A Bodey in Motion

Building momentum, one step at a time

Quick Hits: No credit score isn’t such a risk. Online predators not so common. The hammock bathtub.

  • If you have children, then the ever-present fear of sexual predators might be a problem for you. We want to protect our children from the pedophile hiding under the bed, or on the street corner, or behind the computer screen. It’s likely, though, that that fear is just a touch exaggerated. For example, a few years ago, a study showed that despite social networks online being populated more and more with kids, most of them still resembled your everyday real world community – “comprised mostly of good people who are there for the right reasons.” Child predators were actually few and far between. Bullying was more of an actual concern. Facts put fears into perspective, which is a good thing, because our fears about our kids are starting to hurt them. Fact: Sex Offender Registries are listing more and more teenage children (and even some pre-pubescent kids) who are haunted for the rest of their lives due to a moment of foolish sexual indiscretion.

September 20, 2013 Posted by | Quick Hits and Links | , , , , , , , | Comments Off on Quick Hits: No credit score isn’t such a risk. Online predators not so common. The hammock bathtub.

Don’t Be Lazy! Get Up and Make Your Money Work

I’m starting a new series of posts today. I’m calling it the “ABCs of Personal Finance.” The word for the letter A is Action, because succeeding with money in your home requires action. Your financial situation isn’t going to get any better while you sit idly by and ignore it. So, it’s time to get moving and make some changes. Ready?

He sure looks comfortable, though. Poking him with a stick might be a bad idea. Like irritating my wife before her morning cup of coffee.

  • INCOME – GET TO WORK. Everything worth doing is going to be hard and take a lot of effort. If you want a career that gives you a sense of purpose and pays you well, you’re going to have to take action.
    • Truth: Any job that you can get with a 10 minute interview in a booth at a fast food restaurant is unlikely to pay a lot, and will never be a great career. If you want a bigger paycheck, you have to make yourself more appealing to better employers, and that takes work.
    • First Step: Start Reading. Read books written by the best in the business you want to be in. Read classic business books. Read books about how to get a better job.
  • BUDGET – MAKE A PLAN. Having any income is great, but paychecks have a nasty tendency of looking bigger than they actually are, and spending more than we make has become a national crisis. Planning is an essential part of winning. Even if this month’s budget fails, you learn and fix what failed next month. If you’re not budgeting, you’ve robbed yourself of that opportunity to improve. Take action and give every dollar you make a purpose.
  • GROW – SET GOALS. Once the income is coming in and the bills are all covered, it’s tempting to breathe easy and relax. That might work, if all you ever want to do is just cover the bills. If you have bigger dreams, if you ever want something more than what you have right now, you have to make conscious decisions about how to get there and set some goals. You have to take action.
  • FIGHT – DON’T GIVE UP. Remember, everything worth doing will be hard and take a lot of effort. It’s going to be tough, but as long as you’re breathing, there is always hope.
    • That job may be all you can get right now, but it’s not forever.
    • That budget may be so tight it scares you, but it’s a start.
    •  That goal may seem so out of reach, but you’re still growing.

What do you think? What parts of your finances could use a little less conversation and a little more action? Did I cover it all or miss something important? And what should be my word for X? Let me know in the comments below!

[image from publicdomainpictures.net]

September 17, 2013 Posted by | Work and Money | , , , , , , , | Comments Off on Don’t Be Lazy! Get Up and Make Your Money Work

Quick Hits: Ask about their story. Destruction can be creative. Small kayak, big fish.

