So one of my New Years' resolutions is to better track and budget my spending. For that purpose, I'm playing with Mint.com, a free web service that lets you import your credit card and loan accounts and track what you spend. It's not quite as great as, say, Quicken; on the other hand, it's free, and works on a Mac.
I offer this space for two open threads:
1) What steps so far have you taken to act on your New Years Resolutions?
2) Any free or low-cost tools you recommend for weight loss, financial management, and so forth?
Copyright © 2009 by The Atlantic Monthly Group. All rights reserved.
To both save money and loose weight, I resolved to only drink of Fridays. So far, I've only slipped up on Saturday. But Sunday.... Sunday I was good... and today is looking good as well.
I have a spreadsheet I designed to track my spending. All I have to do is download the data from my bank's web site, copy and paste into Excel, make (moderate) formatting changes and refresh the pivot tables.
Dead simple, at least to me.
Funny, I'm trying to use mint as well, from my brother's recommendation. Its only crashed a half dozen times in the last 15 minutes, so something tells me New Year is not the best time to try new finance software online.
For weight loss, I recommend eating less and exercising. My personal system, implemented periodically when my pants feel a bit too tight, is to 1) always finish a meal a little hungry, and 2) have small healthy snacks (a cup of yogurt, a granola bar) at 90-minute intervals, but no sooner. Also, I don't cut out "bad" foods completely. I usually have about 50 calories worth of dark chocolate for desert. I have a slice of genuine buttered toast about once a week instead of every day. You will find that diminishing marginal returns applies to chocolate consumption, so limit yourself to the highest-utility dose.
It sucks, but I can take off a pound a week this way until I'm around 175 or so, at which point I usually stop because it becomes much harder and my pants fit anyway.
Financial management: I find that spending less than my take-home pay is most convenient.
That would be "dessert." Not that I don't deserve it, though.
Rregarding question #2 - Any free or low-cost tools you recommend for weight loss, financial management, and so forth?
How about a little Self Control:
Cut down on food and spend less money
My resolution, chosen in large part for cheapness, is to FLOSS. I know, I should have been doing it all along. But I haven't, like many people, so I have chosen this year to nail that one stupid thing.
Little equipment required, just the discipline to build a new habit.
Anyone else have a simple, one-variable resolution like that?
Taking a tip from Keynes, whose name is inescapable lately, I've decided to drink more champagne. So far so good.
And I have a bottle of Duval Leroy waiting to pop after I finish my own intra-DC move next Saturday.
1) No drinking Su-Th (though NY Giants games get a hall pass through the Super Bowl). Also starting a Master Cleanse next Sunday. Going to get back on the 5k circuit, too.
2) For saving money, we've actually created a family goal to save $50/week for 65 weeks (yikes!) in order to take a trip to Ireland for one week in the Spring of '10. Yes, it's a long ways off, but the incremental saving is a great way to have both long and short term budgeting goals, IMHO.
For weight-loss, YMCA gym membership, and about an hour of cardio every other day. But that may be expensive, how about a half hour?
Financial Management, sorry, until they make an electrode to zap me everytime I open the wallet there is nothing I can recommend.
For weight-loss, you'll find that a pair of feet and a long walk are reasonably inexpensive. Repeat dosage ad lib.
ps. Don't try this on water.
Financial management: I find that spending less than my take-home pay is most convenient.
I get your point, but it can be difficult to know that you're doing this unless you're tracking spending on a monthly basis. Putting the money spent into different categories helps as well, so you can review it and figure out where you are overspending. However, you will need some form of budget. I used to just take all of the fixed monthly expenditures out of my income, along with some savings. The rest you spend on gas, food, having fun, clothes whatever. This worked well when I was single.
As far as exercising, I have to have some fun specific goal in mind besides "lose weight" or "be in better shape" This year it was mountaineering, last year was to be in better shape for surfing.
"2) Any free or low-cost tools you recommend for weight loss, financial management, and so forth?"
Sign a legal contract that sends copies of all your credit card bills to your mother
I get your point, but it can be difficult to know that you're doing this unless you're tracking spending on a monthly basis.
