Experiences are worth more than Stuff

Whenever I meet someone who has done a lot of interesting things I am fascinated and I want to hear more about and their experiences; I admire these people. These people have stories that they can share and will always be relevant and interesting. Unfortunately the same can’t be said about all the stuff that we acquire; yes its cool but it doesn’t last very long. Right now iPads are all the rage and people I know are snapping them up and very excited about them; I’ve even heard stories about people going to the US just to buy them  (they didn’t come out in Canada at the same time as in the US). In 5 years do you think that all these people that went and got their stuff will still be using it? Do you think they’ll care that they had this short lived affaire with a toy?

Now to put this into context imagine skydiving out of a plane at 3,000 feet or learning to sail. The  emotions that come with these activities are very real and you will always remember them deeply. The scary thing is that experiences like these of these are probably about the same in cost if not less than that little gadget. Five years after doing either one of these things do you think these people will remember them? Of course they will even if these experiences were terrifying or something they didn’t enjoy. Why? Because they did something and experienced it.

When I was younger I was fascinated by stuff and I got a great deal of items and gadgets just because that’s where my whims were taking me. Unfortunately I don’t remember these very much anymore and quite frankly all the money that I spent on them is totally lost. To really illustrate this around the year 2000 I really wanted a laptop and bought one for $1,800 on a payment plan – at the same time I took a trip to the Dominican Republic with some friends and took windsurfing lessons trips. I paid for both of these with credit (I know not the best idea) but in the end while I used the laptop I don’t recall specific moments of joy or wonder as I do from that trip – the moment where I was able to pull the sail on the windsurfer up and actually start moving forward in the ocean I don’t think I will ever forget. The laptop unfortunately I will remember for a different reason (and it’s the only reason I’ll continue to remember this item); and that reason is I kept the stupid thing for almost 10 years because of how much I paid for it and the extreme difficulty I had in parting with something that was outdated and never used.

The ironic thing is the reason I will remember that laptop is because of another experience, reading Leo Barbuta’s The Power of Less The Power of Less and starting to purge unwanted and unneeded things in my life. A simple excursion or activity is more valuable to me than any gadget and the gadgets in my life now are meant to help me experience life because when my grandkids ask me about my life I want to be able to say what I did not what I owned.

Budgets are sexy!

The idea behind a budget is incredibly sound – you plan out where your money is going and you make sure to set money aside for savings. Pretty simple right?  It gives you a clear sense of where your finances are and what you have to spend; for example if you needed to pay your water bill this month then you wouldn’t run out and buy an iPad if you didn’t have extra money. The budgeting process is pretty straightforward you match all your expenses against your incomes – in essence it really is that simple but the reality is that people are scared of the idea, they are happy to live in ignorance while spending themselves into debt. With budgeting you gain some measure of control even if you have to take best guesses when it comes to some items because they’re a bit variable (say groceries).

After a month or two you can start to see where your money is really going and how to start making positive changes in your budget and your lifestyle. Unfortunately you have to keep very close tabs on your spending to really make sure that you know where your money is going. Personally when I’m evaluating my budget or trying to get a clear understanding of where my money is going I use a budget but I match that up with a detailed accounting of all my spending and I really do mean all of it (down to the pack of gum and can of soda). After about a month or two you start to see a picture forming of where you spend your money versus where you think you spend it (your budget). You need to make sure that your actual spending isn’t causing problems in your budget. One of the biggest shocks I’ve gotten as a result of this site cam from this exercise. I found out just how much money I was spending and where my money was going and it floored me. I think a great many people would be surprised if they did this exercise.

Overall budgeting isn’t too hard but you do have to keep it up for it to be really useful. If you budget for a month or two then stop then there’s really no point to it. By having a budget and tracking where your money is going you can see the gaps and adjust either your budget or your spending.

The biggest problems I have with budgets is that the budget portion by itself is pretty straightforward, it’s the expense tracking that can be time consuming and lets be honest tedious and boring. After a month or two I tend to stop being as meticulous about my expense tracking – the good thing here is that by this point I’ll already have an understanding of where I’m really spending my money and I’ve made a few corrections. While my approach isn’t perfect a couple quick resets a year and I’m able to keep myself mostly on track. If you’re extremely meticulous and diligent in keeping this going then it can make a huge difference over a year.

