Long gone are the days when one stayed with a single employer for 30 years, then retired with their pension and gold watch. Even before the 'Great Recession',many people stopped believing in the term 'job security'. And while many don't feel secure in their jobs, they feel it is better than the alternative. Now more than ever, people are unsatisfied with their jobs, but many are not willing to rock the boat, given the status of the current economy. Because of people's fear and apprehension, they ignore the glaring signs that it may be time to leave a job that is unfulfilling. The following are a few signs most of us have had at one time or another at some point in our careers:
* You dread going to work everyday--I'm sure most of us have felt this one before. Getting out of bed in the morning is the absolute hardest and you seem to be more tired in the morning than any other time of the day.
* You are starting to get sick--I have an online buddy who recently left a job that was literally giving her migraines everyday. She took a lot of flack from friends and family for a leaving a job in this economy, but when a job is literally making you sick...
*There's no room for advancement--Again, we do not live in a society where people stay in the same job their entire work life. Even if a person remains with a company for a number of years, it's usually because he was able to move up and continue to gain new skills. My motto is, "If I can't grow, I gotta go".
* The company is in trouble--Is it worth the stress and worry for a company that may not be around much longer?
* Emotionally Abusive--You are suffering emotion abuse from either a supervisor or co-workers or both.
* You're bored--The job is no longer challenging and the company won't consider you for other positions.
* You're burned out--You are experiencing exhaustion of physical or emotional strength or motivation usually as a result of prolonged stress or frustration. And you don't see any other remedy to this problem except to change employment.
* You're underpaid--This issue is not just the underpayment, but the fact that the raise scale is not sufficient, therefore even with annual raises you are still underpaid.
Are you currently experience job burnout or have you experienced in the past? What was your solution? Our current recession is forcing a lot of people to stay in jobs that are slowing draining the life out of them. In this economic climate are you more inclined to stay in a stable job you hate just for the security it provides or are you at a financial stage where you could afford to leave a draining job and ride it out until you find a job that fulfills you?
We have heard it said a million and one times since the start of the recession: "This is the greatest recession since the Great Depression." This recession period has also been called the "Great Recession." Despite the 24 hour news coverage of every aspect of the recession, from the housing bust to the loss of jobs to the Oil Spill, the question that remains in my mind is, has the Great Recession had a permanent impact on how Americans spent their money, save and invest their income and view debt? In other words, will the recession have a positive impact on Americans' spending habits once the recession is over (technically, it's already over, according to the experts).
In my opinion, the recession will have the same effect as a yo-yo dieter; and, of course, everyone knows the symptoms and the consequent effects. There is an event that snaps the dieter into action--for example seeing a picture of oneself at an event and being jolted into the reality of just how much weight has been gained. Next, the dieter researches a variety of diet plans and decides which one fits. Then for months the dieter diligently follows the diet, sees results and vows to continue the healthy lifestyle, eating habits and exercise---and for a while is very successful at maintainance. But, slowly and unbeknownst to the dieter, the healthy habits are practiced less and less as day-to-day life takes precedent and the dieter isn't "dieting" anymore. Before you know it, the dieter has gained the weight back, is depressed again and doesn't even realize how he got back to square one. This is how I view most people who have changed their financial habits as a result of the recession.
Being financially responsible has to be a permanent mindset. It's not something you can just turn on and off or else you will find yourself right back where you started from. Just like I've known people who have lost weight only to gain it back again, I've also known people who have used their income tax return to pay off all of their debt and even go so far as to cut up their credit cards. But, somehow, they always end up right back in debt.
I never had a lot of debt and it was never really "bad debit". Although I would sometimes carry a small balance on credit cards, it was never more than I could pay off with one lump payment if I chose. Any other debt was mortgage and student loans, so, naturally, I thought I was doing just fine. Despite being fine, by most people's standards, in regards to debt, something clicked with me and I felt I needed to change. Instead of wanting to be just 'fine' in regards to debt, I decided to become completely debt-free FOR LIFE.
I still have not identified what my 'Ah Ha' moment was, but somehow, someway I got 'IT'. Whatever 'IT' is, it's what I feel the majority of the temporary, "only financially responsible because of the recession people are lacking. It is that lack of 'IT' that will, more than likely, place them right back into debt when this recession and effects have passed.
Can you identify your 'Ah Ha' moment?
I love the progress I'm making in my life in regards to my financial freedom and minimalism. However, I'm aware of the fact that these two priorities in my life aren't exactly the priorities of the majority of society. I discussed in a previous post how I'm sometimes judged because of my frugality and as a result I have begun to wonder how my lifestyle might affect future romantic relationships.
Suzie Orman always says, 'People first, then money, then things'. And while I definitely share this sentiment, money is vitally important in a relationship. Statistics have reported the number one reason for divorce in America is money problems. I don't have all of the answers, but I feel I have come to realize what is important in life and how I spend my money reflects that. I also must admit that I am also sometimes guilty of judging (mentally, not verbally) people for, what I consider, harmful/wasteful financial decisions.
