After reading Kat’s comments, I thought I would attempt to dive a little deeper into why I look at my upcoming financial year (it is all about reducing bill induced stress). Plus, I am boldly going to make a pledge to do something I really don’t want to do. But, like cod liver oil, it is said to be good for me. More on that in a moment.

Planning the next year sounds daunting and even high-minded. It is neither. Instead, it is practical.

By looking forward and acknowledging what I need to accomplish in the coming year, I have a very good idea how to use the next pay cheque.

Knowing that I need about two-and-a-half thousand to pay for car insurance, sports and music lessons for my son, I can set aside an appropriate amount each month. When I follow through on this, there is no scrambling when it comes time to pay these major bills.

To make sure the money is set aside for this purpose, I transfer it to a separate savings account. That way it is easy to monitor progress at a glance and, because it is in a savings account, I think two or three times before drawing from it.

RRSP is a monthly contribution, along with other insurance bills.

So, my idea of long term planning is to set up a system to reduce worry about pending bills. Now if I was really good, I would be planning how to improve my financial lot as opposed to just meeting the bills.

Anyway, my pledge is I am going to try (once again) to track my expenses for the month of June. I did well for the first six weeks or so when I tried this before and then I suddenly stopped doing it. Now is the time to start again.

Ok, in response to Kat’s most recent post, I’m going to go into controversial territory a little.

Kat I may have misread you a little, but I got the sense, a bit, that you are putting pressure on yourself both to face the challenges AND TO SUCCESSFULLY NAVIGATE THEM.

I wonder. Does that pressure on ourselves to successfully navigate through challenges also contribute to not even wanting to make the effort?

Could we give ourselves total carte blanche to simply do the best we can, and see what happens?

And what happens may well not be pleasant or look good or feel good. And in our culture, god knows how many messages we receive suggesting that we really SHOULD look good and feel good.

For you, could ‘handling the challenges’ also include having a (metaphorical!) piece taken out of you now and then? Surviving some bruising?

Obviously bruises are not what I wish anyone, esp you!, but I think it’s an invetible part of this life of ours. We don’t have it in us to do it right all the time. Also, sometimes stuff truly IS out of our control (here’s where I take issue with some of the success-oriented messages).

Can we live with that? Or will we increase our internal pressure to manage life as flawlessly as we (erroneously, I think) believe we can?

Just some thoughts from one financial pilgrim to another.

Having read Nancy’s comments about my “head in sand” re upcoming time off and my inability to examine my options, and then subsequently reading Jack’s last blog installment, I’ve realized a couple of things about myself.

1) Nancy is 100% right about why I chose not to look at the options in this situation…and about why I (and many of us) procrastinate hard decisions of many kinds, not just the financial ones. I’m afraid that if I look at the options I won’t have any, or I won’t like the ones I have available to me.
And then I will be faced with difficult decisions I feel unprepared to make.
It also comes from having made less than satisfactory decisions at various points in my life and a fear that I may not make the “best” choice or may live to regret the choice I do end up making.

2) I became very aware reading Jack’s last blog that he actually has a regular, once yearly (at least) habit of reviewing his finances with respect to projecting what’s coming up. Not just in the next pay period, or the next month, but for a whole YEAR at a time! My god, what a concept! It’s not that I don’t know this is a helpful exercise, it’s just that I realized it’s not a habit I have concretely formed yet. It is something that would go a long way to helping me prepare for the expected so that if/when the unexpected arrives, I’m on much more solid footing to handle it.

Both of these issues have a similar root. as far as I’m concerned: a lack
of confidence in my ability to handle whatever comes my way. For me that is about self-esteem and self-belief. The truth of the matter is I am fully capable of handling everything that comes my way - whether joyful or challenging.

Of course I have made decisions I later wished I’d made differently….that’s called learning and it’s how we grow and develop as individuals. I’m choosing to use language that reflects the value of that experience, so rather than “making a mistake”, I really do believe I have “experienced an opportunity for learning”. That difference may merely seem like semantics to you. I’m aware that the language I use inside my head affects my outcomes very significantly. And sure, sometimes I have chosen something I feel was a mistake. I also know that when I step back and see that had I chosen X over Y the result would be different, the power of that moment is seated in LEARNING and knowing how to apply that knowledge the next time I have the opportunity to make a similar choice.

It is in no way constructive for me to berate myself about a “mistake” I’ve made or to say to myself what a bad job I’ve done of choosing. What IS helpful is to step back, witness my choice, see what might have produced a better result and figure out how to learn something useful for the next time around. There is also value in having to produce creative solutions to correct situations where I have not gotten the best result - for example, in not having taken the time to verify that “two week waiting period” with my benefits provider means deductible/no money for those two weeks I’m off work, not simply a delay in receiving the funds!

