Grand Theft Auto 5 is the upcoming gaming title developed by Rockstar Games, set in the . Grand Theft Auto has been a perennial classic and the definitive gaming series for Rockstar Games, creating the modern urban sandbox game and similar gaming titles such as Saint’s Row. The release date for GTA 5 was originally planned at the beginning of the year in spring 2013, but was pushed back to September 17. Does moving release dates have any noticeable effect on the sales of video games?
Carnival of Personal Finance #270, the Elvis is Dead Edition
Today is the 33rd anniversary of the death of Elvis, so I’m bringing you the “Elvis is Dead” edition of the Carnival of Personal Finance.
What can the King teach us about finance? The immediate lesson is, of course, to not let success destroy you or your life. Always remember what is important.
“Adversity is sometimes hard upon a man; but for one man who can stand prosperity, there are a hundred that will stand adversity.” -Elvis Presley
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Editor’s Picks
“When I was a child, ladies and gentlemen, I was a dreamer. I read comic books, and I was the hero of the comic book. I saw movies, and I was the hero in the movie. So every dream I ever dreamed has come true a hundred times…I learned very early in life that: ‘Without a song, the day would never end; without a song, a man ain’t got a friend; without a song, the road would never bend – without a song.’ So I keep singing a song. Goodnight. Thank you.”
-From his acceptance speech for the 1970 Ten Outstanding Young Men of the Nation Award. Given at a ceremony on January 16, 1971
Craig Ford from Money Help For Christians presents How to Buy Cars With Cash. This is great advice. My car will be paid off in the next few months and I will be doing exactly this.
FMF from Free Money Finance presents Are Tattoos at Work Really That Acceptable? Do tattoos limit your career? I reference this graphic when thinking about a tattoo.
Pop from Pop Economics presents Getting a raise: The negotiation. It’s always best to raise your top line as high as possible. Bringing in more money is far more effective that simply reducing your expenses.
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Your Budget is Worthless
When you realize that you’ve buried yourself in debt and decide to get out from under that terrible burden, the first thing you’ve got to do is build a budget because, without that, you’ve got no way to know how much money you have or need. After you’ve got a budget, you’ll start spending according to whatever it says. Hopefully, you’ll stay on budget, but what happens when an emergency does come up? What do you do when your car dies? When you suddenly find out your kids needs vision therapy? How do you manage when your job suddenly gets shipped off to East De Moines?
Your budget isn’t going to help you meet those expenses. Most people don’t have enough money in their bank account to make it all the way to the next payday, let alone enough to keep the lights on and food on the table. How can you possibly hope to deal with even the little things that come up?
You whip out your emergency fund.
The problem with a budget is that it does a poor job of accounting for the unexpected. That’s where an emergency fund comes in. An emergency fund is money that you have set aside in an available-but-not-too-accessible account. Its sole purpose is to give you a line of defense when life rears up and kicks you in the butt. Without an emergency fund, everything that comes unexpectedly is automatically an emergency. With an emergency fund, the things that come up are merely minor setbacks. Without an emergency fund, your budget is nothing but a good intention waiting to get shattered by the next thing that comes along. With an emergency fund, you are managing money. Without it, it’s managing you.
How much money do you need in an emergency fund?
Every “expert” has their own opinion on this. Dave Ramsey recommends $1000 to start. Suze Orman says 8 months. The average time spent looking for work after losing your job is 24.5 weeks(roughly 6 months), so I recommend 7 months of expenses. That’s enough to carry you through an average bout of unemployment and a little more, but that’s not a goal for your first steps toward financial perfection. To start with, get $1000 in a savings account. That’s enough to manage most run-of-the-mill emergencies, without unduly delaying the rest of your debt repayment and savings goals.
How do you build an emergency fund?
Let’s not kid ourselves, $1000 is a lot of money when can barely make it from one check to the next. Unfortunately, this vital first step can’t get ignored. If you really work at it, you should be able to come up with $1000 in a month or so. Here are some ideas on how to manage that:
- Cut. Drop every possible expense. If you drop cable, your cell phone, Netflix, and a weekly dinner out, you will already be saving $400 that month. You’d be almost halfway there.
- Sell. How much stuff do you have that you don’t need, want, or use? I’d be willing to be there’s more than you realize. Last spring, I had a garage sale that brought in about $1300. Everything we sold was just crap we don’t use any more. We sold candles and candle-holders, DVDs, books, clothes, toys, electronics, games, and anything else we could find. I spent a month going through every room in my house to find my inventory. Craigslist is a good way to sell just one or two things at a time.
