oh my gosh... so I sit here yesterday and say how I need to save money too and then I got spend 100$ at futureshop last night! I bought the second season of Lost (really didn't need that!) and a new flash drive (okay, so I kinda broke mine last week and did KINDA need it (I was using my old one almost daily) and it was on sale after mail in rebate for 20$ - so I thought I might as well get it now)... but I did have a cd in my hand that I put back because I really really didnt need that, lol
anyway, I will not spend today... I will not spend today... oh crap, I am going for dinner
argh, I sware, next pay day HALF of it is going into my savings account....
hmmmm maybe we should start a thread and encourage each other to put aside X amount of dollars... we could each pick an amount (monthy, weekely, whatever) and then remind each other to put it away and save?
I would never say I had a spending problem, but I did end up with quite a bit of credit card debt (I say "quite a bit," and for me it was about $6k--I know many have dug themselves into much deeper holes, though). Once I graduated from college and actually moved into my OWN apartment, the reality of all the major expenses took its toll. I was paying over $950 a month by myself just for rent and utilities. I got 2 paychecks per month (since I was salaried, so I get paid every 2 weeks), and each paycheck was only about $900, so add in gas and food and such, and I often ended up turning to my credit card even for basic things like groceries.
Now, I am making almost double what I was 2 years ago, and I'm sharing an apartment with my boyfriend (more expensive than the one I had alone, but less out of my pocket since we split it). I will have my credit card paid off within the next 3 months (hopefully 2)--I've been making GIANT monthly payments ($500-$1k per month even though the required minimum is only around $100). Once I get that paid off completely, I'll actually be able to SAVE some money--and I WILL save it, because saving for a down payment on a home is WAY more important to me than DVDs or accessories or whatever.
So maybe that is something else that would help? Maybe you need to think about something you really want in your future that will be very expensive, and keep that in mind when you're out shopping. It could be a certain kind of car, a home, anything you want to be able to have that you could not possibly afford right now. If you keep spending like you are now, you may NEVER be able to afford it!
I've been there, done that.
I just turned 25 and my BANKRUPTCY discharge just came through at the end of July. That was $23,000 of credit card debt - about $5000 or more was interest, late fees, over limit fees and all kinds of other charges. Most of the charges were for living expenses that could not be met by my husband's income; and all the debts were at least 3 years old as I have since got my head out of my *** and straightened up financially - but we couldn't even afford the minimum payments, so bankruptcy was our option.
The way you talk about spending, if you don't get it under control and/or get a credit card, you WILL end up here too.
Since bankruptcy, (I was able to file Chapter 7, and NO it does not affect my husband because his name wasn't on it) we have acquired a second vehicle, have saved boatloads of money - have over $3000 in multiple accounts, have NO CREDIT CARDS, pay all our bills as soon as they come in the mail, all the bank statements reconcile, and generally I'm just doing it right. It took bankruptcy for me to get it right.
So for a reality check: you too could end up bankrupt by the age of 24.
I think that you need to have responsibilities for your money. If you had to pay for college out of your own pocket you would be more thrifty - I'm certain. Everything isn't going to be handed to you and you'd do good to learn that lesson now and get yourself under control. No one really gives a damn about the latest fashions or whatever other bs.
You really need to think about what you're gonna do someday when you've blown your rent money or grocery money on "stuff".
DO NOT GET A CREDIT CARD. ever, really. That's the single worst thing you can do. With the exception of a vehicle or buying a home, the rule should ALWAYS be: if you don't have the money, you don't buy it.
For those who want to disagree with me about ever having a credit card, I'd encourage you to visit www.daveramsey.com; to check out Dave Ramsey's radio talk show; or to look up Dave Ramsey's book "Total Money Makeover."
This guy knows what he is talking about and gives much good advice: including avoiding credit cards and buying everything outright.
Last edited by buckettgirl; 09-06-2006 at 06:14 PM.
I definitely agree with buckettgirl and not the cheat (the motleyfool website is pretty good - good forums and you can ask whatever questions you want - you are getting advice from very knowledgeable people...I think one of the most knowledgeable one is a person with screen name of 'fuzzbucket' - or something like that - pretty sharp guy).
If you don't have the $$, don't spend it.
