Monday, May 08, 2006

Spending Time on Spending Money

Have you ever stopped to think about how much time you spend on your finances? Is it enough? Too much?
Lately, I've been feeling like I spend a lot of time thinking about my finances, but not necessarily in the way that I should.
First off, I'll just say that I am not including the time I spend writing this blog--I see that as related, but different. I'm thinking about the daily time I spend entering transactions into Pocket Quicken, the weekly time I spend synching those transactions to desktop Quicken and downloading new info, paying bills, etc; and the monthly time I spend going over my credit card receipts, brokerage statements, etc. Then there are all the little in-between times that I spend noodling around with spreadsheets, looking at how rising interest rates keep making my home purchase more expensive, analyzing my monthly savings and cash flow throughout the year, thinking about my budgeting and wondering if it will all work out the way I want it to. I'm kind of a data junkie anyway, so there are times when I feel like I just become immersed in playing around with all these numbers and can spend hours at it.
Then there are the occasional finance related books that I read, mostly out of curiosity and to review them on this site. This starts to approach what I think I should be doing more: learning more about how to improve my finances. I'm in okay shape-- I have savings, I've made successful investments, and I have a job that I like that also pays me enough for me to live relatively comfortably. But I will never be as comfortable as I'd like to be if I stay on this path. I would like to learn more about how to invest my savings wisely, how to profitably deal with owning a rental property, which is currently part of my long-term plan, and how to get more out of my career. I like what I do, but I'm sure I could find something I like just as well that would pay me more!
These are all things that I could spend time on-- researching different options, reading books, talking to people who are knowledgeable. I do at least feel like I am moving in the right direction with information I've gleaned from all the other blogs out there, but I should take it to the next step. Since books are usually the first thing I turn to, I'm going to try to come up with a good reading list to work my way through over the next year or so-- please share any recommendations! Also, I'm going to try to streamline my time management a bit more-- I'll still check my E*Trade portfolios once a day, but I'd like to force myself to do all my other bills and banking on just one day of the week, or maybe even just every other week when I get my paycheck. But even with that kind of discipline, I think I'll find it hard not to occasionally look at the spreadsheets I have on my Palm when I'm on the subway!
I must really be a geek.

How much time do you spend per week managing your finances?
0-30 minutes
30 minutes to 1 hour
1 to 3 hours
More than 3 hours
24-7, baby
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Joe said...

Hey Madame X,

I was just curious about your feelings on your E*Trade account. I was thinking of opening one up, but not for serious trading. More or less just for occassional purchases such as gifts and such. Considering transaction fees they charge, do you think E*Trade is a good choice?

Anonymous said...

Since you are doing all this analysis, you might want to check the performance of your investments against the blue-chip S&P 500 Index. If you are underperforming the index on a year-to-date or last quarter basis, perhaps you need to spend more time studying ways to improve yor performance.

thc said...

I spend 50+ hours per week dealing with other people's finances which leaves little time for our own. It's funny since obsessing about my own money is how I got started in this business in the first place.

Anonymous said...

I like your blog because your life parallels mine. I'm a 30-something woman in NYC in a good, but not highly lucrative, job. I understand your dilemma about spending time on managing finances. On one hand, it's really important. On the other hand, it takes time away from other things we could be doing -- reading, hiking in the woods, spending time with family and friends, traveling, painting, whatever -- things that create not money, but health, happiness and great memories. I doubt that when we're on our deathbeds, we'll wish we'd spend more time counting our pennies! Still it must be done, and since you find it enjoyable, you can probably also count it as a hobby. I only spend a few hours once a week, or every two weeks, paying bills, balancing the checkbook (so to speak), thinking about my retirement accounts, and how to pay off that annoying student debt! For now, my thinking is, it's unlikely that I will ever be really rich in monetary terms, so I might as well have a rich life instead! There are tons of people who have amazing lives on very little cash, and others who have all the money in the world who are miserable. I'm trying to find a balance. It isn't easy!

Madame X said...

Thanks for the comments, all.

Joe-- I haven't done any comparison of online brokerages. I signed up with E*Trade in around 1999 or 2000, because it got me some frequent flyer miles! I think MyMoneyBlog might have done a post comparing online brokerages. I know a lot of people don't like E*Trade but I am not a very active trader so I haven't bothered to look at other options.

Anon 1-- I have looked at my performance vs. the S&P500 and I've actually done really well! But again, I've only bought a few things and I tend to just hold them.

Anon2-- I know what you mean about the balance thing! If I felt like I was losing out on the rest of life because I was spending too much time counting my pennies, I'd really want to do soemthing about it! But I feel like I manage to fit a lot of other activities into my time, to try to balance my needs for saving money and having fun!

Andrew - Money Supply & Debt Blog said...

I think the key to finances is not how much time you spend on it, but how you spend that time. I recall my mom always trying to balance the checkbook even if a dollar and fifty cents were missing. Cut out that stress and spend money on something productive or relaxing and in the long term you will save on your health bills. For example, reading a book on money is a better choice than pulling your hair out over even $100.

Once I started to get rolling in my own business I realised that I had to be responsible with my money, but at the same time I couldn't worry about it. One day you bring in $1,000, the next $100. No matter what you earned today or yesterday you don't have time to be focused on what could or couldn't have happened, but rather on how you are going to make more money tommorow.

Joe said...

Cool, thanks for the info. I don't plan on being an active trader either. Just wanted an option to be able to make the occassional purchase.
Thanks again.