From the time I was 18, I always saved money. But now at the age of 27, I have less money in my bank account than I did when I was 18. There is no denying the fact that my holiday shopping has played a part over the last two or three months. I don’t buy for many people, but my spending on just a few special individuals really adds up. This is not the only reason I have so little money at the moment though. What is the real reason?? My relationship.
A year and a half ago, after about 4-5 years of being single, my spending habits changed dramatically when I found myself in a relationship with an amazing girl. So what changed specifically? Eating out multiple times every weekend ADDS UP QUICKLY. Additionally we took mini trips every couple of months for a couple of nights, sometimes in places where the overnight stay was $400 a night. Now that was only once or twice for a water park where we took her son. I have to admit those trips are always a blast, they just come at a higher price. Most overnight stays though, averaged probably $140 a night after using travel sites. And of course there was the ring I bought her which was $5,500 and came right out of my brokerage account with money that wasn’t currently invested. My focus here is not on those accounts, but I have used money from them as well during this relationship.
I have spent more money this year (2018) than I ever have as a consumer before. Going out to eat, going on shopping trips with her, buying her things, buying me things, eating out for lunch during the work week way more than I ever had before, and on top of it all, I bought my first house in September! I’m not going to lie, it’s been great fun spending my money and “living” more than I ever have. But at some point a line has to be drawn, and even though I passed that line a while back, I’m starting to go back to find it.
What I realized about a month ago, was that for the past few months I was spending more than I even made. What does that look like? Well two weeks ago I had $700 in my checking account. The lowest it has been since opening it years ago. There had been a time in my life that I was saving $500 every month just for my brokerage account. Money I could use to invest in stocks long term, trade on earnings, short sell, or literally whatever I wanted to do. But for 2018, not one dime has gone in to my brokerage account. Not one dime has even been saved. Instead, I not only spent the money I was making from my job, but I was also draining my other accounts for various expenditures. This realization has made me sit down, evaluate my financial situation, and develop a strategy to dig myself out of this hole.
I’m pretty smart when it comes to understanding finances, saving money, and investing. The problem is that even though I may possess such knowledge, I allowed my new lifestyle to take over and start to ruin me in a financial sense. Money I had been saving since I was 18, now gone. And the ability to save money from my current job was eliminated by my own spending. So what am I doing about it? It’s simple…If it isn’t a bill or current loan obligation, then I’m not spending money on it. My mortgage isn’t large, nor is my car payment. There is money left over to save out of my monthly income, I just have to stop pissing it away.
After building a spreadsheet of my income vs debts, I found that I actually have $400-$550 each month left over that I could be saving. That’s even after estimating eating out (only occasionally), and estimated gasoline expenses. If I didn’t have exact figures for something I estimated the figures, and I did so in an unfavorable way. Worst case scenario means that I have even more money each month left over. But using my estimations as they are, that $400-$550 each month is what I came up with. What’s even better is that I am receiving a small raise at the beginning of 2019. I will also become a 20% owner in my current company and will receive distributions every two months. And lastly, I will receive 50% commissions on any products that I sell.
So…combined with a lifestyle adjustment which is already in place, my increased 2019 income will allow me to generate anywhere from $600-$1,500 each month in income that can be used to save, invest, or pay down the few debts that I have. As for now, I take my lunch to work with me each day, and I only spend money on eating out once each weekend, as opposed to 2, 3, or 4 times. And most of all, I have cut myself off from spending money online for general merchandise, as well as taking any shopping adventures. Some self restraint combined with increased income will allow me to start saving for my future and for retirement. And saving for retirement is something we all need to be doing.
There is nothing wrong with enjoying the weekends at home with someone you love. Just taking it easy, and saving that hard earned money. As a 27 year old who lives in a “YOLO” kind of world, that’s not always easy. But you know what…it’s responsible. And one day I want to look back and thank my younger self for not being completely stupid with my money…..only somewhat stupid. Haha.