When I was seventeen years old I thought I was a grown up. My parents always attended church and they expected us to go as well, this didn’t sit well with me. I wanted to do what I wanted to do, not be told what to do.

I rebelled, I gave them a hard time at every turn. I was an arrogant seventeen year old but things came to a boiling point. My parents drew a line in the sand and said that if I didn’t obey the rules I had to leave, so I left.

I stayed with friends, sleeping on their couches. I hit up family members begging, they stood with my parents. I spent a few hard nights sleeping in parks and bus stops, I even stayed in a few homeless shelters. I definitely learned that I wasn’t all that I thought I was.

During this time I got two minimum wage jobs and ended up meeting my wife at one of the jobs, we were married three months later. We ended up getting our own place and I felt vindicated in my mind, I still didn’t get it.

Since I was so arrogant I didn’t heed any lessons from my elders, actually I didn’t listen to anyone. My wife and I made good money but I spent money like we were millionaires. I bought what I wanted and didn’t save a penny. (more…)

Tell me if this sounds appealing: you work hard and bust your but for 40 years or more, you then spend the next 20 years or so (if you’re lucky) living based off of what you saved and assuming you didn’t lose any of it in an unforeseen circumstance? This is what a typical retirement looks like, does this sound appealing?

Is this what you want?

Is this what you want? Before we go any further you should know that I’m not telling you to spend all your money and not save anything for the end of your life, that’s suicide. What I’m talking about is a little different strategy to truly enjoy your retirement but more importantly, enjoy your life.

Retirement is not what it used to be

It used to be you would work for a company for years upon years, when you were ready to retire; you would get a pension from that company based off of how long you worked there. In theory it was a great system, you would have guaranteed money coming in each month. The problem these days is with the demise of our economy, pensions are quickly becoming extinct. Most companies don’t even offer a pension anymore and the one’s that do are negotiating to get away from them. If our economy keeps deteriorating, I’m afraid people who are retired will lose that money they are desperately depending on. Don’t believe me? Ask anyone who works for Wonder Bread, they had union negotiated pensions but about 4 months ago, the company stopped contributing. Do you really think you can depend on this for your retirement? (more…)

Why are we so worried about what other people think about us?

This guy might be able to afford this

A few years ago I was at the height of my bread business. I had four guys working for me and the business was bringing in about $200,000 a year. Now, I want you to notice two important things right off the bat, I said I had four guys and that the business brought in $200,000, which is before expenses.

For me I thought I was Donald Trump, I would see the checks coming in every week and felt like I was rich. That summer we had just purchased our first home, and it was a decent, modest home. We already had two cars but they weren’t “good” enough for the money I was now making (or so I thought). So along with the house, I upgraded my car. I went out and got a brand new, fully loaded, Nissan Armada at the very low price of $55,000!

Since I was never really good with money, I was rolling in a lot of negative equity from other car purchases, which brought my monthly payment to $1200 a month to LEASE the car, it was only $1650 if I wanted to own it. My wife was totally against it, saying we couldn’t afford it, I convinced her with all the money I was making and going to make, we could lease for little while and then buy it outright. To this day someone should have drug tested me!!!! (more…)

You’re pretty smart so I don’t need to tell you that every single cent of your money counts!

Last year I had a work schedule where I wasn’t getting much sleep, so to keep me up I would get a Mountain Dew from the gas station from time to time. Now, it started out as a way to keep me up but quickly moved into a bad habit that I did even when I wasn’t working. As you probably already know, Mountain Dew can be addictive. I would buy a 44oz everyday at the cost of .83 cents, not that much money right?

There probably are little things that you spend money on everyday that you don’t even give a second thought to, they cost the same amount of money that you would find in your couch cushions. You can see where I’m going with this, all those “little things” add up to a good amount of money in the end, money you could use for a number of different goals and dreams.

Do you have an emergency fund set up? Could you if you cut out all those little expenses? I talk about an emergency fund in more detail here: http://talesofwork.com/blog/2012/01/living-paycheck-to-paycheck/, it’s worth a read. I know it can be hard sometimes at work when you get hungry and you just want a little snack from the vending machine and you have two bucks in your pocket, as hard as it is, it could pay off greatly if you resist the temptation. If you’re self employed like myself the temptation comes in the way of buying fast food, it’s so much easier to just pull in the drive through at McDonald’s and buy a quick-lunch, you don’t even need cash anymore.

The Problem:

If you have a goal to get out of a job you don’t love or to move onto something or somewhere you’ve been dreaming about, then every little candy bar or trip to a fast food place delays that dream. Think about what that .83 cents adds up to in a year: $302.95. Or how much does that fast food add up to, even if you’re only going one or two times a week? In order to move forward you’re going to need money to make it work, in order to be a little more secure, you’re going to need some money as an emergency fund. That $302.95 could be the start to my emergency fund or yours.

