Planning

I’m Making All The Right Moves, But I’m Still Unhappy

After my recent article about personal finance and happiness, I received the following email from a reader named “Constance”: I’ve always been pretty responsible with my money and lived a frugal life, especially over the last few years with my husband in school full-time. But what would you say to someone like me who doesn’t …

Some Thoughts On The 60% Solution

A couple years ago, an extremely influential article entitled A Simpler Way To Save: The 60% Solution popped up on MSN Money. It proposed a very simple way to budget: After analyzing our spending patterns over the past couple of years using our Microsoft Money data file, I determined that we needed to keep our …

Categories: Planning, Saving Money

Children Fighting For Money At The End Of One’s Life: A Cautionary Tale

I received a very sad story from a friend of mine, who I’ll call Roger, that I felt was worth sharing as a cautionary tale: About three months ago, my paternal grandfather was diagnosed with lung and intestinal cancer. He had worked for forty years at a factory that, for most of the time he …

Categories: Planning

The Real Reason So Many Personal Finance Gurus Encourage A Written Budget

If you’ve ever read many personal finance advice books, you’ll find that the vast majority of them encourage the reader to make up a formal budget and write it down (in fact, I even wrote a guide along those lines myself). Without a doubt, making up a formal budget is a very good exercise for …

Finding Your Dream House – And Trying To Convince Yourself You Can’t Quite Afford It

My wife and I have been doing some house hunting in our area lately. We have been watching the real estate fliers carefully and have been driving through nearby towns looking at homes with “For Sale” signs in front. Last night, we drove by a house that somehow just called out to both of us. …

Categories: Housing, Planning

Do A Financial Spring Cleaning

Today is a lazy Sunday in the early spring, the first authentic lazy Sunday I’ve had in a long while. The taxes are done and now it’s time for a financial spring cleaning. What’s a financial spring cleaning, you ask? For me, it’s a post tax filing tradition in which I go through all of …

Rethinking The Costs Of Child Care – And Considering Some Major Choices

My wife and I are expecting our second child in September. As soon as we made the decision to have a second child, we sat down and did a number of calculations on the subject and we quickly realized that the expenses were going to be tremendous. Let’s walk through the expenses just a bit …

Categories: Parenting, Planning

My Company Just Announced Huge Layoffs And I’m Afraid My Position Will Disappear: Seven Things You Need To Do Right Now

A friend of mine works for CitiGroup in South Dakota, which is about to experience some massive layoffs. He’s a bit worried about what’s coming down the pike, and so he asked me what I thought he should do. Here’s my advice to him, as well as anyone else who is facing a potential layoff …

Short Term Savings – How To Plan For Upcoming Vacations, Auto Purchases, And So On

As I’ve mentioned before, I maintain multiple savings accounts at various institutions, mostly in an effort to keep my different savings goals in discrete places. For the most part, I only deal with two: one is an emergency fund, and the other I refer to as my “short term” fund. What’s a “short term” fund? …

Categories: Planning, Saving Money

Some Notes On The 60% Solution

Many people complain that budgeting is too confusing and that they have a hard time setting concrete goals for themselves, and when they do set goals, they’re so loose that they are easy to meet but they don’t really generate any significant savings. One major solution to this problem is the so-called 60% Solution, described …

The Tao of Setting Concrete Financial Goals

When I was first recovering from financial disaster, one of my biggest challenges was convincing myself to actually do the things I knew I needed to do. I would think to myself, “I want to save money,” but when push came to shove, it was so easy to not save money. I’m willing to bet …

Categories: Planning, Psychology

Yes, You Can Get A Financial Life: The 30s

I’ve been a fan of Ben Stein’s financial writings for years, but this is the first book of his that I’ve picked up. Could it possibly be as good as his columns? Is it worth reading at all? A large portion of the book (chapters 7 through 13) really focus on issues that many people …

25 Things You Should Always Have In Your Car

Having grown up rural and now living rural, I know first hand the types of experiences people can have when they’re caught out in the middle of nowhere and something goes wrong with their car with no help in sight. The end result was expensive towing, lots of time wasted, and in one case, one …

Categories: Automobile, Planning

Multiple Emergency Funds: Are They Necessary?

Let’s face it: an emergency fund of some sort is a necessity. However, some of my readers think a single emergency fund isn’t enough (remember, this comment was discussing the personal finance of a single person): Aside from the 6 month contingency fund he has saved, does he have emergency funds for insurance deductibles, a …

Categories: Planning

Training Your Mind: Ten Personal Finance Mental Exercises You Can Do Anytime

One major part of being financially responsible is to have the proper mindset, and to build the proper mindset can often be quite challenging. Just like anything else, being financially fit requires work, and most of that work goes on between your ears. Here are ten mental exercises you can do any time to strengthen …

Categories: Planning, Psychology

I’m Debt Free and I Have a Six Month Emergency Fund – What Now?

I spoke on IM with an individual a few days ago who has a six month emergency fund (actually post-tax; it is equal to half of his annual salary) and has also paid off all of his debts. He currently is putting the full amount into his 401(k) and is receiving employee matching, plus he …

Categories: Planning

What’s In Your Wallet? How I Organize The Finances In My Pocket

Every time I see a CapitalOne commercial chirping their promotional “What’s in your wallet?” line, I actually think of my own wallet and what’s inside of it. So, in the interest of openness (and because there are a few interesting things going on), here’s what I keep in my wallet. Minimal identification The only photo …

Why Career Planning May Be Time Wasted – And Personal Finance Planning Isn’t

I recently read a provocative article on PsyBlog entitled Why Career Planning Is Time Wasted, which focuses on a concept called “miswanting”: The idea of making mistakes about what we might want in the future has been termed ‘miswanting’ by Gilbert and Wilson (2000). They point to a range of studies finding we are poor …

Categories: Careers, Planning

Do I Really Need To Talk To Chuck?

For the first time ever, my wife paid attention to an advertising campaign produced by a major brokerage firm. In this case, it was the nearly ubiquitous “Talk to Chuck” campaign for Charles Schwab, in which cartoon people discuss their financial needs to the camera. This particular spot showed a man concerned with having to …