Search Results for “three-alternatives-to-a-budget/573/future-dreams/living-the-xbox-life-on-an-atari-income/first-3-things-to-do-in-the-new-year”

Living the XBox Life on an Atari Income

: Image via Wikipedia

At some point, everyone has “champagne wishes and caviar dreams.” Over the last 25 years, we’ve even been peddled the “you can have it all” myth from every direction, including the media and the government.

The truth is simple: you cannot have it all. You can have anything, but you can’t have everything. In order to have one thing, you have to give up something else. It’s a law of nature. If you have $5, you can either get a burger or an overpriced cup of coffee, but not both.

“But wait!” you shout, rudely interrupting the narrator, “I have a credit card. I can have both!”

Wrong.

And stop interrupting me.

If you have $5 and borrow $5 to get some coffee to go with your burger, you will eventually have to pay that money back with interest. You will have to give up a future-burger AND a flavor shot in your overpriced coffee.

Everything you buy needs to be paid for, some day.

If you have an Atari income, but insist on living the XBox life, you will wake up one day, buried in bills, forced to live the Commodore-64 life out of sheer desperation.

There is a solution.

Don’t get all XBox-y until you are making XBox money. That way, you’ll never have to worry about going broke tomorrow paying for the fun you had yesterday.

Even when you have an XBox income, ideally you’ll restrict yourself to living a Gamecube life, so you’ll be able to put some money aside to support future-you instead of constantly having to worry about your next paycheck.

Inadvertent BOGO

Finance

I refuse to buy my kid more expensive video game systems. He’s got a friend who’s got one of each, going back 15 years.

We don’t do that, so he’s spent the last 6 months saving to buy his own XBox 360. After his birthday this month, he finally had enough, so we ordered it a few days ago.

Wednesday was the Great Unboxing.

I was making dinner in the kitchen while the punk and his friend unpacked the box from Amazon.

The squeals were normal. The shouts of “Dad, why did you buy two XBoxes?” were a surprise.

Two?

No.

Actually, yes. There were two of the things in the box. Did I order two? Did I accidentally pay for two?

Nope. The packing slip only listed one, my order history only showed one, and my credit card was only charged for one.

Yet, there were two in the box. Free XBox! Woot!

That means an XBox in the bedroom for Grand Theft Auto and Red Dead Redemption, and an XBox in the basement for Madden and Star Wars. No fighting. No turns to take. And it didn’t cost us an extra $200.

That’s all win.

If there’s nothing on the packing slip, then Amazon didn’t know I had it. Even if they did, I didn’t do anything to make them send it. There was no fraud. Legally, I had no obligation of any kind to do anything other than enjoy my new prize.

Lots of win.

The kids were excited. Everyone gets a turn. Multiplayer games.

The parents were excited. We get a turn. M-rated games.

So much freaking win in that box.

But….

There’s always a but.

We didn’t order it. We didn’t pay for it. It wasn’t ours.

A friend told me to sell it. She knows how hard we’re working to pay off debt.

A coworker said, “Screw them. They’re just a big corporation who’d be happy to screw you first.”

But it wasn’t ours.

I spent 12 hours trying to rationalize a way to keep it that wouldn’t be unethical, make me feel guilty, or–most important–send a horrible message to my kids.

I couldn’t do it.

It wasn’t ours.

I had a talk with my son. It was his money that got this little prize into our house, after all. He wanted to keep it, naturally. He’s got a lot to learn about persuasion. He acknowledged that sending it back was the right thing to do. He agreed that it would suck if the roles were reversed. His only argument in favor of keeping it was “I want it.”

Even he admitted that was completely lame.

It’s going back. I let him think that was his decision.

I talked to Amazon. They apologized for the inconvenience and gave me a UPS label to send it back at no cost. It didn’t cover pickup, but I’ve got a drop box in my office building, so I can deal with that.

My wife was pissed. The customer service rep never bothered to say thank you. She called Amazon to complain to a manager. After reminding him that we had no duty to return the free XBox, he gave us a $25 gift card to say thank you.

I love my wife.

My son, for deciding to to the right thing, gets to spend the gift card. My wife, for being awesome, gets to be with me. I miss my free XBox.

What would you do? Would you keep the free XBox, sell it, or send it back?

Three Alternatives to a Budget

Finance

the envelope system: day one — Image by J. McPherskesen via Flickr

Budgets aren’t for everyone. For some people, the very idea of trying to track where their money going is painful. And that’s just the idea of tracking the money. It gets far worse when you’ve got $10 budgeted for coffee, $12 for fast food, $66.50 for gas, and $0.75 for entertainment. It’s can be hard to follow a strict budget for long.