Another thing I’ve started to use is Google docs for tracking my expenses – its got pretty much the same power as excel or quicken but you can access it from pretty much anywhere in the world where you’ve got an internet connection. This has made the tedious aspect of tracking my daily spending a bit easier.

If you are brutally honest with tracking your spending you’ll see that there are many holes there, even the daily cup of coffee can add up to a lot of money which you could use to pay down your debt or start a savings account. By budgeting you can start working towards your financial goals rather than simply letting the monthly bills and expenses drive your life (it can be very easy to fall into this trap)

I’ve been pretty good about tracking my budget and expenses over the past few months and I’ll share my  templates and give more details on my budgeting at the beginning of the month (I want to take another look at everything to make sure it all makes sense).

One Million and Beyond – A Reintroduction

In September of 2006 I started this site in the hopes that it would accomplish a few things, I was hoping that it would help me get better acquainted with my money and it has done that to some extent. I wanted to become more confident with my money and I definitely have; I wanted to get out of debt which is something I am still struggling with; I wanted to make some money (lets face it this is an underlying goal for many bloggers). Finally I wanted to document my journey to a million dollars and while I am closer than when I started this site I am no where near this goal.

Along the journey so far I have learnt a great deal about myself, finances, writing, blogging and life in general. I have read some really great books and become familiar with my own financial situation.  This has been an interesting journey both good and bad. At times I have contemplated shutting the site down because I just didn’t have the time to devote to it and I’m in the middle of yet another one of those situations.

The thing is I do enjoy writing on the site, the issue that I bump into is that other things in life are just more important like my family or even my job (perish the though). The reason that I fall into these gaps is while I focus on my finances and the general subject of personal finance often, it doesn’t’ necessarily happen every day. When I don’t get a chance to write or if I don’t have anything to say I feel like I’m not fulfilling my commitment to the site (or to my idea of the site).

When I first started this site my knowledge of personal finance was limited and my goals were ambitious and I think they were very unfocussed which eventually lead me down too many paths and I lost some of my initial enthusiasm for writing. I have learned a great deal and I believe that if I were to start this site over today I would be much more focused and not so demanding on myself. I would focus on my challenges rather than grand ideas of growing my networth to a million dollars while I’m sitting in debt.

With all of this said I would like to refocus this site a little bit to capture the items that really do interest me and hopefully you my readers. I want to make sure that I have the something to say even when I do get busy rather than grasping at ideas simply to get a post in because I feel guilty for not writing one.  Without further adieu here is a reintroduction to this site:

Hello fellow readers, my name is Matt and welcome to my site: One Million and Beyond. This is a personal finance blog that have written on for a few years now. I am 33 years old, married with a cute button of a daughter; I make a good living and like many people I am in debt. I’m not drowning in it but I have a fair share of it. I don’t have much in the way of investments because like too many of us I live from pay to pay only saving a small amount.

This site is about my journey and my experiences in the world of Personal finance (and specifically my finances). I will be writing about the things I learn and things I do while I tackle the challenges of being in debt and living from pay to pay. I’m not struggling financially but if I were to loose my job I would be and I think a lot of people are like me. The idea behind this site and my own personal financial goals is to become financially free. My interpretation of this before was to have a lot of money but that is no longer the case; now my goal is to not be burdened by my finances – I mean to be their master not they mine which has been the case since I started making money. I will write about my ideas and challenges while I strive to achieve this.

This site is partially an anonymous blog because I am writing about my finances and I will share real numbers; this site is not intended to be a personal blog about me and quite frankly I don’t need everyone I work with knowing how much I make or spend on my car or my smoking (which I will be aiming to quit). I want to be able to share without impacting those directly around me; I want to provide a place where people can come to read an article or two without it having an impact on my family or work.

Hopefully I will make a little money off this site, so you will see some ads and other means for me to do this. The idea isn’t for this to be my only source of income but multiple sources of income are always better than one (and it helps to pay for the hosting).

Please leave comments and share your thoughts – we learn more from the world around us and experiences than from text books (I can only have so many experiences).