If you’re feeling stuck in your current financial situation but don’t understand why, the answer may lie in changing an unconscious belief or habit that doesn’t jive with your larger goals.  Check out some common thoughts/habits that can hold people back financially.

1)  Money isn’t important.  
Nobody wants to be a slave to money, but it’s almost impossible to live free of it.  Money doesn’t guarantee happiness but as the currency for surviving in this world, it’s pretty darn important.
Your subconscious mind is very powerful.  If money isn’t important - why bother going to work, getting out of debt, or building a nest egg?  Talk about mixed messages.

2)  I deserve nice things. 
What exactly are ‘nice things’?  My guess is most people want universally nice things like money in the bank, a home of their own, and free time to spend with loved ones.  Yet we easily settle for the temporary satisfaction of buying the stuff we want right now.  Yes, you deserve nice things.  Get clear on what that means for you then set your goals.   Geezeo lets you track and share your progress.          

 3)  I’ll never get out of debt. 
If this is your mantra don’t be surprised when (surprise!) your debt never shrinks.  The subconscious gets hooked by ‘never’ and its job is to help you cope, not find solutions.  Consciously replace this thought with something positive that requires action like  “I’ll be debt free in two years”.  Get ready for awesome results.  
     
4)  Closing doors before they’re open.   
This is a biggie when it comes to making career changes or taking risks so your money can grow.  Develop the habit of seeing opportunity rather than problems.  This one shift in thinking allows for so much creativity in improving your financial life.
Seemingly harmless thoughts like, “That won’t work”,  “They won’t let me do that” or  “I don’t know how”, send the message that it’s okay to give up before trying.

The road to financial freedom is hard enough, why stand in your own way?   Do some money soul searching on the Confessions page.

Geezeo is all about community. It’s a great place to share ideas and tips. So I wondered, what’s the best money advice you’ve received? Did you get it at Geezeo, or somewhere else?

Here are my “top 3″:

Pay Yourself First

Where I Learned It: From my father, at age 18
When I Actually Did It: Um, uh… not consistently until age 30. Too bad! It really makes a difference.
What I Learned: Now it’s even easier to have the discipline. Route that money electronically into an account you can’t easily spend!

Invest a portion of every payday in your 401(k) and/or IRA

Where I Learned It: From my father, age 22
When I Actually Did It: Age 22 — thank goodness! But, there were times when I put in very little, and years when I didn’t contribute anything at all.
What I Learned: Even if you don’t work for a company that offers a 401(k), you should still contribute to an IRA. You won’t get any “company match”, but you will see this account grow over time.

Credit Cards Can Really Suck

Where I Learned It: School of Being-Out-On-Your-Own-And-Buying-Too-Much
When I Actually Did It: Credit card debt really stressed me out ages 23-26. Harsh lesson, but well-learned.
What I Learned: Overspending is a habit you can change. Credit cards are useful, but should be paid in full every month. Go without rather than charge it and think you can pay it off later…if you can’t afford something right then, chances are good you can’t afford it at all.

What if you weren’t lucky enough to have a father give great financial advice (even if you didn’t take his advice at first)? Or, what should you do to deal with your credit card debt and spending habits? Speak up and befriend people here at Geezeo! You never know what good tip you’ll discover.

With all the emphasis in the press these days about tightening the belt I thought it would be nice to think about life with less money. Does it always mean sacrifice?

Self-employed writer Rita Farin had these points to say. I’ve added my own comments, too. Thanks for the thoughtful writing, Rita!

* Life requires living, whether you have the money or not. It also requires a plan. If you have a plan for your new life, then you can start really living by doing what you love.

One way to start planning is to write it out. The list doesn’t have to be in any particular order. The important things is to get it all out. Some items you’ll commit to doing and others you’ll think, “that’s a cool idea but I’m not ready to commit to that, yet!”.