It's fairly simple: if your bank balance goes up, you're spending less than you earn. If it goes down, more. An accounting system may help you discover that you're spending more on coffee than on food, but it really shouldn't be necessary for a single person to get fancy to figure out the raw numbers.
Or you could follow my wife's trademark system, which involves mentally denying the very existence of certain savings accounts, not counting 401(k) contributions as "savings," and transferring money randomly between accounts for purposes which are, to say the least, obscure. If you go that route, you can convince yourself you're rapidly going broke while actually saving roughly 1/3 of your husband's net.
I've found that it is easier for me to reduce my food intake by removing the cues cause craving or excess consumption.
1) eat with smaller bowls and plates. The meal will look more substantive and you'll have to get up and get more. I usually finish whatever is in front of me so this is a way to play with my sense of satiety.
2) Remove uneaten food and snacks from my visual field. If I see it I'll want to eat it. So I usually put away most of a prepared meal as soon as possible. Plate what I think I should eat and store the rest out of sight. Same thing with snacks, put them in drawers and behind cabinets. Leave out fruits and veggies to snack on.
While I don't snack or eat too much dessert, my issue is that I have NO idea how much I am taking in at a sitting. That is, I look at calories and fat a bit, but I was not getting a picture of the total amount I was eating in a day, which turned out to be about 100 to 200 more calories that I should have been per day (especially on a day I didn't exercise). Thus, I started tracking my calories at the Daily Plate (dailyplate.com, I think) where you can put in what you are eating, how much you are exercising, and set a goal for the number of calories you would like to consume. I liked it quite a bit. It worked for about a week until I found out I was pregnant, when the goal became to eat about 300 more calories per day rather than less calories per day. I plan to go back to it after my pregnancy so I can continue to pay attention to the total I am taking in during a given day.
Last fall, we finally confronted the fact that my husband and I have fundamentally different approaches to money: I like to save for big purchases, he likes to spend on small luxuries every day. This wasn't working out so well, since the small luxuries consumed all of the big-purchase money, but there's nothing inherently wrong with either preference.
So, we instituted a "personal money" approach: we each get a set amount which is automatically withdrawn from the household funds every week, to be spent exactly as the "owner" likes. We'd resisted before, because it smacks of having an allowance, but it's working out wonderfully. My husband even finds that he spends less than he used to, because he's now tracking the money more explicitly; he now has a "big purchase" fund going too.
I've been reading about Mark Bittman's new book and he recently lost a bunch of weight by eating no animal products before 6pm and cutting down on white flour and sugar. He seems to think it's a system so painless that he can live with it forever. I'm trying and failing to remember if Megan blogged about that book.
This year, my five resolutions include reading more, completing tasks, reducing bad debt, living in the moment and exploring spirituality.
To read more, the simple thing that I am doing is to shut the television and computer off by 11pm so that I can get an hour of reading in before I should go to bed.
To complete my tasks, I am setting smaller goals for my tasks. Instead of the task being to re-finish the bathroom, the task would be broken down into painting, installing new mirror, installing new toilet, etc.
To reduce my bad debt, I am continuing with the spreadsheet that I created two years ago when I realized that my debt was out of control. By the time that July comes around I will have eliminated my bad debt by keeping an eye on my spending.
I haven't determined how best to live more in the moment other than to try not to worry too much about planning unless it is a major even such as a trip.
Finally, to explore spirituality, I plan on taking time out of every week to personally reflect on the events of my life and what meaning they hold. Combine that with a dedication to read some religious based texts and I think this one shouldn't be too hard to do.
Oh yeah, I forgot this part. Definitely flossing. I just spent a lot of time and money at the dentist suffering for the flossing that I did not do. Now I'm flossing every day.
The dentist gave me a thingy that makes it much easier - it's a handle and you buy little floss heads that you use a few times and throw away. (I rinse it in listerine.) It's amazing how much easier that is than wrapping floss around my fingers.
It's kind of like this:
http://www.wisdomtoothbrushes.com/img/Easy%20Floss%20product2.jpg
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I resolved not to procrastinate so much, and will have my plan for accomplishing this ready to put into operation at some point in the future.
