Hey everyone, I've been working at Sun Microsystems (soon to be Oracle!) for about half a year now in their Control Center. I get paid a fair amount for my age and I'm extremely lucky to of had this opportunity. I feel like i used to be good with my money but in the past months I have grown to see that it is no longer the case. I seem to spend my paychecks (I receive one every two weeks) almost instantly but I can't seem to think where it goes. I don't smoke marijuana any longer, I rarely drink (and if I do, I ain't spendin'!), I have a minimal amount of subscriptions, and the bills I have to pay aren't too great. I actually seem to a pretty stingy mindset when it comes to spending money but maybe that is when it is for other people. When it comes to buying something for myself, I see myself buying shit almost immediately. Then again, I can't think of anything that I have spent money on that I now regret. Usually it is pretty generic items such as clothing, food, etc. but I still see my money disappearing. So obviously, I'm having issues saving my money. I usually put away half of my pay check towards bills, gas, rent, necessities, tax and the other half is usually just "money." At this rate, I should have enough money to buy a brand new car but for some reason I just can't seem to save it. I have a savings and checking account at SunTrust with the savings account currently not activated. Would setting up the savings account help me keep on to my money? I don't see how it would stop me from just buying shit with it as well. I have also signed up on Mint.com but I usually just delete all of the emails at it tends to clog up my corporate email and I rarely check my personal accounts. I feel like I am sometimes pushing it when it comes to paying for things that I truly need (I was in the double digits after I had to get my car serviced) when I should have a comfortable cushion with the amount of money I am bringing in with little demand for fees. On top of that, it feels nice to have a couple of hundred in the bank with no need to spend it, you know? So, to the point: I'm looking for some helpful tips from anyone that will help me save my money. Anything will help. Checklists? Spreadsheets? Mental challenges? Whatever. Thanks in advance.
I grew up in a very tightwad family. My dad was the senior partner in a law firm and the car he commuted in had twice as many miles and was worth half as much as his secretary's. He got lots of puzzled looks, but he didn't give a fuck. Hope I impart that attitude to my own kids some day. Are you maxing out your 401k contribution? That's the quickest way to ensure you are wisely saving money. Somebody once told me the goal is to get that fucker over $75k as quickly as possible, so that compounding interest really starts doing its work. Wish I'd worked harder at that myself. I'm more of a "mental challenges" guy, myself. Set a goal to have, say, $2000 in your new savings account by April 1. Then evaluate every purchase between now and then as to whether it's worth sacrificing toward that goal.
I used to have this same issue when I first moved out to Portland. I wouldn't have anything to show for my money, but it would quickly be gone before I knew it. And I would be fine, unless soemthing happened, like a car problem, etc. The biggest thing I had to cut out of my budget was going out to eat. Or, rather, spending money on food. I still like to go out to eat, and still do occasionally. But from going out to eat 3 nights a week, and buying lunch every day, it quickly adds up. The buying lunch is a killer. Figure you spend somewhere between 5 and 10 dollars every day on lunch. That's a quick 100-200 bucks a month. I know not enough to sap your check, but it quickly adds up. Not surehow old you are, and what you like doing for fun. I've found now that having a group of friends over for dinner is a lot funner than going out to eat somewhere. And, if you rotate between who is having who over for dinner, say it's 4 friends, or 4 couples, that's like 3 or 4 times going out to dinner without having to pay. Going out to eat, the biggest add on seems to be drinks. Get together with friends over dinner, and then there's a beer, a cocktail, a glass of wine, an after dinner drink, etc. A quick 20-30 dollars spent on drinks alone, for what might only be a 20 dollar meal. I've also found that, when I feel like I am being stingy, it makes me feel like I can splurge on items, and that's always a big money drain. Like, i wouldn't spend money for a week, so if I wanted to "treat" myself to a new movie, and a new video game or something it seemed ok. But it's like binge drinking. Binging and purging. I'd spend a bunch, then spend nothing, then a bunch, etc. And the spending seemed to outweigh the not spending. I don't like using programs to manage money, I would just fail to update it anyways. I found one thing that helped when depositing my checks was to take out some money, and try to just use that money for the week. Like, depositing a 1000 check, and keeping out 150 for the next two weeks, or something. And try only spending what you have on hand.
I opened up an HSBC direct account. I have it automatically withdraw $50 per week out of my checking account. I don't really notice the missing money and it just collects the money, over time I have a nice little sum.
