ten four

{cred}

recently i told ya'll that i went to a financial seminar. i was telling bbe about it the other day and she asked, 'what was your biggest takeway?"

it made me think. and also made me think i was an idiot for not sharing (on my blog about my financial decisions) what my big revelation was!

so here it is.

once my student loan is paid off, rather than continue to put big chunks of money down on my car loan (which has a low interest rate) i am going to start contributing much more heavily into my savings. i will put a little bit each month into savings until my student loan is paid, and then start beefing that sucker up.

my reasoning:
my car loan has a tiny interest rate- 2.95%

i'd eventually like to own, not rent, and as it stands today i don't have the money for a down payment even if i could afford the mortgage...not a good feeling.

i dont want to be one of those people with $45,000 in the bank at age 65.

i need to get enough money into savings to be able to 'make my money work for me.' right now i have an emergency fund-but nothing else. i need to have a retirement account, and an idea of what the hell i'm doing with it.

i think it will help keep me motivated to see the 'money i have' column on my spreadsheet go up and up each month.

so there you have it. i'm on the retirement path. weird, right!??
xoxo ashleycolean

like a great wine...

so it's not exactly rocket science to think that the earlier you start saving for retirement the better off you'll be. i mean, come on guys. basic math. BUT, i hadn't really wrapped my (still young) head around just how significant of a difference it would make!

here's a little info according to the schwab center for investment research

age you start saving/% of your salary you need to put in savings

20s-   10-15%
30s-   15-25%
early 40s-  25-35%
50+ -  58+%

i'd rather be enjoying a mimosa at an inappropriately early time in the morning than working my ass off because 26 year old was a dumb ass who thought an overpriced apartment and car were more important.

60 year old me better be patting 26 year old me on the back.
xoxo ashleycolean                            

that's what he said

art by alice carroll

j.d. roth posted today-putting first things first. laying out the financial basics he has learned over the years and drawing the parallel between his daily routine and his financial routine. i reorganized these in the order in which i'm tackling them...

"pay your bills as they arrive-in the olden days, i’d wait to pay my bills until the last minute. why pay them early? i figured waiting let me use my money longer. this just led me to live paycheck-to-paycheck, though. now I pay my bills when I get them (and sometimes I overpay!), which makes life easier. it relieves pressure." i do this every month. on payday, every two weeks, i sit down and pay everything i know i have due for the next two weeks. not only does this ensure that i pay everything-on time, but it also gives me a much more realistic idea of the money i have to work with for those two weeks.

"build your emergency fund as soon as possible. shit happens. people get sick, things break, and fate is fickle. an emergency fund is like self-insurance: It’s a way to ameliorate the bad stuff that happens around you. build your emergency savings as soon as possible, and when you can, build it bigger." we've talked about this here before-but i can't stress how important this is! even if you can only afford to put $20/month into a rainy day account, it is still imperative to your financial success. one flat tire and you're, as they say, royally...screwed. i'm keeping two months expenses (that's what i decided was right for me) and adding between $150 and $180/monthly to that number.

"get out of debt as soon as you can. i hope this one is obvious. debt drains your soul — and your bank account. when you eliminate debt, you eliminate burdensome interest payments, freeing that cash for other uses. i’m a fan of the debt snowball, which lets you pay off your smaller debts quickly so that you can use the increased cash flow to pay off even more debt." the meat and potatoes-get.out.of.debt. i'm doing it and you can too. even if you don't do a lock down or a fast like anna-every little bit helps. don't skip payments, don't only pay minimums, and do start taking your financial situation seriously. trust me, it sucks but it's awesome. :)

"invest as much as possible as early as possible. the single greatest factor in determining how much you’ll have saved for retirement is how much you save. and the earlier you start saving, the more the extraordinary power of compound interest can work for you." this is my plan after the debt is all gone. save at a max for another 6-9 months (with $0 debt) and then hire one of those suit wearing guys to tell me what to do next. ira's, 401k's, etc etc...won't that be fun!!!

knowledge is freedom.
xoxo ashleycolean

life or money

the other day i got an email from my pops. he doesn't send (too many) forwards so i took a minute to look it over. basically this chart shows that the longer you work, the shorter you live after retirement. take a gander...

table 1: actuarial study of life span vs. age at retirement

Age at Retirement	Average Age At Death
49.9	86
51.2	85.3
52.5	84.6
53.8	83.9
55.1	83.2
56.4	82.5
57.2	81.4
58.3	80
59.2	78.5
60.1	76.8
61	74.5
62.1	71.8
63.1	69.3
64.1	67.9
65.2	66.8

read more about this study here



bbe made a good point though when i showed her the table-that there are also studies that show that because work causes you to think critically, be active, etc-for many people (likely with less stressful jobs, or jobs they truly enjoy) working later in life actually extends their lifespan. so i suppose, it's different for everyone and every job.

but then, today on the simple dollar i read this quote 'everytime you buy something today, it effectively tacks some time on to the end of your working career.'
yikes...that'll make you reevaluate unnecessary new bedding, or overpriced candles for your apartment.

the retirement gods are trying to send me a message. maybe something along the lines of 'don't think once you get out of debt you are done with this new budget-you have a lot of catching up to do, erickson.'

c/o weheartit

daily golfing is going to add up.
xoxo ashleycolean