Even though we’re talking life goals the same could be said for your financial life. Your list could include goals like “Save 10% of my income”, “Give 10% to charity” or “Start a secondary savings fund for Goal X”. In the end you may decide that you can only commit to one of these immediately.

As they say, you must start with the end in mind.

* You have more money than you think you have. Even with a budget in place, it’s hard to know how much money you actually have until you have to spend it without bringing in any income. I had no idea until I started a business a couple of years ago and lived off of my savings. That savings lasted a lot longer than I ever thought it would. And I found pockets of money that I had forgotten about, lasting me nearly two years.

I totally agree here. I literally saved my “lunch money” for 9 months and then lived off of it for nearly the same amount. How did I do this? With a budget. Get yours here at Geezeo.

* You can easily learn to live on less. Having less money taught me how to do more for myself and become more resourceful. I used to shop retail. Now I don’t.

This is great advice because it works. There are multiple groups here at Geezeo with a living-below-my-means emphasis. Find one or more that you’d like to do (or currently do!) here.

* Not having money helps you overcome your fear of not having money. Ask yourself, what’s the worst that can happen? For me, the worst that can happen is going back to a career that I once loved and still enjoy.

This is a common fear among freelancers or the self-employed. Pursuing your life dreams shouldn’t be dictated by money. But the reality is money plays a role in that it can make it easier or harder. To gain control you have to control your money. While no one should “plan to fail”, there are always ways to get back on your feet.

* There are resources for living with no money. As long as you have good credit, you can take out loans or lines of credit. You can also research grants and other available money.

Rita makes a good point here. But I’ll add the caveat: be careful not to lean into these resources too heavily and find yourself with debt you cannot manage. Be sensible in your approach.

* Having no money is a choice and is temporary. It’s a time of investing in your future to rebuild. Transitioning to a life you love at every level brings abundance. Whenever I’ve needed money, it’s come—through opportunities that land on my doorstep.

It’s said that “broke” is a mindset. Don’t let it be yours.

* You always have something to fall back on. We have so many skills. If you’re transitioning out of a career, you can always go back if really necessary. Or you can turn that knitting hobby into a money-making endeavor.

Be flexible with what you can do and you’ll be able to do more.

* Listen to yourself and commit to your passion. Friends, family and strangers may tell you you’re crazy when you decide to make a change. “You can’t make any money doing that,” they may say. Just remember that they’re expressing their own fears, and you can in fact make money from anything you love and commit to do.

We’ve all experienced naysayers. That’s part of the reason money — and by extension, dreams — are so infrequently discussed. Rather than keep your dreams to yourself, find people who will support you and guide you. If these people aren’t in your life, look for them in any of the groups here.

Think big, take action, and believe. Money itself won’t make a life worth living. Yet, managing what you have will make your life easier and increase the chance you’ll reach whatever goals you pursue.

Good luck!

I’ve heard that many Americans are one paycheck away from serious financial trouble. That’s pretty scary, so I decided to check out the goals page to see who’s building an emergency fund.

I discovered lots of users with this goal, but only a handful following through. Maybe some of you are just forgetting to use the tools to track your progress. If not, it might be time to visit the confessional.

An emergency fund is critical for peace of mind. When the unavoidable happens it helps if money worries don’t have to cloud your judgment. Then you can calmly decide the best way to deal with a crisis.

Here are three things to remember when trying to grow your cash cushion:

1) Pay yourself first.
This is the best way to start saving and lots of us don’t do it because we’re stuck in ‘Wait Until’ mode.

The problem with this approach is that the right moment never arrives. There will always be something that requires our cash and attention. The only way to develop a ‘pay yourself first’ habit is to make the leap and start. Now.

2) Be proactive with the little things.
Procrastination and impulsive behavior create avoidable emergencies that suck energy and resources. Prevent surprise expenses by taking good care of your health, home, and car. Don’t sabotage your efforts with actions that ultimately work against your goals.