Resolutions? What resolutions!?!
I live in the UK, and Her Majesty's Government has graciously informed me that it is their resolution to make me less obese. I feel lighter already.....then again, they can't even defend their own national interests, so maybe I shouldn't get too excited.......
Losing/managing weight is not hard. Go for a run two-three days a week, go for a swim one-two days a week.
To control spending, stop using cash. I use a credit card for everything that I can. That way, I can see where it goes each month. Otherwise it just melts away....at least for me.
Secondly, I have several different bank accounts set up. My wife and I each have our own personal account that gets a set amount each month that we can spend as we wish. There is an account for vacation money and an account (with associated credit card) that I use for work expenses. These sub accounts get fed automatically at the first of the month. For savings we are fortunate enough to have payroll savings plans, so we never see that part.
For losing weight, I use the single belt system. I only have one belt and when it starts to get uncomfortable, I start to cut back in my eating and getting more serious about the frequencies of my working out. I have a gym in the building so it is just a case of increasing the visits.
Part two is never keeping any snack food around the house. I just don't buy it so no matter how hungry I get, I don't eat so much junk food. Of course at Christmas this is always sabotaged by relatives who think a 5 lb can of caramel popcorn is a great gift. I can't ignore it, so I have to gorge and then excercise even more.
One strong motivator is my brother who, in his 50s, is a nationally ranked fencer. When we are visiting at Christmas, he and his rock climbing spouse are always going to the gym, so I am forced to compete.
Scissors. They work great on credit cards.
For weight loss I recommend "mindful eating."
As the Mother of All Sensible Eating — my elegant, swelegant sis — always says, if you have a lot of different savory and sweet things on the plate in small amounts, it seems like a lot of food but doesn't put on the pounds. And she's got the figure to prove it.
Following her lead, I lost 50 pounds in about 9 months.
My financial plan is simple: think twice before buying and save what's left over at the end of the month. This is easy because I'm very cheap. My stupid employer pays monthly, which sucks but makes accounting easier.
Step one: call the credit card companies and get the due date to be about the 5th of the month. This lets you maximize the monthly float and put more money in an interest-bearing account rather than sitting idle in checking.
2: Open an online savings account. Transfer all all your checking account except for a baseline value. I use $1k.
3: On the get paid on the last day of the month. I get direct deposit and the money's available immediately.
4: On the 31st, schedule to pay all your credit cards on the 1st or 2nd of the month. Pay in full.
5: Calculate your checking balance and transfer whatever's left above $1k into savings.
6: When the savings balance gets above some multiple of your monthly pay, stop putting the balance into savings and start making extra payments to your car/student loans. (I chose a threshold of $10k). I cheated here, making a large final payment that took me a little below $10k, just for the sake of starting the new year with zero debt.
7: Once your loans are paid off, start finding ways to invest, or put a chunk in higher-yield CDs, etc.
Whoops! Here is the correct link for my comment above:
For weight loss I recommend "mindful eating."
As the Mother of All Sensible Eating — my elegant, swelegant sis — always says, if you have a lot of different savory and sweet things on the plate in small amounts, it seems like a lot of food but doesn't put on the pounds. And she's got the figure to prove it.
Following her lead, I lost 50 pounds in about 9 months.
Step 4 above should also include monthly rent/mortgage and whatever utility bills that can't be be automatically charged to a rewards credit card.
For weight loss, I recommend breastfeeding. By the time my daughter was three months old I was wearing a size smaller than pre-pregnancy.
For money, I recommend only using cash. It's so painful to hand it over that you won't. Those plastic cards are a little too removed from what you're actually doing to feel real. And if you've taken out all your spending money for the month, you'll know when you've hit your limit, because it'll be gone.
Quicken Online is now free as well and should work on a Mac. I've been using it for the same reason for about a year, as well as to keep track of business expenses versus personal expenses.
I'm trying to lose that last ten pounds, plus I have high cholesterol and am tracking fat/cholesterol. This website is great
http://www.my-calorie-counter.com. It's a pain keeping track, but it's helped me lose weight.
Try this link
http://www.my-calorie-counter.com
Wanna lose weight?
