. I did my expense report a little early. I'm in the hole for $324 this month, meaning expenses exceeded income by that amount. Bummer. That hasn't happened in a while.
I had a lot of atypical expenses all the way around, including my $150 annual borough tax, a $196 tab for framing mom's art, I blew $100 taking dad out for Father's Day, my $149 Ancestry.com membership, $160 in co-pays for physical therapy, Waldo's $330 vet bill and oh yeah: $438 in groceries this month!
Not great.
I think I may skip doing my monthly investment report. I don't want to see how much I lost, on paper.
In the red for month of June
June 28th, 2016 at 10:25 pm
June 28th, 2016 at 10:52 pm 1467154372
June 29th, 2016 at 02:08 am 1467166126
June 29th, 2016 at 09:09 am 1467191351
June 29th, 2016 at 11:21 pm 1467242471
July 1st, 2016 at 01:37 am 1467337026
July 1st, 2016 at 05:23 pm 1467393837
Barclay’s aggregate bond index for the month of June is up 1.8%.
If you are invested in a diversified, risk-tolerant index, you have nothing to worry about, and I will BET you that you are in fact UP for the month overall.
Turn OFF the financial news, it is focused on the day-to-day changes which have virtually NOTHING to do with long-term trends, and people get completely misled and make bad decisions when they focus on it. Or at least, as in your case, they fret needlessly.
Same thing with your monthly income/cash flow report. One month is a poor proxy for the year given that expenses like car insurance and property tax and emergencies hit only occasionally. It's a poor metric in the short term. In fact, depending on how you assess it, it can be misleading in the long-term. I show expenses more than take-home income more often than not, but I increase my net worth in the long term because the take-home income, which is what I focus on, doesn't reflect withheld taxes (and my eventual tax refund) nor (the big one) the money put away in my retirement accounts.
July 1st, 2016 at 05:27 pm 1467394057
You can't just focus on the dollars and cents. Focus on the dollars and SENSE instead!
July 1st, 2016 at 05:49 pm 1467395360
In doing this, you first calculate your REAL hourly wage. Your REAL hourly wage is your hourly wage LESS taxes paid LESS (and this is the big one) the additional costs that you incur because you work--for example, gasoline for commuting, increase in clothing costs because of buying work clothes, increased restaurant costs for when you eat out because you are too tired to cook....any extra expenses that will go away when you stop working. For me, this brings my "real" hourly wage down from 38.625 to 28.125 (which I round to 28). So for example, that weekend that I spent with you basically cost me one day's worth of work when I take into account the B&B, gas, and meal costs and divide it by my REAL hourly wage. Then instead of focusing on the expense, I can ask myself, was it worth spending a day's worth of wages to have a weekend that I'll remember?
The value part is the output....so experiences that I can savor in memory forever have a much higher value to me than material objects that are consumed and then gone...while the "real life energy" calculation is the output. You can then ask yourself for each item, was this worth it? The answers you get when framed this way are much more telling than looking at just the dollars and cents, because they ask you whether you are spending your time = your life energy in line with things you truly value--in other words, are you living with integrity, in a way that will maximize your happiness and well-being.
Dollars are the wrong metric. Hours of life energy spent for value attained is the core metric that I try to use.
July 1st, 2016 at 05:51 pm 1467395501
July 1st, 2016 at 05:54 pm 1467395647
July 1st, 2016 at 07:08 pm 1467400113
Dido, yes, poor choice of words when I said I "blew" money on things that are all very valuable to me. I often feel, after many years of seeing very little of my father, that I am making up for lost time with him, and the clock is ticking.
I did read Your Money or Your Life and I liked it very much. It does still cause me to ponder purchases more thoughtfully than I used to. I'm going to check my investments now, as I do every month, but I wholeheartedly agree that one month does not a portfolio make (or break). I value your intelligent take on all money matters becus it usually makes me feel better...thanks!