Somebody asked me my top five financial tips yesterday, I reminded them that I am no expert on finances, but in terms of what has worked for me I’m always happy to share. So today I focus on the lesson I learned about not being able to do/pay for everything at once!
Similar to my previous post, I think where I previously went wrong (as well as many others who have chosen to share their financial stories with me) is that I wanted too much at the same time. The reality is, our money will only stretch so far, if you are trying to pay off a significant amount of debt it might not be the right time to add to your family and buy a timeshare, if you have large car payments and have to pay for an upcoming big family vacation, it may not be the right time to accept a slot in graduate school. Similar to my last post I think it relates to accepting the quick action of pushing a button won’t work. Financially savvyness it is more like a horse and cart: there are bumps in the road, it takes the right tools and equipment as well as time and perseverance to reach your destination and it is important to remember the reality is you can’t overload the cart or you will go nowhere!
Right now I could potentially have 5 major financial plans – saving to increase my emergency fund again, saving for a down-payment (at least 20%) for a home, saving to adopt, saving to go to China and today I was offered a place on a very elite graduate program with a choice of beginning in 2 weeks or in May. There is no way on one income I am able to accomplish it all, or even 1/2 of those things, within the next year or two or possibly even five. Yet, even three years ago it would probably have been my normal thinking to pay for the course on my credit card, get a 95% mortgage and use my savings for China (with putting the rest on my credit card). Now? Those are not even options, I know I can’t have it all and I accept that hook, line and sinker.
You know, I think the fact that you have financial goals in the first place is the first and most important step! So many of my own financial blow-outs are the result of impulse decisions with no goals in place.
Having those goals and then setting a realistic plan to save for them (instead of getting into debt for them) has been a simple but effective rule for me.
By the way, you asked on my blog if you can link to my “beauty is not how skinny you can be” post. You are more than welcome to link to it! You may want to read gleaner’s comment after yours though – she raised some very interesting points about the video.
Cheers,
Eilleen
This is a really really good tip! I think we often want it all right now and actually realizing it might take 3 years to save for grad school, 5 years to save for a family actually makes it all the sweeter when you get there!
I love these tips! They are such a good reminder!
You are so wise and disciplined for your age. I wish I had been so when I was in my twenties! It’s taking me much longer to learn that stuff will not make me happy.
Great post! This is a topic that J and I actually discussed just this week. Finance (if you have any leeway at all) is simply about choices. Over the holiday weekend, I felt a bit down that some relatives of ours were able to take a fabulous trip and we were in savings mode and couldn’t do that. But the truth is, I *chose* to spend my money taking car of an abandoned animal, even if it didn’t really feel that way. I could’ve dropped her off at a shelter, but I needed to make the choice to take care of her myself. Every money decision I make, unconscious or not, is really a choice.
I’ve really enjoyed reading your blog over the past couple of days and some of your posts have really struck a chord. I’ve been saving for grad school for two years now. I hope it will make me a very dedicated student when I finally get there and also allow me more time to enjoy the experience because I won’t be worrying about debt.
Congrats on the offer of a grad program!
This is a very wise perspective, and one I try to follow in my own life as well. There was simply no way for me to responsibly go to grad school, buy a car, get together a down payment for a house, and keep working on my finances all at the same time. So, grad school it was, and I happily take the bus and live in a rented apartment and watch my finances grow a bit more slowly than I’d really like.
We definitely live in a culture that promotes having it all and having it all now, which can be a difficult thing to work against. But in recognizing that you can’t necessarily have it all right away, I think it’s even more likely that you begin to see where your priorities are. And, by waiting on what isn’t possible right now, you appreciate those things all them more when you get there.
i love this. i remember when i was a little girl and didn’t get much pocket money, if there was a toy i wanted (like ski-boots barbie!) i would have to save my money for x-amount of weeks until i had enough to buy it. (sometimes my parents would match me, so i only had to save half, depending on what it was i wanted and if i did some jobs round the house or kept my room tidy or whatever) and in the interrim, we used to go and “visit” the toy in the toy store. it was great, every week, to go and check she was still there and realise that in a few weeks i would have enough money to buy her. it really made me appreciate the toys when i did have enough money to buy them, and to make sure they were what i really wanted and not a passing fad.
xx
i am *trying* to bring this back, wrt to the “toys” i buy now (cd’s, clothes, books, whatever) and i think it’s a great discipline – make sure you save FIRST rather than “buy now, pay later.” very counter-cultural. not easy. but worth it (like most things!)
inspiring as ever FT! and i would love to hear more about your savings goals/goals in themselves
Great post, I’ve heard many times over that young people want now,what their grandparents sometimes took decades to save up for. I do think a lot of is entitlement issues. Congrats on the offer. You will forever be grateful for your financial savvy and choices now, wise beyond your years
Wow, congrats on getting into the grad program!