User Tag List

First 2345 Last

Results 31 to 40 of 45

  1. #31
    insert random title here Randomnity's Avatar
    Join Date
    May 2007
    MBTI
    ISTP
    Enneagram
    6w5 sp/sx
    Posts
    9,489

    Default

    Quote Originally Posted by ptgatsby View Post
    I don't budget, but I did track my expenses in great detail.

    Budgeting is not very effective at anything except cost estimation. Most people use it as a way to set hard limits on their spending but this tends to result in sub-optimal utilization of money.

    The real goal is to optimize utility. For example, we spent something like 800-1500/month eating out. That's a lot of money, and the question isn't if we should budget a lower amount (because we want to save), but if we'd rather eat out less and take more vacations. Relating costs helps constrain spending better than limiting yourself.

    Anyway, I had spreadsheets that tracked all expenses, then balanced it against income and savings. Same concept as any business accounting. It gave me an idea how accurate I was. I also used it to check credit card bills, etc.

    It actually helped quite a bit in making decisions later, like should we move to a nicer apartment and lose that bit of money. It's much easier to visualize what you need to sacrifice when you have the data.

    Kinda stopped tracking it when we spent all our money to travel around the world. It also changed my view on saving. I'm not a big fan of saving anymore. Seeing so many old people with money, but no energy left to enjoy it, was very sad. Not to mention, they seemed no happier for it. (All this within reason, of course.)

    I also tend to be a model builder and more data is always helpful.
    This is exactly my strategy. I've been tracking my spending since I've been living on my own (~6-7 years now) so I have a good amount of data built up, although I've lost some of the earlier files. I'm too careless to save receipts so I just buy everything on my credit card and categorize things based on my statements. It's not a perfect system since "cash" and "department store" are ambiguous, but they're both a fairly small amount of the total and I have a pretty good idea of the kinds of things I'm buying with them. (I think this might not work as well in the US since when I visited, it seemed like a lot of places were cash-only. Pretty much everywhere takes cards here.)

    I really like making graphs and charts with the data and seeing how it's tracking over time. I've never had to go to the extent of an actual budget - I see it as very similar to dieting, where for me it's much much easier to aim for good habits overall (with the occasional treats) than to restrict myself to a fixed number. Similarly I don't really save for specific things, I just try not to spend money on things unless I really want them, so that when I do, I have the money for them. A house/car will probably need dedicated savings, but that's pretty far in my future.

    edit: ha, I actually wrote that before seeing you made the same analogy later on. that's a little scary
    -end of thread-

  2. #32
    Senior Member ptgatsby's Avatar
    Join Date
    Apr 2007
    MBTI
    ISTP
    Posts
    4,474

    Default

    Quote Originally Posted by Randomnity View Post
    A house/car will probably need dedicated savings, but that's pretty far in my future.
    Although I've bought both before, I'm without both now... and I'm not sure I was better off having saved for either. Unless you live in a few of the more expensive cities in the world, reasonable savings are enough to get by without even losing too many options.

    I'd say savings is more about being able to capitalize on opportunity. Renting is currently a better choice in the majority of Canadian cities, but if inflation suddenly increases, it's only the renters that have cash that will benefit (raising rents vs dropping housing prices). And the opposite is probably even more true. Cash gets you out of bad situations without them becoming misery-spirals.

    Savings is a great marginal-value problem. I cannot see deferred consumption as a positive value - you are essentially discounting the hours you worked! Why!? Opportunities though, that's different.

    edit: ha, I actually wrote that before seeing you made the same analogy later on. that's a little scary
    It's pretty common I believe the drivers for both are very much the same.

    I don't have good enough data to write a paper or anything but I did notice a connection between spending and eating "rich" in my own data. For us, I noted that if you decrease one (proxy: eating out, proxy: discretionary spending), the other one swings up. Awareness broke this, as I'm sure other things do... like running out of money I wouldn't be surprised to find out that there is yo-yo spending like there is yo-yo dieting.

  3. #33
    insert random title here Randomnity's Avatar
    Join Date
    May 2007
    MBTI
    ISTP
    Enneagram
    6w5 sp/sx
    Posts
    9,489

    Default

    Quote Originally Posted by ptgatsby View Post
    I'd say savings is more about being able to capitalize on opportunity. ...Cash gets you out of bad situations without them becoming misery-spirals.
    I definitely agree with this. Money is freedom, in a lot of ways - both to pursue opportunities that come up, and to escape traps that spring up unexpectedly.

    And yeah, I'd just as soon avoid a car forever, and I'm not planning to start saving for a house until it starts to seem like a realistic possibility in the next few years. I wouldn't take a house even if it was offered to me with no down payment and a reasonable mortgage right now, because I don't know yet where I'd like to be living in five years* or what my income/job stability will be (and then I would still need to look at the real estate vs. renting options there). I don't really care about the emotional value of owning a house (at least so far) so I won't be buying until it makes sense both from a lifestyle perspective (more settled) and financial perspective (sufficiently cheaper than renting to justify the loss of freedom). I see a lot of people assuming that buying is automatically "investing" while renting is always "throwing away money", and forgetting that real estate fees, interest, repairs/upkeep, property tax, etc don't turn into equity either.