If you know you need to track your money, and you also know that a strict, zero-based budget won’t work for you, what can you do? Luckily, there are alternatives.

1. Hope and Pray. This is otherwise known as the “Call my bank everyday and see how close I am to over-drafting” system. To fully embrace this system, you need to not only abandon a written–or even organized–budget, but you should also throw your checkbook register in the garbage. Make sure you’ve got a good overdraft protection account attached to your checking account and let your money take care of itself. This is the ultimate zen of personal finance. Don’t stress or worry, just hope for the best. This system works best if you make more money than Oprah and have modest tastes. For those of us who have to watch our money a bit to make sure the month outlasts our money, this probably isn’t a great plan.

2. The Envelope System. To implement this system, you do need to create a basic budget so know what you are obligated to pay. Once you have that done, take a stack of envelopes and label them for each item you have to pay. Add another envelope for food, another for entertainment, and another for miscellaneous because there is always a miscellaneous. Divide the money among the envelopes. Now for the magic. When you have to spend something, take the money out of the appropriate envelope and spend it. That’s it. If, however, there isn’t enough money in the right envelope, but you still need to spend the money, you have to take it out of a different envelope and spend less on the category that lost money.

3. Percentages. This is the simplest of the non-budget budgets. Take 50% of your money and spend it on necessities, like the mortgage, food, and utilities. The next 30% goes to savings and retirement. The last 20% is for fun or any other thing you want to spend it on. This naturally works best if you are out of debt, but if not, just make sure most of the 20% fun money goes to repaying debt. This system works best if your bills are automated and you will need to set up a basic budget first, so you can make sure your necessities come in under 50% of your income.

Not every budget plan will work for everyone, but there are always alternatives that can still help you manage your money.

How do you track your money?

Future Dreams

Relationships

While jogging with my wife a few days ago, we had a conversation that we haven’t had in years. We discussed our dreams.

It’s an important conversation for couples to have. What are your hopes? What are your dreams? Where do you want to be in 10 years? In 20? In 50? Planning for the future gives you a map for the present.

My wife and I hadn’t had this conversation in years. A few days ago, we did. Our life-goals are simple and achievable.

I want to leave the corporate world and support my family with writing and the training classes I do. I want a chunk of land outside of any major metropolitan area, but close enough for the entertainment and shopping. I want enough land to expand my classes on my own property, relying on no one.

My wife wants enough land to have some horses. It was unspoken, but I think she wants my goals to take off so they can support her goals, too.

We want a comfortable retirement and we want to help the kids with college.

We’re a bit behind the game for college funding. That’s ok, though. There is nothing wrong with a kid working his way through college and learning those life lessons.

We are also behind on the retirement. But, if I can support us doing the things I love, I don’t need $X million. Retirement isn’t a cessation of activity, it is taking the time to do the things you love on your own schedule. If writing a book while sitting on my private range is enough to fund our life, that’s the perfect retirement.

Living the High Life

Finance, Life

This post is part of the Yakezie Blog swap. I have swapped this week with Eric at Narrow Bridge Finance. This is a post from Eric discussing the theme: What Motivates You to be Financially Responsible? Please take a moment to read my post, Monsters, at Eric’s site.

Unlike my blogger buddy Jason here at LiveRealNow, I have no family. Quite the opposite in fact, I am loving the single guy life. I don’t have much debt. I love going to the bars and partying on the weekends. I have a good job. I have relatively low expenses. Things are good.

So what is my motivation to be financially responsible? It is two-fold. First, I want to be able to keep doing whatever I want whenever I want without worrying about money. Second, I do want to settle down someday in the not too distant future and make sure I have a good foundation to start the next chapter of my life.

I Want to Do Whatever I Want Whenever I Want

Is that selfish? Probably. But who cares? I don’t have kids, I don’t have a wife. I don’t even have a girlfriend at the moment. I do make an effort to donate to local organizations I believe in and I am happy to have friends over for a pre-game and buy a round of drinks, but that is as far as my obligation to others goes.

Doing whatever I want is not always cheap. I like going to concerts. I enjoy nightclubs. I love traveling and exploring new places. $80 tickets, a $15 cover plus drinks, and a $500 trip are fairly common occurrences in my life.

As you know, money doesn’t grow on trees. I have to work hard to pay for the things I want and the experiences I have. I am totally okay with that. But I have to plan now to be able to do what I want later.

I live in a modest and inexpensive apartment. I try to keep my food budget low. I bought a small car that would be reliable, low maintenance, and fuel efficient.

By cutting out wasteful spending and thinking before I spend, I am able to do pretty much whatever I want. If you have the same goal, dive into the depths of your budget. Dig in deep and see where you are spending money. Not to be cliché, but the ‘latte factor’ is a big deal. Those stops at Starbucks, afternoon snacks, energy drinks, cable bills, and other cash drains might not be worth it. If you don’t really, really enjoy it and get pleasure from it, why would you spend money on it?

My Future – Family, Travel, and Early Retirement

I am 26. I am at that point where I am going on a lot of dates. I am meeting a lot of great girls. One of these days, probably when I least expect it, I will fall madly in love and get married. You know the story.

My short term dream is a life of travel and urban living. My long term dream is to get married to a hot Jewish girl (I am Jewish, so it makes sense to “keep it in the tribe”) and have two or three kids. Once kids are in the picture, we move out from the urban fun areas and settle down in the burbs.

But just because I will give up the party life does not mean I have to give up my passions. I want to show my kids the world, give them amazing life experiences, and help them grow to hopefully be even more awesome than me, which is a hard bar to beat.

To do all of that and reach financial freedom, I have to set my goals and work to achieve them. (In case you were wondering, Jason recently wrote a great post on financial goal setting. If you have not read it yet, you really should.)

To get there, I am already working on saving and investing. I am contributing over 10% of my gross income at work to my retirement plans. I am working hard to pay down my student loans and save up a down payment fund. I am planning ahead and saving for my future goals.

How to Reach Your Goals

You probably have financial and life goals too. What are you doing to get there?

We can always tell people about our dreams. However, unlike when you are two years old and dream of being an astronaut police officer that lives in a toy store with an ice cream machine and a McDonald’s in it, your dreams today can be a reality.

With few exceptions, every person can reach their goals. Do you want to retire at 40? Take steps to save and create residual income streams. Do you want to travel in space? Save up to buy a ticket on Virgin Galactic. Do you not have enough money? Diversify your income streams and make more. Do you feel chained down by your traditional desk job that you hate? Start a business and transition to self employment.

Yes, it is easier said than done. But you will never reach your goals unless you take solid steps to get there. Don’t just dream it, live it.

Please take a moment to head over to Eric’s site, Narrow Bridge Finance. While you’re there, be sure to subscribe. You don’t want to miss his posts.

Dreams

Finance, Life

Ever since she was a little girl, my wife has wanted to be a horse. Err, work with horses.

The problem is that most jobs working with horses pay horse-crap. It’s hard to raise a family on a stablehand’s income.

Her alternative was to own horses. This comes with a different set of problems. The biggest problem is that we live on 1/8 of an acre in a first-ring suburb. That’s not a lot of room to graze, though I would be willing to give up my spot in the garage.

I rock like that.

Boarding a horse costs a minimum of $200 per month. Two girls means two horses, otherwise, they won’t both be able to score in the saddle club. For the math challenged, that’s $400 per month, plus about $300 in preventative vet care per year.

$5100 for a year of boarding an extremely obsolete car.

Then, you need a trailer to get the horse to shows. You need saddles and reins and and short-legged stirrups and feedbags and muck-rakes and brushes and combs and hoof-cleaning-thingies and other stuff that will catch me by surprise for years to come.

Expensive.

My rough estimate is that it costs at least $10,000 to get into horse ownership, and that’s not counting the horse itself.

You can buy a horse for well under $1000 if you aren’t concerned about registration or speed. A 15 year old horse can last 10-15 more years, so it’s not money down the drain.

That’s $12,000 to get in and $5100 per year to stay in. Minimum.

Never let it be said that I’m not a pushover. Last month, we bought an SUV that can pull a horse trailer. Last weekend, we bought the trailer. That’s two major steps towards making my wife’s dreams come true. The rest of the plan culminates in a hobby farm in the sticks.

There are several steps in between.

I just need to put the brakes on every other step. We’ve been offered the free use of one pony next season, and we may be able to get another for the same price. Beyond that, we need to be patient. There will be no ponies purchased until the new truck and old mortgage are paid.

Period.

Search Results for: three-alternatives-to-a-budget/573/future-dreams/living-the-xbox-life-on-an-atari-income/first-3-things-to-do-in-the-new-year