Write down everything that goes in your mouth (and does not come out).
Lose 3 lbs/month at maximum.
OR:
Cut out the white stuff.
Lose 3 lbs/month at maximum. seriously, that's enough.
David S: I thought the white stuff boosts metabolism (isn't that why so many models do blow)?
Hi Megan,
Dave, thanks for pointing out that Quicken Online (www.quickenonline.com) is a free, Web-based option for basic personal finance solution as well. QuickenOnline.com is geared toward a different audience than Quicken desktop software. Quicken Online helps you get a forward-looking view of your finances over the next couple of paychecks, taking into account bills and other financial obligations so you don't lose money by overdrawing your accounts, exceeding your credit limits, etc.
Megan, if you have questions or would like a demonstration, please don't hesitate to contact me directly! Thank you.
- Chelsea, Quicken Online
One of my new year's resolutions is to lose weight. To implement that, today I have eaten healthily and avoided any sugar whatsoever. Consequently, I am hungry and about ready to rip someone's head off. But I have been assured that this is the path to a longer, if less enjoyable, life!
As to spending constraint what my wife and I have done is set up two checking accounts. The first account is for our 'fixed' costs, like the utilities, mortgage, kids college saving, funding for big ticket items like vacation/car/house repair fund. The second account is 'discretionary' - food, clothing, movies, Starbucks etc. The fixed account is, well, fixed so that runs pretty much on autopilot, and the discretionary fund is what we can watch. I think to worry about every latte can be too hard, but if you realize you have say $100/week you can think do I want to have the latte or see Slumdog Millionaire tonight (off topic but definitely save for the latter than the former).
I'm a big fan of making resolutions, small or big, throughout the year, not just on January 1st.
So much so that myself and two friends created http://www.pledgehammer.com on our free time. It provides an easy way to write resolutions down with a deadline and share with whoever you want to share them with. This increases the chances of a resolution becoming a reality. It also has a charitable 'flipside' to it - if you can't stick to your resolution Pledgehammer asks you to donate money to charity. So whether you stick to your resolution or not, either way the world will be a little bit better.
We went live just two weeks ago and it's great to see the number of resolutions grow so fast. Would love to hear if this helps people keep their resolutions.
We're on the Dave Ramsey plan ($1,000 emergency fund, pay off debt as fast as possible, save up 3-6 month emergency fund, save up house downpayment, start retirement savings, start kids' college, pay off house, etc.). The idea behind the DR plan is total focus, one step at a time (we did alter the plan to have one month of expenses in the bank at all times, rather than going down to $1,000). As a family of four, we paid off my student loan, our old credit cards, and a car in the course of one year (that was about $10k). We are currently saving for a house downpayment and a family ski trip. These are big goals, but we're saving at least 16% of take-home every month. Barring the unforeseen, we'll go on the ski trip in one year and buy our first home in about 18 months. It is a really novel and enjoyable experience to be spending the money we already have.
At the end of every month, my husband and I produce a new budget for the month to come, using the income number for the previous month. It's all down on paper: rent, school and preschool tuition, renter's insurance, life insurance, car insurance, internet, long distance, electricity, natural gas, cell phone, water and trash, haircuts, dental/medical, school lunch, Netflix, housecleaning, gasoline, clothes, Christmas and travel savings, downpayment savings, my fun, my husband's fun, ballet, chore money for the kids, car maintenance, house maintenance, grocery, seasonal expenses, charity, etc. Some items are constant and some fluctuate. (I'm pretty free about dipping into grocery funds, since we can always squeak by to the end of the month by just buying bread, milk, and fruit and eating what's in the cupboard.) Every month is different, so you need a new budget every month. Also, as DR says, Christmas comes every year in December--be prepared. I also keep a list of high-priority or seasonal expenses (glasses for me, summer camp for oldest child, new summer jammies for the youngest, shoes for husband), and squeeze them into the budget as space appears.
Everybody's different, but I find it most effective to insert savings categories into the budget (car maintenance, house maintenance, Christmas/travel savings, downpayment savings) rather than just waiting until the end of the month and seeing what's left over. Because at the end of the month, there's at most $7 left over. It's usually a real squeaker at the end of the month, but there's also a lot of satisfaction in knowing that I've done it again, we are on track, and with every month that goes by, our family is on a sounder footing.
