Perspective, and introducing another new blogger.

by Nick on February 14, 2012

I check out a lot of blogs.  In doing so, I see a lot of really cool blogs and some that just seem blah.  My favorite blogs are ones where I can instantly “hear” the writer telling her story and feel her passion to learn, share or just have fun.  Most of the time, those are established blogs where the author found a comfort zone over time. 

But every once in a while I find a new blogger with a cool message or voice – something real.  When I do, if there’s something in particular that that resonates with me enough to share it with you, I like to point out the blog here with a link and explanation.  Over the weekend I found one that really got me thinking about perspective. 

You know when you’re all panicky about whether you’re saving enough or spending too much?
Well you might just be lost in the details, caught up in the daily grind or hysteria of emotions.  When that happens to me, I hit pause for an hour or so and take an inventory of what I have and, importantly, what kind of shape I would be in if everything went wrong.  Sometimes that’s all I need to catch my breath.  (And this is just numbers… add in the value of my personal relationships and that usually knocks me out of my funk!)  I’m all about pedal to the medal when it comes to making and saving money, investing and paying down debt.  But it’s important to stop and take inventory every once in a while so I don’t go nuts! 

Take Below Her Means, for example.  She’s a new blogger who late last month posted a question to the world about her budget and short-term savings.  “I’m stumped,” she said.  Now paraphrasing….

I’m told to save 10% of income.  I take home $3,500 per month and put $5,000 per year in a Roth.  I also pay $836 extra per month on my student loans.  If I put another $10% into savings I’ll only have $400 per month to spend.  What would you do? 

Back to quoting… “I know I need to be more frugal, as evidenced by my out-of-control spending” but am I saving enough or paying too much on my loans?  Let me know.

In case you’re wondering, this is her budget.  Here’s a pic.

You see any out-of-control spending?  I think she’s rocking it!  Of course, I couldn’t resist commenting (I am a commentaholic, so make sure you leave one every time you stop by.  I’ll respond to pretty much all of them, although sometimes it takes me a day or so to catch up.).  Of course I left my standard “what would Nick do in that situation” answer based on the numbers I could figure out on the site. 

But then I thought she needed a little perspective!  Remember, we’re talking about someone who takes home $3,500 per month.  Out of the $3,500 she pays $836 extra to student loans, saves $417 for a Roth, another $250 for apartment savings (to buy housewares and stuff as needed) and still saves another $320. 

That means she has $1,823 a month going into savings, retirement or extra debt payments.  This is over half of her take-home pay!  I’ll ask again, anything out-of-control?  Of course not!

She just needed some perspective. 

Not including retirement accounts she had over $9,500 in savings.  Sure it’s not retirement money, but if all hell broke loose and she had no income she could cut her student loans down to the minimum, stop saving and investing and maintain her lifestyle for over five months.  Not a lot of people can say that.

I know it’s not her plan.  (Her plan is to pound down on the debt and save up as much as possible.)  But it’s perspective.  She’s doing great.  Don’t be afraid to see how well you’re doing.  It’s good confirmation that a plan is working!

Now go check out her blog, welcome her to the blogosphere and let her know how well she’s doing. 

Oh, and how’s your plan working?  Don’t know?  Maybe it’s time for a little perspective.

Until next time, put your credit card down and slowly step away from the mall!

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Image: graur razvan ionut /

{ 7 comments… read them below or add one }

Money Infant February 14, 2012 at 10:17 am

She has the same disease we all have when paying down debt. It never seems to go down fast enough. The same can be said for the savings side. Many people don't look at their retirement savings as a marathon, a long marathon and so they get antsy when they don't see the balance increasing as fast as they would like. It's just another side of the coin for the "I want it now" generation. She is doing damn good though, I admire her budget.
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Modest Money February 14, 2012 at 4:44 pm

I agree with Money Infant. It can be discouraging when you are paying off debts or saving money and you don't get results as quick as you expected. It takes a lot of time being smart with your money to get where you want to be. She just has to start following some bloggers who are deep in debt and she'll appreciate her progress more.
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Kooz February 14, 2012 at 11:26 pm

What is $517 for "Allowance"? Anyway, it doesn't look like she has any "bad" debt–student loans, rent, utilities, etc. No credit cards, other loans, etc. She's in good shape. I often flip-flop on whether to pay down debt or save when the debt is at a higher rate than the savings. I usually decide it makes sense to save some percentage to give yourself a cushion, but then stop saving and dump excess income into paying down debt. This especially makes sense with respect to student loan debt, which (worst coming to worst) cannot be discharged in bankruptcy. Am I crazy? Dunno. Would love some insight–maybe one of you financial bloggers could blog about this (maybe you already have?) and share the link in these comments?
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PFM February 15, 2012 at 1:46 am

Looks like she's doing great, $517 allowance and $250 apartment adds up to $767 in discretionary money, she could use that to cut down the debt even more, but again the numbers look great as is
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Nick February 16, 2012 at 3:57 pm

Yep – there are some great debt destruction bloggers out there. Very inspiring.
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Nick February 16, 2012 at 4:08 pm

Yep – imagine putting that much to debt or invest that much. She could retire in no time if she keeps her costs down… rent's the wild card though, so maybe a home purchase is in order at some point at least for cost control purposes.
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