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Confessions of a Checking Account.

September 3, 2009

Last night, I finished reading Confessions of a Shopaholic. Granted, it’s not the most stimulating literarture on the planet, but it had its merits. Namely, it fouxed on a very real epidemic infecting millions of people around the world: spendtoomuchicitis.

It’s running rampant, especially in those under 50, with a heavy presence in the “just-out-of-college-with-a-credit-card” demographic. It’s tragic, really, the lives ruined by spendtoomuchicitis. There’s not much that I have done to prevent my own diagnosis, but I am working hard on the remedy.

Truth is, I have never been that great with my finances. Terrible, actually. My dad is probably laughing as he reads this. If that man had a blog… hoo boy… you probably would not see much of me anymore! Anyway, I keep trying to change, or at least I’m saying that I’m trying to change, but for some reason I always seem to not do too well. The only reason I have been able to not be evicted from my wonderful life in New York City is because 1) I actually do have a job 2) I pay my rent and utilities in full and 3) I make just enough side income that I can afford to pay slightly more than the minimum on my credit card balance every month.

Eeesh.

My emergency fund is barely existent (I believe we’re in the “blastocyst” phase) and the only reason my credit card debt came down even a tiny bit is from a little thing I like to call SELLING MY CAR FOR THOUSANDS OF DOLLARS. You see where I’m going with this?

Well, I have finally decided enough is enough. I HAVE to start tracking my funds. It’s like logging your blood sugars. You may know where you are on any given day but do you really know WHY? Do you have any semblance of an idea how you got there and what you’re going to do about it to either keep it that way or fix it? Either way, it’s logging numbers. And I HATE that. But this is the price that you have to pay when you want something.

As far as the book is concerned, it’s cute and funny. It’s very blog-like, actually, but not poorly written like some rambling memoirs tend to be. And it’s NOTHING like the movie. But I also liked the movie. But the only thing that was the same, basically, are the characters’ names. The plotline is entirely different. I liked both though, so if you’re looking for an easy, fun read or a cute chick flick movie for a Friday night with the girls, I highly recommend it.

They actually might motivate you to change your life.

13 Comments
  1. Micah permalink
    September 3, 2009 1:43 AM

    I would recommend checking out mint.com for help with this. Although it’s a bit of a leap to hand over all of your bank account information to them (a requirement of creating an account), they provide a really intuitive means of budgeting and managing expenses. Since the website interfaces directly with your bank, all of your transactions (e.g., credit card charges, checks written) are automatically logged — it just takes a small amount of effort to re-label and categorize them. I spent my college years (through this past May) painstakingly logging all of my expenditures by hand, but now that my finances are much more complex I’ve found mint.com to be a tremendous help in keeping everything organized.

  2. September 3, 2009 10:25 AM

    I use a simple Google Docs spreadsheet to track every single expense, with a tab for each month. I save every receipt and enter it as soon as I reasonably can. Then I always know where my account stands and how much I have to spend. You could also add a category indicator of some kind (eating out, medical, clothes, whatever) to see what category is the greatest drain.

    An idea that my husband and I try to keep in mind is to “pay yourself first”. Just make sure that you put away some money first and then see what you have leftover to spend. One thing my husband does is that every month he gets a $50 savings bond cut directly out of his paycheck. It’s automatic, so we don’t even “see” the money that we spent on that, it’s already taken out. Plus it feels like a cool bonus to get a $50 bond in the mail. =)

  3. September 3, 2009 10:48 AM

    Yes, Mint.com! It will change your life for the better.

    • September 3, 2009 10:58 AM

      I tried Mint.com and it didn’t work for me. It didn’t seem to update my accounts fast enough for it to be that reliable. I also don’t like the fact that I have to go in and relabel something when the whole point is to have it be automatic. I might as well make my own labels and set things up the way I want, rather than having to work around an existing system. I think I found an Excel spreadsheet that works for me, and automatically makes adjustments to tell me how much money I have left in my monthly budget. I’m glad Mint.com works for so many people. Maybe if I gave it more time or maybe it has changed, but I did not like it when I first tried it. I still have the weekly account summary emails sent to me, and they are usually wrong when it comes to what is in my balance. Maybe it’s because I haven’t logged in, but I would think having given them my account information they could keep at least that straight.

