Final reflections on 2010

It seems as every year starts, many folks are good at thinking about what they want to achieve. Where the rubber rarely meets the road, and where new year’s resolutions get a bad wrap, is folks tend to set goals that are not very specific, nor achievable, nor measureable.

Hey, I’m an expert because I’ve set lots of unrealistic goals in the past!

In 2010, I set a goal to be debt free by the end of the year. In hindsight, I realize, this was not a very realistic goal. It was specific (it had a dollar amount attached), and I could measure it (there was/was not still debt at the end of December 2010), but there would have been no way I could have accomplished it. It wasn’t realistic because my 2010 wasn’t entirely realistic.

Most of my budgeting issues in 2010 had to do with a bit of delusional planning on my part.

When I create a budget, I use Excel, and I enter in my revenue (pretty stable unless I get fired), then my expenses (most are reasonably predictable), then I look at the variation. If I’m projecting a deficit in a month, I take a look at what I can do to shave money from expenses somewhere in order to try and prevent it, at least on paper. If there’s a surplus, I try and see where I can add more money (normally added to savings or debt repayment, not to increasing expenditures).

In my zeal to try and forecast a balanced budget each month, I really failed to take a totally honest look at where I spend money. For example, I seem to have forgotten that I didn’t own a car and that from time to time, I rent cars and take cabs. I had no money budgeted for this in 2010. Therefore, everytime I did rent a car or take a cab, I was creating a budget deficit that I had to scramble to correct, just to satisfy my nerdy spreadsheet/mind.

I also failed to consider that “stuff happens”. I’m not talking about the emergency kind of stuff, I’m talking about the common “stuff” that can reasonably happen to a parent with kids, pets, and an older home. Stuff like needing to call a plumber to fix the dishwasher, like a kid wanting to take driver’s education, like wanting to go to daycamp, like adopting new pets, like wanting to just go see a Roller Derby match for spontaneous fun. I budgeted us too close to the bone, and didn’t allow for life’s little adventures or misadventures.

One of the other things I failed to do, particularly in the early months, was to understand a fundamental teaching I’ve learned as a Weight Watchers member, but didn’t apply to this part of my life. That lesson is – we must find a way to treat ourselves AND stay the course. If we deprive ourselves of something (whether it’s a burger and fries or an afternoon matinee), eventually we’ll be resentful that we can’t have it, feel we should have it, and we not only have it, but we probably over compenste by having a bit more than we otherwise might. They key to a new lifestyle is to learn the critical skill of staying the course, and also allow yourself some indulgences, in order to feel sane, to feel normal and to be motivated to continue. I was the picture of military discipline in the early months of 2010, and as the year wore on, my resolve wore down. It’s pretty dull to live with zero or $30 entertainment budget for a month for the three of us. I wonder if I might have been more stable if I had budgeted for a “whatever floats your boat” expense line.

Actually, I’m concerned that some of my zeal for money management in 2010 has given my kids an impression that everything is always about money. Good thing Kevin O’Leary isn’t following this blog, he’d say “right on sister – it is always about the money!” While I don’t believe that, I do believe that the lack of worry about money is liberating. I also believe that we can have anything we want, as long as we put a plan in place in order to achieve it.

Despite my delusions and some poor planning in 2010, I am truly proud of what we accomplished. I want to be really clear about what I consider our accomplishments to be:

  • I stopped the knee-jerk consumer reaction of see it, want it, charge it, pay credit card with line-of-credit;
  • The girls and I started talking about money, just as common place as we talk about separating the colours from the whites in the laundry room;
  • We started planning for our wants and needs in advance;
  • I was a great money tracker consistently throughout the year;
  • We all became partners in our financial plans/spending;
  • The girls got more proactive about their own savings for things they saw in their future;
  • I got to meet all of you, and enlist your wisdom for the benefit of my family, and I’ve been really thankful for you;
  • oh, and yeah, we paid off a whack of debt. Funny, that’s all I wanted to do, but in reality, the behaviorial changes are as big, and I trust will have a lasting impact on me.

While I wonder what I’ll be writing a year from now, I’m looking forward to the journey in 2011. By May, I’ll be able to measure any change in my year over year net worth. This month, I’ll be telling you about some work changes ahead for me, and working through what that means to our bottom line (don’t worry, nothing bad – just different). I’ll be sharing with you the stories of University applications and all that goes with it. There will be more stories of finding a new tenant for my rental property in the spring. I’m hopeful to be sharing with you a declaration that I’m consumer debt free, and that we’re off to Disney World at some point.

Yes, I’m looking forward to 2011. May you enjoy good health, good fortune and great planning!

 

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One response to this post.

  1. Tracy, I always lowball myself too when I used to try and break things down – that’s why I do the bigger “miscellaneous” account (that’s not an account per se) and just try to stay within a certain monthly amount. There’s just always “something”, isn’t there? It reminds me of back in the day when I joined WW 15 years ago and they had the plan where you had to have x servings of each food group – I just couldn’t do it and I’d beat myself up all the time, but a few years later a program like the flex points was easy for me to stick to. Funny how that is. 🙂

    Reply

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