In the past month or so, I started playing basketball again. I say again because I grew up playing basketball, played it all the way through high school, and continued to play for fun for several years after that. Of course, I was in great shape back then. Sadly, for the past three-and-a-half years, I’ve lived an almost entirely sedentary lifestyle where playing basketball is almost as crazy for me as running a marathon.

Fortunately, I have a friend who lives about a mile away and we have a school nearby with two basketball courts. We decided to start playing to get back in shape. Even though it’s only the two of us playing 1-on-1, the amount of exercise in one hour of playing is tremendous. I felt like I was going to die the first day we played. I was completely winded after a few minutes and I was sore for days afterward. I’ve continued to play though, and I feel more energetic every time we go. I think it’s making a huge difference for me.

So, while all of that sounds great, I did have one small obstacle to clear in order to play more frequently and to enjoy it more. When I started playing again, I only had one good pair of basketball shorts and only two t-shirts that were comfortable and fit me well. That may not sound like much of a problem, but when you’re busy working and trying to fit in a game of basketball at the end of the day, you don’t really have time to manage your laundry. Wearing clothes that are too tight or a little old and worn out, even just for exercise, doesn’t make you feel very good about what you’re doing and can make skipping a day a bit easier than it should be.

To solve this problem, I went out and bought three new pairs of basketball shorts and five new t-shirts. I made sure they all fit me well, looked good, and made me feel good wearing them. I spent about $90 for my new basketball wardrobe. I know this probably sounds trivial, but it really makes a big difference. I look forward to playing more now because I can put on the clothes that make me feel like an athlete again. Sure, I’m still fat, but at least I’m dressed for getting fit.

I value saving money and being frugal, but you’ve got to be prepared to spend some money to set yourself up for success and remove the little barriers that may not be obvious at first. So think about what you’re trying to accomplish and look for the little things that get in your way and don’t be afraid to spend some money to eliminate those barriers.

By Eden, Sun 19 Apr 2009, Comments Categories: Fat, Spending

Christmas 2007 was my first cash-only Christmas. That was a great experience and I would never dream of using credit cards to pay for Christmas again. However, this year I’ve made the cash-only Christmas even better by starting a ‘Christmas Fund’ back in January of this year. My Christmas Fund is a savings account at ING Direct with a monthly auto-transfer to cover this year’s Christmas spending.

It’s a great feeling to know that not only will Christmas shopping not put a dent in my normal monthly budget, but thanks to the spirit of frugality this year, I’ll actually have a fair amount of money left over that I can save or pay down debt with. Nothing makes personal finance easier than a little planning and proper execution.

If this wasn’t your experience this year, I’m sorry and, believe me, I can relate. Everything I’ve just talked about would have sounded rather nutty to me up until about a year ago. It’s not too late to prepare for next year though. If you start now, you’ll be ready for Christmas in 2009.

How to prepare for Christmas 2009:

1. Plan how much you will spend in 2009
2. Divide that number by 11 (assuming you will save from Jan – Nov)
3. Open a savings account and call it your Christmas Fund
4. Set up a monthly auto transfer
5. Your work is done until next December!

This is a great way to cut down on stress during the Holiday season and it makes it easy to keep your budget under control.

By Eden, Fri 5 Dec 2008, Comments Categories: Budgeting, Spending

*update* I think I left the door a bit too wide open for me on this issue. I just needed to remind myself why I don’t want another credit card.  The question is still a good one to ask, but I finally know that the answer is no for me.

My article on taking a look back at our first cash only Christmas was included in this week’s Carnival of Personal Finance, hosted by We’re In Debt (great site by the way, I recommend subscribing if you don’t already). The ‘King of Debt‘ at We’re in Debt made an interesting comment on my article-

I would argue that they could have earned rewards using their credit cards, but cash only is just that, cash only with no possibility of spending more.

I don’t disagree with the comment but part of my get-out-of-debt plan is cutting up my credit cards and closing accounts as I pay them off so going out and getting a rewards credit card isn’t an option for me right now.

This topic really just brings us back to the old argument of what we are doing with PERSONAL finance and why we have to consider the emotional and non-mathematical parts of the equation. Looking strictly at the numbers, yes, you would be better off spending your money on a rewards credit card and paying off the balance early each month (never carrying a balance). That is true IF you have the discipline to pay off the balance on time AND the discipline to not spend more money because you are using your rewards credit card. Can you honestly say you are never tempted by your rewards points to buy a little more than you had planned before? Maybe you aren’t and if so, you are the person that should be using this strategy. If I am honest with myself, I know that I would be tempted to spend more money in order to earn the rewards. If I spend less money using cash (and debit cards) then that is how I need to pay for things until I develop better discipline with my spending.

Taking control of your personal finances really requires a focus on the human and emotional aspect of your money (we are starting with the assumption that your finances got out of control like mine). I can’t just look at the numbers, do a little math, and suddenly be out of debt. That is part of the process, but I have to understand what got me here. Honestly, I think I’m a shopaholic. I thought that seemed crazy at first, but after reading this great article by J.D. at Get Rich Slowly, I really think that is me. Like most men, I don’t get any joy out of going to the mall or shopping anywhere in general, but if I sit down at my laptop with a cup of coffee and visit Amazon.com, I could easily spend and spend some more without thinking about it. In fact, I did just that when I got my Amazon.com rewards credit card! Oh how I loved racking up those Amazon points- well, guess what? I couldn’t use that card wisely and it only took a few months for me to max it out. Is that stupid? Absolutely that is stupid. I am not trying to suggest that a rewards credit card is evil, but in the wrong hands it certainly is. No offense to anyone who has struggled with alcohol, but this is much the same situation- the bottle of beer in itself is not evil, but in the wrong hands it can do great damage.

