Money Matters: The Challenge

Is Saving Money a Challenge For You?

I don’t know if you’ve ever challenged – or tricked – yourself into becoming better with how you manage your money. If you haven’t and are suffering from hole-in-wallet or hole-in-pocket syndrome, a challenge is exactly what you need.

Looking back at my expenses over September and October, I realized I spent a lot of money unnecessarily on food. Namely, ordering out. I would UberEats this, Postmates that, GrubHub more. It was ridiculous for someone who has a full working kitchen, knows how to cook and food in the cupboards. Ridiculous, I tell you!

But why was I spending so much money on food when I could very well make my own? Laziness. Uninspired by what I had in the kitchen. Despite that, I was burning a hole in my wallet with all this take out. It was absurd how much money I would throw away on food because… I could.

The ability to waste the money is never a good enough reason to waste money. There’s a lot of things we can do. Doesn’t mean we should do them.

So, I decided the best way to curb my biggest money leak was to reward myself. Not for spending money. But rather not spending money. I spent a lot of money on ordering out. To reduce how I spend on food outside of groceries, I decided that every week I go without spending money on food, I will give myself 25 points. 25 imaginary points. Whatever. However, once I reach 100 points, I will reward myself one of two ways: dump $50 into a savings account or buy something nice for myself (not food related).

In other words, I can reward myself for not spending money by putting money towards a savings goal or a pair of ankle boots, or a coat or something useful! Seems fun. If it all goes when over the course of these eight weeks by myself, you all might get to participate with me. Something I’ve been thinking about for 2020.

In the meantime, does anyone have any tricks or challenges they’ve given to themselves to become more financially successful?

Money Matters: Give Your Budget A Little Wiggle Room

You know what my biggest budgeting problem is? Sticking…. to it.  I know I’ve  mentioned this before, but keeping to the terms and agreement of a budget is hard.  Not because money burns a hole in pocket every time I get it or I’m out trying to sabotage myself.  But, because… sh*t happens.  Life happens.  And no matter how much better I think I’m getting at preparing for life’s surprises, it likes to throw me a curve ball every so often.

I’m a fan of the game, but damn! Life, could you let me sit on the bench and watcg few times?  No.  That’s not what life’s about.  She whispers to me.   Anywhoo…

I budget bust.  Meaning, I find it hard to stick to a budget because I don’t factor in life happening.  Like, how? Something as simple as a cold or flu can bust my budget.  Stay with me here: I feel the signs that I’m coming down with something.  I try to head it off at the past by drinking tea or more fluids, covering myself up with vapor rub at night, wearing socks to bed.  Little things that should go a long way.  But sadly, they fail.  I’m sick.  And now I’m sick of being sick.

So I stroll into CVS and go down my trusted but questionable cold and flu aisle.  I grab some cough drops, cough syrup, allergy medicine, a saline rinse and something marked “may cause drowiness”.  Not overkill.  I’ve learned that there is no on medicine that works as a cure-all for me.  I need to make a concoction of these poor excuses of FDA medicines to feel a bit of relief.

With my legal experiment in hand, I make my way to the register to pay for my new found treasures.  Only to learn as I swipe my card, I just dropped over $40. On a problem that may last for one to two weeks.  Seriously?!?

So, now in the middle of summer I’ve just busted my budget because I got sick.  It sucks.

However, if I had given myself a contignecy… a little wiggle room, that $40 wouldn’t have been so detrimental to my accounting ego (or lack there of).  I would’ve considered my cold drugs an unexpected but covered in the budget expenses. 

How much should a contingency be?  That depends on you.  I like to place $115 as a safety net.  Odd number?  No, not really. I took the average of past over expenditures and decided that was a healthy number I could live within without busting my budget and still covering a random cold here or there.  What about a medical expense or car repair?  I have dedicated emergency fund for things of those nature.

So it’s possible to budget and stick to it.  Just gotta be real with yourself and give your budget a little wiggle room.  And maybe not get sick in the middle of July.

Money Matters: Are You Motivated By Money?

If you ask me this question point blank, my answer would be: hell yes! But not in the I love money, money rules everything around me kind of way. More like… I don’t wanna be boke so I make money conscious decisions so I can have a comfortable future that isn’t wielded by the fear of lack of money. There are songs that speak to the evils of money and how money is corruption but I disagree. I see money for what it is — a tool.

