Every American has made financial decisions in their life where they can look back on and say “That was a good decision!” Those decisions do not have to be monumental but instead they are intentional in nature that has caused them to be deemed good decisions. These decisions aren’t necessarily for the short-term benefit, even though majority of them are. The distinction is that the short term gain also has a major impact in the long term as well. Any good decision that is made now will reap major benefits in the future. Here I’m going to list the 6 beneficial decisions I have made in the last year that have not only impacted my day to day life but also ensure a favorable outcome in the future.
I graduated pharmacy school in the past year and have had a major increase in income. Before making a pharmacist salary I was barely making enough money to support my spending habits. However, during that time I was still putting 10% of my paycheck into my 403b. Since I was an intern, I wasn’t eligible for my employer match, so it was funded strictly by my contributions. This was an intentional decision that I made because I knew that there was a light at the end of the tunnel that would have me making a 6-figure salary. I wanted to start off on the right foot so I automated my contributions so that when that first pharmacist paycheck came in I would “trick” myself into thinking I was taking home less money. I have been contributing a percentage of my pharmacist salary to my 403b and have seen a major impact in growth in that account so far.
In the area I live there is an extremely vibrant auction community that is ripe for major savings. I was first introduced into the concept of auctions by my roommate in pharmacy school. It took me awhile to get on board mainly because the concept and website design of the company seemed rather sketchy and I didn’t want to get burned or scammed in the process. However, once I got over that initial fear and made in the decision to try my first auction, I haven’t looked back. The whole concept of the auction is to buy anything (and I mean anything) for a fraction of the retail price. I was moving into a new place at the time so the main pieces I was interested in were for my new apartment. I scored tons of items for a sliver of price I would have paid if I went to the store. I purchased a fully functioning Keurig for under $6, a Shark brand vacuum for under $15, and a modern designed rocking chair for under $20. If I would have bought those 3 items in the store, it would have cost me over $300!
Cooking at home
One of the easiest ways I have found to spend money is by eating out. Prior to this year I was eating out for almost all my meals and the meals that I would “cook” at home were terrible for me. I would just put a frozen pizza in the oven and call it a day. I then wanted to make a change to eat better but I was still finding I was spending a lot of money on food. Now, I have found a pretty good solution to my problem. I downloaded the app called Mealime. It takes all the good things from meal delivery services, such as the wide variety of meals and ingredients but it doesn’t cost a thing! Instead of getting the meals delivered to your door, it creates a shopping list for you based on the meals you have selected for the week. All you have to do is do the shopping yourself. I have found this to be such an enjoyable experience, and have fell in love with cooking!
I recently made the purchase of a magnetic weekly calendar that goes on my fridge, and I will say it has been one of the best purchases I have made for under $10. Just the act of planning the week has done wonders for me. Since I work in a hospital, I don’t work regular hours of a typical 9-5 job. I have shifts all over the place, including weekends. I was having trouble keeping everything straight even with using my phone to store it all. The act of writing something down helps it stick in my mind better. Now that I am planning my weeks and cooking at home, it takes a lot of the guess work out of where to eat for that night. I have constantly found myself having the “we have food at home talk” with myself because I have planned all my meals out for the week. It’s not only my meals that go on the calendar either. I write everything down on the calendar. I write what shifts I work, what rooms I need to clean that week to keep myself accountable and everything else in between.
Paying Credit Card in Full
Two things my parents always told me when I was younger after I received my first credit card were 1) if I charge something to my credit card make sure I have the money to pay for it and 2) make sure I always paid my statement in full every month. I never questioned their reasoning for telling me this, all I know is that I do this every month. Now being grown up and getting involved in the FIRE community, I can fully appreciate their advice now. I can’t imagine charging something to my credit card knowing that I don’t have the money in my account to pay for it when my statement comes. I know there are a lot of people who don’t have this way of thinking and that truly scares me. Now that I understand how interest rates work on credit cards has made me much more aware of what I am spending and charging to them every month. A new thing that I started today (as of writing this entry) is to pay my credit card off each week. My thought process behind this is to see exactly how much I am putting on my credit card each week and where it goes for that week. I’ll keep everyone posted on how that is going and my thoughts on that within the next month. So stay tuned!
One of the best ways I have found to see where all your hard-earned money is going is by tracking EVERY expense, and I literally mean EVERY. I started doing this within excel and I have had an eye-opening experience while doing it. It was amazing to me to see where I was spending my money for the month. I have over 15 spending categories that I use to track my expenses. I track everything from rent and utilities to the $1 vending machine purchase I have made at work. Seeing where your money goes is an easy where to see where you can cut some of your monthly expenses because in the FIRE community it is all about your monthly expenses. Now that I have been tracking all my expenses for the past several months, I have a really good grasp on what my FI number actually is. I know now that it can be a little more flexible because there are certainly some areas where I know I can do a better job. This tracking system is a way to hold myself accountable for the spending I do in each month. If anyone is interested in the excel template I use, feel free to send me an e-mail via my contact page.
These are just some of the few financial decisions I have made in the last year that have made a major impact on my life. Feel free to let me know in the comments some of the decisions you have made!
Steven | Rx for FIRE