Both DH and I are pretty frugal people...my biggest splurge is I get my nails done every 3 weeks. I do go on the occasional shopping spree (especially after losing weight...that's the hardest to refrain from - buying cute clothes in smaller sizes!!).
But, one thing I do different is this: DH and I put 90% of our purchases (even our electric bill) on the credit cards and pay it off every month (we get about 2-3% back on all our purchases doing it this way)...but I am an absolute freak about my credit card statement. I check it daily to make sure I am staying in my budget because even though I'm pretty frugal, I still spend more $$ than DH, whether it be grocery shopping, clothes shopping, etc...). The only debt we have is our house and that will be paid off in about 15 months. DH HATES debt - he grew up with basically nothing...he hates financing anything that will depreciate (basically everything but a house or an education should never be financed in his eyes). It's great because almost everything is one bill and you can see everything that you've spent. I'm first to admit this won't work for everyone because it would be so easy to go absolutely nuts with this kind of 'freedom'.
Cars - nope - we will pay cash when we buy again...we both bought new vehicles when we got out of college (he bought a truck and i bought a sedan. He was sorely disappointed in his truck and sold it 2 years later and bought a 1995 Toyota Corolla. We paid off my car 1.5 years into my loan and we still drive it today. We don't plan on buying another vehicle until baby-land comes along) and we will buy used...no matter how much I beg and plead ('babe - 2.9% APR - we can do that!! It's like nothing!')...nope - he won't agree to it...heck - if that's the best I can do to complain about him, I've got it made.
Furniture - nope - when we buy furniture, we buy used furniture...even though it'd be great to get a new bedroom suite for 0% financing...nope - won't do it...
Although DH is frugal (although he will pay top-dollar for top-of-the-line quality if that's what it takes) I handle the finances - I like checking our balances...I love seeing our mortgage decrease every month.
We can't wait until we get our house paid off...we've already talked about what we are going to do as a celebration...I mean, I'm not trying to toot my own horn but how many 30-yr old couples out-right own their house? People think we are absolutely nuts. 'Put the $$ in the stock market, mutual funds, etc...you'll make more $$ that way'. But, what people don't understand is that we've always been this way. The peace of mind it will give us, especially DH, is priceless. Bascially my paycheck has always covered the rent + down payment (now it covers the mortgage and what we pay extra towards it)...everything else (including escrow and property taxes) comes out of his...so if either one of us ever is not working, we are covered. (we make just about the same amount of $$)
We also have our 401K, Roth IRA, and a few I-bonds. It's a very nice feeling to not have to worry about funds but we do sacrifice things (like the cars, furniture, we don't have cable, we don't have home internet service, etc...)
DH loves finance...I think he should teach it when he retires in 25 years but most people would never buy into his methodology - which is not even his...he gets most of his tips from people like Warren Buffett and Benjamin Franklin - he does a lot of reading about them...I just like to get the synopses - lol...
DH and I are extremely lucky people. We both have Engineering degrees and both work in fields where our degrees are utilized. We are both healthy and both of us received scholarships for college (his was for academics, mine was for athletics) so I know our way is not everyone's way. But it can be done.
I agree that the Motley Fool is an awesome website. I visit it quite often. There is a lot of good solid financial advice there.
As for credit cards, I'd disagree with not using them. You should never ever carry a balance on credit cards, but if you can use them wisely, I think you should. I think they have helped me financially because I am able to track my spending with them. Also credit cards have protections if they are used by someone else and it doesn't involve someone taking money out of your banking account and waiting for the bank to resolve it. I only had one issue where I had to have a credit card company reverse an invalid charge but I was glad I didn't have to deal with it. I also use cash back cards that get anywhere from 1% to 5% cash back. I usually get a couple hundred dollars every year.
Financial lessons can be painful if you don't know how to budget but it is important to learn how to manage your finances.
hey I'm broke to I don't have gas in my car and won't have money until monday. and still have 3 days more of school. and overdrawn my account i don't know what to do. so i understand you very well and i can't budget my money either never think of saving money for tomorrow or emergency money for instance now.
I always seemed to have enough money without any issues. When I graduated college and started making some decent money was when I started to spend like crazy.
