Archive for the 'Circumstance Navigation' Category

12
Sep

Thrown Into the Deep End

By David 1 Comment
Categories: Circumstance Navigation and Frugality

The past month has taught me some difficult lessons. In the same way working through college made me grow up faster than classmates who had the parental free ride, losing my job 2 months after starting to get my finances in order has taught me a lot, very quickly. In short, I did find another job that seems to be the perfect opportunity, but I will wind up losing a full paycheck because of the transition. This is my first week working full-time in 3 weeks.

First, I learned that even if I think I have things figured out, but don’t account for major shifts from the very onset, I’m doomed for failure before having tried. I started getting my finances in order in June. In August, I lost my job. Two months could have been enough time to get at least a basic strategy ready just in case something happened. Granted, I thought things were stable, but I still should have had at least one exit strategy.

Second, I’ve learned that it’s possible to be extremely frugal given the correct circumstances. I can say no to going out with friends, I can refuse to drive extra miles, and I can even eat off $100 for two weeks (when I normally spend $100 per week or more). I’ve cancelled every little subscription I had, and tried my best to find every spare dollar I had. If the money is simply not there, I cannot do that stuff. Translating this into my path out of debt, my goal will be to make debt payments first, and live off of what’s left. This means I’m forced to be frugal, where thus far I’ve tried to be frugal on the front-end. It’s hard to be frugal when the money is sitting there waiting to be spent, but much easier when you don’t know when the next check comes in.

Third, I’ve learned that some creditors are sympathetic. Within reason, of course. A few credit cards allowed me to not make payments this month, and resume next month. They are still charging me interest this month, but will not charge me for two months later, will impose no late fees, and will not report me to the credit bureaus. While it doesn’t completely save me from the lack of funds, it will be an immense help, and one less thing I have to worry about right now. It took a lot of time and talking to get it done, but a few hours work to save me peace of mind during this transition was well worth it.

Fourth, I’ve learned the real cost of not having my finances in check already. In June, I wanted to do it for peace of mind and looking to the future and marriage/family. I assumed the job was stable, that I would always have an influx of money, etc. By sabotaging my own future self financially, I made this thing much more difficult than it should have been. After all, I’m only missing one paycheck, not even a full month, much less half a year like some people do. I’m extremely happy I was able to quickly find another job, but if missing two weeks worth of pay messes me up this month, I’m in a very bad condition. If I was not motivated before to get out from under this debt, I sure enough am now.

My new job will be paying me a few hundred more per month than I am making now, but will not be paying my school expenses. After thinking long and hard about it, while school is important, I really need to build up some financial muscles. After this semester, I may put school on hold temporarily if I cannot find financial aid to help me out. At this point, I may even take out additional student loans to cover the cost, and use my extra money to get out of debt even faster. With a few hundred extra per month, and living more frugally, I should easily (or rather, difficult-ly) meet my target of next December. Even more, I should have a decent emergency fund by then. While it may put my education in somewhat of a bind or cause me to gather more debt in student loans, I’d much rather trade my credit card debt for student loan debt! And with the increase in salary, once my debt is paid off that gives me that much extra money to either invest or put towards those student loans, which is nice. Once I have my degree, that’s an immediate $10-15k bump in my value as an employee apparently (though personally I feel the caliber of my work is not affected by a piece of paper), and I’m all set.

And while it’s fun to think about the future, it’s taking everything I have to make it through September. I’ll probably be posting very rarely until money starts coming in, but know I’m getting some good life experience that will give me much better perspective on my posts. I hope I learn some more lessons worth sharing, but until then…

24
Aug

When it Rains…

By David 2 Comments
Categories: Circumstance Navigation, General and Uncategorized

Well, I only thought that going back to school was a major lifestyle shift. Little did I know that there are much bigger shifts that can happen, such as, say, losing my job. Yes, I’ve not been posting for the past week because I have been using every spare second searching for a new job. Luckily, I was given plenty of notice, and it isn’t due to poor performance on my part; they are divesting the entire R&D arm of our company and about half of us will be lost in the shuffle.

On a not-so-side note, I finally learned what not having a degree means in terms of job availability. Even though I don’t feel the degree really means you know more (and personally will never hire people as if that were true), a lot of companies weed out potential candidates based on that little piece of paper. Oh, if only this were happening two years from now when I will have finished school.

