will never forget all of those moments is that every other moment is a blur of crying, screaming and sleepless nights.  And that was just me!  Throw in some vomiting, problems with gas and constant laundry, and that sums up the baby rearing experience.  Looking at it this way, new parents are gluttons for punishment.

Personally, I wouldn’t have had it any other way.  Because as time goes on, the baby gets bigger, starts talking and becomes more independent.  As my son is growing up and learning new things, I’m trying to grow and learn myself.

And part of that is taking lessons from the most unlikely of places.  Watching my son grow up from a helpless little baby into the fiercely independent and loving toddler he is today has taught me a lot of things.  And even some things about personal finance.

A great sage once said, “For everything your eyes see, therein lies a lesson.”  Here are some personal finance lessons I’ve learned from having a baby:

1.  You don’t need much.  This is by far the number one thing I’ve been trying to apply in my life.  A baby doesn’t care if you wrap him in a $5 blanket from the thrift store or a $500 blanket from some place that sells $500 blankets.  It just wants to be warm and comfortable.

A baby doesn’t care if you feed him a homemade concoction of peas and carrots or the most expensive organic baby food from Whole Foods.  It just wants to be fed.

And a baby doesn’t care if he wears a hand me down shirt or a $150 shirt.  He just wants to be warm and clothed.  And he’s either going to throw up on it or outgrow it in a month.

The point is, in the end you don’t need that much to be happy or feel secure.  A roof over your head, a warm house, good food and a caring family is all we really need to feel fulfilled.  And that’s a lot more than many people around the world have.

2.  It’s the journey, not the destination.  It is absolutely incredible to see my son learning new things, seemingly every day.  I know that one day he will become a walking, talking human capable of higher thinking, while also being able to go to the bathroom by himself.

But the it’s doing the little things every day that will get him to that point.  Cuddling with him while reading a book while improve his mind.

Taking him to the bathroom for the tenth time that day will eventually allow him to be potty trained (work in progress).

Striking up a conversation with him will produce a babbling brook of incoherent sounds and spittle, but eventually he will be able to talk to me about anything.

He will most likely be able to do everything a normal adult does, but the journey to that point provides the true memories.

Same thing goes for our finances.  While we may have solid goals of having a secure retirement or paying off debt, it’s the everyday things we do that will matter.  It’s always important to keep the end goal in mind, but never forget to enjoy the journey because it will make the end all the more sweeter.

3.  We can’t do it alone.  Despite my son trying to become more and more independent every day, in the end he still depends on his parents.  Whether its getting fed or taking care of a boo-boo (official clinical term), my son needs us when it’s important.

He wants to be independent by picking out his own clothes or taking his own shoes off, but when push comes to shove and he needs real help, he will turn to his parents.

In the same way, we need help when it comes to our finances.  That could mean we all need a financial adviser, but that’s not always the answer.  Sometimes we just need a family member to point out our spending addictions.

Sometimes we need a financially savvy friend to find out how to save some more money.

Sometimes we need a mentor to help us jump start our careers so we can make more money than ever before.

And sometimes we just need to turn to Google to find some answers.

We can’t do it alone, and we don’t need to.  We are more connected than ever in this world, but people still find ways to isolate themselves.  Something as simple as an email invitation to lunch can open up avenues you never knew existed.  Don’t ever be above asking someone for help.

Raising a child can be a harrowing experience, but it’s one filled with ups and downs and everything in between.  Most people think that having kids makes life utterly more complicated, but I have noticed that it couldn’t be simpler.

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