Tag Archives: life

The Fear of Losing it All

What would you be doing right now if you had nothing to fear? I read this question on a blog the other day (eeks, can’t remember which) but it made me think just how much my life would change if I could ignore fear.

That is, the fear of having nothing. I’m not even sure what that means anymore. There’s definitely a fine line between having enough to get by from now until death, and excess income for ongoing splurges. Also, on the other end, there’s a fine line between comfort and poverty.

I’m not anywhere near poverty now. In fact, I’ve done surprisingly well for myself this year, despite overspending time and again. Between my increase in salary and my fairly stable freelance income, it looks like I’m on track to bring in about $75k this year (pre tax). That’s quite a lot for a single gal. Granted, I live somewhere that the cost of living is high, but I survived on $25k a year before and it scares the crap out of me that suddenly $75k seems like not enough to get by on when I feel like I need to put so much income into investments in order to afford life in the future.

But if I wasn’t afraid at all… of being poor… what would I do? I don’t think I’d be doing what I’m doing now. I’d like to start my own business. Lately I’ve been fantasizing about opening a store. Not that I have any retail experience, I just love the idea of being in charge of a business and being able to call the shots.

Every year that goes by I think, man, I really need to go to grad school. But then I add up the numbers and it just doesn’t seem worth it. Maybe if I was making $25k still a graduate education would help me make $70k+, but I’m already there without it. I might be limiting my income in the future, but who knows. Would getting an MBA really increase my overall life income when I just don’t see myself as a person willing to work 80+ hours per week?

I don’t need to be rich, but I enjoy being in the upper middle class. I do like to spend money on things I need and things I don’t need. Can I get over that? Probably. But if it makes me happy… or at least, content… why should I?

This month I’m spending SO MUCH on health costs. Well, between my dental costs and mental health therapy and eyecare, my budget is largely going to healthcare. I guess that’s a “good” place to be spending my money. I went to a psychiatrist that charged $280 for the initial 1 hour consultation. She prescribed me an anti-depressant, which I’ve yet to fill. I also have spent $150 for group therapy (3 weeks this month, $50 a session.) I also spend $330 on something like a years’ supply of contacts.

I haven’t finalized any laser hair removal plans yet, but I found a medspa that has a pass for about $4300 where you can get unlimited laser hair removal. The catch is there is a $20 copay each time you go and each session can only be 90 minutes long, but still, that sounds like it would be so very worth it for my hairy self. I’m leaning towards doing the 12 months financing through care credit, paying about $330 per month over the coming year. That won’t be a problem as long as I keep my current job. And I already have that amount in savings if I need to pay it off and I lose my job, it would just kind of suck to spend my savings on it if the income stops coming in.

The good thing is that I’m building my side freelance writing business. I’ve decided in order to feel comfortable I need to obtain multiple streams of freelance income. Ideally, each of them should be able to cover my rent ($630) or a large portion of it. I figure, if I lose my full-time job, I want to already have income streams set up to cover rent and other basic costs. I can cut out all other spending and investing if needed. My goal is to take home $1,000 in freelance income per month. I’m more or less around $500 right now, but I have a new occasional gig that pays well and seems to be working out, for the time being, at least.

All of this has me terribly frightened about stopping everything and going to grad school. And knowing that my poor GRE scores and academic background will keep me from attending a top school, I wonder if grad school is worth it. I’m considering a state school, but even then I’d have to stop working full time for two years. Maybe there’s a way to balance freelance income and graduate study at a state school where I won’t go into that much debt during my studies. But I don’t want to go to a grad school just because it’s affordable. I’m not sure that’s the wrong way to look at it, but it seems like people choose graduate programs for reasons beyond cost, as that’s what student loans and a lifetime of student debt is for, right?

Hmm. I wish I grew up in a family of risk takers. I’d feel a little more confident in knowing what next step to take, or trusting my gut. My father’s whole job was dedicated to mitigating risk. Even as my younger sister is scheduled to visit and spend a week with me, when I talk to my dad on the phone he seems sincerely concerned that I’m somehow going to have us both killed… even though she’s 19 and I’m in my 20s and we both haven’t died yet. Neither of my parents ever trusted me to make smart decisions, and neither of them knew how to make smart decisions… so I don’t know how to decide, well, anything. And without deciding, I’m slogging along, having a few good days but more bad than good, earning my $75k and preparing for a day when I’ll be back to $25k. That’s how it looks like my life will go. I can’t even think about what will happen when/if I have kids and have a family to support.

How Much Would I Have Without My Wealthy Family? — Inspired by MEG @ The World of Wealth

Being a personal finance blogger, I’m often embarrassed of the financial background I come from. I’ve been reading a lot of MEG’s blog Wealth is Good lately, and she seems to have the same problem, if it is a problem.

MEG recently “came out of the finance closet” and wrote how she’s getting a financial gift each year from her grandparents, as part of their estate planning process. It’s causing quite a stir in the PF blogosphere. In a recent post, she is trying to figure out how much her net worth would be without any help from her family. It’s one of those things that’s pretty impossible to figure out. But for both of us, our net work would be much less (likely negative) at this point in our lives if our parents hadn’t helped along the way.

Looking back on my life, I really have no idea where my net worth would be without my parents. Maybe I’d be poor and depressed. Maybe I’d be in law school after working my ass off in undergrad. I probably wouldn’t be living on my own and making $60k at a job I love.

My parents paid for so much of my life. My spending on things I didn’t need (clothes, other junk) was high, but I never really bought anything material I really wanted with their money. Just a lot of crap. I went to public school, so that was free, but my parents paid a lot for outside classes and camp. In high school, every summer I went to a different college for courses. All of that helped me get into college, which ultimately helped me get the job I have now.

