.. my journey to financial success

Having a steady job certainly is a good thing, especially in this economy. However, it never hurts if you take on an extra project on the side if it will help bring in some extra money that you didn’t have before!
Easier said than done, but the opportunities do exist to not only earn money, but develop new skills.
For example, I took on a web design project that focused entirely in Flash. I’ve never really programmed in Flash, but it was always something that I wanted to do. This project allowed me to learn more about Flash, while still earning a bit of money. Grant it, the money I made, $500, was not even equivalent to earning minimum wage per hour spent, but it provided an incentive for me to learn while earning money at the same time. This has also helped build exposure to future clients.
I would definitely encourage anyone to look around for opportunities to apply their skills. It could be as simple as enjoying the outdoors and giving hiking tours on weekends, or mowing a few lawns for neighbors that don’t have the time!

Finally I’ve updated the NetworthIQ account I’ve had for quite some time. It’s amazing how much it has changed and I’m so close to be in a positive networth I’m making the commitment to start updating it on a monthly basis.

I’m about to make a big move.. really big in the fact that I’ll be paying about $400 – $600 more in rent per month. Basically, I’m moving to New York City. I live pretty close by right now, but I feel the need and urge to move closer to the city. It’s an irrational need and thought I guess so I thought I’d share it here. Here are the pros and cons:

Cons:

• 400 – 600 more in rent per month (about $6k more/year!).
• Moving in with a roommate again..

Pros:

• Convenience to the city and work (i.e. no more +1hr commute back after going out in the city).
• Experience of having said that I actually lived in the city (I’m contemplating starting a consulting career in one year which might take me away on a regular basis).
• Splitting utility and cable bills
• Splitting some food costs
• Slight savings in commuting costs (only 1 monthly pass for the MTA)

I’m not sure if these make sense and worthwhile the $6,000+ annual expense given my current status.. It does seem quite irrational. I’ve tried to tell myself that I’ll start taking lunch more often to work and eating dinner at home on a regular basis to make up for the lost amount of money. I guess anything to convince myself that this is a change that needs to happen. In a month, this move will happen and I’m quite nervous so I thought I’d follow Kotter’s 8 Steps to creating organizational change and apply it to making this move:

1. Create a sense of Urgency
   • Done. I have to move out by the end of the month.
2. Form a Powerful Coalition
   • Need to work on this.. So far only my roommate
3. Create a Vision for Change
   • Trying to envision living in the new place and being a true New Yorker
4. Communicate the Vision
   • This post.. I’ve also been talking with friends
5. Remove Obstacles
   • Don’t talk to nay-sayers and come up with strategies to make the move have almost no impact (i.e. new ways to save/earn money)
6. Create Short-Term Wins
   • Start by making changes this week, lunch and dinner in everyday
   • Think about the new apt and all the pros
7. Build on the Change
   • Continue the short term wins and build on them every week to create new goals
8. Anchor the Changes
   • Turn these changes into long term habits by continuing to practice them

Well, that’s about it, off I go to work and to start my change process… 1 step at a time.
If you want to read more about actual organizational change you can check out Kotter’s 8 steps by clicking here.

We all find ourselves at some point in time stressed for time. Often that is due to overloading your schedule, having too many priorities, or as is often the case.. wasting time on things that are not that important.

One of the things that I waste much of my time on is TV and Hulu. Even though I only have basic cable, Hulu more than makes up for all the shows I missed. I’m addicted to TV you might say. I just love the feeling of sitting on my couch, dinner in hand, and watching a show. That being said, I often go beyond what one would consider normal. I watch TV and watch TV and watch some more.. In the end I neglect the important priorities in my life such as sleep, school, exercise, and friendships, just by watching TV. It is a huge waste of time, and starting today, I’ve decided to remove TV and Hulu from my life for a month. It’s already hard and it hasn’t been a day. However, I believe I can do this, and I’m putting it out there to keep myself in check.

I hope to see more time to actually do things that have priority and a significant improvement in my exercise plan. I’ll keep updating on the status of this new adventure.

I admit it, I used to check my email constantly throughout the day. The little email notification would pop up at work or at home I would hit refresh on Gmail whenever I was on the computer. This all changed recently when I started getting inundated with email for a class where I was a teaching assistant. It got to the point where I was anxious anytime I saw email in the inbox. This was not healthy and I decided to make a change. Instead of checking email everytime I am on the computer, I now check it at specific intervals. So in the morning and afternoon I check my email when I get in at 9 AM, 11 AM, 1 PM, 3 PM, and 4:30 PM before I leave.  In the evening I check my email at 9 PM and that’s it! It gets harder with a BlackBerry around, but I try to stay committed and I don’t get down on myself if I slip up sometimes.
It is amazing how much this change has reduced the stress in my life. Much like automating my savings goals, it has reduced my anxiety and made me more efficient in the process.

Well I am a week into getting a budget together. This part involves just recording everything that you spend your money on. I started with a small notebook, but that was  impractical as I didn’t have it with me always. Instead, I created a memo entry on my BlackBerry and I keep track that way. Each day I enter more information starting with the date then underneath all of the expenses for that day. Something like this:
2/1
3 – bfst
10 – lunch
…
The hard part has been to actually write down the expense. It takes some getting used to write it down, but once you get a hang of it, it becomes almost automatic.
I will update this post with the first weeks numbers.