Rice. Make lots of rice. Eat lots of rice. Rice. Cheapest food in the world. Keeps a billion Orientals alive. Remember that word. Rice.
My mother, father, and step-dad are all from a very tough childhood and they definitely push their "tightwad" views on to me which I completely appreciate. I just feel like I'm not used to receiving this amount of money on a regular and steady basis (I went from working in a pizza store to a corporate business) and spend it almost without thinking. As for the 401k, no. I am a contractor for Sun seeing as they aren't allowed to hire permanent employees during this period so I don't get those benefits. I don't think I would be even if I did have that option. I want to believe I can do that but I feel like it wouldn't be enough. Perhaps I should talk to someone at SunTrust about automatic transfers from my checking to savings every week? Yeah, I tend to find myself spending money on shit that sounds legitimate at the time but in a week I can't even remember what it was. Right now I feel like I need a new pair of shoes but that's far from it. I feel like I am doing fine with everything bill-wise but if something bad happened, I would be in a lot of trouble financially. The eating out could be making a big dent in my cash. I work forty-hour weeks and we need somebody on-call 24/7 so our lunch breaks are minimal. I usually pop in to Wendy's or Harris Teeter for a sub which is usually ~$10 a pop. That's around ~$50 just for lunch every week so that is ~$100 each paycheck. On top of that, sometimes I'll order something for dinner which is usually around $20. I'm going to start making my own lunches and seeing if it affects my moolah (I know it will). Yeah, I'm not in that age-group to be doing that sort of shit. I go to school part-time and most of my friends are in college. I'm getting some "once in a lifetime" work experience while studying for my Associates in IT so I'm usually pretty pushed for time. I don't really know how I have time to spend money! I'm usually exactly the same with the stinginess. I'll go through a phase of great spending and it will be gone by next week. I feel like I should be depositing all of it into my savings account at those points. You don't have to actually update Mint -- It sort of monitors your account and alerts you if you're exceeding a budget but I'm finding it pretty useless, to be honest. I'll have to check that out at SunTrust.
I recommend figuring out a budget. Go back 4 to 6 months and figure out what your average monthly bills are. Gas Rent Utilities Food Entertainment Student Loans? Internet Cell Phone Cable etc. A lot of people actually spend more than they bring in because of those evil credit cards.
Always do the 401k at least to your employer's matching level. Consider it part of your wages, because it is. There are IRA's for those with no 401k's. Always use direct deposit to your account and automatic transfers to your 401k/IRA. Always save a minimum of 10% of your gross pay. Do this at every job or you'll probably not ever retire comfortably. Avoid fast food and any habit that costs you more than $5 a day. Re-evaluate your fixed expenses (like insurance) each year. Avoid using credit whenever possible. Most young people throw away around 20% of their gross income on interest/fees... And of course, avoid women and muscle cars.
Cable is another expensive one. Do you get movie channels, or just regular cable? Do you watch it enough to justify it? Do you buy movies? Rent movies, etc.?
I think about 15 years ago my bank account was at zippo... living in apt... had credit cards, student loans etc... I say down and made a list of the things I wanted to accomplish... and what I would need to do to get there. Just having that list went a long way and I am in much greener pastures now. So make a list of what you want... figure out what changes you need to make to get there. I only spend with debit card so I can import all the expenses into Quicken and see exactly where the money is going. I saw things like I was spending over $100 a month just in coffee! Yikes. Consider your purchases very carefully... don't buy something on spur of the moment... consider the cost vs how much entertainment you will get from... and make very sure whatever it is is worth it. A big asset you have Ronan... is a good job... good source of income. That is always valuable... but right now it can be downright enviable. Do what you can to make yourself more marketable so you can move up or to other oportunities. Make yourself invaluable.
Get a second job, and you won't have time or energy to spend money. But if you do, you'll have enough money now. You can't lose either way.
Are they withholding taxes from your paychecks? "Contractor" makes it sound like they are treating you as a self employed individual, which means that they dont have taxes withheld from your paychecks, and you are responsible for Medicare and Social Security taxes in addition to income taxes when you file your tax return. If they arent having taxes withheld, you need to make sure to save money to pay for the tax you will owe.
I'm going to go over a few bank statements and receipts in the past couple of months to see where most of my spending goes. I actually don't use my credit card. I've only used it once, I believe. Thanks for the advice.
