Decrease Expenses or...

Increase Income

At the rate I'm going I probably won't finish school, in all reality, for another 2 and a half years, which is too long in my mind. It's mostly because of money. I have to work full-time to pay my rent and debt payments so I can't take too many classes or I'll risk burnout. And besides, I can only afford to take 2 or 3 classes per a semester anyway, instead of the usual 5 or 6.

I get uneasy on payday seeing my meager wage and massive debt side by side.

I try to find solace in my easy life, my easy job, my easy schedule. I have a small apartment, but it's warm in winter and cool in the summer. I eat fairly well, not as many lobster and champagne dinners as I'd like but I eat meat and fresh milk often enough to keep me happy. Since I can only afford 2 or 3 classes at a time school is a stress-free breeze. And my job, babysitting the front desk of a four star hotel, is a cakewalk. It's an 8 hour shift that requires probably only 2 or 2.5 hours of actual work. The rest of the time I program, study, read, write, or chat on the phone or with my co-workers in a beautiful setting. I volunteer several hours of my time each month for political movements I believe in so I feel a sense of pride in my contribution to society. I wrote a pretty decent novel that I'm trying to get published. I'm certainly not just wasting time.

And even despite my financial hardships I still manage to make slow progress in that area. My debt is being reduced in $250/month chunks and I'm starting to put together emergency and rainy day funds for a sense of security and stability. Still, it's so slow and mostly I just wish I could get a real job, the beginning of a career, and increase my income by about four-fold so that I could finally start really investing towards financial independence. The well-paying jobs available to an ungraduated English-major college junior are in short supply but I think I have found one that I would really enjoy.

I've begun the process of applying for the position of police officer in a large western city about a days drive from here. I've been eyeing this career-path for myself for a long time. I feel a sense of duty to my neighbors to promote and enforce justice. I want to stand between ill-intentioned men and their victims. I want to do it with respect for civil liberties, extreme honesty and unquestionable integrity. I feel the need to serve my community for a time while I'm still a sharp, fit young man. And finally a good opportunity has come along. I met some recruiters two weeks ago. I took preliminary tests, physical and written, and passed with high marks. Now I have to wait patiently until early July when they will be ready to interview me and conduct a few more less-stressful tests and then I'll receive notice a few weeks after that as to whether I'm admitted to the academy or not. If I am my income will go up three-fold immediately and after four years as an officer it will have gone up four-fold from what it is now to around 62k. With that I could quickly payoff my debts, finish my degree rapidly by taking night/weekend courses and start scraping together an impressive financial portfolio.

My plan is to save every dime. I'd like to remain without children and live frugally so that I can save 80% of my pay. All I have to do is continue to live how I live now on my current income and just be disciplined about my budget. I'd like to augment my income by writing novels and other books of non-fiction as well as by marketing my pet software projects. I'll invest almost all of it in real estate. Flipping fixer-upper properties and quickly paying the mortgage off on a few rental properties should allow me to quit policing after 7 or 8 years, just when I imagine I'll be getting tired of it, and live off the rent and meager income from writing. Then spend the rest of my days in peace with my pen and my keyboard.

New Budgeting System

I have decided to change the way I manage my money. I have adopted the zero-balance budgeting technique. I picked it up from browsing the articles over at YouNeedABudget.com. Jesse describes how he raises a child and pays his and his wife's tuition up front on a modest income using the technique. The long and short of it is that you have to budget every single dollar every single month. There isn't one cent left up to chance.

It's already working. I didn't want to shell out the $20 for Jesse's program. Besides, I wanted it to be web-based and it seemed like a fun project to take on. So I programmed my own budgeting software. Here's a screenshot:



Basically it breaks things down in an easy to manage system. On the left hand side is the budget. Each category, at the beginning of the month, is allocated a certain amount. On the right hand side is the expense log. Every time I buy something I put the receipt in my back left pocket. Then, when I get home, I throw it into an empty plant-pot. Once every few days I grab the receipts and put them into the budget which automatically deducts money from the allocated amounts. So now I see what I'm spending.

Another big aspect is that my money doesn't become available to be allocated into the budget until the next month. So my two paychecks for April will be added up and made available to be spent in May. Since my paychecks vary in size this assures that I will never spend more than I've made. In addition it offers a bit of a cushion should I ever have trouble collecting a paycheck.

To get me started I'm living off one paycheck for all of this month and I'll attempt to live off only one paycheck for May. Then, come June, I'll have both of May's 2 paychecks to budget and I'll have kick-started myself onto a system where I'm always only spending last-month's money.

I enjoyed programming the software. It took about three or four days of spare time while sitting around at work. I intend to keep upgrading it and maybe in 6 or 12 months time I'll make it available to the public or try to make a little money off it as a hosted service.

Payday!

Income
Payday: $564.02
Trust: $200
Ebay Sales: $428.27
Entrepreneureal Income: $57.36

Expenses
Rent: $375
DSL: $62.63
Webhosting:$24.95
Netflix:$51.23
Phone: $15.00
Tuition: $403.88
Postage: $15.00
Food: $50.00
Debt: $243.00


Total
Income [$1,249.65] - Expenses [$1,240.69] = Net $8.96


______________________________________________________

Fixed Expenses (Monthly)
Rent: $375
Phone: $15
Internet: $60
Webhosting: $25
Netflix: $50
CC Debt: $250
Total: $775

Average Income (Monthly)
PayDays: $1,075
Trust: $400
Total: $1,475

Average Monthly Disposable Income
Average Income [$1,475] - Fixed Expenses [$775] = $700

Shrinking List of
Things To Buy:
Helmet Visor: $30
Camera Tripod: $20
Total: $50.00
$50.00/Average Monthly Disposable Income [$700] = .07 Months

Payday!

Income
Payday: $666.23
Trust: $200
Entrepreneureal Income: $107.73

Expenses
Pants: $65
200 Blank DVDs: $38.90
Taxi Fare's: $100
New Shoes: $50
Food + Entertainment on Trip: $300


Total
Income [$973.96] - Expenses [$488.90 ] = Net $485.06

______________________________________________________

Fixed Expenses (Monthly)
Rent: $375
Phone: $15
Internet: $60
Webhosting: $25
Netflix: $50
CC Debt: $250
Total: $775

Average Income (Monthly)
PayDays: $1,075
Trust: $400
Total: $1,475

Average Monthly Disposable Income
Average Income [$1,475] - Fixed Expenses [$775] = $700

Shrinking List of
Things To Buy:
Urban Survival Kit: $150
Sound-proof Booth: $500
Golf Bag: $100
Golf Membership: $350
Helmet Visor: $30
Office Chair: $100
Stereo: $90
Concealed Weapons Permit: $200
PVR: $450
Camera Tripod: $20
Total: $1,995
$1,995/Average Monthly Disposable Income [$700] = 2.85 Months