- Work. Have you thought about delivering pizza or working weekends in a gas station? If you have some technical or writing ability, you could pick up some part time work on oDesk or eLance. Your opportunities are only limited by what you are willing to do.
Stop at a grand?
Dave Ramsey’s advice is to get your fund up to $1000 and then leave it alone until your debt is paid off. Screw that. I’ve got money going into my fund every month. It’s only $25 per month, but over the last two years, it has almost doubled my fund. Don’t dedicate so much money that you can’t meet your other goals, but don’t be afraid to keep some money flowing in .
Using the fund?
When can you pull the money out? That is entirely up to you. I have ju st two points to make about withdrawing from your emergency fund:
- Don’t keep the money in an easy-to-access account. If your fund is in the savings account that serves as your overdraft protection account, it’s too easy to spend it, and it will go away. I keep it in my INGDirect account. I don’t use the checking account for anything in person, so I don’t carry the card. If I want to spend that money, it will take 2-3 days to transfer into my main bank account.
- Never decide to spend the money on the spur of the moment. There are very few major financial decisions that can’t wait until morning to be answered. Sleep on it. If it’s still necessary tomorrow, you can spend it without guilt.
An emergency fund makes your life easier and your budget possible when the unexpectable happens. Don’t forget to fund yours.
How much money do you keep in your emergency fund? What would it take to get you to spend it?
A Budget Isn’t Enough
You know exactly how much you make, to the penny. You’ve listed all of your bills in a spreadsheet, including the annual payment for your membership to Save the Combat-Wombat. You know exactly how much is coming in and how much has to go out each month. Your income is more than your expenses, yet somehow, you still have more month than money.
What’s going on?
The short answer is that a budget is not enough.
A budget is not…
…a checkbook register. Do you track everything you spend? Are you busting your budget on $10 lattes or DVDs every few days? Is the take-out you have for lunch every day adding up to 3 times your food budget? Are you sure? If you don’t track what you spend, how do you know what you’ve actually spent? You have to keep track of what you are spending. Luckily there are ways to do this that don’t involve complex calculation, laborious systems or even proper math. The easy options include using cash for all of your discretionary spending(no money, no spendy!), rounding your spending up so you always have more money than you think you do, or even keeping your discretionary money is a separate debit account. That will let you keep your necessary expenses covered. You’ll just have to check your discretionary account’s balance often and always remember that sometimes, things take a few days to hit your bank.
…a debt repayment plan. You may know how much you have available, but if you aren’t exercising the discipline to pay down your debt and avoid using more debt, you not only won’t make progress, but you’ll continue to dig a deeper hole. Without properly managing the money going out, watching the money coming in is pointless.
…an alternative to responsible spending. Your budget may say you have $500 to spare every month, but does that mean you should blow it on smack instead of setting up an emergency fund? I realize most heroin addicts probably aren’t reading this, but dropping $500 at the bar or racetrack is just as wasteful if you don’t have your other finances in order. Take care of your future needs before you spend all of your money on present(and fleeting) pleasures.
A budget is a starting point for keeping your financial life organized and measuring a positive cash flow. By itself, it can’t help you. You need to follow it up with responsible planning and spending.
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Sunday Roundup: Father’s Day
On Father’s Day, 3 years ago, my third and final kid was born. My kids are all horrible brats and I love them dearly.
I wouldn’t give up fatherhood for anything. Watching my kids grow and learn, steering their development, and teaching them how to navigate life is the most fulfilling thing I’ve ever been a part of. Also the most frustrating. I can’t imagine being anywhere else, not being with my kids. I have no respect for deadbeat parents.
I am incredibly grateful that I had a proper model for manhood and fatherhood. My dad taught me the concepts of honor, integrity, and responsibility. I couldn’t be the man I am now, if he wasn’t the man he is. Thanks, Dad.
Best Posts
Sometimes, the coolest things in the world are the things most likely to kill you. Call me crazy, but I’d happily strap a 1200 cc propeller to my crotch and find out what 10,000 feet looks like.
Via Budgeting In The Fun Stuff, Super Frugalette reminds us that, when there’s a significant amount of money involved, spending a few hundred dollars on an attorney isn’t wasteful.
