Money Freedom

First off I should say that I'm not a financial planner, and this blog really isn't for advice.  I wanted to get these thoughts out of my head.  Most of my thoughts aren't mine; they are an amalgamation of everything I've read from experts and pundits and journalists.  Realistically, they are an amalgamation of everything that I've read that I've agreed with.

For me, financial planning starts with a budget, a simple total-money-in, total-money-out budget.  I put my budget in MS Excel, but it could be in your head, on paper, in Quicken, on Mint.com, whatever.  If you don't have a budget, put one together.

When I want to buy something my budget gets in my way.  I have to think, and I can't impulse buy.  I wish I had enough money to buy everything I wanted at any time.  That would be great.  My budget doesn't pay off now, but it pays off later.  It pays off when I have savings, it pays off when I have a 529 plan already for my 9 month old, it pays off when my wife and I both have Roth IRA's to pass on to our heirs, it pays when my 401k is on track to be enough to live on when we retire.  It pays off when I don't buy things I don't need.

I've bought a lot of nice stuff.  It didn't really make me happy; it kind of wore off after awhile.  Sometimes it made me feel more important or part of the crowd.  It was also not real, and deep down I knew it.  I'm most happy when I'm in shape, playing with my kid, when I'm eating good food, when I'm laughing, when I'm thinking of jokes to tell my wife and friends.  In other words, I shouldn't buy things for happiness or as a cure for boredom.  I know this, but I forget it too, then I remember it--usually after I regret spending too much.

That's the best thing about my budget.  I can always get back on budget, and since I have savings I can get off the budget to get things like new dining room chairs.  I say new, but we didn't have old dining room chairs.  We just had to stop eating dinner in front of the TV.

I'm not a hard core penny pincher or coupon clipper.  I like things on sale, but I'm more interested in value and utility.  I use my budget to force myself to make good choices.  The things I buy should matter and not be simply more stuff.

So, start with a budget, and start thinking about what it means to save, invest and spend for you.