  • [Insert Alt-Text Here]Even on our worst days, we’ll probably meet and briefly interact with somebody new. In most cases, they’ll be there for just a few moments, a few words and maybe a smile will be exchanged, and then they’ll be gone and forgotten. That’s normal, but it’s also a shame. Right now, sitting in this restaurant with my headphones on, I can see five people who I don’t know. Two of them I’ve spoken to. One took my order, the other handed me my food. I only know one of their names, because I read the tag on their chest (Vivian). But each one of them has a story to tell about their life, and I’ll probably never hear it, unless I ask. Why don’t I ask? Do you? What’s your story?
  • There is a concept in economics called Creative Destruction. Broadly speaking, when a something is destroyed, its resources are free to create something new or make something better. Maybe even several things. For example, when Borders went bankrupt a couple years back, their books, furniture, fixtures and equipment were all sold to other people who put them to use. Their employees all temporarily lost their income, but they had the opportunity to seek other, maybe better, employment. It goes deeper than just business, too. Seth Godin says that a revolution destroys the perfect to enable the impossible. Cory Doctorow says that every act of making begins as an act of unmaking. Think about the areas in the world around you that are showing their wear. The institutions and traditions that aren’t quite hacking it anymore. Think about your personal life. The failures and pain that haunt you and you pray would just go away. What could arise from the ashes of these things if we just. let. them. die?

September 12, 2013 Posted by | Quick Hits and Links | , , , , , , , , | Comments Off on Quick Hits: Ask about their story. Destruction can be creative. Small kayak, big fish.

5 Steps to Make a Budget That Works

Sitting down to write your first family budget can feel overwhelming. Like you’re attacking a wall of expenses.

I'll need to use this graphic again. That was a lot more work than I expected.

Facing a wild mix and match pile of costs like that, and feeling sure that you haven’t even thought of all of them, can make most normal people stop, drop their pencil, and walk away. Let me tell you, I have been there and I understand. You have my sympathy.

As a financial coach, though, I’m not going to let it end there. You have a responsibility to manage your money, and ignoring that is just going to make things worse. Walking away is not a realistic option. You need to scale that wall, climb that pile, and overcome your fears and frustrations about budgeting.

Like any problem that seems overwhelming, the answer is breaking it up into smaller steps.

Step 1: Determine Your Income. For most of the five people reading this, that’ll be easy. A fixed, regular income is still pretty common. How many paychecks are you going to receive in the next month? Total those up, write down the number, and label it “INCOME.” Done.

If you’re one of the lucky few who receives an irregular income, this seems like more of a challenge, but you can’t skip this step. The best general advice I have is to take your worst average month’s income and use that as a baseline to budget from. If more comes in, excellent! You can put it to use in one of the next steps.

We can’t spend more than we have coming in, and we need to put every dollar to work, starting with…

Step 2: Pay for Your Necessities. Your first priority is to take care of those things that keep your household functioning. I’ve covered this ground before, in explicit detail, so I won’t spend a lot more time on it. The big point of this step, though, is to make sure that you have enough income to cover the basics, and see for yourself how much is left over once those basics are covered. In most cases, that margin way bigger than you’d think.

Next…

Step 3: List Your Goals. What is it that you want to do with your money? What’s on the top of your list? Do you want to pay off debts? Save up a cushion for emergencies? Invest for the future? Build up a college fund? Go on a huge vacation? I know the order that I’d advise you to do them in, but ultimately you get to make the decision. So, pick one.

You’ll be using the margin you have from Step 2 to fund this goal (including any unexpected irregular income), but you have one more step before you’re ready to go…

Step 4: Say “No” Everywhere You Can. That big goal, and all of those necessities, probably didn’t account for every expense in that massive wall from before. For everything that’s left, you have to ask yourself this question: “This month, is this thing more important than reaching my goal?” For a lot of items, the answer will be a frustrating “Yes.” For example, you might find that the pets get a little bitey if you don’t feed them often enough. Not to mention that your children do need new clothes now and then. And it’s really hard to say “No” to debt payments.

Still, there will be a bunch of things you can say “No” to. Like Cable TV, or eating out. Plus, it gives you the chance to take a hard look at how much you’re spending on those “Yes” items. Maybe your kid doesn’t need new school clothes from the mall. Who knows? You might even find a few ways to cut back on your necessities.

By now, you should have a budget that works for the upcoming month. Finally, you get to…

Step 5: Do It Again Next Month. There is no such thing as the perfect budget. Every month is different, and every month’s budget should reflect that. Each time you sit down with a pencil and write it out, you give yourself the opportunity to learn from mistakes and develop good spending habits.

This isn’t a one time deal. It’s a lifetime deal.

What do you think? Did I skip a step? Let me know in the comments below!

September 10, 2013 Posted by | Work and Money | , , , , | 1 Comment