While not from the bank accounts of my mom and dad, my $15k that I started with out of college was directly a result of their work. That is, when I broke my arm in 6th grade and they sued the gym, the lawyer and my parents won me $15,000. I wasn’t able to touch it until I was 18, and when I was able to touch it I was afraid to invest it. I just put it in a CD and let it sit. (Probably a good idea given the current state of the stock market.)

If I didn’t come from money, I may have worked harder in school, gotten myself a scholarship to a better school than the one I went to, majored in something that would have gotten myselef a stable job right when I graduated, lived frugally, stayed at home to pay off debt, etc. Or, as MEG puts it, I could have been so overwhelmed by everything and just dug myself further into a hole with credit card debt. It’s hard to say.

The one thing we can’t control is where we come from. It’s easy to spend any amount of money if you aren’t careful. I didn’t start thinking about saving money until I found An English Major’s Money blog two years ago. I always thought saving was something I could figure out later. Then, the personal finance blog community let me know that’s the worst idea ever. So I started saving.

And the rest is her(everycentcounts)story.

Getting Back on Track – goal: from $12k to $30k savings in 1 year

In this past year, despite being conscious of my poor spending habits, I managed to whack my net worth down from $26k at its highest to about $12k, where it is currently, give or take a few k.

Most of the damage was done on my trip to Israel, when I basically threw most of my financial wisdom out the window. The biggest problem, it seemed, was that because the trip was pretty much “free” (even for the week after the free trip, I stayed with my family all over Israel for “free”) it was easy to spend money for gifts and little items for myself here and there. Well, it all added up. Meanwhile, I was paying $1050 in rent for the month for my empty studio apartment back in Cali, and I wasn’t making any money either while I was on vacation. It doesn’t take a math genius to figure that out.

The good news is that as long as I stick to a tight budget this year, I should be well on the way to healing my ailing savings account.

While I need to just accept the fact that anything in my net worth involving the stock market is being kicked in the groin repeatedly right now, I can do quite a bit to get myself out of this financial rut and figurative debt.

According to my calculations, I’m about -$9000 in the “red” (not literally) in my cash accounts. My non-liquid savings accounts are at $21k, which includes those suffering in the stock market, so in reality my overall “net worth” is somewhere at $12k. I’m also getting another paycheck in a few weeks, though some of that will go to rent.

For the sake of my mental health, I’m going to use this entry to re-draft my budget, so that I have a very clear plan on how I can save $17,000 in one year. That’s really just about $1500 a month, right? I think that’s… well, that might be do-able.

————–
Fixed Spending: $994.32

$635.12 – Rent (includes water & garbage)
$60.00 – TV / Internet / PGE (estimate)
$97.64 – car insurance
$146.78 – health insurance
$54.78 – cell phone
—————————————
$994.32

OTHER: $900

$400.00 – Food
$100.00 – drugstore / vitamins / cleaning supplies
$300.00 – gas
$100.00 – entertainment
—————————————–
$900

$1600 – $1900 – approx “necessary” spending (+/-)

Income:

$4800 + $400 / month before taxes
$5200…

about $2600 after taxes

So… saving $1000 a month, if I never ever go to the doctor, or buy clothes, or eat out… is possible. Right?

I’m also looking into seeing if I could get a cheaper health insurance plan since it’s not really doing me any good and it’s just for emergencies. I had to pay $65 to go see a doctor just to get antibiotics for my last UTI anyway, so why does it matter how high my deductible is?

Anyway, saving $1500 a month looks somewhat unlikely. However, I am overestimating my tax payments since they won’t really be exactly 50% of my income. They’ll be close to that, maybe 45% when all is said and done after self employment tax, but at the least, I figure if I’m saving 50% that will give me some extra dough at the end of the tax year to close out my Roth IRA for 2008.

Ugh, I feel like I’m making a lot of money, but it’s no where near enough. I wonder if I should look for another, better paying job. But I LOVE my job. I make $57k a year, though not really, since that’s on contract and no benefits or time off is included. So I figure I prob make about $50k a year in comparison to my past jobs. I just have no idea what I should be making. I charge some clients $50 an hour for work, but that’s all on smaller projects, I can’t justify asking for that sort of raise at my current gig, nor do I feel the work I do there warrants $50 an hour. There just isn’t enough work for me to do there in terms of work that I know how to do – writing. I do a lot of other things, but a lot of those tasks are literally shared with an intern.

Futz, I’d like to be making $65k a year w/ benefits. I have no idea if that’s a ridiculous amount to hope for with my experience and given that I live in the Bay Area. I’m also kind of frustrated with the fact that 40 hours per week at my company does not = full time. Granted, I work my 40 hours a week at random hours of the day and night, and they aren’t picky about it – but still, I just dislike that 40 hours a week no longer equals full time. To be full time at my company, I have to work 60 hours a week. But really, what would I do for 60 hours a week? I don’t even know how many hours I’m actually working… but I’m sure it’s more than 40. I need to start keeping track of where my hours are going. I just feel like… if I worked for an advertising or interactive marketing agency, I’d know where my hours were going, because they’d be spent writing, and I’d have something to show for all those hours. At my current job, it seems like I have little to show for the work I do. I’m so used to being a journalist, where every day you’re worth is in your clips. Here, it’s ideas, it’s finding bugs on the site, it’s doing a lot of little things that are kind of sort of in my job description… and I worry that I’m not doing enough, and I worry I’m doing too much, and I wonder how I can move up in the company when there’s really nowhere to move up to…