Finance and Fat

One of the great things about writing this blog is having a public place to post my goals and easily review my progress each month (also publicly). I started 2008 with 2 ‘big’ goals and 5 ’small’ goals. Here is a look at our progress so far.

Big Goals

Pay off all Credit card debt - I started the year with $18,504.78 in credit card debt. After 3 months I have $16,381.98 for a reduction of -$2,122.80 in 3 months ($707.60 per month). At that rate it will take about two years to pay off the credit cards. That still isn’t fast enough, but the pace is improving over the last couple of months. With 9 months remaining in 2008, I need to average about $1,820 principal paid per month for the rest of the year. It’s amazing how short the year feels when I look at it this way, but I still think I can get this done.

Get body fat percentage under 25% - I started the year with 39% body fat according to my new scale (the absolute accuracy of that may be debatable, but this is my baseline number). As of my last weigh-in for March, my body fat was 36.6%. That leaves 11.6% to lose this year, which means I need to average 1.29% lost per month for the rest of the year.

Small Goals

Increase the emergency fund to $5,000 - I set up an auto-transfer of $150 from every paycheck to the emergency fund. That alone is almost enough to reach $5,000 ($3,900 from the transfers). As of today, the emergency fund is still under $1,000, but that is due more to me moving some accounts around and taking some money to prepare to pay some taxes.

Earn $20,000 (gross) from side businesses - I consider any money we earn outside of our regular ‘day’ jobs to fall under this category. For me, this would primarily be freelance web development work and websites; for my wife this would mostly be tutoring and test scoring.  We have earned $2,699.55 toward this goal through March. Still behind the pace we need to be at, but we are getting closer.

Start a Roth IRA with at least $1,000 - Done! I opened a Roth IRA with an auto investment of $100 per month. I will attempt to fully fund this later in the year, after the credit cards have been paid off.

Buy life insurance - Still have the quotes, need to follow up with our insurance agent.

Write a will - Nothing done with this yet. I want to do it, but our financial lives are so simple and our assets so small this is a low priority.

That’s it for 3 months into 2008. We aren’t off to an amazing start, but we still have a decent amount of time left (although time seems to be going faster and faster), I still think we can accomplish these goals.

One of the greatest things about writing this blog is having a public place to post my goals and easily review my progress each month (also publicly). I started 2008 with 2 ‘big’ goals and 5 ’small’ goals. Here is a look at my progress so far.

Big Goals

Pay off all Credit card debt - I started the year with $18,504.78 in credit card debt. After 2 months I have $17,364.96 for a reduction of -$1,139.82 in two months ($569.91 per month). At that rate it will take almost 3 years to pay off the credit cards! Obviously that would be a huge failure given the goal to pay off the credit cards this year. With 10 months remaining in 2008, I need to average about $1,736 principal paid per month for the rest of the year. That is still possible and I think it can be done, but time is running out!

Get body fat percentage under 25%  - I started the year with 39% body fat according to my new scale (the absolute accuracy of that may be debatable, but this is my baseline number). As of my last weigh-in for February, my body fat was 36.7% for an average of 1.15% lost per month. I need to average a little under 1.2% lost per month so I am just about right on track for my goal this year.

Small Goals

Increase the emergency fund to $5,000 - I set up an auto-transfer of $150 from every paycheck to the emergency fund. That alone is almost enough to reach $5,000 ($3,900 from the transfers). As of today, the emergency fund is at $875.11. That is lower than last month, but not because I have been spending the money, I am just changing accounts so some of the money has a different name now. I will be building the fund back up soon.

Earn $20,000 (gross) from side businesses - I consider any money we earn outside of our regular ‘day’ jobs to fall under this category. For me, this would primarily be freelance web development work and websites and for my wife this would mostly be tutoring (at least for now).  We have earned $1,722.59 toward this goal through February. We need to pick up the pace here, but I anticipate a couple of larger projects to come through later that will get us most of the way there.

Start a Roth IRA with at least $1,000 - Not yet, but soon!

Buy life insurance - Still have the quotes, need to follow up with our insurance agent.

Write a will - Nothing done with this yet. I want to do it, but our financial lives are so simple and our assets so small this is a low priority.

That’s it for 2 months into 2008. We aren’t off to an amazing start, but we have 10 months left so there is still plenty of time to achieve our goals.

One of the great things about writing this blog is having a public place to post my goals and easily review my progress each month (also publicly). I started 2008 with 2 ‘big’ goals and 5 ’small’ goals. Here is a look at our progress so far.

Big Goals

Pay off all Credit card debt - We started the year with $18,504.78 in credit card debt. After 1 month we have $18,034.11 for a reduction of -$470.67. At that rate it will take us more than 3 years to pay off our credit cards! Obviously that would be a huge failure given our desire to pay these off this year. With 11 months remaining in 2008 we need to average about $1,640 per month of principal paid. That is still possible and I think we can do it. It will require a little more dedication to frugality and some more efforts to earn extra money.