As a result of my mindset and where I am in my life, I know a relationship with someone who does not understand the true purpose/value of money would not work for me. In a weird way, my approach to and view of money has become a part of my value system. For me, planning a future with someone who still believed in mass consumerism and debt would be like planning a future with someone who didn't attend regular religious services or something of that equivalent. It is that serious and that ingrained in my consciousness at this point. I'm not saying my mate would have to believe exactly the same as I do, that would be kind of controlling and self-centered. But I do believe we should be like minded on most paramount issues that have the potential to negatively impact a relationship. And finances are definitely a huge issue in any relationship.
So, what have been your experiences? For those who are married, did you and your mate decide together to embrace financial freedom or did one have to pull the other along kicking and screaming? Did the relationship survive the change in financial lifestyle? For those who are still single, has your financial mindset affected any relationships or whom you choose to date?
When I began getting my finances in order, I could not have predicted how it would lead to changes in other areas of my life. Financial changes led to Minimalism which led to the question: Does my spending reflect my values?
When I initially began to question if my spending reflects my values it was more along the lines of environmentally friendly items/packaging and no animal testing. But, eventually I began to question, more specifically, how do I want my values to manifest in my life. Of course, after valuing the tangible things such as family, friends, health, and the like, I also value my quality of life. Valuing my quality of life leads me to understand the negative impact debt will impose on my life and those more subtle, intangible aspects of life. This realization begged the question what intangible things will be affected if my spending isn't in line with my values?The intangibles that I value are the following:
* Peace of mind in regards to finances
* Having new/interesting life experiences (well this is sort of tangible, but...)
In order to achieve all of these things (and I am on the cusp, so close I can taste it) I must make conscious decisions when parting with my money. I have decided what is important to me and if my purchases uphold these values in one way or another---by either supporting causes/products I believe in or by purchasing items that add value to my life in some way or by making money choices that add to my fulfillment of the intangibles.
So, it's your turn to reflect. Does your spending reflect your values; and if not, what do you plan to do about it?
I found this very insightful article on Yahoo Finance, written by Fleur Bradley. I thought it would be of value to post....
If you're just entering the workforce, retirement probably seems like a lifetime away. A million dollars by retirement? That's someone else's dream, right? It doesn't have to be. Here is the millionaire's retirement plan. For these calculations, assume an average annual return of 8%, adjusted for inflation at 3% - a reasonable estimate of average market returns.
Age 25: A Good Beginning
You're 25 and landed that first job on your career ladder - congratulations! Before you start living to your new paycheck's standards, budget your retirement savings. If you have a 401(k) plan that matches your contributions, use it! These matching dollars are like a guaranteed return on investment. If you don't have a matching 401(k), look for a mutual fund through an investment firm with low fees; many now offer target funds, which allocate your investment risk with your targeted retirement year in mind - great for a beginning investor.
Choose a Roth IRA if you can; you don't get to deduct your contributions from your taxes, but you'll enjoy tax-free withdrawals at 65. Plan to start by saving about $200 a month to reach your millionaire goal; increasing this monthly amount by $10 annually as you get a raise or promotion will only speed up your saving.
Age 35: Rolling Along
By now you have saved about $45,000 and you've grown in your career with a bigger paycheck, but often, family commitments like children and a mortgage will seem more pressing than saving for your golden years. Don't make the mistake of slowing down your retirement savings. By now, you should ramp up your contributions to about $400 a month - remember that a matching 401(k) will help you in attaining this amount.
If you have kids and worry about saving for their college, look at it this way: the best way to help them in the future is by ensuring you're financially sound in retirement. Make saving for retirement a priority.
Age 45: Holding Steady
You're mid-career, and things are looking good in your retirement portfolio. Your savings have grown to about $160,000 - not bad, but it still isn't quite time to slow down. Increase your retirement contributions to about $450 a month or more, and you'll be rolling your way to millionaire status by 65.
Age 55: Close to the Finish Line
By age 55, your retirement portfolio should be at $400,000 or so. You can start to see the finish line, but begin to wonder about risk. If you've been investing in a target fund, your portfolio has been adjusting its allocation for you; otherwise, look at adjusting some of your investments to reflect a lower risk tolerance. And remember: your income at, say, age 70 won't be withdrawn for another 15 years - plenty of time to ride out market fluctuations.
At age 55, expect to really ramp up your retirement contributions, to roughly $600 a month, and more if you can manage it. The more you save, the sooner you can leave the nine-to-five behind.
Age 65: Prudent Asset Management
You're at the finish line: a millionaire at 65! Since you have no way to add to your savings now that you're out of the workplace, prudent asset management is vital. Keep a close eye on your portfolio so you can make your nest egg last. Protect yourself against inflation as well as market risk, and you'll be enjoying your golden years without financial worries.
