Let's talk money. Budgets. Life.

[timmymac24]

We live in a rural area that is captive ot Wal Mart for shopping for the most part with the exception of one local mom/pop grocery that is not real affordable. We will drive an extra 10-15 minutes to shop at Aldi. The amount of groceries we get from their store vs. Wal Mart is substantial and worth what little extra gas is being spent. Aldi has greatly improved over the past several years.

 

[eoperator]

 

[summs]

As a younger person, soon approaching my 30's. I just had this talk with a buddy while striper fishing. How do people afford this stuff? And all I can come up with is living it up now and will be struggling later.

comparison is the thief of joy.

New trucks, boats, quads, tractors, guns... I know what they make, and either I value the dollar to much or they don't value it enough.

I have for sure had lifestyle creep and spend more than I used to. I also own an older truck, and old boat and have old mechanical item expenses as they pop up. Needed brake lines that don't exist and having to buy materials and tools and fittings to make your own. Rewiring boat trailer... again, new axle for the boat and tires, truck needs tires. Necessities I have no problem fixing, but are unexpected and need to be covered.

I do not make a lot of money, but I have zero stress. I think it's time to take on some stress and accelerate my prep for the future and switch back to stress free job later down the road.


to keep it on topic. Run a budget sheet, at least see where you money goes and how much you value those things. I dont think a $4 coffee 2-4 times a week is bad, until you add it up and it's a $1000 at the end of the year, and you have 2 or 3 or 4 small treats adding up the same.

Usually the saying is penny wise and dollar foolish, but those pennies sneak up and add up at the end of the year.

 

[el_jefe_pescado]

I don’t know what you guys are worried about…In 2016, I bought a collectible garden gnome for $35 that is worth around $6,000 now.

So yeah, things are going prettttyyyy good at my house.

 

[Michael Rankin]

I don’t know what you guys are worried about…In 2016, I bought a collectible garden gnome for $35 that is worth around $6,000 now.

So yeah, things are going prettttyyyy good at my house.

You boss was probably sad to see you leave after you told him about this windfall of money and wouldn’t be working anymore. Enjoy your retirement

 

[The Ri Guy]

How strict are you guys with your budget?
What are some major things that have helped save some $$$?
We do well, have a home and a couple reliable vehicles, but the extra money seems to be getting less and less. I guess I'm just reaching out to confirm that we are in fact not in the minority hahahaha.

I had the tremendously good fortune of financially savvy tutors in my family who got me started on The Richest Man in Babylon early, helped me apply the lessons early, start working early, and thus enjoy compounding interest and financial freedom to the fullest for the vast majority of my life to date.

Over the decades I've warped and simplified my financial philosophy and basically put my budget on autopilot. This has helped me both to save money, appropriately set lifestyle expectations (budget), and ensure peace of mind for my family and myself. The key that I've found, is to automate as much of your finances as possible, out-of-sight, out-of-mind, and it becomes a habit. Note that this particular strategy may not be feasible to suddenly enact at your stage in life, as it is somewhat dependent on living well below your means from the onset. That being said, it is entirely scalable for your income level as long as you have the discipline to stay the path.

My wife and I prefer to keep our non-retirement and non-family moneys in our own accounts. But this can be applied to joint accounts as well, your spouse just has to share the same vision and discipline.

1. Maximize retirement investment off the top every month, employer direct deposits. For my longterm retirement accounts, I now use a robo-investor with medium-low risk tolerance. Schwab's Intelligent Portfolio is a great low-cost, reliable return option. I maintain one play account, it is entirely self-funded by the successes of the trades in the account, initial investment aside, and I do not EVER put more cash into this account. Do not make the mistake of looking at your investments too frequently, you must trust the process and time to do their thing.
2. With the remaining take home money, immediately subtract your portion of the monthly bills (mortgage, utilities, groceries, insurance, childcare, etc.) off the top. This money is used for these expenses only, and remains a set amount per month as dictated by your families needs/situation.
3. Split the remaining portion of your take-home in half, then designate 50:50 split to savings:checking.
4. Of the portion allotted to savings, put it to work multiplying for your family. My current split is 66.66% of these funds go into high-yield (4.3%), easy to liquidate, online savings account that is a dual purpose emergency/big purchase (vehicle, hunts, etc.) fund. Set a minimum safety net that will cover X months of your expenses laid out in #2, my number is 12 months. This account can never fall below this number unless SHTF. Of the remaining 33.33%, I split it 50:50 again into my wife-and-I's joint savings account (family vacations, home projects, etc.) and the remaining into my 6 month old daughters custodial UGMA/UTMA & 529 accounts.
5. The portion allotted to checking is mine to do with what I please. Hunting gear, truck upgrades, you name it.

One of the cornerstone principles of this strategy is that, large purchases aside, if I cannot afford to buy it outright with the cash on-hand in checking, then I simply don't buy it. This completely fluctuates based on my past spending. Some months I live a pauper, others a king, with my checking money. As well, I put everything on CC's (OPM) and accrue as much cashback as possible, but never in excess of what I can pay down to $0 balance from checking each month.

I'm not going to share my personal numbers, but I can tell you that having set myself up for success with this strategy since childhood, my peers will never, ever catch me financially, and my family will never, ever have to think about money.

 

[jpmulk]

How much money someone makes is never enough. As Dave Ramsey said, money is 20% numbers and 80% behavior. There are a lot of people making 200,000 a year that are paycheck to paycheck and there are people making $60,000 a year that are doing just fine. Historically, the average millionaire has an average income of $70,000. It’s not about money. It’s about your perspective on life, your values, and your ability to be content.