And like any generally good-natured person, I work so I can have enough money to have my basic necessities met. But I hustle so I can have more money build my dreams. Because we live in a world where, as my Nana would say

Money talks and bullshit walks!”

And I’ve been very perceptive of the power we have given this tool we call money. We allow it dictate the value of living, housing, vacationing, education and every thing else that touches our lives. So if we don’t have money, we have lack. Or, so we’ve been taught to believe we lack if we don’t have money. Which is why it’s such a powerful motivator. There’s nothing wrong with money as a motivator. But, how we allow it to motivate us, that’s where the waters get murky.

Yes, I’m motivated by money. If I had more money, I’d be able to save more for a place I could own in the foreseeable future. If I had more money, I’d be able to pay off my student loan debts. If I had more money, I’d be able to live in a better neighborhood, or at least in a building that provided its tenants with parking. If more money this or if more money that. I’m sure we’ve all given ourselves the more money speech. But how often have we given ourselves the take action speech?

Think about how many times you yourself or someone you know has said, “if I won the lottery I’d buy….”. That’s a wonderful dream that money may have motivated, but what become of that dream? Better yet, if you didn’t win the lottery – which is all of us – are you still on track to live that dream life? Let money be motivation, but let some sort of execution propel you there.

The Money Matters: Create a Recession Hustle

A recession is coming, are you financially prepared?

If you haven’t been living under a rock lately, you’ve probably heard reports that a recession is lurking in 2021. Now Trump and his administration are saying that’s not true. They’re saying the economist experts are wrong. The economy is strong as well as the labor market. And they’re right… except for the fact a recession is coming despite the markets right now (or as a result of, depending how you look at it). And it’s probably not going to be anything like the recession we faced in 2007/ 2008, but an economic dip is on the horizon.

Let’s just use some basic high school education here to explain why a recession is headed our way. History, a subject every American was required to take in high school, shows that it often repeats itself, but more importantly, economic dips and recessions are normal. They’re patterns. It’s how the market corrects itself. Fine. Don’t like history (I didn’t either till later in life)? How about physics? One Newton’s laws states that what goes up, must come down. Okay, I’m dumbing that down a bit much, but basically what it’s stating is that a object will stay in motion until an opposing force of equal force is exerted on it. The object is the economy/ inflation and the force is the market correction. The cost of goods, services and living has steadily increased over the past 5 years because the force of the market hasn’t yet corrected itself.

I was gonna jump to math if you weren’t a physics fan, but I’m not here to battle why there will be a recession. I’m here to help you get prepared for it. And if one never comes, well then guess what? You have a stash of extra money you’ve been growing over this coming year. Otherwise, hustle. Your “recession” hustle is going to be different than your regular hustle as it’s going to be an independent service from one that you’re already offering now. I’m deciding on whether or not I want to do résumés for people or proof read and edit documents.

Editing, for me is easier, but the need for resumes is greater which means more business. More money, essentially. Hey, I could do both. But what makes the recession hustle different or possibly have a greater impact on increasing your finances? It’s gonna be more cut and dry. No package tiers or multiple offers. You’ll market it the same way and provide samples of your services, portfolio if necessary. And you’ll do far less negotiating. Prospect clients will either take your offering as is or not all. This hustle doesn’t have time for the nitty gritty back and forth. Technically, neither do you.

We have 4 months left in 2019 so it’s imperative that you squeeze in an extra hustle if can. If you can’t? Then the hustles you’re already performing need to go hard. You need to find more creative places and platforms to market your hustle. Reach out to more people. Connect offline more frequently. You need to dig out every tool and assest under your belt. Make this time matter.

Too many of us were caught off guard by the last recession.  I was working in a department store in college and was laid off because of low sales as a result of the recession.  Lost my little part time. I was living off campus and supporting myself at the time. So, I felt that lack of income deeply and immediately. I never want to feel that again. Neither should you.

Money Matters: Budgeting Takes Practice

Budgeting takes practice

I don’t know about you, but every time I hear trips and tricks about saving money, the root of it all starts with budgeting. And it sounds simple enough to believe it. Make a list of all my monthly expenses and stick to those costs alone. The idea is that if we can spend less than our take home pay, we can save for a rainy day or that dream home fund. But, what these experts fail to share is that budgeting isn’t some secret ingredient the rest of us didn’t know about. Budgeting takes practice.