The Bottom Line
With steady savings and smart financial habits, you can retire a millionaire - maybe even before you're 65.
I am steady knocking out the last of my debt. I only have $800 remaining on a credit card and I'm down to $5,533.52 for my student loan. The plan was to pay $400 for the month of July and August and have the credit card paid off. I was going to make lump sum payments on the student loan and have it paid off by the end of the year. Now the catch...I paid a few dollars less than $2500 for my thyroid surgery, which was supposed to be the only amount I would owe based on my insurance's hospital stay deductible. However, when I called to find out the balance on the account I was told the remaining balance is over $1700.
The $1700 balance is the physician's bill and not the hospital's. I was assured the $2500 I paid went to the hospital and as a result there would be a credit to the hospital portion of the bill, which would be transferred to the physicians bill. This would leave a balance of $0 for the physician's bill. I just have to wait for my insurance company to process the claim. Hopefully this happens, but I'm not the most trusting of insurance companies; so I'll see how it all plays out. I hope I don't have a battle on my hands...but if I do, I'm up for the fight.
Provided the physician's bill is covered as explained, I'm on track to be debt free by the end of the year...or maybe even sooner! I'm so excited that this minor set back can't even diminish my excitement. I can't wait until I can yell, "I'm COMPLETELY debt free! I'm sure it will be on this blog, and Facebook, and Twitter, and Yahoo IM, and....well, you get the picture.
I cannot tell you how many times people have commented on my frugality; some meaning it as a compliment and others being sarcastic and meaning it as an insult. For the record, I am never offended by being called frugal. But what I am offended by is the underlying thought by the majority that frugal means self-deprivation.
First and foremost, I'd take frugal any day over the lifestyle I see many others living. But, I wish (or maybe not) I could get people to realize that my life involves no scarcity. For example, I once had a conversation with a friend who is also a co-worker. We were talking about how we spent our extra paycheck (we are on the 26 paycheck pay cycle). She proceeded to explain all of the wonderful things she did and bought with her "free" money, but then she turned to me and said, 'I bet you saved your whole check, right?". To that question I responded, "No, I saved half and spent half". What confuses me is, I don't even know how people develop their opinion of my lifestyle because I never talk about it. The conversation about the extra paycheck was initiated by my girl friend, not me.
Any-who, I do not deprive myself in anyway--which is the main reason why I will never give up my handbag collection. It is my one indulgence and I would feel like "not me" without it. But, I also know the difference between frivolous spending or spending because of peer pressure. I cannot begin to tell you all of the crazy excuses I've heard from friends to justify their ridiculous spending--'But if I use my debit card, I have 'keep the change' and the change goes into my savings account'; or 'See, it was on sale, so I only spent $8 dollars for it (an item she bought solely because it was on sale, not because it would serve a purpose in her life).
Being frugal to me means evaluating whether or not I really need an item, will it serve a definite purpose in my life and how much use will I get out of it. Also, would I be better served borrowing the item if I would have limited usage for it. Additionally, when I do choose to purchase an item I will never spend more than I feel it's worth; whether the cost is $7 or $200. You see, for me, it is not about the cost, per say, but the value. I will definitely pay what an item is worth, even if it's an expensive item (even though I may be inclined to wait for it to go on sale). I've found that most people don't understand this concept--which is fine for them, I guess. But what bothers me (and I will admit I am bothered by this), is the underlying judgment that others have about people who refuse to spend their money mindlessly. It was part of my motivation for starting this blog.
So, what do you think? Do you sometimes feel judged by others for your frugal ways?
Today is July 1 and officially marks the end of my 'Go Green' Challenge. I never anticipated the challenge would be a hard one as I have already gotten a grip on my discretionary spending. What the challenge did for me is force me to plan out my discretionary expenditures at the beginning of the month instead of just using my discretionary cash randomly.
What I've found is carrying cash is not as bad as I thought, despite the times I forgot to take my money before leaving home and was without money for the entire day. Actually, I kind of liked the 'throw back' feel of carrying cash. Additionally, carrying cash stopped me from having to do a lot of calculations in my head in an effort to try to remember what purchases I made so I wouldn't be surprised when I viewed my checking account online. And of course, having cash made me more aware of what I was spending and how much money I would have remaining after each purchased.
What I've learned from the Challenge is that I would like to continue with the cash system for everything EXCEPT purchasing gas each week. Going into the gas station to pay for gas is easily an activity I can live without. Besides, did I mention I'm semi-paranoid? I'm always so fearful that I'll have the bad luck of being caught in the middle of a robbery while waiting to pay for my gas...crazy, I know! But, what can I say...I was raised by an overly protective, completely paranoid grandmother. The apple doesn't fall far from the tree, I guess.
So, there you have it...from this point forward I will continue a modified version of the 'Go Green' Challenge.