CheapsKate's Money or Her Life

CheapsKate_3

Hi everybody
In spite of the lack of posting, I have been avidly following these diaries for ages and picked up some great ideas and so it’s time for one of my very own...
On someone’s thread – sorry, can’t remember where – I saw a reference to Your Money or Your Life by Vicki Robin – subtitled Gain Control of Your Money and Start Making a Life. Now I’ve read a number of ‘money’ books, and while they’ve had much useful information, this is the first one which has actually inspired me to do something! In this case, a nine step plan to ‘transforming your relationship with money and achieving financial independence’. Hmm, I like the sound of that, bring it on.
So the purpose of this diary is to track my journey as I explore the steps: Making Peace with the Past; Being in the Present – Tracking Your Life Energy; Monthly Tabulation (ugh); How Much is Enough?; Making Life Energy Visible; Minimising Spending; Maximising Income; Capital and the Crossover Point; Managing Your Finances.
The authors are very enthused with the idea of money affecting our life energy, and without being too new agey about it, I would tend to agree. A quick flick through some of these diaries seem to suggest that having issues with money may also mean having weight issues, clutter issues, housework issues, low energy and low confidence issues...could they really all be inter-related? Am I going to come out the other end not only solvent but super fit, organised, sleek and lovely? :think: I wonder!

Hovel_lady

Happy shiny new diary :j

Yes, I would say a lot of those issues are inter-related. Mine certainly are anyway.

Look forward to seeing how you get on xx

CheapsKate_3

My relationship with money until now has been a nodding acquaintance. Over my lifetime (nearly 50) I’ve earned a lot at times (and been on a very small income at others). I have wasted humungous amounts by not paying attention – bank charges, fines for late payment of tax, impulse purchases. Part of me has always believed that money was boring. I knew vaguely how much I was earning – I never had much of a clue what I was spending! I’m not a shopaholic (in fact I loathe shopping)...er well, unless it’s books, plants, horsey stuff, and yummy things to eat. If my bank account looked dire, I would just get some extra work or flog something. Until the next time.
I have a bit of debt ATM – about £5K in total on an income of about £25K, and for the first time in half a century I am committed to getting rid of that debt once and for all. For me, I’m also interested in exploring my whole relationship with money, and currently I’m doing it by working through Your Money or Your Life which has many exercises but also raises many questions to think about. I might fling in a few other ideas too, if I think they’re helpful or interesting.
The first step in the programme (or program – it’s American but not overwhelmingly so) is Making Peace with the Past. I have to find out how much money I have earned in my lifetime – the sum total of my gross income from the first penny I ever earned till now.
Yikes. That’s 35 years’ worth. The only one I can remember is my very first job when I was 14 where I earned £3 on a Saturday helping out at a local stables. I remember feeling rather rich.
I feel resistant already. What a slog. Plus I’m going to wonder where it all went (luckily Vikki doesn’t seem to want to know that.) OK – my next post will answer that!.
She also wants to know ‘what IS money?’ Hmmm, I would guess ‘a unit of exchange which society agrees has a specific value’. Of course, because money is so computerised these days, really it's lines of binary code on a server somewhere.

ZTD

Happy new diary!

And welcome on-board. :wave:

CheapsKate wrote: »

The authors are very enthused with the idea of money affecting our life energy, and without being too new agey about it, I would tend to agree.

Well I would think the non new-age phrase for it was "state of mind".

CheapsKate wrote: »

A quick flick through some of these diaries seem to suggest that having issues with money may also mean having weight issues, clutter issues, housework issues, low energy and low confidence issues...could they really all be inter-related? Am I going to come out the other end not only solvent but super fit, organised, sleek and lovely? :think: I wonder!

Well hypno did...

CheapsKate wrote: »

The first step in the programme (or program – it’s American but not overwhelmingly so) is Making Peace with the Past. I have to find out how much money I have earned in my lifetime – the sum total of my gross income from the first penny I ever earned till now.
Yikes. That’s 35 years’ worth. The only one I can remember is my very first job when I was 14 where I earned £3 on a Saturday helping out at a local stables. I remember feeling rather rich.

Well also there's the concept of inflation. I remember when £100 was actually a lot of money. Of course the world was in black and white in those days, so perhaps that was it...

CheapsKate wrote: »

I feel resistant already. What a slog.

Does she give any reason for this adventure in accountancy?

CheapsKate wrote: »

She also wants to know ‘what IS money?’ Hmmm, I would guess ‘a unit of exchange which society agrees has a specific value’.

Which leads to the question "What does 'value' mean?"

CheapsKate wrote: »

Of course, because money is so computerised these days, really it's lines of binary code on a server somewhere.

Is that money? Or is that debt/credit?

CheapsKate_3

Hi ZTD and Hovel Lady :wave:, thanks for dropping in. Lovely to see you.