So how can I put a stop to this?

Remember back in the day when your mom use to pack you a bag lunch for school? As you know, you can pack a lunch for work and put more than your lunch in that bag, have a whole bunch of little snacks in there for you. I really didn’t need that soda everyday to keep me up, buying some healthy oranges gives me the boast that I need at a way cheaper price.

You have to realize that it’s all connected:

If you cut out getting fast food or cut out that soda or that candy bar or whatever little thing you’re into, what do you think the results would be? You would have more money in your pocket but you would also cut out the junk from your eating habits. You would then lose a little weight and feel a lot better. I felt like I needed that soda but after a month of not drinking it I felt like I had as much energy as my kids. You see how one area affects another?

A small challenge for you:

Actions speak louder than words so why not test out my theory. For the next month try to not spend money on even the smallest items at work or even in your home life. See if you have more money and check the scales to see if it helps your weight. If I’m wrong you’ll have more money to spend when you go back to buying  junk. Can you try this for just one month?

I hope you decide to take me up on this challenge, I think if we band together and try this we can be each others support system. You’re here reading this blog, probably because you’re pursuing your dreams, trying to move onto work that you love, cutting out the little stuff and saving that money will help you get closer to those dreams!

What are some little things you struggle with? Be honest and let us know in the comments:

I’m going to let you in on a little secret about my past, back in the day I was able to do a little magic! Alright let me be honest, it wasn’t exactly magic but I’m talking about writing magical checks that “floated”.   What?

Don’t act like you don’t know what I’m talking about, “floating” a check was when you didn’t have the money in your account to cover that check but a bill was over due, so you sent the check out anyways hoping you would be able to deposit your paycheck before that check cleared. Like I said, magic (Ha!). For me those days are over and I hope you either have never done this or are in a financial position where you don’t have to do this anymore!

The reason I had to do this was because I was living paycheck to paycheck.

I had no kind of savings and even the smallest unexpected circumstance would have ruined my life! I don’t think I need to tell you that this is no way to live, you must have a little cushion for all those unexpected things life will throw at you. So be honest with me (and yourself), how much money do you have saved in case of an emergency? If something happened now,  car repairs, broken water heater, or any kind of mini disaster, how would you make it?

Many people and families have fallen apart over shoty finances, so we have to have a back up plan to fall back on, here are a few thoughts that hopefully will be a help in this regard:

1. You need an emergency fund! I’ve hit on this already a little but let’s get specific. The experts will tell you to have at least three to six months worth of your expenses, if you can do this, great! For myself (and maybe you) this wasn’t a reality right away. So I took Dave Ramsey’s suggestion and set aside $1,000 as a small, starter emergency fund. Three to six months would be great but my financial situation was not healthy enough to hit that right away. I liked the idea of $1,000 because it was attainable and it would cover 90% of emergencies that would come up. Maybe you can’t get $1,000 right away but start with $100 and work your way up to $1,000, a week at a time, you’ll get there eventually.
2. Cut out excess spending and pick up extra work: Do you have to have those three soda’s everyday at work? Do you have to go get fast food for lunch? Do you really need a bigger TV just because it’s on sale? You know there’s junk you can cut out of your life right now that could enable you to get that emergency fund saved, right? CUT OUT ALL THE UNNECESSARY STUFF FROM YOUR LIFE! Also, if you’re having trouble saving up a little extra, why not pick up some overtime or some odd jobs? There’s a wealth of untouched opportunity because people think certain things are below them. How about cutting grass, shoveling snow, cleaning houses or any kind of odd job to make some cash? Most people think they’ll be fine and won’t do these minimum jobs but you can and use this money to build up your emergency fund!
3. Make this a way of life: I’m sure even before you read this blog post you knew that living paycheck to paycheck was stupid, this isn’t new information. So the question is why then don’t we have an emergency fund already? Whenever we want to accomplish lasting change with anything in life the best way to do it is to make it a habit, quick fixes don’t work. So with finances it can’t be about saving a couple hundred bucks and going back to the same old life style, it won’t last. We have to form a habit of saving money, watching how we spend our hard-earned money and thinking about our financial future. The best way to do any of this is to take it step by step. Cut out that soda, put that money you would use on it in a jar somewhere. The end result will be habits that also affect other area’s of your life. If you cut that soda out you’ll lose a little weight, once you lose the weight you be more active with family and friends, you see how that works. Come on, you know I’m right, give it a try!

The key to getting an emergency fund and creating habits that will change your life is to take the first step. So when you get your paycheck this week, set aside a little money for your emergency fund, it could change your life forever. Once you make a little progress don’t be happy with making progress, don’t get complacent. Move forward towards your goal and don’t stop until you’ve changed your life and no longer fear the unexpected. The best way to combat the unexpected is having and sticking to a well thought out plan.

How’s your emergency fund looking? What are you going to do about it? Let us know in the comments: