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3 Ways to Keep Your Finances Organized
I have 16 personal savings accounts, 3 personal checking accounts, 2 business checking accounts, and 2 business savings accounts. That’s 23 traditional bank accounts, spread across 3 banks. Just talking about that gives my wife a headache.
Every account has a reason. Three of the savings accounts exist just to make the matching checking accounts free. One of the checking accounts handles all of my regular spending that isn’t put on my rewards card. 14 of the savings accounts are CapitalOne 360 accounts that have specific goals attached. A couple of the accounts were opened to boost the sales numbers for a friend who is a banker. Really, it’s almost too much to keep track of. One credit card, 5 checking accounts, 18 savings account, all on 4 websites.
Sometimes, when you extend your bank accounts this far, it gets easy to let it all slip away and lose track of where your money is going. How do I keep track of it all?
1. Simplify
Whoa, you say? Simplify? I don’t simplify the number of accounts I have, I simplify the tracking, or specifically, the need to track.
Twice a month, I have an automated transfer that moves a chunk of money from my main checking account to C1360. I have a series of transfers set up there that move that money around to each of my savings goals. I move $100 to the vacation account, $75 to the braces account, and $10 to the college fund, among all of the other transfers. Doing that eliminates any need to keep track of the transfers, since it is all automated.
Using the same rules, I make every possible payment happen automatically, so I don’t have to worry about paying the gas bill or sending a check to the insurance company.
Simple.
2. Complicate
As you saw in the opening sentence of this post, I also complicate the hell out of my accounts. On the surface, it would seem like that would make it harder to keep track, but in reality, the opposite is true. I have 14 savings accounts at C1360, each for a specific savings goal, like paying my property taxes or going to the to Financial Blogger Conference in October. I can log in to my account and tell at a glance exactly how much money I have for each of my goals. In the account nickname, I include how much each goal is for, so I can easily see if I am on track.
3. Quicken
Everything I do gets set up in Quicken. This makes it easy to track how much actual money I have available. Since I’ve moved my daily expenses to a credit card, I only have about a dozen entries to worry about when I balance my checkbook at the end of the month. At that time, any excess funds get dropped into my debt snowball.
This may all leave me with a needlessly complicated system, but it’s a system that grew slowly to meet my needs and it is working well for me. I spend about 2 hours a month tracking my finances, and can–at any time–tell at a glance exactly how my finances look.
How do you keep your finance organized? Have you tried any unique savings strategies?
$1500 Luxury
I’ve got some expensive habits. Not like Charlie Sheen snorting $2500 of blow of a hooker’s boobs, but still expensive.
My latest one is dancing lessons. Linda surprised me on one of weekly date nights a few months ago. She found a Groupon for the dancing studio we used before we got married. It was $69 for a month of unlimited group lessons.
When the month was up, we signed on for their beginner cycle of lessons, which cost another $400.
And now we’re starting the Social Foundation program.
Social Foundation is a series of classes that teach some advanced moves, but also to teach dancers how to lead and follow properly and how to dance socially and look respectable on a dance floor in any number of situations. Leading and following are important because every single dance move out there has specific cues that tell your partner what’s coming next. If she doesn’t know, you both look clumsy.
So we chose the four dances we’re going to learn better and signed up. We’re going to learn the Rumba, Waltz, Tango, and Swing. We’re already pretty good at Rumba and Swing, but we’re going to get better. Personally, I’m hoping to also figure out how to use the Tango on an open dance floor without crashing into people. That way, we can pretend to be Gomez and Morticia, my heroes.
Now, the thing is, dance lessons aren’t cheap. They cost about $100 per hour, where an hour is defined as 45 minutes. We’re rolling the last half of our beginner lessons into our social foundation lessons and paying $1400.
Ouch.
They gave us the option of financing it over 3-4 months, but I didn’t want to pay an extra $200 for the privilege. I think we’ll be tapping the vacation fund to pay for the lessons.
Why am I willing to pay this much?
Dancing is one of the very few things Linda and I both enjoy. We’re pretty good at it, it’s great exercise, it’s fun, and (shhh!) it counts as foreplay. It also doesn’t hurt to have the sidelines of the dance floor lined with people watching us dance, wishing they could do what we’re doing…or wishing their husbands were willing to learn how to dance. This also isn’t just something we’re doing at the studio. We are out on a dance floor dancing to a live band almost every week. That usually comes with about $25 in cover charges and drinks.
Fun, exercise, have sex, and inspire jealousy. That’s a winning combination. And finding things to do that we both love to do is difficult and easily worth the $2000 we’ve paid the dance studio this year.
Toxic People
You should never be in the company of anyone with whom you would not want to die.
-Duncan Idaho, from God-Emperor of Dune
Some people suck the life out of everyone they encounter. Whether it be through lies, unreasonable demands, emotional abuse or manipulation, or just a vile personalty, the people they meet are worse off for the encounter. The people they interact with every day are screwed.
My time is too precious to waste any of it unnecessarily on people who remove value from it. I like being with people who enrich my life, instead.
