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Financial competence 101
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2016-02-02 at 5:29 PM UTC[SIZE=18px]Issue 1:[/SIZE]
Budgeting and reducing outflow
So you're an idiot with $$$. You make a decent amount but you never seem to have quite enough to not worry or do the things you want to do. Let's start by planting your feet on the ground; let's see where your money is going, how much is coming in, and where you can cut expenditures.
The key to this is writing shit down. First, write your monthly or biweekly income. This is your "cap". Past that number, you will be in the danger zone. Below that, keep track of every single penny you spend, anywhere, for any purpose and in any shape or form, during the same time period (so if you're paid biweekly, keep track of two weeks of expenditures corresponding to your paycheque).
If you have a smartphone, you can use an app like Mint, and everything will be super easy. If you don't have a smartphone, what the fuck is wrong with you? But anyway, just use a piece of paper or a notepad or something. you can go to mint.come from your computer. Then look at your expenses; rent, bills, food drinks, all of it, and see where you can cut down or cut out. See how much you can start cutting each pay cycle, and how big of a gap you can create between your income and your outflow. This will be the money you have to work with to pave your way to a secure financial position.
Do this for at least a month, and feed your tracked spending back into the budget; what are your food costs? How about transport? Write these numbers down and give yourself a little "overage". If you spent $220 on food, write 250. Your budget should ultimately look like this:
You don't need to go as hard in the paint as this one right now, but everything from debts to utilities to food and entertainment (your netflix subscription, redbox, video games, and so on) needs to be on here. Every. Single. Cent.
Keep it up until you have an accurate view of your situation, then move on to step 2. -
2016-02-02 at 10:03 PM UTCi nefar lern soma!!!!
What the fuck? did you actually type all this just to explain how to do a household budget that's taught in like grade 7 when you already grew up hearing your parents argue about money ever since you could understand the emotional connotations attached to words? Fuck you, no wonder your country is dirty, stupid, broke and butthurt about it. -
2016-02-02 at 10:09 PM UTC[SIZE=18px]Issue 2:
[SIZE=14px]The short term; planning six months ahead[/SIZE]
[SIZE=14px]Alright, so you've got a handle on your expenses and balanced them up against your income. How much money do you have left over every pay cycle if you ideally cut down on most of your frivolous expenses? That's the important number. Give yourself a wiggle room for when you really, really just want a pizza or something. We want this number to be conservative, not generous and based on you having amazing willpower, because you probably wouldn't be in the hole if you did.
Now look back at your budget and take a look at what you call the essentials like rent, utilities, food and so on. Add those numbers up and multiply by six. This will be your target "never drop below this" amount. What we're looking for is for you to be able to go a good six months without work. You can play with the amount of time if you want. Some people say you can aim for three months, and that's reasonable. But any lower and you're cutting it way too close. This fund will be your lifeline if everything else goes to shit; three to six months is enough time to get a new job, fix whatever emotional situation you're in and begin digging yourself out of the hole once again.
The key to accumulating enough money for this, of course, will be to bring your everyday expenses NOW, way way down. Stop buying expensive soap, organic milk and lots of beef to eat each night. Quit ordering pizza and learn how to cook basic shit, it's easy and cheap. Cut out soda and beer and either switch to water or brew some tea, tea is cheap as fuck.
Start saving where you can and pinch pennies. Use coupons. Go full jedi until you've hit your target here, because the sooner you hit three to six months of savings, the sooner you'll have a gigantic mental burden lifted off your shoulders and you can start looking at other areas to improve. Once you've hit this, you will not touch this money. It will be here in case you have a car crash or get laid off, or if someone robs you or eats your soul or something. You need to always have this under your belt.
once you accomplish this, congratulations, this is stage called "having your shit together". Look forward to Issue 3.[/SIZE][/SIZE] -
2016-02-02 at 10:10 PM UTC
i nefar lern soma!!!!
What the fuck? did you actually type all this just to explain how to do a household budget that's taught in like grade 7 when you already grew up hearing your parents argue about money ever since you could understand the emotional connotations attached to words? Fuck you, no wonder your country is dirty, stupid, broke and butthurt about it.
Look at the forum you're on, lol. There are a lot of people in this community that have never gotten their basic shit together. Everyone learns this stuff for the first time some time, so it's important to have the information available for them. -
2016-02-02 at 10:20 PM UTCYou should also invest in sunglasses around april and you'll really start to see the return around august
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2016-02-04 at 7:30 AM UTCOne technique I've used successfully begins with writing it all down and using it to develop an effective disciplined budget. When you can account for your income and expenditures, you can break down each individual outgoing purchase. Think of your shopping list, but with prices added. Now look for frivolous items which can be eliminated, and then anywhere you can downgrade from brand name to generic, purchase in bulk, etc.