Fivecentnickel discuss multi-level marketing. It doesn’t matter which company you are in, if your downline is more important that your product, it’s a bad business model.
Keith Ferrazzi shows us how to improve our body language when it really matters.
When I started driving, I tossed my car in a ditch going way too fast. Naturally, it was my parents’ fault for giving me the curfew I was trying to beat. They never would have bought it if I would have told them I was driving like my grandma and it jumped into the trees by itself. Why does the FBI think that’s believable? Corruption, maybe?
Financial Samurai talks about living a life without regrets, which is a personal goal of mine.
Food storage will become critical when the zombies come.
Beer is good. Even the cave-men thought so.
Carnivals I’ve Rocked and Guest Posts I’ve Rolled
3 Ways to Keep Your Finances Organized was an Editor’s Pick in this week’s Festival of Frugality. Thanks!
5 Reasons Your Wealth Isn’t Growing was included in this week’s Carnival of Personal Finance.
Money Problems: Insurance was included in the Totally Money Blog Carnival.
Unlicense Health Insurance was included in last week’s Carnival of Personal Finance.
Thank you! If I missed anyone, please let me know.
Yakezie Blog Swap
Last week, the Yakezie shared what they would do with a single financial do-over.
– Melissa from Mom’s Plans shares her biggest financial mistake at Barbara Friedberg Personal Finance: Opening an eBay Store and Using Credit. It is a great story about how not to grow your business and how competing priorities can pose a real challenge.
– Budgeting in the Fun Stuff shares her biggest financial mistake and potential do-over at Super Frugalette: Investing in a Friend’s Business. Its a good, but costly lesson learned about small business.
– Eric from Narrow Bridge Finance shares how He Wouldn’t Have Paid Down His Student Loans So Fast at The Saved Quarter. This may seem counter-intuitive, but he has some good points. Check it out.
– Mr. S from Broke Professionals shares how He Wouldn’t Have Bought a New Car at My Personal Finance Journey. This has some great analysis, especially considering the new car was a hybrid!
– The College Investor posted at Wealth Informatics: What you should know when you are investing?
– Wealth Informatics posted here: If you had one financial do-over, what would it be and why?
– Barbara Friedberg shares how She Was Scammed at Mom’s Plans. You have to watch out for the hard sell!
– Joe at Retireby40 tells us about How He Invested his 401(k) in Company Stock right before the dot com crash, at Financially Consumed. A financial adviser may have helped avoid this one!
– Financially Consumed shares his Car Purchase Do-Over And Over at Retireby40. Car addicts have it tough!
– LaTisha from FSYA shares her do-over story in It’s Never Too Late at Little House in the Valley. Sometimes the do-over is quicker and more painless than most.
– Little House yell’s Do-Over! Do-Over! at FSYA Online. It looks at the road to saving more, starting on an elementary school playground!
– The Single Saver asks, What Are The Long Term Consequences of Small Purchases at Totally Money. A cool post on how past purchases cost future returns!
– Miss Moneypenniless from Totally Money shares her story of Vacationing to the Brink of Bankruptcy. Sometimes a vacation can be fun, but the bills afterward may be daunting.
– Super Frugalette shares How a Lawyer Could Have Saved Her $24,700 at Budgeting in the Fun Stuff. Maybe lawyers are worth it sometimes?
– Jason from Live Real, Now shares how he Amassed $90,000 of Debt at Debt Eye. A good lesson in living a little more frugally.
– Kevin from Debteye shares his do-over: Not Buying a House Right Out of College at Live Real, Now. I have said it before that buying a house can be challenging right out of college.
– Penny from The Saved Quarter shares how She Would Have Finished College Before Having Kids at Narrow Bridge Finance. An awesome story that has will soon have a happy ending!
– Jacob from My Personal Finance Journey shares how he was Scammed on eBay at Broke Professionals. An important lesson for anyone selling or buying online.
– Marissa from Thirty-Six Months shares how she Accumulated a Ton of Student Loan Debt at So Over Debt. If you are going to live the life, you’re going to pay the price!
– Andrea from So Over Debt shares How She Would Have Started Saving for Retirementat Thirty-Six Months. I would love to read a post on each of the stories you mentioned getting to where you are now!
– Below Your Means shares his story about A Missed Investment Opportunity. There are so many times I wish I could have gone back and bought a stock!
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