March is the month for financial fitness here at Republic Wireless. Not only are we working on ways to bring you savings in your life, but as employees of Republic Wireless and Bandwidth.com (our parent company), we’ve had the chance to work on our own personal finances this month as well.
Now, I’m a little biased, of course, but Bandwidth.com is a great company to work for. I started as an intern here about a year and a half ago and came on full-time in May of 2014. You hear about companies that practice what they preach and this is definitely one of them. Our awesome People Resources team knows we all want to help our members save more, so they help us start at the source and educate ourselves! Through special programs like Dave Ramsey’s “Smart Dollar” classes, they help us become the financial experts. And just like the savings we wrack up when you use more WiFi, we pass our knowledge onto you!
I’m definitely not a finance guru yet, but here is what I’ve learned so far:
- It’s Spring now: If you’re anything like me, you’ve been procrastinating on looking over your monthly expenses since the holiday season. Take the time NOW to look over your bank account and see where all your money is going.
- Take a financial fitness course: As mentioned, we’re taking the Dave Ramsey “SmartDollar” program – it’s all about building wealth with what Ramsey calls “Baby Steps.” No “get rich quick” schemes here. Instead, we learn to focus on one practical step at a time. “Live like no one else does now, so you can live like no one else does later,” is a quote Ramsey mentions often. Baby Step #1 is to get $1,000 into a savings account, just so you have it, by saving up, selling things, maybe even delivering a pizza or two, as he says. I’m on Baby Step #2: Pay off all debt. I’ve been lucky enough to graduate college without student loans, but I do have a car loan, and a little bit of credit card debt, even though I really only use my credit card for gas and groceries. So, based on this program, I shouldn’t be transferring a whole lot of money into savings just yet – just focusing on paying off the credit card quickly and attacking my car loan with as much as I can. At the rate I’m going, I’ll have my car paid off a year earlier than originally planned for!
- The trick behind budgeting: Don’t look at it as what you are kept from doing with your money, but what you CAN do with the money you set aside every month. Once I figured out how much money I had going to fixed costs like rent, utilities, and my car loan, I got to plan around how much money I wanted to spend as my “flex” money for things like groceries, maybe a little shopping, gas, etc. I sat down and looked at my bank account (SEE FIRST BULLET POINT) and figured out how much I could cut on spending, while still living comfortably with the appropriate amount of money set aside for food and fun (two most important categories for me). I decided on a reasonable amount and found that I still had about $100 a month that I could be putting somewhere else, so, I’ve got an automatic draft set up in my bank account for $100 each month to go straight to savings. The best part about budgeting? I feel guilt-free throughout the month now that I know my money is going to the right places!
There are a ton of advice columns out there on what you should be doing with your money and it’s hard to understand what’s right for you and where you are at in life. Why? Because everyone is different!
For example, I’m a year out of college and have a job now, so I’m no longer dependent on my parent’s money (their idea, not mine). That said, I needed to learn how to balance paying for rent and utilities while also having some spending money to do the fun stuff like going out to dinner with the girls every once in a while and seeing a movie at the theaters (which, by the way, has become ridiculously expensive!). On top of that, there are things like retirement that I need to be thinking about, and yes, according to multiple sources, I should be thinking about retirement at age 23.
The Dave Ramsey program lays out a total of 7 Baby Steps and you get to decide where you’re at in those Baby Steps and customize the plan from there. He recommends that you take each Baby Step one at a time up until a certain point and then get into simultaneous investment stages.
I have really enjoyed this program, mostly because it has at least started the thinking process for me. Where do I want to be investing my money? Am I in a good position for a potential emergency? What should I be doing now to plan for my future?
If there is one key takeaway from this that I walked away with, it’s this:
There is no defined way to handle your finances, because there are so many different factors that come in to play, and it will take time to learn how to customize your experience, but the key is to start learning and asking questions today.