Unfortunately, since I’m not an advocate for the use of hitmen, not every toxic person is easy to eliminate from your life.
Toxic people come in 3 basic varieties: professional, personal, and family. There is some overlap between the categories.
The personal category is easiest to deal with. These people aren’t relatives or coworkers, so you won’t see them at family gatherings or at work. I’ve dealt with these people in two ways.
First, there is the direct approach. One former friend, who was really only a friend when it was convenient for him(a pure leech), got told that he wasn’t invited to one of our parties because I was inviting his ex-wife, instead. That was the last time he called me.
The second option is far more passive. I set up a contact group in my phone called “Life’s too short”. At first, I set it up with a fairly insulting ring tone, but I later switched it to no ring at all. I don’t know they’ve called until I check my voicemail. It’s far less direct, but also far easier than the direct approach.
Dealing with the toxic people in your family is more complicated. You’ll see them at holiday gatherings, or hear about them during unrelated visits. You probably have a lot of memories growing up with them, and may feel some level of obligation–deserved or not–to maintain contact. It’s hard to break a tie that you’ve had your entire life.
Can you fix their behavior? It’s worth trying to have a frank discussion about how they are treating you, or the things they are doing. If the problem is that they are constantly bringing over their methhead boyfriends, banning the drug addicts from your home, while still welcoming the relative may be an acceptable fix. If the problem is a constant need to belittle you, demanding they stop may work. If the problem is a lifetime of emotional abuse, it probably isn’t fixable.
Is banishment an option? Can you put that creepy cousin on the Life’s Too Short list? You’ll still have to deal with him at family gatherings, but you can always leave the room when he comes in, right? Don’t engage, don’t participate in any conversation beyond a polite greeting, and don’t offer any encouragement towards regular contact.
It’s possible that it won’t be possible to fix their behavior and that you won’t want to banish the offender. If, for example, the offender is your mother (Not you, Mom!), you may feel a sense of obligation to maintain contact, or even be a primary caregiver at times. This is a line nobody else can draw for you. At some point, the current bad behavior could overwhelm the past obligations. When that happens are you prepared for it? That can be a traumatic break.
The other option, as cold as it sounds, is to wait it out. Nature will take its course, eventually. Can you wait that long, while maintaining your sanity and emotional equilibrium?
Professional toxic people include customers, vendors, and coworkers, none of whom are easy to get rid of.
If you own the business, you can fire your problem customers if the hassle outweighs the benefits you get from the relationship. You can find a new vendor, and you can fire the problem employees.
What happens if you are an employee?
If the problem is your boss, your options are to suck it up, talk to his boss, or find a new job. If the first is intolerable, and the second is impossible, it’s time to polish your resume.
If the problem is a vendor, you’ve got some options. Document the problems, first. Does he make inappropriate jokes, or badmouth you to your customers? Then, research the alternatives. Does one of his competitors offer an equivalent product or service? Take the documentation and research to your boss, or whoever makes that decision, and see if you can get your company to make the switch. The other option, is to request someone new to deal with at the vendor’s company, but that may not always be possible.
Finally, we come to the problem of toxic coworkers.
Some coworkers have the same problems as a toxic boss. Is the company vice-president the boss’s baby brother? You’re probably not going to find a win there. You’ll have to suck it up or move on.
Is the problem person working in an unrelated department doing unrelated tasks? It may be possible to start taking breaks at different times and leave him where he belongs: in the past.
Is the difficult individual sharing an office with you, demanding everything be done his way, and throwing daily tantrums? This is the one that has to be dealt with. He’s the one sucking the life out of you every single day.
First, start making use of a voice recorder. If you’ve got a smartphone, you’ve probably already got one. Otherwise, drop the $20 to buy one. This lets you document the evil. When his behavior goes hinky, record it.
Second, stand up for yourself. If he’s making unreasonable demands, tell him it’s inappropriate. He’s a bully, and bullies tend to back down when they are confronted.
Third, make sure the boss knows about the behavior. Yes, this is tattling. Get over it. If he wasn’t acting like he was a spoiled 4 year old, you wouldn’t have to tell the boss that he was. If the boss doesn’t know there’s a problem, he can’t deal with it.
Fourth, for any problem that isn’t directly aimed at you, ignore it. If he makes a habit of throwing a tantrum because somebody emptied the coffee pot, or because the company switched health plans, let him. Only get in the way if it’s directed at you. Over time, the tantrums will get more noticeable and out of hand, forcing the boss to deal with it, preferably by handing him a pink slip.
Your goal is documentation, awareness, and avoidance. Make the worst of it go elsewhere so you can be as productive as possible, document what you can, and let the boss become aware of the situation and how bad it has become. And be patient. This isn’t an overnight fix.
How do you deal with the toxic people in your life?
Horseback Riding Lessons
For the past couple of years, my daughters have been riding in horse shows with a local saddle club. We’ve been lucky in that my wife’s cousin has let us borrow her horse for the shows, so costs have been minimal.
Unfortunately, that horse isn’t available this year. We knew that a few months ago, so the plan was to take a year off from the shows and focus on lessons, to get the girls some real skills. We found a great instructor at a stable about 30 miles from our house. Since we live less than two miles from the border of the biggest city in the state, that’s a comparatively short drive.
