Fiscal Fitness

OK, now that I have some idea of what the $20 challenge is, I am going to start participating. I have to think about what I will do to put money towards this, but my first step was to go to INGdirect.com and fund a special account for the purpose from my checking account. When I generate any money towards the challenge, I will put it in there so that the money will get saved rather than spent. A virtual money jar!

On a daily basis, my biggest struggle is keeping my food expenses down. I'd like to think that as a single person, I could spend $50/week on groceries, but I routinely spend twice that, and my eating out expenses sometimes spike up to $150 in a month. Usually this is when I'm busiest, so instead of the dining out money going to nice restaurants I enjoy, it's going to sub shops and fast food joints where I can have someone else cook for me when I'm too tired to do it for myself.

On the more global level, there are two challenges I struggle with. The first is to develop a more steady income stream for myself. Things have been going well the past few years, but a year from now, a long-term contract I've had will expire, and I'll be struggling with income again.

The second challenge is to learn to do more things myself rather than to throw money at the problem. This is particularly true when it comes to any type of physical or mechanical work. Not only do I find this type of work distasteful, but I have no confidence in myself and my abilities. Case in point: yesterday, I "accidentally" turned my thermostat higher when I meant to turn it lower (left-right dyslexia kicking in?). A couple of hours later I feel the radiators blasting heat and go down to the basement to find the furnace chugging away. Instant panic attack!!! I had no inkling that this was connected to the thermostat turn I'd made earlier, but thank heavens my boyfriend was at home and he suggested checking the thermostat first thing. If he hadn't been there to suggest it, I would have called a repair person and had a major expense because I was terrified that the furnace was about to explode and I have no idea how to turn the thing off by myself. As it was, I ended up calling the gas company and spending $99 for an annual service contract so that any future "emergencies" will be covered.

Is that stupid or what? I know it is, but when I get panicky, all concern about money goes out the window and getting the problem solved becomes first priority.

I didn't have too many struggles with money until I finished graduate school and entered the working world. My first year out, I had a postdoctoral fellowship, and I managed to spend almost twice what I earned and when I got a "real job" the next year, I started my career over $13,000 in debt. For the first 3 or 4 years, I just paid the minimum balance due, and then it hit me that my debt wasn't going down. I started reading about personal finance, including Your Money or Your Life, got a consolidation loan and started paying my debt down. It took a couple of years, but by the time I'd left my first job, I'd not only gotten rid of the debt but started saving 10% of my salary in a retirement fund.

At my next job, I also managed to save up a significant amount towards a downpayment for a house. However, I had a bout with an illness that landed me in the hospital for two months, cost me two surgeries and six months of unemployment, and led me to make the decision to get off the "fast track" towards my career and worry more about my life as a whole. The experience also ended up eating up the downpayment fund.

Successes I've had so far in changing habits:
--I spend much less on books than I used to and frequent the library much more often
--I eat out less than I used to, but I still could make a lot more progress
--I pretty regularly save 10% or more of my salary (which varies tremendously year to year depending on my job situation...I've saved up to 27% of my salary in flush years but have had a couple of years where I've lived close to the bone and eaten into the emergency fund instead of adding to it).
--I've put most of my bill-paying on auto-pilot, so I don't get hit with the late fees I used to incur about once a year in the past.
--I finally was able to buy a house this past year, due to the generosity of my mother, who gifted me the downpayment money. This brings the total housing expenses up a bit from what they were, but now I have equity, plus the rents in this area are rising rapidly and it won't be long before my expenses as a homeowner will be less than what they were as a renter.

I have a major challenge this summer: I have to live off of my savings from May 20 to September 20. I'm a teacher and I'm usually paid over 12 months even though I work 9, but I had a job-change this year and unexpectedly learned in January that I'd be paid my spring semester salary in 4 checks, one each in Feb. through May. I managed to save about $5500 for the summer, but I've had a lot of expenses this year as a new homeowner. So far, I'm on track to make it through the summer, but things are going to be very, very tight. I'm taking classes myself this summer and just got a new dog, so I'm reluctant to expand my budget by finding some additional income.

Yesterday, I had a major blow to budget plans: I had a nearly $500 car repair (exhaust system) to have made when I brought my car in for its annual inspection.

P.S. Can someone explain the $20 Challenge to me? Every time I click on a link to it, I get taken to an individual's blog entry related to this, and not to an explanation of what it is. I get the general idea but I'd like clarification.