Finance Globe

U.S. financial and economic topics from several finance writers.
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Nickel and Dime Yourself to Life, Part 2

It’s here! The beginning of my new fiscal year, and in my new fiscal year I hereby resolve to get control of my finances. In order to accomplish that I have to be smart, or rather S.M.A.R.T. As in, that acronym that gets touted so often as The Formula for successful goal setting it’s almost a cliche. I’m not a big fan of cliches, but I am a fan of stuff that works. Nearly 2 decades of research has proven that SMART goals are indeed smart. So, today I'm going to give it a try for real.

It may appear that I’m doing this blog-type-thingy for my own benefit, but I actually have a more altruistic purpose. My overall vision is to inspire real people (yes, that means you) to get their finances in order. Logic being that if I, an average Jane monetary layperson with a problematic pecuniary past, can turn things around you can too. All that being said, I do hope you’ll try this with me and share your experience in the comments section.

Back to the task at hand... SMART goals. Commonly defined with these words: Specific, Measurable, Attainable, Relevant, Time-bound. Surely, you’ve heard this before, so I won’t insult your intelligence with a detailed letter-by-letter explanation. Instead, let’s take a moment to consider the many variations out there on the definition of SMART goals. Do a casual internet search on the topic and you’ll find anywhere from 2 to 18 different words that each letter of the SMART acronym can represent. After perusing the alternatives it seems wise for our purposes to upgrade the A and R, so that our goal looks like this:

Specific

Measurable

Accountable

Realistic

Time-bound


Swapping out Attainable for Realistic should require little explanation since they’re basically the same thing. But why replace it with Accountable? Because it’s why Weight Watchers and other programs like it work. Why do you think Jennifer Hudson looks so good? Well, yes, she is getting paid tons of money, but she’s gotta give major props to accountability. I’m pretty sure that having to show her face and body to the world for all those commercials has something to do with why she’s able to stay thin. Non-celebrities have made Weight Watchers a household name because of the accountability piece built into the program. It’s a well documented fact that people have a better chance of reaching their goals when they have to report their progress on a regular basis. Dieters do so through scheduled weigh-ins and meetings. You and I will do it by reporting to each other, throughout this series.

Together, we will shed all those extra pounds of monetary struggle. We are going to get into fiscal shape. Get it? Fiscal... shape? Ok, 80’s nerds, I know you’re humming it too--Olivia Newton John, eat your heart out!

Cheesy 80’s diversions aside, let’s get started with the SMART goal setting. Feel free to share yours in the comments section. The Accountability starts now.

When I first started working on this series I thought setting my goal could be as simple as committing to a policy of spending less than we earn, then creating a balanced budget and sticking to it while reporting our progress to you monthly for a period of 6 months. Specific? Check! Measurable? Check! Accountable? Absolutely! Realistic? Um... apparently not.

They say that in every marriage there is a saver and a spender. Not ours. Unfortunately, we both like to spend. However, I can tighten my belt when the need arises. It’s how I survived 17 years as a single parent. Remember the “budget stretched tighter than Honey Boo-boo’s momma’s pants” line from Part 1? Yep. That’s what it was like. Most of those years I worked two jobs that still barely covered my monthly expenses, to say nothing of the car trouble that plagued me mercilessly whenever I could least afford it. Child support? Forget about it! I counted myself lucky if I got $36 in any given year. Back then following a budget was pretty much a process of trying to put kittens in a box.

Now I find myself with vastly different life circumstances, but nonetheless still herding cats. I’ve often thought about how we managed to stay afloat in those days when my income was so low the official federal poverty line seemed like opulence. Then I wonder how we now, with our modest but comfortable income, somehow manage to keep running out of money before the next paycheck comes in.

Here’s where we arrive at the roadblocks I alluded to previously in comments about my husband. His past life circumstances differ greatly from mine. He’s never really known what it’s like to struggle to make ends meet. When I met him he was living with his parents who provided for his every need and want. He’d never had to make it on his own. Fast forward to now. His parents are still very--shall we say--‘involved’ in his (i.e., our) financial life. They actually put a monitor on our bank account so they could funnel in cash when it hit rock bottom. I know, sounds like a good problem to have, right? Cue the tiny violins. But wait. Please allow me to explain why it’s not as good as you might think.

By nature, I am an independent person. I like to do things on my own. I am a capable human being and I can do enough math to get my money in order by myself, thank you. Which is why my in-laws dumping money into my bank account is so frustrating. Yes, I am VERY grateful for their contributions to our well-being, but what they are really doing is enabling their son to spend without discretion, not to mention shielding him from healthy financial struggle that would open his eyes to his problem. Thus, my husband has never needed to manage money--his idea of personal finance is this magical pool of dollars that never depletes--and therefore spends without regard to how much we actually need to survive. He doesn’t seem to realize that, although a two buck breakfast sandwich at the gas station is cheap in the moment, buying one every day adds up to a huge dent in our budget, which leads to his parents stepping in to save us. And so it’s a vicious cycle of nickeling and dime-ing, overspending, and enabling to nickel and dime some more.

Now you have some insight into why I’ve struggled to develop a reasonable budget and to even work out an attainable goal in the first place. The odds have seemed insurmountable at times, but I am not a quitter. And slowly, but surely, after countless tense conversations and two reluctantly surrendered debit cards, we have finally arrived at a budget we can both live with. At least, I think so. I’ll let you know at the end of the month.

I could go on with all the hairy details of our budget, but the bartender has started flashing the lights and I fear I may have already overstayed my welcome. You can take it from here until I return. You get the gist of how to set SMART goals, right? If not, please let me know in the comments section. And if you need some advice on the whys and hows of budgeting look no further than “your trusted financial source” where you’ll find lots of great tips recently posted by my colleague, known to you loyal FG members as latoyairby.

So here’s the plan going forward. Starting with my next post I will provide you with monthly updates on our progress as well as a handful of money saving tips that we’re trying. I’ll let you know what is and isn’t working for us and why. Each month’s tips will be based on a common theme or budget category to be reflected in each respective column’s title. In order to avoid ridiculously long titles I’ll pare down the overall series title, “Nickel and Dime Yourself to Life” to acronym form. I don’t have exact titles all worked out yet, but my next post will be something like NDYL, Part 3: Pros and Cons of an All Cash Budget.
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Saturday, 17 August 2019

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