The Financial Overhaul

Spending + Emotions = Financial Disaster

My bank recently offered a tool where I can access all of my accounts in one place. It also categorizes my spending. In one month I spent $200 on lunch and happy hour to ‘comfort’ myself. $200! I’m embarrassed writing that. Yet, my clothing balance is still at 0 and I don’t have enough of a savings to live comfortably if The Hero or I lost our jobs. While I knew I couldn’t change what I’d spent, it really made me start asking myself some serious questions about my priorities and what legacy I wanted to create financially.

Emotional spending is subtle. I realized that I, like a lot of people, suffer from it. It’s almost like binge eating. I buy and then when I balance my account, I regret dropping $20 on that slider platter and Brownie Overload Addiction.

My other detrimental spending habit what I like to call possibility shopping. I need ONE thing, but it’s strategically placed near other things that I’ll possibly need one day, so I grab it (or them) and end up with more than I needed and overspending. Have I used the products? Probably not. But it creates a vicious cycle.

Things Have GOT to Change

This year, I decided things have to change. I’ve been living in denial for most of my adult life about my financial situation and have lived WAY beyond my means at times. It’s a vicious cycle that I gave myself permission to keep continuing for years.

As The Kid gets closer to leaving the homestead and The Girl approaches puberty, I really need to get things on track. Not just for me, but for them so that when they leave home, they’re prepared to live within their needs, but below their means. I want them to start saving for retirement early, having a security net, not depending on credit or living from one paycheck to almost another one. This is not the legacy I want to watch my kids live out. So, for me and them, I coined 2012 the Year of Financial Honesty.

In order to stick with this and make it a lifestyle change, I created six monthly steps I can manage for the first half of 2012:

  • Always live within budget. Always
  • Create savings and spending plans
  • Review my credit file
  • Identify ways to recycle and upcycle as much as possible
  • Research second income for us to beef up Life Happens Fund
  • Teach the kids how to manage money NOW

These six steps have weekly steps as well. For living within my budget, I had to cut out extraneous spending and surprisingly, I don’t miss possibility shopping. Unpacking helped me realize that just about anything I’ll possibly need in the next three months is already somewhere in that house. I refuse to buy another cake tip or pan, offset spatula, pen or to-do notebook for at least three months. Seriously.  

Brighter Days Have Arrived

Since early January, I’ve made significant strides. With the help of The Money Class by Suze Orman I was able to look honestly at what I have and planning what I need and want. And I have been able to avoid a lot of spontaneous spending. I created a monthly budget and although the Heroine Happiness line item has been significantly reduced, I haven’t actually wanted to spend on those items. I’ve learned to manage my emotions in healthier ways, not by consuming a lot of empty calories or seeing how many peach mango martinis I can buy with $20. I’m learning to funnel that energy into productive activities and just letting it go. I realized I hold a lot of grudges about the pettiest of things. I mean, can I really do anything at 1:42 p.m. about the girl who bumped me with her book bag on the bus at 7:22 a.m.? Not a thing. The point is I’m learning how to deal with my emotions better. And while it’s not 100% yet, I’m feeling myself right now and my bank account is happier for it.


2 thoughts on “The Financial Overhaul

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  1. I wish mine had taught me about credit BEFORE they sent me to college. I learned that one the HARD way. Fortunately, there’s a law now that prevents credit card companies from offering kids under 21 credit cards.

  2. Good one! I wish I had listened when my parents used to try to tell me to save and not spend every penny and then some.

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