1) What steps so far have you taken to act on your New Years Resolutions?
2) Any free or low-cost tools you recommend for weight loss, financial management, and so forth?
1) None. No resolution.
2) Increase retirement account contribution. Pen and paper.
Amy,
Re: Dave Ramsey - I like him and I think he has some great ideas but his 15 year mortgage idea is just crazy. If the choice is between paying off your mortgage in 15 years or putting an extra $500 a month into savings, in nearly all circumstances you will be better off putting that $500 into savings.
Amy,
Also you should never pay your mortgage off early unless you are putting the full $20,500 into your IRA/401k. I don't care if you put it in CD's once it is in their but never pay off your mortgage if you haven't contributed the full $20,500.
One of the few things that worked with me for weight loss was public knowledge of my goals and progress.
If you have some serious ovarian fortitude, post your weight every Monday morning. The urge to avoid humiliation is quite compelling, I must say.
MapMyRun.com, not just for runners. It acts as a workout log (and if you run or bike, it helps track your mileage). It interacts with facebook and twitter, so your friends know exactly how much you've been working out - a great motivator!
jmo,
1) I believe the DR plan calls for funding retirement at 15% of income (take-home? gross? not sure) before accelerating the house pay-off. The house pay-off is on top of the 15%, not instead of.
2) I'm pretty green about saving and investing, but if mortgages are running about 5.3% right now for 30 yr. and 5% for 15, and we're getting 3.5% on a money market account, it seems like if we had a mortgage, paying it off would be the equivalent of making 5% on our money. In the current environment, that sounds pretty good. Also, we live in TX, so our mortgage will hopefully be at or around $150k. I'm thinking that if we are at all aggressive, it will just melt away.
THE BEST IS TO MODIFY OUR RELATIONSHIP TO DEBT
Behavior modification requires acknowledging past mistakes.
What did we do for twenty years?
-
http://pacificgatepost.blogspot.com/2009/01/myths-of-debt-to-be-corrected-for-2009.html
-
Now let’s get on with the correction.
I always liked to use sparkspeople.com for a free weight loss/nutritional system that gives lots of support stuff, from its community to simple nutritional options and a weight losss plan tailored for you
I always liked to use sparkspeople.com for a free weight loss/nutritional system that gives lots of support stuff, from its community to simple nutritional options and a weight losss plan tailored for you
I downloaded a $1.99 application "ifitness" for my iphone from Apple's App Store. It's a great tool for weight training and another fabulous use for the iphone.
Amy,
Your mortgage interest is tax deductable meaning the real rate is %3.675. Also, why are you in a money market account when a Texas municipal bond fund is yielding 6%?
The money you put in your 401k/IRA is also tax deductable. Depending on your tax bracket reducing your taxable income by 20,500 could reduce you tax bill by $6,000.
Eat an apple and down a glass of water before going out.
Forget weight loss, focus on building a healthy body. Get stronger, and build endurance.
If you are a girl, focus on legs (squats, step-ups are easier on the back) and abs (weighted situps, and don't forget your obliques), but don't neglect upper body either.
You won't necessarily lose weight this way, but you'll be healthier and look better. 10 lbs of muscle looks vastly better than 10 lbs of fat.
Your mortgage interest is tax deductable meaning the real rate is %3.675. Also, why are you in a money market account when a Texas municipal bond fund is yielding 6%?
On a $150,000 house (what the poster is thinking about buying) the interest deduction would be about $8,300 a year. The standard deduction is over $10,000 a year if you're married. I think too many people forget about the standard deduction when calculating how much they'll save with the mortgage interest deduction. It's best to use some tax software and itemize along with a theoretical house and see just how much you save.
The money you put in your 401k/IRA is also tax deductable. Depending on your tax bracket reducing your taxable income by 20,500 could reduce you tax bill by $6,000.