I am not trying to argue with the comment regarding the benefits of rewards credit cards. If I didn’t make it clear, I absolutely agree with that opinion. However, I want to stress the fact that this strategy is not for everyone. You need to know yourself, be honest with yourself, and do what works for you to save money and take control of your finances. I am not saying that I will never use a rewards credit card. I may get to the point where I can have the discipline to use it as a personal finance tool and actually earn money with it, but I’m not there now. I actually admire the people who are able to do this- they must truly be wise and disciplined. Frankly, I love seeing people ’stick it’ to the credit card companies and earn money using the very same piece of plastic that is the downfall of so many others and costs most people thousands of dollars a year in interest charges. I can’t argue with the math, I just know I can’t trust myself in that area yet.

By Eden, Mon 31 Dec 2007, Comments Categories: Credit Cards, Life, Spending

I guess I didn’t really know how it would go, but this Christmas came and went just as quickly as the others before it. However, the big difference this year is that Christmas won’t be lingering in the form of credit card debt or budget regret. I can’t even begin to express how good that feels!

We didn’t plan all year long and we didn’t start saving last Christmas, but we did sit down in November and make a plan for Christmas- and we stuck to that plan. We took a portion of the money that would have gone toward extra debt payments in December and budgeted $800 for Christmas. That included gifts for everyone on our list, cost of food for hosting Christmas dinner at our house, and a little extra padding for unexpected expenses. I am happy to report that we came in under budget, by about $90.

This is the first Christmas I can remember that we didn’t use a credit card and didn’t over spend. Working with a budget for every person on our list was quite liberating. It made it easy to decide what to buy for someone- if we planned to only spend $25 on someone we wanted to make sure we got the best value we could for the money.

What to do if you took on debt to pay for Christmas this year:

If you had to use credit cards to pay for Christmas this year, don’t beat yourself up over it now. Recognize the mistakes you made and take action TODAY to prepare for next Christmas and to be ready to handle it with cash. If you don’t have one yet, open a savings account for Christmas. Call it your ‘Christmas Fund‘ and only use the money for Christmas. Decide now how much you need to spend for next Christmas and divide that total by 11 or 12 (decide if you want to count this month or start in January or whatever). The best advice is to set up an automatic transfer each month for your monthly Christmas Fund contribution so that you won’t even have to think about it. Personally, I don’t like to set up automatic payments or transfers for non-essentials so I will manually move the money each month- decide what works for you here and what you can safely commit to doing.

An example- I opened our Christmas Fund yesterday (with ING Direct) and funded it with $50. I chose $50 because I always start my new ING savings accounts with $50 (no particular reason for that). We have decided to budget $1,000 for next Christmas, which leaves $950 to save from January through November (11 months = $86.36 per month). That’s it! Next Christmas is taken care of! Of course I need to make that transfer a part of my monthly budget, but we can afford it so that won’t be a problem. So whatever your budget may be for next Christmas, decide it now, plan for it now, and get started TODAY! I promise you won’t regret it.

Remember, by preparing for next Christmas now, not only are you taking control of your money and making it work for you, but you are reversing the damaging effects of interest that you would be paying to a credit card company and actually earning interest all year long on your savings account. Compound interest working against you is the enemy of financial freedom and wealth. Compound interest working for you is your greatest ally in changing your financial future and becoming wealthy. This distinction is probably the greatest difference between the poor and the wealthy- don’t let this be another year that you move in the wrong direction.

Best of luck and Merry (cash) Christmas! 

By Eden, Sat 29 Dec 2007, Comments Categories: Budgeting, Saving, Spending

I posted a while back about the My Mile Marker website. It’s a simple online application for tracking fuel efficiency and fuel costs. Today, Clever Dude wrote an interesting article about the rising costs of fuel and that made me think this is a good time to review my history. After tracking my fuel costs for almost two months I have a decent amount of data to review.

My first recorded fill-up was on September 28, 2007 and I paid only $2.519 per gallon. My most recent fill-up was today, November 16, 2007 and I paid $2.939 per gallon. I don’t always use the same station, but I do always make an effort to go where the prices are on the lower end. That is a 16.7% increase in less than two months. If only my salary increased at such a rate!

So now the good news. My fuel efficiency has also increased, starting at 28.86 miles per gallon and hitting 29.97 miles per gallon on my last fill-up. That’s an increase of 3.8%, sadly not keeping up with the rise in prices. I’m not sure what I’m doing differently to increase my efficiency, but maybe just having this extra awareness in the back of my mind helps me to drive a little more efficiently. Now that I’m so close to 30 miles per gallon I want to see if I can break it!

You don’t need to use MyMileMarker.com to track your fuel efficiency, it’s just an easy to use tool and I like it very much so far. I’m on the Internet all the time so it’s not really any extra effort for me. I make sure to get a receipt when I buy gas and I write my odometer reading on the receipt and enter the information later on the website when it’s convenient. Whatever you do, I do think this is valuable data to have and if you see a drop in your mileage you can do something about it right away.

This isn’t an attempt to whine about fuel prices, I generally don’t give them much thought because I have to get to work so I have to pay the going rate. However, it is good to look back and see the trends and know where you stand. I just hope prices start to trend back down soon so we have a little more spending money for the holidays.

By Eden, Thu 15 Nov 2007, Comments Categories: Finance, Spending