Already more questions than answers. The reasons for adding up everything I’ve earned is to give a picture of how powerful I am about bringing money into my life (hmm, we shall see), to eliminate vagueness or self-delusion; to instil confidence and facilitate goal setting. The book gives a detailed explanation of why it’s important. ATM I’m not judging, just doing it.
I can already see (and I’ve only got to 1988) that I have earned/got what seems to be a LOT of money (even before doing any complicated sums about inflation.) I’ve always been in work – not usually high-paying jobs except one (which I hated) but often (at current rates) around the £10 -£12 ph rate. I’ve also been self-employed, generally not bringing in vast sums but enjoying it. I’ve also had a couple of inheritances, again not huge, but certainly huge enough to own my home outright.
Bringing money in doesn’t seem to have been the problem. Nor has lavish overspending in terms of holidays, cars, Jacuzzis or shoes. It is that I haven’t paid attention. Much has leaked away unnecessarily. I have given a fair amount away – I don’t regret that...no point in me having two loaves if you’ve got no bread IYSWIM.
Vikki says, ‘no shame, no blame’ but I do feel embarrassed at the amount I’ve wasted, generally through a combination of ostrich behaviour, disorganisation or carelessness, like not opening bank statements for months or even years, not returning tax returns on time, etc and hence incurring unnecessary charges. Not shopping around. Not returning faulty goods. Having a couple of parasitic partners (not at the same time!)
Oh well. It’s different now (I sincerely hope). I have a solvent (and generous) OH, I’m paying attention to what comes in and goes out (for all of 3 weeks now!) I’m trying not to ‘waste’ money.
Something spooky. Since my LBM I have received £500 which I didn’t expect, and also had a letter about several thousand pounds worth of shares belonging to my late mother which I didn’t know about. Wow.
I plan to post my total income to now a bit later on. I'm also pondering why I have (or have had) the feelings about money that I do (did). It's not like I come from a wealthy background, though that's all relative I suppose. I don't recall ever having missed a meal, as my tummy is my witness.
Off to work, and today I'm going to claim expenses. (I haven't usually bothered, it's not large amounts and I work for a charity). All those little amounts over the years, added up, would probably pay off my overdraft!
Still confused about money and value, ZTD, but sticking with it!

CheapsKate_3

And the answer to how much money have I earned in my life is....
£406,060.50. Something like that anyway! The 50p is one I was given as a child – I remember being given 10 shillings (as it was then) and believing I would never be able to spend so much.
Another childhood memory surfaced doing this exercise. As a child I was given a monthly allowance – to cover bus fares, swimming etc. I’m sure my mother (who grew up during the depression) was trying to teach us how to handle money. I’d spent mine within a week of course, and too frightened to tell my mum, borrowed from my brother at (I’m sure) 1000% interest!! I learned about debt for sure, but not I think what my mum had in mind...
That’s nearly half a million quid that’s been through my hot little hands. Blimey. Not sure that it has given me a picture of ‘how powerful I am about bringing money into my life’, as Vikki hoped, but thinking back through my fiscal history it certainly shows a lurching repeating pattern. Get money. Spend it (and a bit more). Panic. Get money. Rest and repeat.
More questions to answer from Your Money or Your Life:
Do you have enough money? Yes, I truly think so. I know I’ve currently got some debt, but I think with wiser spending and a more organised and creative approach, I have enough for my needs without scraping by at subsistence level.
Are you spending enough time with family and friends? Definitely not. Lack of energy and organisation are culprits here.
Do you come home from your job full of life? Are you kidding?
Do you have time to participate in things which you believe are worthwhile? Yes I have. Would still like more energy. At the beginning of the year I was juggling 3 part time jobs, not clever or funny. I bought in to the ‘ we’re all financially doomed’ scenarios currently being played out in the media and took on way too much. Didn't dare turn down work. Luckily two of them finished before I collapsed completely, but still feeling a bit burned out. Currently working thirty hours.
If you were laid off from your job would you see it as an opportunity? Yes, to sleep! Seriously, that doesn’t worry me TOO much.
Lots more questions in this vein in the book. I would like to answer ‘yes’ to ‘do you have enough savings to see you through six months of normal living expenses’, but currently the answer is definitely not. That is a goal though.
By the time I am 50 (middle of next year) I want to be free of debt and have 6 months’ living expenses.
That means I have to somehow find £10,000 in 9 months (on top of my current salary). It's a goal, but not yet backed up by a plan.
Gonna put it in my signature though.
Part B of Step 1 is Find out your net worth by creating a personal balance sheet of assets and liabilities. Why? Because 'you can never know what is enough if you don't know what you have.' Also, material possessions which are not bringing me 'fulfilment' could be coverted into cash.
Back soon xx

ZTD

CheapsKate wrote: »

And the answer to how much money have I earned in my life is....
£406,060.50. Something like that anyway! The 50p is one I was given as a child – I remember being given 10 shillings (as it was then) and believing I would never be able to spend so much.