3) Prayer is not a substitute for planning.
Bad things happen to good people all the time. Nobody gets to avoid accidents, disasters, or general misfortune. Why not be prepared? Then you can focus your prayers on those less fortunate. Like people who don’t use Geezeo.

An emergency cash cushion is an important step on the path to financial well-being. So don’t give up, your peace of mind is worth the effort. Congratulations to Sunny who is 56% of the way to building his emergency fund!

Natural born spenders might be unclear about emergency vs. non-emergency needs. Check out the group My Wallet Is Bulimic for a checklist.

One classic personal finance book is “The Millionaire Next Door” by Thomas J. Stanley and William D. Danko.

For anyone unfamiliar, the book covers habits and strategies of “normal” people and how these behaviors contribute to a million-dollar (or more) net worth. Everyone profiled in the book share what could be called “middle class” incomes and values. A common trait is being somewhat low-key on the exterior (no flashy millionaires here!).

Chapter Three is titled “Time, Energy, and Money”. In it the authors write:

“PAWs [Prodigious Accumulators of Wealth] allocate nearly twice the hours per month to planning their financial investments as UAW [Under Accumulators of Wealth] do.”

The book was published in 1997. I wonder what the 1997 PAWs would make of Geezeo?

One of Geezeo’s strengths is the ability to collect all your financial accounts in one place. If you monitor your accounts on a regular basis it is much easier to do so at one location (Geezeo) instead of logging into many different banking websites.

But few were probably monitoring their accounts and investments online when the book was written.

Interestingly, this chapter went on to say that UAWs [Under Accumulators of Wealth] spend more time worrying about being able to retire comfortably or ever accumulating significant wealth (pg. 71). The authors conclude they have every right to be concerned! To illustrate the point, the chapter outlines the choices between two fictional doctors — Dr. North and Dr. South. Despite high-paying professions one ends up with better financial resources.

So what does this have to do with you? Do you exhibit behaviors of a PAW?

I would guess that the Geezeo community has a greater percentage of millionaires and millionaires-in-the-making that most websites. For starters, our users monitor their accounts on a regular — even daily — basis. They save time checking multiple online accounts. But, they are likely to spend more time thinking about, and acting upon, longterm financial strategies. Couple that with the ability to discuss your strategies with peers, and, I think it’s safe to assume that being involved at Geezeo is good for your net worth.

So ask yourself today: what am I doing on a regular basis to secure my financial future? Am I using my time, energy, and resources to the best of my knowledge and ability? What goal am I actively pursuing (paying off debt, saving a cash cushion, and saving for a home are three popular goals). If you’re just starting, click here to check out some of the Geezeo community goals.

For this and other personal finance books, check out the Geezeo group “Bookworms Unite”.

Here’s to your time + your energy = your money!

What “ripple effects” are happening in your financial life right now? Can you change them?

Yesterday The New York Times featured an article about people first losing their homes and then losing their possessions because they cannot pay for their storage units. (Here’s a link to the mobile phone version of the story).

A “ripple effect” occurs when something happens and the consequences spread out to touch and affect other areas, often unintentionally.

Some examples in your financial life might be:

Not paying your bills on time, every time….which sinks your credit score….which makes it more expensive to borrow money for large purchases….which makes your new bills even higher.

That’s one ripple effect cycle to avoid! Here’s another:

Not investing small amounts when you can….missing the advantages of dollar-cost-averaging….requiring more savings and/or higher, riskier returns to live comfortably when you’re older and cannot work.

Phew! Sounds terrible! But couldn’t ripple effects in your finances also be positive? Consider the inverse of the two examples mentioned. Or, consider these shifts in behavior that can dramatically change your financial life:

Figure out where you spend all your money….create a budget to maximize your resources….meet your financial goals.

Or another good one:

Get out of debt….feel more confident and in control….be a happier person.

Choose your moves wisely. Your financial behavior will allow you to enjoy ripple effects we all want — those that keep getting better and better.

