Emmie Mears
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It’s All About the Money

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It’s All About the Money

Living beneath your means in a world that would rather you bankrupt yourself to keep up with the Joneses  can be difficult at best.

And it might be strange to think that I’m about to write a post of financial advice when my rent is eight days late and likely won’t be paid until Friday — but rest assured everything I say is very much directed right back at me and my own family. I’m going to do my best starting now to follow it.

I’ve heard the advice before: live beneath your means.

It seems like a nebulous sort of bit of advice. What does that really mean, anyway? I’ve spent a while trying to come up with something to describe it, and this is what resulted: spend your money so that there’s something left at the end of each month.

I know, W. It's a tough concept for me, too.

This is where it gets tricky. And it’s where people get somewhat prickly. Because we want nice things. We want a nice home and a nice, reliable car. We want a flatscreen and an Xbox and to Buy Things. We want to eat out and go to movies and buy our spouses and children presents Just Because.

We feel we deserve it. I feel I deserve it, and you probably do too.

The problem is, we often Can’t Afford It.

Those three little words are almost dirty ones. You know what I mean — saying them makes a bitter taste in your mouth sometimes.

I grew up very, very poor. I grew up with those words as a constant litany. And yet in spite of that, we always stretched beyond our means. It’s a rather harsh truth, but I never learned how to save. The only lesson I’ve ingrained into my being about saving is that when you save money for something, catastrophe strikes and then it’s gone. So why bother?

I didn’t realize how poor we were until I went to college. I bought my own car with my meager college savings and the promised graduation check from my grandma that I had planned to use to buy a computer. Most of my classmates at my private university had parents who paid for their cars, their tuition, and their spending money. That’s when I first felt the bitterness of having to tell my peers I couldn’t afford things.

When they asked me to join them for dinner. For skiing and snowboarding. For camping. For Spring Break trips. For movies. I had to work my way through college, and even with all the grants and loans and scholarships, I found myself broke sophomore year with expulsion looming due to my finances. If it weren’t for the extreme generosity of two of my friends and the fact that I crocheted my fingers off all autumn selling beanies and scarves, I wouldn’t be sitting here right now typing this. I don’t know what I’d be doing, or where I’d be doing it.

I’ve never learned to live within my means, let alone beneath it.

I thought I was getting back on my feet this year. Yet here I sit, twenty-seven years old, with a balance of a couple thousand dollars hanging over my head for this month. Including $1100 we owe the IRS. It’s humbling. And terrifying. It’s somewhere I never wanted to be again.

So I know that there’s something I have to do differently if I want my children to have a different childhood than I did. If I want my family to succeed and not be torn apart by the crushing weights of poverty and debt.

No, not budgie. Budget. Budget. No, the word's not French.

Budget

Oh, I’ve budgeted before — sort of. I’ll get as far as lining out my finances for the month, what bills are due and when, and then that’s it. It disappears into the depths of its spiral bound notebook (of which I have several), and if you were to page through my notebooks, you’d find probably a page or two in each written in panic as I crunch numbers.

A budget is more than knowing when your bills are due and how much they’re for. A budget is a plan for paying them on time. A budget is how you know how much money you have, how much you need, and where it’s going.

Right now, according to our calculations, my husband and I make about $4000 a month. Our bills total about $3400. So where does the rest go? If I have no idea, you probably don’t know either. Either we’re not making what we think we are, or we are spending very poorly. It’s probably both.

My income fluctuates. I once made $1100 in a week. This week so far I’ve made $200 with one shift to go. That’s part of the reason we are le screwed — we haven’t learned that we never have “extra.” We have great weeks and crappy weeks, and we’ve not yet learned to balance them out with good planning. Even with steady income, this can happen due to unexpected expenses and purchases.

I wish. In real life, there's a two. That's it. Just a two. Of clubs.

Credit

I messed this up too. Some of it was due to necessity, of a surety. Some of it…not so much. The result is that I have a net worth hovering around -$70,000 between my school loans, my car loan, and my credit card debt. Somewhere along the line, many of us have been tricked into assuming that buying things on credit should be the norm.

"Assume" makes an ass out of u and me!

You need credit to buy big things, like cars and houses and yachts and mail-order brides. But for most things? Pay cash.

“But I don’t have the cash,” you say.

Exactly.

"I'm lost and alone." It's okay. Me too.

You don’t have the cash because you spent it all. Granted, sometimes it’s spent on such trivial frivolous things as food and rent, but sometimes it’s because going out to eat three times last week sounded more amusing than beating up potatoes with a masher at home.

“But I want it!”

Oh, me too. I know. I get it. But if you want it, you should pay cash for it.

*Sniffle.*

There is a way to pay cash for things. There is.