We pay her $200 per month for 1 lesson per week for both girls. They each get 30-45 minutes on the horse during each lesson.
Now that show season has started, the plan seems to have changed. The girls will be riding a different borrowed pony tomorrow. The shows cost about $50 for registration, lunch, and gas. Our club has 1 show per month, but my wife has assured me they’ll only be hitting three shows this season and limiting the number of events to keep the cost down.
The direct costs aren’t too bad, but there’s a problem with keeping-up-with-the-Joneses accessorizing. Vests and boots and helmets and belts and shirts, oh my.
I’d guess our costs for the summer will be $300 per month.
One thing we’ve been considering is buying a pony. We can get an older pony for around $500-1000. Older is good because they are calmer and slower. Boarding the thing will cost another $200 per month. We’ve been slowly accumulating the stuff to own a horse, so I’m guessing the “OMG, he let me buy a horse, now I need X” shopping bill will come to around $1500, but I’ll figure $2000 to be safe. We already have a trailer, a saddle, blankets, buddy-straps, combs, brushes, buckets, rakes, shovels, and I-bought-this-but-I-will-just-put-it-in-the-pile-of-horse-stuff-so-Jason-will-never-notice stuff. We’re certainly close to being ready to buy.
(FYI: If you’re starting from scratch, don’t think you’re going to get into horse ownership for less than $10,000 the first year, and that’s being a very efficient price-shopper.)
So we’re looking at $5400 for a horse, gear, and boarding the first year. If we cancel the lessons, by spring we’d have $2000 of that saved and most of the rest can be bought over time.
On the other hand, if we go that route, we’ll never save enough to buy the hobby farm we’re looking for.
Decisions, decisions. I should just buy a new motorcycle. Within a year, I win financially.
New Debt
For the first time in 2 years(almost to the day), I am acquiring new debt that I can’t afford to pay off immediately. On a credit card.
Last Thursday, my son entered vision therapy. He has what is commonly known as a “lazy eye”, but is more properly called a “wandering eye”. His eyes don’t always lock on to whatever he is looking at. Instead, one of his eyes will (occasionally, but not always) drift to the side and shut off. His brain doesn’t interpret the signals from that eye.
We had two sessions of tests to diagnose the specific problems: $350.
We will have 28 weekly sessions of therapy @ $140 per session: $3920
There is an equipment fee: $85
That’s a total of $4355 over the next 7 months.
Insurance covers some of it, but the therapist is out-of-network, so it’s “pay first, get reimbursed later from the insurance company”. If we pay up front, we get 1 session free, bringing the price to $4215, minus insurance.
I have a health savings account that I have been trying to max out to cover this, to make my payments all pre-tax. I haven’t been able to get enough in there, yet. In fact, since I don’t have my kids on my insurance, my maximum HSA contribution is $3050.
Since finding out that vision therapy was going to be necessary, I have managed to save $1000 in cash, and about $1500 in my HSA. That’s $2500 of a $4215 bill, leaving $1715 that I still need to be able to cover.
Here is my plan:
We’re charging the entire $4215 at 11.9% interest on a card with a 2% travel rewards program. This will give me $84.30 worth of travel rewards good for reimbursing any travel expenses.
I will immediately pay off $1000 from cash savings.
I will also immediately file for an insurance reimbursement, which will cover 80% – $500, or $2972 minus a bit. Our insurance got a waiver on the pseudo-wonderful healthcare fraud act on the grounds that the plan sucks so bad that it would cost too much to comply with the law. No joke. I’m expecting about a $2500 reimbursement, and I have no idea how long that takes.
In 6 weeks, when I have maxed out my HSA contributions for the year, I will file for an HSA reimbursement for about $2500, leaving about $500 to cover some medical costs for the rest of the year. Vision therapy doesn’t count against my deductible, since my kids are on my wife’s insurance plan.
Starting in June, my debt snowball will no longer be going to max out my HSA and will instead go straight to this card, to finish paying it off as quickly as possible. That’s $750 per month.
Any money from any side work will also go towards this bill, but I don’t budget for that, because it isn’t reliable money.
The projected results:
$3215 on the credit card for 6 weeks @ 11.9% = $50 in interest payments.
After the HSA reimbursement, there will be $715 left to pay, which will be paid off in June for another $10 in interest.
When we get the insurance reimbursement, we’ll replenish the medical bill account, to start getting ready for the kid’s braces next year. We’ll drop $1500 into that account and use the remaining $1000 as a debt snowball payment.
We’ll end up paying $60 in interest to save $140 in therapy costs, so it’s good math, but I hate the idea of racking up another credit card bill. I could drop the interest costs a bit by raiding my emergency fund, but that still wouldn’t cover it all, and it would leave me with very little left for an actual emergency. I could raid the emergency fund for half of its value($700), and reduce the initial interest paid to $25 and the total interest paid to about $40, then use the $1000 leftover from the insurance reimbursement to replace my emergency fund.
