Financial Learning Curve

Have you ever had a "well, DUH!" moment regarding finances? I did. Just last week. I sat down and wrote out a chart of Incoming Funds vs. Outgoing Cash-o-la. Overall we're doing fine, but I realized that I should be able to set aside a rather large (to us) amount after I've paid all the bills, and it wouldn't even require us to stop eating! After checking and rechecking to make sure I hadn't left anything out, I sat back in my chair and pondered this idea of saving.

My main question was, where has this amount been going up to now? I came up with where it went (paying off a car - DONE! publishing a book - DONE! paying an illustrator - DONE! buying insurance - DONE! paying for each step of Peter's electrical contractor's license - DONE!), which made me feel better, but I also knew I hadn't done any of that in the last month. So where did it go? Away. It went away.

On our way to Alaska in 2008 - it's the car we now own!

And that's when I had my "well, DUH!" moment of brilliance. Let me give you an example of what I'm talking about and what I'm hoping to change for the month of September (if not October and November as well):

Current Scenarios: I visit Amazon.com to see if anything in my saved cart has dropped in price - and hey, I might as well top off the cart at $25 so I can get free shipping. Right? After all, it's so easy! Or I fall prey to the lure of Target ("FACT": much like the gold in Pirates of the Caribbean - Target calls to us). I cruise the aisles picking up cute fall napkins and a new autumn throw, tossing in a couple of clearance items before spending a few minutes in the "innocent" Dollar Section. The nice clerk rings my stuff up and I swipe my debit card - $74.19 (oh my! How did that happen?). Shrugging off the guilt (because, of course, I got a lot of good deals), I head out the door with my purchases.

NEW Plan: I'm at Amazon or in Target, but rather than topping off the Amazon cart at $25, I write down what I was going to spend, then change websites to our online banking site. Instead of giving Amazon $25 I make a transfer to my savings account for that amount. Because, here's the deal, if I was going to buy it from Amazon, I thought I had the money to do so, which means that I should have the money to transfer into savings. Rather than cruising out of Target with bags of stuff that will eventually end up in the the next yard sale, why not keep a general running total of what I would have spent? When I get home I can put $74.19 into my savings and save for something I really want (like a paid off mortgage!). By practicing some self-control, I've just "found" money to set aside. Well, DUH!, right?  (Clarification: I {heart} Target, and I guarentee that I will be found in there over the next three months - but hopefully I'll be window shopping while picking up toothpaste...and maybe a pack of fall napkins!) 

So that's my goal this month. I've already cheated a tiny bit, but I'm back on the straight and narrow and I hope to be able to transfer an amount that is at least close to my original plan. Every time I think I have this saving/finance/frugal thing figured out, I realize that I'm still on a learning curve...but hey, at least I'm learning, right? :-)

P.S. This only works if you're not charging everything on a credit card and buying stuff you cannot afford. If you're still in the "charge it" stage - please read Dave Ramsey (I recommend Total Money Makeover - I don't agree with 100% of it, but there's a lot of good stuff in there, whether you have it "all figured out" or not).

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