If your heart shlubbed a beat as if I just tossed it in the mud, you're just like me.

Save

How do you save if you’re broke? How do you…*swallows bile*…wait for ten months or more to get that house or laptop or new flatscreen or minibreak  to New York City to see Alan Rickman on Broadway? ALAN RICKMAN WILL LEAVE BROADWAY BY THEN!

Too bad.

First of all, if you are broke to the point of having no money left over after necessities are paid, you probably need a lifestyle downgrade. If your rent is too high, you might need to suck it up and move somewhere you can better afford. This goes for the people who bought McMansions and Lexuses they couldn’t afford as well as those of us at the shallow end of the income pool.

Somehow, we Americans (and increasingly, Europeans and Australians…aw, hell. Everybody.) got it into our heads that we need to always have more. That we need to upgrade our living situation, our functional vehicles, our wardrobes. So we push at the bounds of our income, hoping that we’ll “get by.”

I’m not getting by. Are you getting by?

If there’s anything I’ve learned, it’s that savings has a purpose. It might take twice as long to do things this way, but I’m embarking on an experiment. I’m going to start two savings piles.

1. Squirrel Fund: Squirrels stockpile food and necessities to get by in the slim months. That way when the days of plenty run out, they still have some acorns in their hole to get by when they’re feeling hungry. This is the fund for emergencies — that unexpected car repair, that vet bill, that plane ticket to see an ailing relative. This fund does not get touched except in the case of an emergency.

2. The Treasure Chest: This is where you save for the things you want. This is the money that will buy your new flatscreen, your trip to Europe, your cruise, that rare record you want. It’s also insurance — because in the event that an emergency dwarfs even your Squirrel Fund, you’ll have something more put aside.

It doesn’t have to start with a lot, but it does require discipline, self-denial, and delayed gratification — incidentally, the antithesis of modern culture.

I’ll get back to you on whether I have what it takes to get back on my feet.

What tips do you have for living beneath your means? How have you changed your finances to ensure success? 

 

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Author | Emmie Comments | 18 Date | April 8, 2012

comments

Ms. Marcie

Ok, I feel you on this. For the past few months, I’ve been living off of friends and family who support me mostly because they believe in my dream and see my hard work. They probably have more confidence in me than I have in myself right about now.

I don’t have any advice on how to live below your means. However, I would like to encourage you to use your gifts to increase your income. I don’t know what your daily schedule is, but if you could teach a writing class Emmie style – online or in person – that may help. Or, teach a crocheting class. Heck, teach whatever you know how to do; there’s always a student who needs what you can offer.

Hope this helps.

April 8, 2012 | 1:50 pm

    Emmie Mears

    Oh, man, Marcie. I agree. I would love to start making money writing, but right now I am juggling a job transition, trying to rewrite my first novel and polish it up for submission, and I just don’t know where I would find the time. Maybe an online class would be a good thing to do — I’ll put my feelers out this month and see if anyone would be interested (and what they would want to be taught!).

    Thanks for the suggestions, and I wish you all the best getting out of the money pickle. You’re definitely not alone.

    April 8, 2012 | 4:08 pm

tmso

I like Ms. Marcie’s thinking. Offering what you can do either for monetary gain, or experience you can use later on for monetary gain, is a good idea.

In regards to saving moving, save first THEN pay your rent and utilities – everything else is a luxury. You’d be surprised at what you can make with simple, cheap ingredients like beans and rice. Also, think of creating a small herb garden (indoors if you don’t have space outside). Having fresh herbs make a huge difference in making your food feel “rich”.

Also, when I say save first, of course, save a reasonable amount that gives you enough to just barely make it through the month. Even if that’s only $10 a month, by the end of the year you have $120 you didn’t have before.

Anyway, that’s what we do. And we have it automatically set up, makes it infinitely easier when you don’t even see the money. It just goes straight to a savings account.

However, keep in mind that I have health care insurance through my employer. Without that, I fear we would be in the exact same boat as most Americans – struggling.

April 8, 2012 | 2:37 pm

    Emmie Mears

    Excellent advice, Nila. Thanks for sharing. Spouse and I just sat down, lined out all our expenses and made a calendar with each bill’s due date written in. Then we went through and estimated best and worst case scenarios for our income for the rest of the month to see if we can catch up. Then we made a commitment to the mantra, “We have no extra money” in order to ensure that at the end of the month after we catch up, we put any extra aside for the next month.

    Once we can get to a place of our bills being paid on time, we’re going to start tithing to the savings accounts prior to bill paying each month like you suggest.