    *very possibly BC, and if so I might pick your brain a bit in the future!
    -end of thread-

  4. #34
    Senior Member ptgatsby's Avatar
    Join Date
    Apr 2007
    MBTI
    ISTP
    Posts
    4,474

    Default

    Quote Originally Posted by Randomnity View Post
    I see a lot of people assuming that buying is automatically "investing" while renting is always "throwing away money", and forgetting that real estate fees, interest, repairs/upkeep, property tax, etc don't turn into equity either.
    Honestly, it's a complicated question. However, all models I have created show that it is very unlikely that it would be worth buying (payback exceeding our lifespans).

    But, that's given normal assumption. If capital appreciation continues above inflation due to Asia being lifted out of poverty, then buying almost always going to be better. And it's reasonable to assume that (at least) the Vancouver market moves on a relatively small amount of buyers (at the margin, ~1000), you are looking at a long run impact. (Given a normal distribution of wealth in Asia, 3 deviations is equal to the entire population of BC. They have a lot more money than us. And it keeps growing. )

    So yah, complicated. Not because of numbers, but because the world is messy. But It's one of my very favorite financial conversations, no joke.

    ---

    A lot of people really enjoy having "their own place" and being able to renovate and personalize. More than the stress of roofs, heating and water tank issues, piping... Me, I'm the other way around. I don't want to be bothered, and I want an ever changing location (close to work or otherwise). I want new and nice. So I rent and move when I want.

    Can't say my choice is better than my friends, but it is better for me.


    *very possibly BC, and if so I might pick your brain a bit in the future!
    Proud 2nd place holder of the most expensive (relative to income) city! But a lovely place.

    And certainly. Seems like BC is a hot spot, quite a few people seem intent on moving here!

  5. #35
    reflecting pool Typh0n's Avatar
    Join Date
    Feb 2013
    Posts
    3,091

    Default

    Pretty good at it. I like managing money and bank related stuff. Maybe thats where I should work after all, as Jesse James said, banks are where the money is!

  6. #36
    likes this gromit's Avatar
    Join Date
    Mar 2010
    Posts
    6,652

    Default

    Try not to spend too much. Store brand on anything where I cannot perceive a difference. Making food instead of purchasing prepared food. Not drinking a lot. Etc. And if I'm buying something big, make sure there is $ in the bank account.

    I ended up with a pretty good savings that way. Although now I'm back in grad school, so that sure changes things in terms of income, but still same principles apply.
    Your kisses, sweeter than honey. But guess what, so is my money.

  7. #37
    reflecting pool Typh0n's Avatar
    Join Date
    Feb 2013
    Posts
    3,091

    Default

    Quote Originally Posted by gromit View Post
    Try not to spend too much. Store brand on anything where I cannot perceive a difference. Making food instead of purchasing prepared food. Not drinking a lot. Etc. And if I'm buying something big, make sure there is $ in the bank account.

    I ended up with a pretty good savings that way. Although now I'm back in grad school, so that sure changes things in terms of income, but still same principles apply.
    I find that spending less on food helps me have quiet a bit more for other things.

  8. #38
    likes this gromit's Avatar
    Join Date
    Mar 2010
    Posts
    6,652

    Default

    Quote Originally Posted by Typh0n View Post
    I find that spending less on food helps me have quiet a bit more for other things.
    Yeah it really adds up! $6-12 for a meal eating out vs ~$1-2(?) per meal homemade. I am also incredibly cheap when I eat out, so try not to go above $12 for 'special' meals.
    Your kisses, sweeter than honey. But guess what, so is my money.

  9. #39
    reflecting pool Typh0n's Avatar
    Join Date
    Feb 2013
    Posts
    3,091

    Default

    Quote Originally Posted by gromit View Post
    Yeah it really adds up! $6-12 for a meal eating out vs ~$1-2(?) per meal homemade. I am also incredibly cheap when I eat out, so try not to go above $12 for 'special' meals.
    More or less, but sometimes I like to treat myself to something nice food wise, though I never exagerrate either.

  10. #40
    Member Unionruler's Avatar
    Join Date
    Dec 2014
    MBTI
    ISFJ
    Enneagram
    2 so/sp
    Posts
    98

    Default

    I don't. I park some of my money in investments and roughly know how much is left in the bank. I am quite bad at splurging on myself, except on holiday, and when I do treat other people (and myself) when eating out I consider it worth it in line with my values. My last banker said my expenses were low for my demographic, so I think I can continue not budgeting.

Similar Threads

  1. Replies: 1
    Last Post: 02-15-2012, 10:55 PM
  2. How do you and your type dress?
    By CzeCze in forum The Bonfire
    Replies: 121
    Last Post: 10-28-2009, 11:53 PM
  3. [INTJ] intj girls: where are you and how do i get you?
    By sketcheasy in forum The NT Rationale (ENTP, INTP, ENTJ, INTJ)
    Replies: 43
    Last Post: 08-09-2008, 01:34 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
Single Sign On provided by vBSSO