Wednesday, October 25, 2006

An auxiliary rule

I just discovered, thanks to a commenter, that the link to my Rule #6 wasn't working. Strangely, the original post seemed to have disappeared from my blog. But luckily, I was able to recreate the post (though I did lose the original's comments), because I save a word doc of each month's archive page. So, hey, what a good reminder:

  • Keep records and back them up!
I often wish that I had more details of where I was at financially in my teens and early 20s. I guess the teenage years are easy: I basically had no money. I got a small allowance for spending money, and I had a small savings account where I stashed a little babysitting money. My net worth was probably about $2,000 when I went off to college, and during college I pretty much spent everything I earned. But once I started working, I don't really remember how much I was spending and saving. I know money was tight for the first few years, but after a while I saved enough to pay off my student loans early and chip in half the downpayment on buying an apartment. Around that time, I started keeping some Excel spreadsheets of my spending on different categories, and eventually started using Quicken. I track everything so religiously now, I can't imagine how I lived without it! It's really kind of a mystery to me-- I think I always had a sense of responsibility about my spending, but when I was younger, I just didn't think about it the way I do now. I remember buying things that I knew I couldn't afford, just because I wanted them and because I figured I'd somehow manage to pay off my credit card eventually though I didn't know exactly how. I think I just got lucky with some good career moves, and some good bonuses in addition to my salary... or maybe I was more frugal than I thought back then, I don't know!

There are lots of reasons to keep records, for tax purposes, etc. But it's also just good to see where you're at and where you've been.


Anonymous said...

And then there was your May 8, 2006 entry...found it by accident after reading the above. It seemed like you'd spend more time entering and formating the data from your younger financial days that it would be of functional value; but then again it's part entertainment too.

Thanks for the reminder to back things up. Always good.

mOOm said...

I have records going way back till I was 18 I think.... but over time I've tracked different things. Back then I focused on expenses. Having to write down everything I spent made me less likely to spend. Over time I went through a debt phase, an income phase, a savings phase, and an investment returns phase.... I don't work out the details of my expenditure nowadays just the monthly amount. But I have tremendous detail on the investment earnings side.

Anonymous said...

I started keeping a budget and tracking all my spendings once I graduated college. I'm glad I started early and now I know where all my money goes each month. I see that you switched from Excel to Quicken. What features were you looking for that weren't available to you in Excel. I ask because I'm contemplating on making the change too.

Madame X said...

Hi Samurai,
Quicken basically automates all the things that you could do in excel-- setting up multiple accounts, expense categories, loan payment schedules, and reports/graphs comparing actual to budgeted expenses, comparing this year to last year, tracking net worth, etc. It also allows you to download stock prices and bank and credit card transactions so you don't have to enter them by hand.
If you just want to keep very basic records, excel would be fine, but Quicken lets you do a lot more, much more easily.