And a lot of practice. If you get budgeting down on your first time out, we’re donating your brain to science. Sorry, you don’t have a choice in the matter. I need to know how your mind works.

But if you’re like me and perhaps the rest of us, creating the list of expenses is the easy part. Sticking to it is the challenge. And something as trivial as dinner with friends can throw it all off kilter. Which isn’t fair, but real.

So, then, if budgeting is harder than it sounds because of surprise expenses, how can we be successful at it? Especially if we’re generating a second or third income stream?

Practice. Practice sticking to only the expenses you have to pay. Nothing more. If you’re the social butterfly but still want to budget, one of your expenses line items should either be miscellaneous or entertainment. That way you can include dinners out with friends and going to the movies as part of your budget. Ideally, you want to reduce how often you go out and spend money. If wasn’t made clear earlier, the whole point of budgeting is to save money. And spending money is the direct antithesis of saving money.

But back to the practicing of budgeting. The part we may need real help on: takes time and commitment. Chances are, we’re going to splurge on occasion. Or have an unexpected but important cost come up. It’s called life and she’s not always nice. So start practicing with weekly budgets. See if you can go one or two weeks without calling an Uber and Postmating lunch. Pay off a credit card to reduce an expense.

Want to make it exciting? The money you don’t spend, open up an high yield interest account, put the money you would normally have spent on frivolous things and save it for the end of the year. You can either treat yourself to something posh and outlandish or invest it in yourself or your future. Either way, you’ll have the money and the options to do so.

Money Matters: Lending Money

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I don’t like borrowing money for any reason.   I’m sitting on a mountain of student loan debt which I feel like I am slowing chipping away at and as a result, I HATE borrowing money.  In the investing world, borrowing money is a common thing.  In fact, many experts will tell tell you there’s such a thing as “good debt”.  It’s an investment that can be written off for tax purposes.

I understand the concept.  I just don’t agree.  I’m more of a David Ramsey gal looking to get to the snowball avalanche on my student loans.  But still chipping away at that.

But there’s also borrowing money on smaller, personal level, like between friends and family.  I know I’ve done it once or twice and dreaded having to do it.  More often than not, I’ve had people borrow money from me.  And I’m sure I’ve said it before and probably even posted it before, but I’m going to say it again:

IF YOU CANNOT AFFORD TO LOSE IT, YOU CANNOT AFFORD TO LEND IT.

What do I mean by that?  If your closest friend or a relative asks to borrow money and you have it, but you would need them to pay you back right away, then you probably can’t afford to lend them the money in the first place.  The sad thing about borrowing between family and friends is that is can ruin relationships…if you let it.  Till this day, my Nana swears up and down that she doesn’t talk to my uncle, her own son, because he still owes her like $700 on a truck my uncle bought from her husband.  It’s ridiculous.  So my golden rule is, if I’m going to lend someone money — whoever it is — I forget about it.  That money is gone and is never coming back.  Oh, well.  That way I’m not upset or resentful or angry and it didn’t damage a relationship.

However, should someone pay me back – yay — that money doesn’t go back into my checking account from which it came.  It goes to my savings instead.  I already made up my mind that the money was gone forever so when it does return to me, I treat it like an unexpected windfall and throw it right into my savings.  This is way I’m adding to my savings and I’m not spending “extra” money unnecessarily.  It helps me keep the reins on my money better so I have financial more secured future.

So, ladies.  I know we want to help out our friends and our family, but if it will cost you peace of mind, your sanity or even your relationship, it’s better to just say no.  Money isn’t just money to everybody and we can’t expect everyone to treat or respond to money the same way.  If you can’t afford to lend it, you can’t afford to lose it.

Money Matters: Making Smart Money Moves

The fact of the matter is we’re going to have to spend the money we make in some fashion or form. But when we do part ways with our precious hard earned money, it’s best we’re wise about it. But what does that really mean? What does it mean to be a wose spender?

Last month, I finally got a new (new to me) car. And while I was shopping around, Fair was my best option financially. Fair is a no committment leasing option to obtain a vehicle. No, I’ll never own the vehicle I drive but I’m not trapped with a long lease either. My down payment? $535. No, seriously. I had $100 coupon from the Girlboss Rally I attended in June that I used.