Once you have a total for that list, be it grocery or entertainment or professional expenses or clothing, round it off after accounting for taxation, and put that amount of cash in a dedicated envelope that will be used for nothing else. Put relevant coupons inside with that money, because once that envelope is empty you're done spending in that area for the week/month/whatever increment of time you've allotted.
Surplus is good, better when put into a strong APR savings account. I use https://www.smartypig.com/ because it lets me set a savings goal and the amount which is withdrawn from my primary account, as well as how often that transfer takes place, and they make it a bitch to collect my savings before that goal is met.
Individuals, like cities, states and nations, don't simply pool all of their money willy-nilly, it gets distributed according to purpose and ranked by importance. If this system is unmanageable with appropriate effort, overspending isn't your biggest issue. -
2016-02-04 at 9:53 PM UTC
One technique I've used successfully begins with writing it all down and using it to develop an effective disciplined budget. When you can account for your income and expenditures, you can break down each individual outgoing purchase. Think of your shopping list, but with prices added. Now look for frivolous items which can be eliminated, and then anywhere you can downgrade from brand name to generic, purchase in bulk, etc.
Once you have a total for that list, be it grocery or entertainment or professional expenses or clothing, round it off after accounting for taxation, and put that amount of cash in a dedicated envelope that will be used for nothing else. Put relevant coupons inside with that money, because once that envelope is empty you're done spending in that area for the week/month/whatever increment of time you've allotted.
Surplus is good, better when put into a strong APR savings account. I use https://www.smartypig.com/ because it lets me set a savings goal and the amount which is withdrawn from my primary account, as well as how often that transfer takes place, and they make it a bitch to collect my savings before that goal is met.
Individuals, like cities, states and nations, don't simply pool all of their money willy-nilly, it gets distributed according to purpose and ranked by importance. If this system is unmanageable with appropriate effort, overspending isn't your biggest issue.
That's a good set of ideas, Zanick! Do you have an IRA or multiple IRAs yet? -
2016-02-05 at 3:34 AM UTCThe key is just making so much money you don't have to care about how much you spend on what.
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2016-02-05 at 7:25 AM UTCStep 1: Move to Canada
Step 2: Pay 35% income tax to federal and provincial governments
Step 3: Get shitty socialized healthcare in return
Step 4: ??? -
2016-02-07 at 8:18 AM UTC.
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2016-02-07 at 8:19 AM UTC
That's a good set of ideas, Zanick! Do you have an IRA or multiple IRAs yet?
Every weekend for the last ten months I've told myself I'm going to set one up. For some reason I just can't find the time, part of me just doesn't care enough. My student income is well above minimum wage, but still low enough that I can't invest seriously and I really don't know that I need to prioritize fluidity in my finances outside of matched 401k.
How do you find the time to research and commit to these things while working? I can't seem to make it work. -
2016-02-07 at 5:44 PM UTC
Every weekend for the last ten months I've told myself I'm going to set one up. For some reason I just can't find the time, part of me just doesn't care enough. My student income is well above minimum wage, but still low enough that I can't invest seriously and I really don't know that I need to prioritize fluidity in my finances outside of matched 401k.
How do you find the time to research and commit to these things while working? I can't seem to make it work.
I'm going to be honest here, I don't work. I am functionally retired at this point. I sold my company for 8m USD liquid and 40m USD in mixed securities. At this point I have "fuck you" money so I read up about whatever interests me. I personally can't have an IRA because my G7 treasury instruments (about $10m in US 20-year bonds) roll in enough money to put me above the cutoff.
But since you are a working man, I'll help you out. Starting an IRA and whatnot is a no-brainer. If you can contribute enough, I would definitely recommend having a Roth IRA (preferably from a company like Vanguard, Charles Schwab or Fidelity).
Within the IRA, there is something called a three fund portfolio you might want to consider. I'll post more in detail when I get the time.
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2016-02-07 at 5:58 PM UTCCan you give me 20 bucks?
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2016-02-07 at 7:06 PM UTC
I'm going to be honest here, I don't work. I am functionally retired at this point. I sold my company for 8m USD liquid and 40m USD in mixed securities. At this point I have "fuck you" money so I read up about whatever interests me. I personally can't have an IRA because my G7 treasury instruments (about $10m in US 20-year bonds) roll in enough money to put me above the cutoff.