  4. September 3, 2009 11:46 AM

    I’d highly recommend looking into using Quicken software. I’ve used it for years and it makes things so much easier when tracking finances. You can download directly from your bank and credit card sites into Quicken to keep everything together in one place and up to date. You can also set up categories to track everything, and schedule reminders for bill and cc payments so you don’t forget. Also, you can set up a budget and it shows you a comparison of your actual spending to budgeted amount. There are a ton of features to this software but I just use the basic ones and wouldn’t know what I’d do if I had to track things manually. And I believe it also can help you with all the information you’ll need for your taxes, but I haven’t done that yet. Whatever method of tracking you use, the key is to stick to your budget and adjust if you have an unexpected purchase…it’s not easy and takes willpower. Best of luck to you in the tough area of finances.

    • September 3, 2009 11:51 AM

      I’ve heard good things about Quicken, but I didn’t want to have to purchase anything (I’m broke, hence the new-found commitment to budgeting!). Right now, the Excel spreadsheet does that whole budget vs. spend stuff, which is very interesting to look at and is helping me figure out places where I can cut back. I don’t really need any help with bill pay because I don’t have any bills! I pay back my roommates on the 15th of every month for cable and electric, and rent is the first of the month, so those are pretty easy to remember. I pay my AT&T bill pretty much whenever I get around to it during the first half of the month, and I pay my credit card on an ongoing basis – basically, whenever I have money, I transfer it over since my checking account and credit card are both through Bank of America.

      I have a feeling though, once I get married I will want a more sophisticated system because I’ll be having income coming in from two sources and I imagine that would get very crazy. So far I don’t mind manual, but I have only been doing it for a couple of days. There is something comforting about having to pay close attention though. We’ll see how it goes!

  5. September 3, 2009 12:25 PM

    There’s a great show on Canadian television called Til Debt Do Us Part. It’s geared more toward couples in debt, but the concepts can be applied to anyone. The host shows the couples just how much more than their income they are spending on a monthly basis (usually thousands more), calculates how much debt they will be in if they keep up their spending habits 5 years from now, and takes a bootcamp approach to helping them pay down their debt and actually get a savings account started. My favourite concept is money jars – after all fixed expenses are subtracted from their income (including a portion going toward savings/emergency fund), any money left over for variable expenses is divided into money jars on a weekly basis (jars for food, transportation, entertainment, clothing/gifts, and other). Only the money in the jars can be spent, and the receipts from whatever is bought must be put back in the jar so that at the end of each week, the money left and receipts must total the money at the beginning of the week and they have to log the receipts into a ledger (like tracking blood sugars!). Anyway, some of you with satellites in the US might be able to catch the show (it’s on the Slice channel)… it’s well worth checking out if you can, there are some good ideas for getting your finances in order.

    • September 3, 2009 12:43 PM

      I read a ton of personal finance websites, and they recommend the envelope system, which is very similar to that jar system. Though I imagine it’s easier to get money out of an envelope than a jar! I actually prefer using a debit card and keep track through online banking, mostly because I usually end up not knowing where any of my cash went. I’m also horrible with keep track of receipts, I tend to lose them even when I’m trying to save them!

  6. September 3, 2009 12:55 PM

    The money jar system is to get the participants of the show used to the idea of spending within their means. Using a debit or credit card (which the host actually makes most of the participants cut up), it can be too easy to take the card out and buy whatever you want (which is the problem these people are running into). By having cash, you have the visual of ok, I only have $20 in my hand, that costs $23… I guess I’ll have to wait until I get that extra $3 to buy it.

    But yeah, jars, envelopes, whatever… it’s all the same idea!

  7. September 3, 2009 1:41 PM

    Great book! The whole series is great. I’m horrible with my finances too. Although, I know I’ve suggested it before, I am starting to listen to Dave Ramsey and I’m currently taking a class (through his company) called Financial Peace University. I’m loving it.
    And, from personal experience, the envelopes WORK!!!
    Good luck!

    • September 3, 2009 2:34 PM

      Yep, I still have the workbook you sent me, which was cool, but a little too long for me! I don’t think I would be able to keep track of what money was from what envelope. And what if you had money on you from one envelope but not another? And what happens if you forget to bring money with you? Sigh.

      • September 3, 2009 4:09 PM

        You can spend money from the other envelopes, it’s more of a budgeting tool to get people to realize that you should spend X percent on food, etc. The goal is to not spend more than the cash you have.

        There are full episodes of the show I mentioned above online:

        http://www.slice.ca/Shows/ShowsPage.aspx?title_id=93097

  8. sugar&spice permalink
    September 11, 2009 9:51 AM

    I use cash to buy everything, it’s the only way I can control what I spend! I find with a credit card it was so easy for me to imagine it wasn’t really my hard-earned money and I ended up with a massive debt. After paying it off I’ve completely changed my spending habits. Using cash has made me more aware of the money I spend, although I still have trouble when I see a gorgeous new pair of shoes the exact same colour as my favourite dress!

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