This sounds like me. I spent nary a dollar in high school and college (parents paid) and I worked intensely during the summers. I had $4000 in the bank when I started graduate school. I told my 'rents that I would pay my own way from now on and BOY was I glad that I had some money in the bank what with housing and fees and lord knows what else.
I'm sorry to sound harsh, Amberkay, but from reading all your posts on here, I think you're comfortable spending so much cash because you know that your parents will be your safety net when times get rough. Establish a budget and stick to it. I'm not saying pay for college by yourself, but learn to buy cheap, look for coupons/discounts/bargains if you want to buy a lot of stuff (clothes/shoes).
I have two purses. One my mom got me three years ago because I was carrying around a bargain basement one that was falling apart (literally) and the other I just treated myself to 6 mos ago at a mere $15. You are smart enough to make it into college, you are definitely smart enough to set a budget and stick to it.
bucketgirl, I learned how to control money after we filed bankruptcy about 2 yrs. ago. We had no choice. We were living about our means. A $1500.00 monthly house payment. A large boat and 30 foot camper. 5 new cars, 1 each for me, DH, my son and my 2 step-daughters. Several credit cards. Very expensive lawn equipment. We were making about $7000.00 per month take home with $5000.00 monthly expenses. Everything was being paid but we had no savings. (Except for our 401K's). Then , I got sick and dropped to part-time work. My DH changed jobs and we had 90 days waiting period for medical insurance. I ended in intensive care for 6 weeks, with no insurance. I was told that I could not work any more. Our income dropped by over 50%. We had $1 million in medical bills, hence the bankruptcy. We had to get rid of everything but 2 vehicles and our home. During my 2 yr. absence from work we almost lost everything.
Today, thankfully we still have our home, we have decent cars to drive but they aren't brand new. We have no credit cards. We have no boat and camper. The kids pay for their own vehicles. (They are ages 20, 21 and 23). If we need something we save up and buy it. Every single bill is paid at the first of each month without any late fees. This way of life is so much less stressful than living with huge debt. I know where the money is going to come from each month and I dont' worry anymore how we'll make it. We have good insurance now and our 401's are being added to monthly.
Things happen in life that are totally unexpected and can turn everything upside down but they happen for a reason. We learned our lesson. Learning to control spending and prepare for the future is one of life's great lessons.
DH and I were together a lot of years before we got married, so we didn't then, and don't now, mingle our money. We have a joint credit card (which gives us airline miles) that we pay off every month. When the bill comes we sit down and reconcile it, and he gives me a check for his things and 1/2 the household stuff, and I pay it from my account (online by debiting my checking account). We built our house ourselves, pay-as-you-go, while living in a construction trailer (bunks, bathroom, kitchen) parked next to the house for 5 years. We paid cash for the land, we've paid cash for all our vehicles. We've never had any substantial debt once our studen loans were paid off. We don't have any kids, and that plus the paid for house, have enabled us to save more than many couples. And granted, we're older (61) than most of you, but we've been living this way since our 20's. And we've been fortunate enough to both have had decent paying jobs most of that time (though DH was unemployed for awhile, and sometimes had to work 2 PT jobs), and have had health insurance most of the time.
I know it's hard when you're young to think so far ahead. But now is the time to learn good spending/budgeting habits. Think about what the thing you're buying right now will mean to you in a day, in 10 days, in a month, in a year! Will you even have it in a year? And will you still be paying for it??
My sister got into money trouble like many of you describe, though she didn't go through bankruptcy. She now carries no credit cards (has one for REAL emergencies, but it's in a safe place at home), pays for everything in cash, which when it's gone, it's gone. She thinks a lot more about what she buys, and has learned to budget a lot better.
I am SO sorry! I didn't mean to come off as sounding critical in any way! I am the very same way and do a whole lot of impulse buying ... hey, where do you think *I* get the stuff that *I'm* selling on ebay?
Oh, I didn't mean you stepped on my toes in a bad way. I wasn't offended in any way. I mean...I know you're right. But admitting you're right would have to mean I'm wrong...internal conflict.
I get paid on Friday! And I'm taking out $20...that's it. I'm going to use my spare change (I have about $30-odd in a jar in my bedroom. Don't spend change...it's built up.) for buying a water or diet coke between classes...rather than spending cash. That should actually help me save money.