I’ve seen quite a few blogs out there that have set SMART goals, meaning Specific, Measurable, Attainable, Realistic, and Time bound. There are different variations of what it means, but what it comes down to is creating goals that you can ultimately reach and helping you reach them by answering some crucial questions. This is similar to how I setup my 50, 30, 20 split of my income. Once it was set, it was easy to achieve because I knew how much to focus on them. I also put by each goal whether or not I am automating the process. I feel that is very important, it makes not seeing the money in the account much easier. I found this quote by Lord Kelvin, a famous scientist, to be quite useful – “If you can not measure it, you can not improve it.” So here we go..

My goals for 2010 (starting on Feb 1st 2010)

1.) Establish a $12,000 emergency fund by December 2010. Right now I’m at $4,300 and with bi-weekly $250 contributions I can reach this goal. (Automated)
Specific – Yes, an exact amount.
Measurable – Yes.
Attainable – Yes. I laid out the entire plan.
Realistic – Yes. I can save that much per paycheck.
Timebound – Yes. I set a deadline of Dec 2010.

2.) No Credit Card Debt
Specific – Yes. Currently I managed to payoff all of my CC debt with the exception of a self payment for previous.
Measurable – Yes. Pay off every month.
Attainable – Yes. Spend within my means and budget.
Realistic – Yes. I will always check for my balances and maintain to budget.
Timebound – Yes.. always by the end of the month “zero” out balances.

3.) Contribute 6% of my income to 401k Retirement Accounts (Automated)
Specific – Yes.
Measurable – Yes.
Attainable – Yes.
Realistic – Yes.
Timebound – Yes.

4.) Save $4,800 towards the eventual downpayment for an apartment/house (5 – 7 year goal) (Automated)
Specific – Yes. ($200/paycheck)
Measurable – Yes.
Attainable – Yes. Spend within my means and budget.
Realistic – Yes, at least according to my budget.
Timebound – Yes, 1 year then revisit. (this number might change according to how I can budget these numbers further.)

5.) Enjoy life and build some memories by taking some trips (total planned expenditure $2,000)
Specific – Yes.
Measurable – Yes.
Attainable – Yes. Budgeted, also “if” I do get a bonus this month then I will use a portion towards this goal. well no bonus.. guess I’ll have to find another way.
Realistic – Yes. I will always check for my balances and maintain to budget.
Timebound – Yes. By end of the year allocate $2,000 to a trip. *I already spent $1,000 of this money on a recent trip.*

6.) Create a budget, trim where necessary, and follow it starting April.
Specific – Yes.
Measurable – Yes. I will track my expenses thoroughly for the months of February and March to figure out the best allocation of money and where to cut back.
Attainable – Yes. As long as I always write down my cash expenses. Otherwise the rest of the purchases will be categorized on Mint.com
Realistic – Yes.
Timebound – Yes. By the end of March I should have a clearer view of my budget.

Anyway, these are my financial goals for 2010. I’m sure I’ll add some more goals as we move through the year, but I think it’s a good start.

What are your goals for 2010?

Well it looks like unemployment has reached 10.2% on 11/6/09, the highest in 26 years. There is one number that has been decreasing, initial jobless claims filed. What does this mean? Well it looks like companies are not laying off as many people, so new people are not filling claims at the unemployment insurance office. I’ve made a graph below from the Department of Labor statistics:

Initial Jobless Claims

Usually initial jobless claims have been a leading indicator of a turnaround in an economy and a recession. While this does not take the sting out of the current situation that we’re in (I might be on the chopping block for a layoff myself), it can hopefully bring some hope to us that things are slowly turning around. Remember that the unemployment rate overall is a lagging factor, meaning that it responds after the fact in a recovery. First, companies will have to start seeing a recovery in the market, followed by hiring, followed by lower unemployment.

Let’s all hope for the best and stop listening to the doom and gloom media reporters.

Sometimes I wonder what it is all for?
We strive to gather and gather.. and in the end we just have a bunch of stuff. Does it make us happy? Maybe, sometimes, temporarily.
I haven’t quite found out what it is that makes me always happy, but I do know of some things, which aren’t centered around spending:
- Watching a well made movie
- Creating a website/project just for the fun of it
- Being around friends and family and having a few laughs
- Seeing a little child laugh uncontrollably just by the mention of the word springy

I guess there aren’t that many things out there which involve the money or status in life.. but certainly a lot which make it not so happy. Financial worries etc..
So let’s all vote not to get in that boat. Make enough to live and to be happy; strive to get to that point of freedom. That day where you can just sit back in your chair and breathe out a sigh of fulfillment. That’s the day I’m looking forward to

I just transferred all my savings to Ally Bank (formerly named GMAC bank). They offered a great rate I couldn’t resist (1.78%) at the current time 10-10-09 and daily compounding! How great is that? My money and interest gets compounded daily so I earn more. Good bye ING Direct with your yet again lowered rate to 1.29%. Now I have an FDIC backed bank that offers me the same, if not better, service for greater benefits. I can still do my automatic transfers for my emergency savings and regular savings, and I still have my multiple accounts. Here’s to daily compounding