But it's illiquid, so it's not a great e-fund or down payment fund. An IRA sort of works for down payments, but you end up paying taxes on the income when you pull it out anyways. Unless you have a Roth IRA, but in that case you paid taxes on the money going in anyways and you have to have had the account for 5-years. You can take a loan out of a 401k, but this must be paid back and not all banks consider it a true down payment.
For fitness, I love Crossfit (www.crossfit.com). It is a free site that posts a workout of the day, has lots of great resources in exercise demos, instructional videos and a forum to ask questions on exercise and nutrition. It will not make you skinny, but it will make you fitter, stronger and healthier.
Jordan,
I was thinking more about what Amy should do after she buys the house - I think she should avoid the Dave Ramsey 15 year mortgage idea.
I really don't understand his weird fascination with 15 year mortgages.
Even without the mortgage interest deduction, Texas municipal bonds pay 1% more than she would pay on her mortgage.
1. My resolution is to decided on a simple asset allocation plan for my retirement accounts, and rebalance quarterly. People have said that for a while, but I poo-pooed them. I wanted risk. I don't anymore... I have learned that sometimes not being stupid is enough to let you come out ahead.
2. I have a plan for both weight loss and financial tools. Gold. Gold will protect you from inflation. If you get enough of it, moving it around will give you exercise. I say that gold is low cost, because unlike used Thighmasters and "Get Rich Quick" books, you can sell it back for more than it cost in a few years.
My resolution is to spend fewer evenings vegging out with a 6-pack in front of the tv. It's not a fitness thing, I already run 7-8 miles on most days. And I'm certainly not an alcoholic. It's just that I want to use my time more productively - acquiring new job skills, getting better at the piano, even just reading.
So far so good, I've had exactly one beer so far this year (with dinner on Sunday night), haven't watched much tv at all, and have started to teach myself Java.
Yodlee's Moneycenter is the best tool I have found so far for tracking spending. It is used by many major banks to provide their account aggregation feature. It was far better than Mint when I tried both some months ago.
https://moneycenter.yodlee.com/
We'd resisted before, because it smacks of having an allowance, but it's working out wonderfully. My husband even finds that he spends less than he used to, because he's now tracking the money more explicitly; he now has a "big purchase" fund going too.
Posted by Dictyranger | January 5, 2009 4:44 PM
that's the way it happens, w/anything, including Food, Accountability.
Simply, Write it Down. It's helps one 'own' what they're doing. Gives an additional reflection point to one's affairs.
Usually, after three weeks, at most, the 'issues' become acutely obvious, thus readily changable..
Cost? a little time, a notebook, a pencil, and, probably, the odd stare from your consumption oriented acquaintances--to them? their own.
For losing weight: thedailyplate.com. It's a well-constructed calorie counter that includes burn rates for various forms of exercise and enables you to set goals for net calories per day.
My partner and I each lost 20+ lbs. using this. In 2007. And have kept them off by maintaining a count at a higher calorie goal.
Ramsey's a terrific motivator for getting people and families out of debt. There is none better. He's a great communicator and an ace at the family relationship aspects of money.
Once a family is out of debt, he is a blooming idiot on just about everything else.
Paying down a home early makes zero sense to me. Why would you want to have to go begging to a bank to tap your equity out? They won't loan it back to you when you need it most (i.e., unemployed or disabled), there's underwriting to deal with and paperwork hassles, closing costs, etc.
I'd rather insure the mortgage, overfund a permanent life insurance contract in a participating mutual company to the MEC limit, and let the cash value build up on the side, tax free.
You get the death benefit, which means the house is paid off if you die. You can pay a bit extra to have it self-fund if you're disabled, so you STILL get the death benefit and the cash value build up if you can't work anymore, AND there are no restrictions on when and if you can take out your money.
You don't have to fill out paperwork to get a loan against it, and it will be there if your unemployed (you can pay your mortgage with it while job hunting). Try that with a mortgage company!
Sometime down the road, depending on a number of factors, you'll have enough CV to pay off your home early if you want. Or not. Why pay off a home with money growing tax free when home mortgage interest is tax deductible? Would you raid a Roth IRA to pay off your home?
But you wouldn't hear about that kind of planning from Ramsey. Because, as I said, he's an idiot once you're out of debt.