At work there’s something we use to help our clients overcome fear and develop confidence in themselves and their abilities and lately it’s a credo I’m living by. Perhaps you will find it useful too:

“What would you have to fear if you knew you could handle whatever comes your way?
All you have to do to diminish your fear, is to develop confidence in your ability and believe that you can handle whatever comes your way.”

Throughout my life I’ve done an entirely respectable job of making choices and handling some very difficult challenges. I have no reason to believe that what lies ahead of me is anything I can’t handle. So on the strength of that, I’m going to continue believing in myself and forge boldly ahead, even when it feels scary!

Kat

Kat -
1. I wonder if the main reason we avoid pulling our heads out of the sand is because we think if we do, we will discover we have no options, and that the reality will be painful. Frankly, sometimes this is true. Plus, if it’s true that half of what we worry about doesn’t come true anyways, keeping our heads in the sand makes a certain amount of sense - eg., we do it as a lifestyle, and what do you know, we manage somehow, and in the meantime we’ve avoided the worry that might have come if we looked at the facts. Of course, I believe that over the long haul we increase the odds of handling our finances well by consistently not hiding from our realities.
That does NOT mean that everything gets solved. It means we solve more things than by not even trying.

2. You are facing some (mildly) tough options:
insurance won’t cover you
you don’t have savings
you don’t want to use holiday time on this
you don’t want to have to take a step backwards with your LOC
There is no easy solution in sight, but you have used your creativity to inquire of the universe and of yourself whether there is a way to increase your income . I applaud you entirely, and who knows, you may discover you do get additional income.

If not, remember that distinction I made in class between “Goals” and “Desires”. It might help to remind yourself that your DESIRE is not to use your LOC, but it does not have to be a GOAL, which implies success/failure. Obviously, getting it down has payoff for you. But it won’t be the end of your world, or your financial progress, if you have to dip into it a little. It’s a step back, nothing more, and the ground will be regained.

Again, applauding you for looking at your reality squarely, and making the best decisions in the midst.

When Nancy asked me to blog, she asked me to chronicle the ups and downs of my financial life. Not the most glamorous topic. Especially this time.

Taxes are filed and I’m waiting for a tax return, thanks in part to a little advanced planning.

With that in mind, this is the time of the year I look forward into my personal 2006/07 financial year. I know that I want to contribute to my RRSP, my community, meet major anticipate bills like holidays, car insurance and repairs and extra-curricular activities like my son’s sports.

This is as much fun as entering purchases into a expense tracking spreadsheet (like Kat, I’ve been struggling with this one as well). I know my car insurance requires me setting aside about $100 per month, RRSP is $50 a month (not a lot, but it does add up). At least twice a year, I get three paycheques in a month, allowing me to set aside the better part of a grand to take care of my son’s extra expenses.
Planning my contributions to my communities is always fun and is probably fodder for another blog.

None of the planning is down to the dime. It is done in broad strokes so I can relax knowing I should hit my big expenses and goals without a last minute scramble. Plus, I know some of these activities will pay off with tax deductions.

Well, now that I seem to have the spreadsheet under control, there’s a new fire to put out!

I’ve been fairly proficient at putting my head in the sand with an upcoming financial reality. I will be off work for two weeks at the beginning of June, not for holidays but for other reasons. My current employment allows for only two weeks of paid holidays and since my time off will not be R&R, I do not wish to use up my small allotment just to keep my paycheque intact.

I do not have adequate savings set aside for this, despite knowing for several months that it was approaching. I also didn’t do the necessary footwork to find out whether my benefits at work will cover me for the period I will be off. I’ve found out that there is a two week waiting period which essentially amounts to a deductible, so any money I would receive would only kick in after the 3rd week, which leaves me to fend for myself in this instance.

This is one of the things I dread about being in a financial position where I have assets, while having no liquid cash on which to draw in times of need. As fate would have it, I will be getting an Income Tax Return this year which will cover about one week’s pay, so I will only need to manage to find the second week’s pay. I’m being very creative and have rustled up some extra work, yet (currently) not enough to cover my usual paycheque. In this instance it actually worked to my advantage not to have filed my return early, since had I done so, I would either have invested the money or spent it and would not have it at my disposal for this purpose. While I am happy I have the money for my time off in June, I would have felt better had I taken this reality into account several months ago and found a way to set aside a little at a time so I would not be scrambling to make ends meet and could have used my tax return for investment or pleasure.

I have a Line of Credit on which I can rely if I can’t manage to gather all the necessary funds before June, and if I felt it necessary I could always choose to surrender one week’s worth of holidays so I wouldn’t be out of pocket. I prefer to continue to make efforts to earn extra money, avoid using credit or my holidays. I have (once again) reduced my debtload/use of credit from 5 figures to 4, so I am really NOT inclined to use my Line of Credit. It is so gratifying to see that number diminishing with each payment and to watch my savings account growing over these past weeks. I have put out to the Universe my intention to earn the necessary money and am trusting it will manifest without my having to resort to the “less preferred” backup plans. Wish me success!