Are you planning a party in the near future? Perhaps it will be for a graduation or a wedding. I for one, have offered to a friend of mine, to throw her a baby shower!

First off, I was so happy that she told me she was expecting. I was so excited, right off the bat I said to her, “You should let me throw your baby shower!” But when I sat down to think about the cost of it all, I almost wish I hadn’t. After all, the cost of everything is going up. However, it is not my style to back down from something I have already committed to do. So my question comes to this:

How much is too much?

I want this shower to be spectacular! I would love to be able to go all out, and get her everything she could ever imagine. But to keep things in perspective, I will have to come up with a lot of money for that, and that’s just not likely to happen. So, I have to work with what I’ve got. And that means making a plan, and sticking to a budget.

Here are some things to keep in mind when throwing a party of any kind:

1. Where will it be located? Depending on the size of the party, you might not be able to have it in your living room. So the cost of renting a building or even just a room of a building is an important factor to consider.

2. How big should the guest list be? This goes hand in hand with the first item. If you have a larger guest list, then you will need to have a larger area to entertain. However, having a small intimate party could be lots of fun, and you could quite possibly spend more money on decorations and things.

3. What kind of party will this be? More specifically, are you planning on feeding a meal, or will this be a “floating party”, one with finger foods and snacks? This is where things can get expensive. If you are not careful, you can easily use up the majority of your funds. Keep in mind your guest list here too, as you will want to make sure you have enough food to feed everyone, but not too much that it goes to waste.

See how easy it is for things to add up? Make a budget, write out a plan, and stick to it. Set a goal to put aside a certain amount each month so the cost won’t surprise you! And if you do happen to over spend (don’t feel too bad, we all do at some point), clear your conscience and confess here!

(Photo Courtesy: Earl53 / Morguefile.com)

“I am not particularly confident if I can make all of my personal finance goals this year but the point for me is that you keep trying to do it despite what the world throws at you.”

Since New Year’s Day we’ve looked over the shoulder of personal finance blogger Thicken My Wallet (TMW). He’s shared his financial goals for the year as well as strategies and course corrections. If you’ve missed this great series, you can read last month’s entry here. Previous entries are here, and here.

To reflect on April and kick off May, I asked TMW one question:

“How has the shape of the economy impacted your financial goals for 2008?”. He was gracious enough to reply. Here’s his answer, in his own words.

Financial goals meet the recession of 2008, by Thicken My Wallet

Welcome to the May edition of my monthly posts which tracks my personal finance goals. I am happy to report that I did, indeed, do something for my health in April after I challenged myself publicly.

I joined a “learn how to run” clinic; it’s a 10 week program which teaches me how to run up to 2 miles at a time. I also dusted off my bike from storage and plan to explore the local bike trials close to my home. Thus, I am well on my way to better health.

Personal goals like personal fitness are readily controllable goals. You don’t have to depend on anyone or anything to achieve them- just your own effort. But what about personal finance goals which are influenced greatly by the world we live in? You can say you want to increase net worth, buy a house or pay down debt but these depend on things such as a healthy stock market, the general job market, interest rate changes- factors out of our control. What happens when personal finance goals meet larger world events like the recession of 2008 (and let’s fact it, we are in a recession but we have to wait for the statistics to come in before we can officially say it)?

The easy out is to say simply that the economy has impacted your goals greatly and you cry to the heavens, throw up your hands in frustration and simply scrap your goals. But good goal setting should put you slightly out of comfort zone. It is not a challenge if you set goals you can reach easily. When world events make your goals harder to attain, just remember that the entire point of good goal setting is to reach beyond yourself and, as unfair the world may be, you press on towards that goal.

I am not particular confident if I can make all of my personal finance goals this year but the point for me is that you keep trying to do it despite what the world throws at you.

On a more practical level, I am keeping my goals the same but finding other ways to reach them. For example, one of my goals is to increase net worth by 7%. Strategically, that may be hard to reach this year. But, tactically speaking, I can really concentrate on the factors I can control (i.e. keep my expenses low and paying down debt) and not be too upset by the factors I cannot (how the stock market does or the interest rates).