 

[Freewilly]

I did similar to a previous post, when I got a raise, say 3% , I would put 1.5% into my 401 k each pay
slowly, you’ll see thatyou are up to 20% in future savings

 

[MattB]

i always had a budget. i paid my future first.

Quoting this for emphasis.

 

[huntnful]

About six years ago I read the book "Your Money or Your Life" and it seriously changed my financial trajectory.

It literally disgusts me now to spend money on things that don't truly bring me happiness. That wasn't the case before haha. I still spend a lot of money on hunting and shooting things. No questions there. But that is what I live for.

Still invest about $40k a year towards an earlyish retirement hopefully. But if it doesn't come, I'm genuinely happy living my life as I live it now. Spending time with my wife and kids, and lots of hunting.

 

[vaquero]

Lots of good advice here

My advice would be
1. Get a profession that pays, there’s a lot of those in healthcare.

2. Pick a good wife the first time

Guys making $2-300 an hour, with no trouble at home don’t need to worry about a budget for eating out on occasion

 

[fngTony]

About six years ago I read the book "Your Money or Your Life" and it seriously changed my financial trajectory.

It literally disgusts me now to spend money on things that don't truly bring me happiness. That wasn't the case before haha. I still spend a lot of money on hunting and shooting things. No questions there. But that is what I live for.

Still invest about $40k a year towards an earlyish retirement hopefully. But if it doesn't come, I'm genuinely happy living my life as I live it now. Spending time with my wife and kids, and lots of hunting.

Is that $40k from just your job income or some of it from investments themselves?

 

[eltaco]

There is a sub-set of people (and it seems it may be a larger sub-set than I can even imagine) who is assuming their retirement will be funded by a combination of social security and meager savings. The median net worth of Americans is less than $150K and the median net worth of those 75+ is not even double that amount.

I have heard many similar stats and admit I’ve never dug into this… but I’m curious if those stats account for the fact that many people have multiple accounts. If I theoretically have 5 accounts of $150k each, do I just show up as 5 average Americans each with $150k total savings, or one relatively wealthy American with $750k combined?

Maybe the stat is less staggering if the average account holder has $150k and the average American has 3.7 active accounts.

Not sure.

 

[MattB]

I have heard many similar stats and admit I’ve never dug into this… but I’m curious if those stats account for the fact that many people have multiple accounts. If I theoretically have 5 accounts of $150k each, do I just show up as 5 average Americans each with $150k total savings, or one relatively wealthy American with $750k combined?

Maybe the stat is less staggering if the average account holder has $150k and the average American has 3.7 active accounts.

Not sure.

I do not know how the statistic is calculated, but I assume it is self-reported and would include the value of all accounts owned by an individual.

 

[huntnful]

Is that $40k from just your job income or some of it from investments themselves?

That’s just my job income. I didn’t even think to include my automatic reinvestments of quarterly dividend payouts.

I have no idea what my investments bring in honestly. I know they fluctuate quite a bit. I don’t touch them, or hardly look at them. It’s just a maxed out 401k in an index fund and my personal vanguard investments, also in an index fund.

 

[ljalberta]

I haven’t read this whole thread through, but when it comes to budgeting and getting your financial house in order, I like to recommend Dave Ramsay for getting out of debt, and then the Money Guy team for growing savings, budgeting and retirement. They have a ton of resources for all stages of life in easily accessible forms such as on their website, YouTube or books.

 

[NRA4LIFE]

With the exception of a house or vehicle, never buy any large ticket item with other than cash. I'm mostly talking recreational items, emergencies are a different thing (Furnace, fridge, etc).

 

[CorbLand]

Read the richest man in Babylon and the automatic millionaire. You can find them on eBay for like 5 bucks a piece or download Libby and get the audio book through your library.

My wife and I don’t have a formal budget, we just watch the credit card monthly for any abnormal spending habits and adjust the next month for them if needed. Some months we over spend, some months we under spend.

Don’t compare yourself to others. It’s hard, I am about OPs age and it’s hard to look around and wonder how people do it. Just don’t do it. Live your life. People have debt, or family that helps them. An old hunting buddy of mine got given 80K for a down payment on a house. This was back when that was 40% of housing prices. You can’t compete with that.

Invest young and don’t stop. I started an IRA when I got my real job 5.5 years ago, I put money into an HSA and my employer has a great retirement package. All my investments went up by about 1.5 percent yesterday and it was pretty cool to see nearly 800 dollars in gains in one day.

Get started, stick to it and watch it all come into place.

Inflation is killing people trying to get started right now. We are feeling it too.

 

[Crahnx]

Lots of great advice. My wife works in finance so it’s front and center every day.

I’ll add my 4 cents:

1. Hire a financial advisor. Many will balk at this, but there are many kinds and many ways they get paid. Having someone else to help hold you accountable and be a neutral 3rd party is never a bad thing.
2. As others have mentioned, Dace Ramsey to get the ball rolling on paying off debt.
3. Get a side hustle. So j m sent here people I know that waste hours if their day doing worthless activities (playing video games, watching television, etc) when they could be making money instead. You are a grown man, act like it.
4. Follow the “one in, one out” rule as much as possible and reasonable. You get a nice new hunting jacket, the old ones needs to go. Even if you get half of what it’s worth, it’s something.

 

[NRA4LIFE]

If you're company offers a 401K, hopefully with some matching, take full advantage of it.