Get body fat percentage under 25%  - I started the year with 39% body fat according to my new scale (the absolute accuracy of that may be debatable, but this is my baseline number). As of my last weigh-in for January, my body fat was 37.6%. I need to average a little under 1.2% lost per month and I exceeded that in January so I am on track for this goal. I expect it to get more difficult the closer I get to 25% so I do need to increase the intensity if I want to be sure of reaching this goal.

Small Goals

Increase our emergency fund to $5,000 - I set up an auto-transfer of $150 from every paycheck to our emergency fund. That alone will put us close to $5,000 ($3,900 from the transfers). As of today, we have $1,372.07 in emergency funds. If we can hold steady, we will reach this goal in 2008.

Earn $20,000 (gross) from side businesses - I consider any money we earn outside of our regular ‘day’ jobs to fall under this category. For me, this would primarily be freelance web development work and websites and for my wife this would mostly be tutoring (at least for now).  We earned $860 toward this goal in January. If we stay at that rate every month we will only get about half of the way to our goal so we need to find ways to increase these earnings soon.

Start a Roth IRA with at least $1,000 - We have done nothing with this yet. I don’t expect to look at it until the credit cards are paid off.

Buy life insurance - We haven’t made the purchase yet, but we did get some quotes and will likely get this done soon. I know, waiting isn’t smart, but we’ve gone this long without we can hopefully survive a few more weeks or so. 

Write a will - Nothing done with this yet. I want to do it, but our financial lives are so simple and our assets so small this is a low priority.

That’s it for the first month of 2008. We aren’t off to an amazing start, but we have 11 months to get things done so I feel pretty good about our prospects for success.

Start now. That is the best advice I can give for anything you want to change about your life. No matter what it is you want to do, take at least a few minutes today to do something that will get you started on your new plan.

I have lost 18 pounds since I started this blog in September. I still have plenty of pounds to lose, but I woke up feeling good this morning- I feel lighter and the same clothes that were a tight fit a few months ago are loose and will soon be too big. I would not feel this way today if I hadn’t made the effort back in September to start something. I started small, only trying to walk for 5-10 minutes  per day and limit my calorie intake, but that was what I needed to get the ball rolling and start building momentum.

Setting a goal to walk for only 5 minutes may seem somewhat small and meaningless, but if you are coming from walking 0 minutes per day, 5 minutes is a huge improvement. The point is, no matter what the situation or what your goal is, changing your life can start today and it can start with something small.

Choose something you know you can do. Don’t wake up one day after months of inactivity and decide that you will jog for 30 minutes and lift weights. That is not realistic! Diets can fail for many reasons, but I believe the problem with a diet is the difficulty of making massive changes overnight. You aren’t building new habits if you take that approach. You are trying to force yourself to behave in a new, uncomfortable way- the odds of success are very slim.

No matter what you want to change in your life, I encourage you to start it now. Take the time to write down your long-term goal (perhaps losing 60 pounds or paying off $25K of debt). Think about where you are now and think about what you can do now (or at least today). Choose something that you can take care of in 5-10 minutes. It could be something simple like walking down your street and back, making an extra payment on a credit card, starting a budget, or getting a how-to book at the library- whatever you can do today, in a short amount of time, that will start you down the path to reaching your long term goal.

Decide what you will do today, then do it today and repeat it tomorrow.

There will be setbacks, there will be days you fail to keep up the pace, but the point is to build new habits. After a few weeks have gone by you will find yourself with a new point of view and that long term goal will seem a little bit closer.
Start now!

I didn’t mention it before, but I got a raise at my day job about 2 months ago. It wasn’t huge, about 7%, but I’ll certainly take it. By the way, I started by asking for 15% so either money is really tight at work or I’m being phased out. 

Anyway, the point is that I made no plans of what to do with the extra money except to ‘pay it toward debt’. I’m pretty good about sending all excess money each month toward debt payments, but I also want to protect myself against spending inflation thanks to my now higher earnings so today I set up an auto-withdrawal to my long term emergency fund account. I left a little extra on my new ‘take-home’ pay (what gets deposited in my primary checking account) and sent $120 to my emergency fund. That will put us very close to the new emergency fund goal by the end of the year and as I also hope to have the credit cards killed off later this year so I will be able to finish funding the account then.

You’ve heard it before,  but I’ll say it again, paying yourself first is always a good thing. If you find yourself fortunate enough to see an increase in earnings this year take the time to actually DO something with the extra money rather than just giving it a general purpose or category in your head. Directing it to another account immediately will allow you to easily continue your lifestyle and start saving for something important.