You guys with one or two purses...wow. I mean, my mom will carry the same purse for years, but I still find it hard to imagine only having one. I haven't counted really, but I'd estimate that I have about...20 or more purses right now, more than 30 pairs of shoes, about 100 dvds, toonnnnnns of books...much more than a closet full of clothes. Art supplies coming out the wazoo. (Art supplies are a need, but they're EXPENSIVE!) I probably have over $300 in makeup right now, and I go through it three times a year and throw a lot of stuff away. This is stuff that's accumulated over the years, but you get the point. And...wow, typing those numbers...I get why people are stunned.
I agree that I don't need all of that stuff. But I do enjoy it. I like treating myself, I like buying a lacy pair of undies or a new bag. I am not going to limit myself by the amount of items I buy...I'm going to limit the amount of cash I spend. I mean, I'm sure I'd live if I got rid of all but one purse. But that's not me. And really, it isn't about the amount of stuff I have that's the problem (though I do have a LOT, and it's time to go through that and get rid of some of it. ) it's the amount of stuff that I buy at once...that adds up to the entire contents of my bank account in one trip.
That being said...I'm well aware that I don't HAVE to buy something just because I like it. Or even because I love it. I've been telling myself "Amber...you don't need that. You probably don't even really want it. you'll live if you don't buy it. Walk away...yes, walk away. There you go." Improvement, no? hahaha...I'd like to think that my newfound self control has more to do with a change in my lifestyle rather than the fact that I'm broke.
My game plan? Set a spending limit ($40 a month, that's $20 from each paycheck.), abide by it. If I really really want something and it's a little expensive, I'm going to sleep on it. Usually I'll be able to convince myself that I don't really want to spend that much money if I give it 24 hours. I'm also kind of a product whore (can I say that here?) which I need to get over. There's no reason to buy $18-$25 tubes of lotion when the cheap stuff is just as effective. There's also no reason for me to buy a new brand or line of stuff just because it's new...I also need to remind myself that the most expensive thing on the shelf is not always the best...and I don't need it.
And finally...it'll take some time, but my biggest issue is emotional spending. I really do get a kind of high from spending large amounts of money...and that's not cool at all. I need stop shopping when I'm unhappy...shops are the last place I need to be when I'm depressed. Kitchens come in second to last. Me unhappy in a clothing store is like a starving person grocery shopping.
I'm flattered that you took the time to give me great advice and share some of your personal experiences. You guys are great.
I get paid on Friday! And I'm taking out $20...that's it. I'm going to use my spare change (I have about $30-odd in a jar in my bedroom. Don't spend change...it's built up.) for buying a water or diet coke between classes...rather than spending cash. That should actually help me save money.
Heh, you know what really saves money? Bringing a water bottle and filling it up out of the water fountain. Your plan sounds good, good luck!
I like Dave Ramsey too. I've always been frugal and have never cared about clothes/make-up BUT I think we are discussing 2 issues here that aren't quite the same. This is rambling, but it just struck me as off point to advise someone where they should spend their money. The issue is whether a person can manage their money. If so, spend away wherever you want. Have you ever noticed how people have unique priorities in their spending? What I value (schools for my kids) isn't where some other people put their money (houses), but it doesn't mean I'm "right". I don't think people saying "I only have one purse." should be the standard for another person. I think we've all got priorities where we see the value in spending more/less. I just don't think I would tell someone not to spend a lot on clothes even if it isn't my thing. BUT, being in debt is a different thing altogether. My mother still tries to get off the phone quickly when I call because "long distance is expensive" (I've got unlimited cell phone minutes), but she thinks nothing of buying new clothes she doesn't wear.
Oh, and also, I regret being too frugal about some things in my life. We went cheaper on a house than we had to. In the long run, the home would have held its value better if we had bought something more expensive, but we were trying to be safe. Another memory is taking a trip to Kauai and not taking the helicopter ride because it seemed too expensive ($80? at the time, I think) In the long run, that was stupid. We had spent all the money to get there, hotels, restaurants, etc, not spending an extra $160 to have that memory was shortsighted.
I mean...I know you're right. But admitting you're right would have to mean I'm wrong...internal conflict. 
) it's the amount of stuff that I buy at once...that adds up to the entire contents of my bank account in one trip. 