I feel like I am not alone in thinking, “Man my dad knows about how everything works.” One place in particular my dad gets, its finances. I swear I can call with a question about filing my taxes and he’ll be like, “Here’s what you have to put in box 4A on page 17,” without looking at the damn form.
While I’ve been relatively good at trying not to spend a lot of money on clothes (i.e. Old Navy shopping sprees instead of J.Crew ones) and limiting my out to lunch habit to just once a week, I don’t have a budget I stick to. I saved enough to put a fairly large down payment on a car a few months ago, but I want to be more conscious about goals to go on a trip or even somehow save for a house.
So over Thanksgiving, I did some research on my own and talked to my dad, and here’s where I’m at.
Have a Budget You Check In On
Budgets are great as an idea, but they are really hard to monitor on a day to day basis.Who wants to sit and track every penny every day of your life? While there are some instances where it’s necessary, it can be more time-consuming than fun, even for a crazy planner like me. So instead of tracking daily, I’m back to making sure all of my accounts are in on Mint and working towards following my spending on a regular basis from there. For me it’s about checking to make sure all of my credit card purchases look legit, and having big buckets of spending that I can’t go over. Instead of breaking out Alcohol & Bars and Restaurants as two categories, I just lumped them into one big “Going Out” bucket. At the same time, I’m more closely tracking my out to lunch habit, creating one category just for that.
Save for Retirement
Oh, this one is so not fun but oh so necessary. Saving for retirement is something you should get in the habit of from your very first paycheck (if you can). While I feel pretty good about my contributions so far, I want to make sure I’m hitting the right milestones as I continue. In particular, I found the site Ellevest interesting. It focuses on the female audience, and how investing for retirement as a woman is different than retiring as a man. The average targets are based on men – who typically make more money over their lifetime, and live shorter lives (not to be morbid). So saving for retirement as a woman is even more vital to start from a young age. You need that shit to compound like crazy on itself.
Have Specific Accounts for Goals
One of the things I hadn’t done yet was to create accounts for two specific goals of mine: to go on a big trip and to save for a house. When I was looking into creating goals on Mint, they would always suggest the most random places to open accounts, but I was worried I would forget about it if I opened an account where I didn’t have one. After talking to Dad, he said to do some research within the banks I’m already a part of, but to stick to some of the larger firms. I ended up creating CaptialOne360 accounts for the specific goals – they have a great reputation, no fees or minimums, and a relatively high interest rate.
I already find that actually transferring money from one account to another makes it seem more real to me – both in the sense that I see the money growing, and also that I won’t feel bad spending that money when the time comes.
So while these are still 3 small steps to managing my money, they’re certainly in the right direction.