So, this is a pretty shaky month. I had to start working part-time immediately, which reduces my cash flow quite a bit. I’ve made some big cutbacks already, and have more to make. If by next week I do not have a job, I’m going to have to call creditors and see if they’re willing to give me a break while I find a job. I do have a few prospects, and if worse comes to worst I’ll have to move back home and work fast food or something. So I’m not sweating it too much; worrying about it will not get me anywhere. I am, however, allowing it to motivate me to keep looking for jobs. Unfortunately, out of about 500 jobs I’ve looked over, only 2 seemed appropriate for me.

I’m also at a disadvantage because I won’t be able to make what I’m currently making at a lot of places, without that degree. In a small business, I provide a lot of value. In a large business, I’m just another programmer, and the pay scales accordingly. I’m hoping I can transition into a position that pays what I’m making now, and also pay for school still (or put school on hold for the immediate future).

So, some lessons well learned about life and how it throws you all sorts of curveballs. Don’t worry, I’ll come out of this stronger. I now see even higher levels of importance in being debt free and having plenty of savings stockpiled. That will motivate me to try even harder.

On a side note, I’m not allowed to talk about it in detail yet, but let’s just say that Mint.com is going to be an incredibly awesome tool, and will blow every other finance tool out of the water easily.

15
Aug

Navigating Lifestyle Shifts

By David 1 Comment
Categories: Circumstance Navigation

Note: If you came here from NCN’s Carnival of Debt Reduction, here is the post he was talking about: Backbone Growth.

Today I start back to school. For those new to my story, I have a full time job and am also going back to school full time to finish my degree. I’ve had the summer off, which has helped greatly in terms of getting back on my feet financially. However, since I’ve had plenty of time to focus on finances thus far, not to mention getting in 40 hours at work every week, going back to school will be a major shift.

The shifts are not inconsequential and many of them are things that got me into trouble in the first place. First, the sheer amount of time school takes up leaves me unable to easily take time out to handle financial matters. Yes, I can still find an hour on weekends, but things like calling creditors, looking through statements, etc. seem like much more of a hassle when the grades start dropping. It shifts my entire daily schedule forward (since class goes until 11:30pm or so), which forces me to do things like eat at fast food places or the campus food court for dinner, and go into work later. I get in fewer hours of work per week on average, usually 35-38. Not to mention I spend about $50 more on gasoline per month. As you can tell, these little things really add up when you combine it with debt reduction.

However, I refused to be caught by surprise this time! Here are some things I did to keep this from being a major burden on my life:

  1. I thought ahead. Really, this is the only thing it took, but I sat down and really analyzed what each semester costs me in terms of money, time, and sleep. I then re-budgeted all three of those to make things work. I made a new financial budget incorporating food and gasoline costs. It will be more difficult to get out of debt, but at least I won’t be getting in any deeper!
  2. I got supplies on sale. I caught the back-to-school sales along with the high schoolers, and got things like pencils, paper, and printer ink for much cheaper, and tax free! Better yet, I kept it within my budget for July, so it didn’t even hurt me. I may even have enough supplies for Spring semester as well.
  3. I didn’t take a vacation this summer. Because of that, I have enough annual leave left to where I can take 4-5 hours off work each week and not have to worry about losing money! Yes, I sacrificed a week off, but when big tests come up I don’t have to worry about finances on top of studying.
  4. I arranged my classes to be all in two big blocks on Mondays and Wednesdays, at the expense of taking 4 difficult courses all at once. I will probably have up to 4 tests on some nights, but this saves me money on gasoline, and makes the food problem only apply to two days per week. Not to mention, it makes scheduling work and study time much easier.
  5. It is my goal to have a 100 average in every class by October, or at least high A’s. This means that when things get most stressful, I can maintain all my schedules without having to take even more time off. Even if my grades drop a little at the end, I don’t have to worry about it because I’m pretty much guaranteed an A or B by that point. This is so much better than slacking off at the beginning and then having to step up the studying and time later on, when you’re already too tired. This also applies to any area of life; work twice as hard when you still have the energy, and then don’t feel bad about slacking off a bit later.

Most of all, I just had to sit down and think about what was about to happen. The worst mistakes that happen are almost always the result of poor planning, or even no planning at all! I wanted to make sure I had the bases covered. I feel pretty good about it. Not to mention that even though I have 4 difficult classes right now, my final semester will pretty much be History, Music, a math course, and a final computer science course. Like I said, work hard now, slack off later.

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