But since you are a working man, I'll help you out. Starting an IRA and whatnot is a no-brainer. If you can contribute enough, I would definitely recommend having a Roth IRA (preferably from a company like Vanguard, Charles Schwab or Fidelity).
Within the IRA, there is something called a three fund portfolio you might want to consider. I'll post more in detail when I get the time.
If you're this rich, the fuck are you doing in space, lol? Travel, go see the pyraminds, take HelloClarice on a romantic trip around the world idk bro, if i had a few million in the bank i'd probably be busy with other shit. -
2016-02-07 at 7:30 PM UTCYeah what sucks is that, it doesn't matter how intelligent or disciplined you are in the US, if you aren't making enough money to save then you're basically fucked. In this country, it takes money to make money, which is why over 90% of the people here stay in the exact same socioeconomic status of their parents (or go down).
I graduated college and couldn't find a job until almost 3 years later. That job involves me cleaning toilets and pays less than $14,000 a year. In fact, I almost didn't even get the job, but I begged the general manager to give it to me. He reluctantly did so, which is pathetic seeing as everyone else he hired either quit or got fired within two months. In fact, that job has had over 14 people quit in the first six months I worked there. So I've been there for over half a year and, to date, I still have no health insurance and had to rely on the kindness of family to survive. In fact, some single mom in her early thirties just fucking rolled in here last week and is already making way more than I am doing the same job.
I know, I know, everyone wants to insinuate that if you don't have a job or your wage is bad in the US it's because you aren't working hard enough, have a bad attitude, don't know where to look - anything to put the blame back on the person. The problem is that there's abundant evidence for anyone with the integrity to look and see that's absolute bullshit. I speak two languages, had a 4.0 in college while most of my peers were struggling with algebra in middle school, am an honorably discharged vet, have several college degrees, and was putting in over 100 applications a month. I worked all through college teaching math and logic to other students while maintaining honors, doing university funded research, and being involved in like 3 different extracurriculars. I also have no criminal record, no history of mental illness, have had no car accidents, no history of drug or alcohol abuse, and am in good physical condition.
I always shave and get my hair cut before each interview, dress appropriately, and contact the interviewer via telephone or email to let them know I'm hopeful for the job.
By the way, these applications were everything from waiting tables to government contract jobs. In those whole three years, one job got back to me, and that's the job I'm working now.
I looked for work all over the United States, including contracts overseas with Dyncorp and Triple Canopy. I picked up programming languages. I volunteered. I tried networking. I got on social media. I went to job fairs. I had my resume looked over by different schools and veteran's programs. I went to mock interviews.
I think it all finally resonated with me the day I went to a career fair that was open to the public near a prestigious school in the North Eastern US. I waited in line to show my resume and work experience to government contractors and employers who could barely mask their impatience when they find out I went to a state school. These same employers showed profound interest in students who had like a 2.5 in irrelevant majors with no work experience just because they went to the nice school.
tl;dr - It's who you know and who you blow. Anyone who thinks otherwise is living in a fucking bourgeoisie fantasy-land. -
2016-02-07 at 8:32 PM UTCI'll hire you when I have figured out what to do. Don't worry.
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2016-02-07 at 9:10 PM UTC
I'll hire you when I have figured out what to do. Don't worry.
If anyone gave me a significant amount of money to invest or a job worth doing well, I guarantee I'd make their investment back.
You've got to realize that most people who hire don't have any real direction on how to discriminate between good and bad candidates, so they just bring all their biases to the table and shoot from the hip. -
2016-02-07 at 9:49 PM UTC
If you're this rich, the fuck are you doing in space, lol? Travel, go see the pyraminds, take HelloClarice on a romantic trip around the world idk bro, if i had a few million in the bank i'd probably be busy with other shit.
That is why you are not rich. The reason why rich people have a lot of money as opposed to not having a lot of money is that they have not spent their money. What you are talking about is a poor mentality, and why lottery winners go bankrupt.
You need to change your relationship with money.
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2016-02-07 at 9:55 PM UTC
The reason why rich people have a lot of money as opposed to not having a lot of money is that they have not spent their money.
Also being born with money usually helps. -
2016-02-07 at 10:09 PM UTC
Also being born with money usually helps.
Doesn't if you're an idiot and waste it. The key factor is education.