I love the Hacker's Diet, a free diet book and set of online tools by John Walker, the founder of Autodesk.
It's a straight calorie-counting + light exercise diet, but it's free, well written, and pitched towards an engineering and/or male viewpoint, which is a nice change.
The book is at:
http://www.fourmilab.ch/hackdiet/
Online tools available at:
http://fourmilab.ch/cgi-bin/HackDiet
I use RememberTheMilk.com to track my todo items. I use Bellygraph.com to track my weight, my various goals (miles of running, biking, etc) - I put the images from the graphs on my blog so everyone can see if I'm gaining weight.
Both are free.
Shoeboxed is a great tool for organizing receipts easily for the new year. Send them in to Shoeboxed and they will be scanned and ready to go for tax time.
Shoeboxed.com
I'm going to focus on paying down my mortgage as well. It goes to a variable rate in 2010. The teaser rate was great, but now it's time to pay the piper.
My resolution, getting in better shape, is cliche. I hope that my method is not. I've seen a lot about tracking finances in Excel, which is a great start. I augmented that with a plan I think any economist would love. Each month I set aside a fixed amount of money, if I don't work out it goes towards my student loans, and if I do I earn that money back for my own consumption. Each type of exercise claws back a certain amount of money with more work earning more. The full plan can be found here
I agree about DR being primarily a debt-reduction guy.
"Paying down a home early makes zero sense to me. Why would you want to have to go begging to a bank to tap your equity out? They won't loan it back to you when you need it most (i.e., unemployed or disabled), there's underwriting to deal with and paperwork hassles, closing costs, etc."
The thing is, on the DR plan, by the time you start focusing on paying the house off, you will already have a 3-6 month emergency fund, which should help a bit with either disability or unemployment (especially if you go with the 6-month emergency fund). Also, I think having no mortgage payment would make disability or unemployment much more tolerable, since that's probably your largest expense. If you aren't paying a mortgage and you are in difficulties, you could get by on very, very little.
DR's plan may not be the most mathematically perfect approach, but it is a very helpful corrective to the recently popular American method of HELOCing the daylights out of your house. Up until recently, actually paying off your house was hopelessly uncool and unsophisticated. I'm a big fan of thehousingbubbleblog.com, and every week there are dozens of examples on that blog of people who would be a lot better off if they had been a little bit less sophisticated and just paid down their mortgages.
Thanks to jmo for the Texas bond advice. We might try that some time down the road. At the moment, we're sticking to FDIC-insured stuff and just trying to keep our small savings from getting nuked between now and when we hope to buy our house. On the bright side, house prices here are going down about $1,000 a month.
I recently started reading http://www.getrichslowly.org/ for all that money stuff. It's fantastic - links to different viewpoints on how to (say) budget or whether you should pay down debt first or build up an emergency fund.
I also use Mint, and haven't had problems with it on Windows or Linux.
I plan on cashing out my profits from my investments in the Madoff Fund.
Amy,
I think we got into a problem because people thought of their houses as savings. Don't actually save money, pay more to the mortgage company. Well, we would have been much better off if people thought of their mortgages as expenses and savings as savings and kept both ideas seperate.
Yes, after 30 years of faithful mortgage paying they give you your house - but until they send you the deed, just think of the mortgage like rent. In the meantime, accumulate real money that you can tap in times of trouble or oppertunity.
To lose weight, read _Good Calories, Bad Calories_ to convince yourself it's best to eat more protein and minimize the refined carbs (white sugar, white flour, white rice) in your diet. If you want to lose even more weight, look into "intermittent fasting"; I recommend the ebook at http://eatstopeat.com and the real book _The Alternate-Day Diet_. The claim is that dieting *some* of the time is more sustainable and healthy than dieting *all* of the time.
WeightBot on the iPhone is a fabulous tool to track your weight trend over time.
Owning your house free and clear can be considered "bad economy" insurance. No matter what happens to you or to the economy as a whole, you have a place to live. For the tiny differences (1 or 2% a year is significant?) it is well worth it. It also gives you more flexibility to try different jobs, you're not tied to another monthly payment.
billswift,
The question is, if you lost your job would you rather have a paid for $300,000 house or $150,000 mortgage and $150,000 in the bank?