And yes, I’ve been driving the new car more so than the 1998 Infinity Qx4 that gifted to me almost three years ago. And as you can see, my monthly payment is $298. But…that’s the monthly lease payment and the insurance. It was just cheaper to use their insurance than my own that I was using for the old car.

As side hustlers, we gotta continuously make smart money moves. It doesn’t matter if our money moves affect our personal lives or our business lives. All money moves need to be smart.

Money Matters: More Green, Closer to Black

Yesterday was a good money day for me. Correction: yesterday, was a good financial day for me.

About 4pm I confirmed a notary client that initially wanted to meet in Silver Lake, then later in Glendale. That allowed me to negotiate a higher travel fee, and upon arrival, what turned out to be two signatures, doubled to four. 13 miles from home and seven minutes of my time turned into a $95 service I was paid for.

On the way home from said notary client, I noticed Navient sent me an email regarding my next student loan repayment invoice. And I didn’t want to hear, especially since I had just got finished paying this month’s bill. But as I was reading the email notice – then later confirmed when I logged online to the website – my payment fee had dropped roughly $66.

Okay. I can get on board that. That doesn’t mean more money for me to spend, just that I gotta get wiser how I use the money I’m “saving”.

And to add the cherry on my pie, I learned through my credit card app and banking app that my credit score had jumped 28 points.

I feel as if I’m on a very good financial high. Like, if I continue to curtail my unnecessary spending, monitor my credit, pay down/off debt and save for my future, I really might get to that lovely I often see in my head and call my “future life”.

How’s your financial week looking?

Money Matters: Save, Invest, Pay

I spent most of time at the Girlboss Rally attending money workshops. I was a little concerned that I wasn’t finding workshops related my work. And even though I was attending Girlboss as part of my work, I was also attending as an opportunity to learn for myself and my near future aspirations.

And during these very insightful discussions as to when/ how to manage money successfully, the topics of when and how much to save, when and how much to invest and when and how much to pay yourself were constant and prevalent. But the takeaway was they same.

NOW!!! Or in other words, start saving, investing and paying yourself immediately. The moment you start making money, the moment you get paid from your first side hustle client, do all three.

Save money: you may have to claim taxes on your new found income. So put some money aside for that.

Invest money: put money back into the business and make sure you have the supplies and equipment to remain “operational “.

Pay yourself: I’ve heard lots of self made people talk about how long they went without giving themselves a salary. But that doesn’t logically make sense. Because if this little thing called rent. So pay yourself. Think of a percentage and stick to it no matter how much money you start to bring in.

Make your money work and grow for you from the very beginning.

Money Matters: To Charge or Not To Charge Sales Tax

That’s a very good question. And I think this is the first time I’m delving into this topic. So this should be fun. Maybe moreso for me than for you, but hopefully for both of us.

As a side hustler, maybe all your fees and services are cash based. There is no tax to charge because it’s, well — to put it frankly – you get paid under the table. We’re not reporting the income we’re earning on the side because maybe it’s not worth reporting. Now the IRS will tell you something different. They will say that ALL income needs to be reported. I say (but please do what’s in your best financial interest and to avoid jail time) that IRS needs to prove there was income before I report anything. I mean, a few years ago I found $25 in the street on the way to work and on the way home. The cash I found that totalled $25 in that one week. That wasn’t income. That was finders keepers!

But in all seriousness, there is a reason why cash based businesses still exist. They can report higher losses and keep more of their money because they have “less” receipts to produce if audited or for whatever reporting purposes. But the question is, should you charge sales to clients tax at all?

I’ve done/do both. When I was providing resume services, and clients were paying via online, I charged sales tax with the expectation that I would have to report it on my taxes. And I explained to the clients that because California will charge me a tax, I needed to charge them a tax. Poor reasoning but people legitimately went along with it.

With my part time notary business, I don’t charge a sales tax at all. And it could be because I also charge a travel fee. But a flat rate has helped me – I feel – continue to get clients and have repeat clients.

So… should you charge sales tax? I say yes, if you’re going to be collecting a lot of online payments. No (but you still can), if you’re going to remain a cash based hustle. The decision is yours.