In other words, I am not moving the finish line, I am finding other ways to get there other than I intended. Goal planning is the larger picture: concentrate on the larger picture and don’t be concerned if how you got there wasn’t as you imagined it (assuming, of course, it is legal and ethical). I know a lot of people picture something happening in a certain way and, if it doesn’t work out as they imagine, they get upset. I try not to get too upset if my 7% goal wasn’t reached by my investments going up but by being frugal. It doesn’t matter how I get there, as long as I get there.

The final thing I am keeping in mind is that if I try my best and I don’t reach my goal because of a factor I can’t control, I am not going to beat myself up over it. I gave it my best and, as long as I continue to do so, I should be fine. This may sound like it is coming right out of a Boy Scout’s manual but you control what you can control and don’t worry about what you can’t. Stay positive and see you next month.

Good for you, TMW! Attitude is everything and you’re certainly making strides. Keep your eye on the prize(s)! Have a great month!

Remember, if you’d like to check in with Thicken My Wallet’s daily money musings, subscribe to his blog.

So with the first wave of economic stimulus checks coming through, I am eager to see the total amount that will actually be sent to us. According to the IRS website, we should be receiving it by this Friday.

However, our family doesn’t plan on stimulating much of the economy with the check. We plan on using it to pay off a major bill. Something that was supposed to be paid off with our tax refund, but that didn’t happen due to our washer and dryer quiting on us!! (Yes, at the same time - Oh the joys of being an adult with responsibility now!)

I’ve been reading a lot of blogs and different magazine articles talking about how many are planning on following the same idea as our family - paying off a large bill/credit card debt/etc.

However, I was watching a news program the other night, CNN I believe, and it mentioned that while the government is expecting a large number of citizens to use it to pay off debt, they fully expect the economy to still be stimulated. How? They are expecting that once citizens free up debt, they will go right back to charging more because 1) it’s “available credit”, and 2) things are rising in cost (so how else will they pay for it?) I thought about it, and I agree. For the average American they are probably right.

But don’t fear, Geezeo is helping its users to redefine the average American! We have the tools to help set up budgets and track our spending so we can be better prepared for the things that might happen tomorrow. Take full advantage of the capabilities. Set some goals so that you can pay off that debt, keep it off, and have a cushion to rely on in hard times (so you really can stimulate the economy with the IRS check and a guilt free conscience!!). Share your successes with us in groups such as You Don’t Really Need It…tales of consumerism. And if you do take a step backward (which most of us do), you can always get your purchase off your chest by confessing your money sins here!!!

Do you know how to make money? Could you do better?

Here are five tips to make more money:

1 - Earn more. Here’s how: Go beyond basic expertise in your field. Do all work to the best of your abilities. Deliver more than expected. Treat others with respect. Follow through. Be the kind of person people like to be around. Practicing these habits will position you for more money.

2 - Mix Passion and Purpose. Passion and purpose are critical ingredients. Not all jobs will align with your passion or purpose. Find one that will. Work a job that doesn’t until you’re able to make the switch. Keep passion and purpose a goal. As they say, “the money will follow”.

3 - Financial education. Make it a priority. It’s not what you make, it’s what you keep. An increase in money won’t matter unless you’re already practicing sound money management. Some good financial habits: saving or investing 10% of your take-home pay, living below your means, and paying off credit card debt. Here are six bad habits to quit immediately!

4 - Expand your skills. New skills keep your mind sharp. They also provide a competitive advantage in the marketplace. Plus, the more you know about a variety of topics the more you can relate to others. That directly plays into #1, “be the kind of person others like to be around”. Expand your experiences.

5 - Check your attitude. It’s really easy to complain. It’s more fruitful to look on the bright side. You attract more money-making possibilities when your mind is open and your attitude is good. Believe in your ability to control and grow your finances — and you will.