    April 8, 2012 | 4:12 pm

      tmso

      Good luck! With that attitude, you two are sure to make ends meet – and then some! 🙂

      April 8, 2012 | 4:46 pm

tmso

I meant money, not ‘moving’! Where did that come from? Bloody typos…

April 8, 2012 | 2:38 pm

moosenoose

I am really trying to sort my debt/money issues out but it’s damn hard (as you have noticed too). In fact I wrote a post today biatching about it! Yes we are all in some way responsible for letting it get this way. We got used to buying nice things on credit etc which was wrong. But then the banks/governments didn’t help either. They were throwing credit at everybody and then they took it all away. So now it’s the proverbial beans on toast every night for the next who knows how many years until the debts are cleared and we can afford nice things again. If only somebody could give me those winning lottery numbers!! Hopefully this will at least help us all to realise that credit is bad and savings are good!!

April 8, 2012 | 3:27 pm

    Emmie Mears

    Yeah, I definitely agree that sometimes credit is too quickly offered. Eek. I know I shouldn’t have been given $3000 as a 19-year-old.

    April 8, 2012 | 4:17 pm

Joseph M Kurtenbach

You are so right about how we get tripped up with our finances, and what it takes to get back on our feet and moving forward. I’ve made the mistakes, felt the pain, forgot the pain, made the mistakes again . . . and I’m still learning. Good for you, learning these things and working to create a better future for yourself and your family at a much younger age than I did.

April 8, 2012 | 11:54 pm

    Emmie Mears

    I hope so…we are still in that very humbling place of having to ask for help and borrow money from people. My goal for this year is to get one of us out of credit card debt. Then we can snowball payments into the other, then into the car, and hopefully by 2014 we can be free of any revolving debt and have an extra $1000 a month freed up.

    April 9, 2012 | 10:48 am

jodileastewart

Kudos to you for sharing your struggles. You are learning life’s lessons the hard way and at an early age. Don’t ever regret this journey, for out of it will come the wisdom to make the right financial decisions and the know-how to share with others in the same situation. I commend you for your attitude and character. Many would just whine, roll over and expect family and/or the government to take care of them. You and your husband have chosen to stand up like adults and take responsibility for yourselves and your actions. People like you will find the “exit door to freedom” far faster than the crowd.

April 9, 2012 | 11:06 am

larzrusco

Have you heard of/tried Mint.com? It’s a really neat tool to lay out a budget. It keeps track of where all of the money is spent, so I know exactly when and where I’ve gone over budget.

I feel pretty luck that my parents never really had credit cards and therefore taught my brother and I how to live without them. (Except to build credit.) Doesn’t mean I’m all that good at it though. I like new things far too much.

April 9, 2012 | 12:03 pm

    Emmie Mears

    I’ve heard of it. I have a hard time being consistent with tools like that, but maybe I should give it another go.

    This money thing gets old fast.

    April 9, 2012 | 12:23 pm

KM Huber

What works for me–something I should have done at the beginning of my working years and not in retirement–is having a spending category for rent/mortgage, grocery, savings, household, pets–sounds too obvious, I know–but now, there is money in my account at the end of the month because I only purchase according to category and anything left over goes to the next month. In a weird way, savings comes last but all categories are covered. So far, only one month have I not “paid” into savings.

With your determination, you’ll be great. Your spending must be an accurate reflection of you or it is failure every time.

Karen

April 9, 2012 | 5:54 pm

Kourtney Heintz

Emmie this is great advice. 🙂 I was doing some research on Bodie, CA, circa 1880s and read a quote that basically said if you do an honest day’s work for an honest day’s pay and live below your means, you’ll never face the financial woes that afflict so many people. it was true then and true now. But we all chafe at budgets and going without especially when. See others having what we want.

April 9, 2012 | 8:16 pm

Renae Rude-The Paranormalist

Squirrel fund and treasure chest … brilliant. I am so with you right now. This was a comforting and inspirational post. Thanks for being so brave.

April 11, 2012 | 1:19 am

corajramos

For some of us, it doesn’t matter if you make more money–you always find the things you “need” that inevitably blow the budget. I wish I had an answer.

One bit of advice I try to use now is to put your money (cash) into envelopes with designations as to what they are for (ex. rent, food, gas, clothing, entertainment, savings). That’s it, when the money runs out in each envelope, you stop spending for the month. It might mean beans and rice and not taking that short trip that came up but you don’t blow the budget.

April 11, 2012 | 2:12 pm

    Emmie Mears

    Oh, I feel you on that one. That’s why I have such an unhappy relationship with saving — every time I’ve managed to save up anything for what I want, something inevitably happens that wipes out my hard saved cash. Like new CV joints for the car, or a trip to the doctor when I don’t have insurance, or some other emergency. It’s incredibly frustrating.

    April 11, 2012 | 2:21 pm

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