I'd rather the $150,000 in the bank as it would provide a lot more flexability.
I am not far from "owning" my home free and clear, but, unfortunately, Newtown, CT will still expect me to pay $600/month rent in perpetuity to live in it.
Weight loss:
1) Exercise at least 5 hours a week.
2) Exercise with good intensity.
3) No carbs after 5 PM.
4) Eat something every 2-3 hours (so healthy snacks between meals).
5) Shop the perimeter of the grocery store.
7) Cook at home, and bring leftovers for lunch (doubles as a money-saver).
8) a) Try to divide your meals according to macronutrients. Have protein with each meal, and don't combine high levels of carbs (>10 g or so) with high levels of fats (>10 g or so).
8) b) Have your high carb meals in the morning, and your high fat meals at night.
Good free resource for workout and nutrition information: http://www.figureathlete.com/
I'd rather have 150,000 liquid in a heartbeat than have it tied up in a house, where the only way I can access it is by going hat in hand to a banker, who may or may not be in the mood to lend against my house if I need the cash.... especially if I become disabled.
Furthermore, I can get:
1.) Tax free growth (by using an overfunded insurance contract as the savings vehicle, rather than a taxable bank account)
2.) Tax deduction on the interest on the home. Yes, I get that zero percent interest is still better than any tax deduction. But unless I bought my home at interest rates that are significantly higher than current expected rates of return, especially tax-free vehicles, such as Roth IRAs and insurance contracts, it's not enough to sway me.
3.) The full benefit of any capital appreciation on the house, regardless of whether I pay off the home. (Minus, of course, home mortgage interest, which is tax deductible).
4.) Depending on the state, better protection from creditors. (Florida and Texas have unlimited homestead exemptions, while in other states, home equity above a certain amount is on the table for marauding creditors. IRAs, 401(k)s, life insurance cash value and death benefits all receive varying creditor protection depending on the state, but in many cases is superior to home equity. YMMV. (Check also federal bankruptcy exemption limits.)
5.) I can have the cash when I want it, not when some banker wants to lend it to me, a month after I need the money.
6.) Premiums paid for me in the event I become disabled, so that that $150,000 will accumulate whether I can work or not.
7.) Some mutual insurers will continue to credit the full policy amount for dividends even when a loan is taken against a policy. (Crediting methods vary).
8.) Oh yeah... a tax-free death benefit to my family after I'm gone.
What will the bank offer me if I pay extra on the home.
Meanwhile, Ramsey was still hawking UGMAs for years after it was clear that that was a stupid idea, his new Money Makeover book doesn't know what a Coverdell is (it hasn't been called an "Education IRA" for years), doesn't understand how federal need-based financial aid is calculated, still teaches people to expect 12% long-term from "growth-stock" mutual funds, doesn't encourage folks to diversify into bonds (because he doesn't understand them), and the list goes on.
I spoke to him, personally once. Nice guy, great ministry, but he didn't know what an index fund was, at the time.
The man is in serious need of some continuing education. If he had a license and was in practice directly, it would be revoked.
Suze Orman has a better fund of information. But somehow manages to be even dumber.
1)I've found Mint really helpful to track expenses. It forces me to confront just how much I'm spending on groceries, alcohol and restaurants and I'm making better decisions as a result. It works great on my Mac, and the only glitch with it is when it attempts to track investments. I don't really need it for that, so I haven't tried to fix it.
2)My diet recc: no dessert, white foods or alcohol on school nights. Visit the gym four times a week. It works for me.
The Slim Fast people actually have a very good website where you can track caloric intake, creates custom meals, etc.
Of course they recommend their own products, but you're free to delete and replace them as you wish.
Of all the "free" tools, I've seen, it's one of the best for watching what you eat.
Sorry - it's at http://www.slim-fast.com/
(I have no connection to the company at all - just have used it successfully in the past)
Nothing seems to be easier than seeing someone whom you can help but not helping.
I suggest we start giving it a try. Give love to the ones that need it.
God will appreciate it.