Four Steps to Getting Your Finances In Order

organize-your-finances-friesGetting your finances in order feels so great.  Even if the picture is bleak, knowing where you stand always comes as a big relief.  You’ll probably spend less energy getting your finances in order than you do worrying about not knowing.

Ready?  Let’s do this.

organize-your-finances-branch1organize-your-finances-branch-2First, make sure you have easy access to your investment accounts.  These are your good news nest-eggs, and you want to make sure that you can keep an eye on them, and that they are invested according to your goals.  We have mostly high-risk long-term investments in index funds.  But if you are retiring sooner or need to access the money for a big purchase you will want to adjust those investments accordingly.  Also, review the fees being assessed to your investments.  If you are paying a money manager to invest for you, chances are you are paying more than you should be in fees.  Vanguard is a reliably low-cost brokerage where you can manage your own money in low-fee index funds.

Now make sure you can login to your credit cards, and take a look at all of your APRs, balances, and account fees.  These guys are the snakes, and you need to aggressively manage any debt you are carrying on credit cards.  If you have a credit card with a high APR could you use a balance transfer from another card to pay it down?  Sometimes if you call the credit card and request a lower APR they will be able to make that change for you over the phone.  Make a plan to prioritize debt payments to your credit cards, and set a realistic goal for when you can be credit card debt free.

Next, look at your savings.  What savings accounts do you need?  We have 529 savings accounts for our kids, plus a cash buffer savings account.  Most people suggest having six months worth of cash in your savings account.  If you have much more than that you are leaving money on the table; since you could be earning a higher return by investing that cash. Too little in savings, on the other hand, and you become too dependent on your paycheck arriving like clockwork.  Shit happens, and it’s best to have a pile of cash available to mitigate it.  How much can you transfer into your savings account each month?

Finally, budget.  Budgeting is a bear, but without it you have no idea where your money is going.  Because of my penchant for list-making, I like to get a big piece of paper and a beautiful pen and draw it all out.  Then I use Mint to categorize our actual spending against our budget.  Mint also keeps all of your accounts on one homescreen so it’s easy to keep tabs on your overall financial picture.  It is important to set a realistic budget, even if that means your ends aren’t “meeting” yet.  Once you have a realistic sense of what you are spending, you can start to set reasonable goals to trim expenses and change spending habits.

Doesn’t that feel better?  Now that you know, you can start setting realistic and measurable financial goals.organize-your-finances-pool-1

organize-your-finances-pool-2[images from The Art of Clean Up: Life Made Neat and Tidy]

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Visualization

visualtization

I spent an evening a few years ago with a life coach who teaches her clients to repeat this mantra to themselves: “I have plenty of money.  It flows into my life from expected and unexpected places.”

Have you ever used visualization or a mantra as a tool?  I have used it during things like walking across a log to cross over a river.  Fear would make me wobble, so I’ll tell myself: you are going to walk over this log gracefully.  Same with unscrewing caps; if I first tell myself that I can unscrew it, I do.  Maybe it wouldn’t be the craziest thing to use this technique for more exciting things than opening my salsa;)

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What’s Your Halloween Tab?

halloween-nesting-dollsHolidays are expensive, right?  Like for just about everything else, you have to pay to play.  I was reading this article that Americans will spend $7.4 billion on Halloween this year alone.  That’s a lot of stuff, a lot of candy, and a lot of costumes!

Our Halloween budget is coming in at $0 this year.  I have the outrageous luck that my kids just call my mom, discuss their Halloween costume dreams, and then she sews them and mails them to our house.  What???  It’s not even fair, I know.  Then we are so far out of town we don’t have trick or treaters, so there’s no candy to buy.  And we do have little kids, so we don’t have a bar tab.

If you are still costume planning, Oh Happy Day always features super cute and very simple costumes for kids around this time of year.  I would love to dress all of my kids up as these nesting dolls.

halloween-pinapple-costumeAs for me, if I was going anywhere, I would go as this pineapple.  Doesn’t that look fun?

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MOMO (Money Of My Own)

money-of-my-own-2

I am always curious how couples deal with joining their finances.  I think it’s interesting that most people I have interviewed on this site so far have joint accounts.

If you have a joint account for everything, you don’t have money of your own.  I have some friends who actually work odd jobs specifically to have under the radar, not-for-the-family cash.

At our house we only have joint accounts, but we also have a pretty strict don’t-discuss-it policy on each others’ purchases.  (This policy is unspoken, of course, as per our don’t-discuss-it ethos;)  This isn’t as unhealthy as it sounds; I mean, who wants to come home from either a dreadful errands-with-your-kids outing OR a fun shopping-with-your-sister outing and then have to re-hash the why and what of it?  Not me.

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So we make sure to be aligned on our overall financial priorities, and then we don’t talk about individual spending decisions.  This works for me since I am generally on the don’t-discuss-it side of any issue;)

p.s. I remember reading in the NYT after the economy crashed in 09 that the fancy ladies were starting to pay half cash for their luxury purchases, so only what they deemed was the defensible amount would show up on their credit card bill.  Such silly games we play to buy stuff we don’t even need!

[photos by the amazing Elise Joseph]

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How Did Your Garden Grow?

garden-grow

Despite over a decade of planting edible things, this was my first time having actual produce that we wanted to eat come in from my garden.  It was kind of fun!

We lost all of our cherry tomatoes, strawberries, raspberries, and most of our cucumbers to a local pest called ‘neighborhood children.’  They like to pretend they are orphans, surviving off of the bounty of my garden.

garden-peas

For the produce that I did bring in, I made friends with my freezer, rather than try to tackle canning anything.  Once winter rolls in I am going to feel very clever and thrifty with my freezer full of produce!

Next year I will plant tons and tons more flowers, and a big salsa garden.  And yes to more herbs of every kind.  Herbs are the magic.  And chips and salsa are also the magic.  Flowers, too, obviously magical.  I can’t wait already.

garden-flowers

Here is the recipe for the best salsa I have concocted so far:

Fill up a roasting pan (about 4 tomatoes worth) with a layer of tomatoes cut into 1/2″ slices.  Toss with olive oil, plenty of salt, and about 8 cloves of peeled garlic.  Roast at 250 degrees for about 5 hours.  Cool, then add them to the blender along with a big handful of cilantro, a big handful of lightly toasted pumpkin seeds, the juice of 2 limes, a pinch of salt, and 2 jalapeno peppers.  Blend it up, then adjust for salt.  So good.

garden-can

[flowers here, and the other pics from this is paper]

p.s. for real-life pictures follow me on instagram

p.p.s. another post on gardening

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