Well it probably was worth quite a bit in those days. Shame the entire world was in sepia...

CheapsKate wrote: »

That’s nearly half a million quid that’s been through my hot little hands. Blimey. Not sure that it has given me a picture of ‘how powerful I am about bringing money into my life’, as Vikki hoped, but thinking back through my fiscal history it certainly shows a lurching repeating pattern. Get money. Spend it (and a bit more). Panic. Get money. Rest and repeat.

One of the best way of being able to change behaviour is being able to understand and predict it.

CheapsKate wrote: »

Do you have time to participate in things which you believe are worthwhile? Yes I have. Would still like more energy. At the beginning of the year I was juggling 3 part time jobs, not clever or funny. I bought in to the ‘ we’re all financially doomed’ scenarios currently being played out in the media and took on way too much. Didn't dare turn down work. Luckily two of them finished before I collapsed completely, but still feeling a bit burned out. Currently working thirty hours.

Well you need to take care of yourself. Your health is the most important thing. Ignore the media - they're only there to sell newspapers. Only worry about things that improve when you worry about them. If you truly think your worrying is going to improve the world economy, then I have some sad, sad news for you...

CheapsKate wrote: »

Lots more questions in this vein in the book. I would like to answer ‘yes’ to ‘do you have enough savings to see you through six months of normal living expenses’, but currently the answer is definitely not. That is a goal though.
By the time I am 50 (middle of next year) I want to be free of debt and have 6 months’ living expenses.
That means I have to somehow find £10,000 in 9 months (on top of my current salary). It's a goal, but not yet backed up by a plan.

Do you *really* need that much? Remember you don't have the expenses of work to take account of.

savingholmes

Well Kate - that sounds like a lot of effort... I must admit I don't want to know the answer to how much money has been thro my hands - and I have not made peace with the past probably either.... Since starting my journey towards debt freedom I have lost a stone and kept it off.... I had lost another stone and half but when I lost control of my spending in the summer I put that back on so think yes there is a correlation...

Other than that - just wanted to wish you good luck on your journey

clippy_girl

CheapsKate wrote: »

I’d spent mine within a week of course, and too frightened to tell my mum, borrowed from my brother at (I’m sure) 1000% interest!! I learned about debt for sure, but not I think what my mum had in mind...

:rotfl: i did this too. brother used to lend £5 and make me repay £7. maybe we should report them as a loan sharks

CheapsKate_3

:rotfl: i did this too. brother used to lend £5 and make me repay £7. maybe we should report them as a loan sharks

Hey clippy_girl, my brother ended up with a punishment which was far, far worse ........ a VERY high maintenance wife...:rotfl:

CheapsKate_3

Do you *really* need that much? Remember you don't have the expenses of work to take account of.

You're right of course ZTD, I wouldn't need anything like that much. I just plucked a rough figure out of the air, typical of the somewhat lazy casual approach which has dogged my financial history.

I CAN add up, so wonder why I'm so resistant to doing it? One reason is I've always rather kicked against authority, and see careful adherence to 'rules' as undesirable, dull and swotty.

However, I am now viewing my free-spirited "I am artiste" stance as being harmful to myself (and certainly my bank account). I do have a glimmer that it's actually OK to work to a budget and do a bit of financial planning without fear of turning into an iron-knickered speccy swot. (No offence to glasses wearers - the only reason I don't wear mine is because nobody ever looks wrinkled in my beautiful myopic world, AND the house never needs dusting.)

Which brings me to ZTD's post

Do you *really* need that much?

All I need is enough. What is enough?
Is it that I never need work again? No
Is it not having any debt? Yes, although that's psychological - an aid to feeling in control I think
Is it not having to worry about money? Yes, although even I know that's not really anything to do with amount. Vicki calls it Financial Independence -"the experience of having enough - and then some". She says it is quantifiable but individuals need to work out for themselves their own definition of 'enough'.

Seems fair. I suppose my financial nirvana would be being in control and with enough spare for unexpected bills or the occasional whattheh*ll treat without really having to think too hard about it, and certainly without associated negative emotion - guilt, worry, fear, shame. I aspire to being in a position where money actually ceases to be important for its own sake but merely a vehicle for more important things in life. I don't mean not thinking about it in the ostrich way I have in the past, but rather not having to think about it because I know where I am financially and that I have enough.

What I suspect I need is not more money but more organisation and planning. Lordy, have I entered a parallel universe and is that really me speaking?

I haven't done my statement of assets yet because I want time to do it carefully and I have a few days off next week. Vicki warns that many feelings associated with your material universe may arise: sadness, grief, nostalgia,guilt, shame etc as you go through EVERY room in your house and calculate the value of the contents. This may take some time (not because I have far too many Ming vases to count)! However, I think for me this may be a very valuable exercise for reasons which I will explain next time.

Savingholmes, thanks for your support.