Money

I have been thinking a lot about money. This is unusual for me. I have been in the incredibly fortunate position all my working life of not having to think about money. This is as much luck as the result of the choices I've made - I am very conscious of that, and grateful for the way things have worked out in my life. But I very soon will reach some milestones that make it feasible, though not financially easy or desirable, for me to retire. More luck in my life, not so much planning. As things in our government (where I work) get confusing, it's a huge sense of freedom to have. Life is full of possibilities and choices. I am conservative, reluctant to make change, but I could if I wanted to.

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My friend wrote a great blog post about bill paying that is the immediate inspiration for this post. She and her husband each own their own businesses, they have children, their financial lives are infinitely more complicated than mine, and she is infinitely more organized. But I need to be more in command and control in order to know what choices I could make. I'm making some strides in that direction.

Guess what? I have DATA. I have LOTS OF DATA!

I have automated almost all of my routine finances, and outsourced other parts of it. I started using Quicken twenty-five years ago, and I still use it. Once, it was just for record-keeping. Then, it printed my checks. Now, almost everything is paid on-line. Every bill that can be automatically debited from my account or my credit card is automated. My paychecks reliably get deposited every two weeks. I manage cash flow by manually making the credit card payments, timed to be able to pay off completely. The most manual thing I do is withdraw from savings by check from the credit union in my office building and walk that check across the street to my bank to deposit it in order to cover my credit card payment.

With a reliable paycheck that exceeds my daily and routine expenses magically going into the bank regularly, I have never had to have a budget. I have been prudent in big expenses and unconscious and casual about little ones. After a splurge, I slow down on discretionary purchases until I feel in balance again. I have saved money every single year of my professional working life, with two exceptions.

Twenty-five years ago, I had a couple years of living bigly. I took up photography as a serious hobby, bought a serious camera, and then a second and several lenses, and capped off a year of intense learning and study and practice with a several weeks-long photography field trip with the Sierra Club to the far north slope of the Alaskan tundra. Fabulous in every way, but it was the first time I had ever been in a small plane. I was infatuated with the freedom and the view. I signed up for flying lessons the day I got home from the trip, and a few months later was licensed and most of my social life was hanging at the airport and flying to places just for the fun - and for the photography. It settled down into ongoing expensive twin hobbies, but one that was financially feasible, after the initial splurges on equipment and training.

The second time I spent more than I earned was the year my sister died, when without thinking I paid cash for her funeral and largely supported the family until they got back on their feet. Glad to do it, no regrets, and look where we are now!

But now, I need to figure out what it would take to live without a paycheck. Worklife has not been financially a bed of roses forever - I worked for two private sector companies that each set a record at the time for their spectacularly large bankruptcies; they turned their pensions over to the government. In fact, the bankruptcies were largely designed to do just that. Thank goodness for the government safety net provided by the Pension Benefit Guarantee Corporation. It doesn't make us whole for the promises my former employers made, but it helps. For many people, it is the difference between poverty and not. For me, at these companies some few years each towards the beginning of my career, it is a very useful leg up.

So with twenty-five years of records in my computer, I have a lot I could do with the data. I think of graphs and charts as one way to write my memoirs, where my money went and what I did with it, and why- what was happening then? But I'm trying not to go down that rabbit hole of memory, but stay focused on what would be useful now:  knowing with some certainty how much money I need to live on. I need to develop a budget. I have lots and lots of information on which to develop that.

Besides being automated, I am very nearly cash-less. (In 2016, I only took cash from my bank twice!) Since small businesses have embraced credit cards, via Square and Paypal and other conveniences, I charge almost everything. Some food trucks don't even accept cash - they don't want to handle it. The only checks I write go to individual service providers  or small scale local clubs - once a lot of things for the kids like piano teachers and therapists - but now pretty much just my dogwalker (who does take paypal but strongly prefers the checks for the bigger net) and my sailing club. That means, via Quicken, I know where every penny is going.

I also use Amazon a lot. Did you know you can download a list of your Amazon purchases? I use automated Quicken categories for my credit card transactions, but "Amazon" could be any of several categories. So one recent project was matching my Amazon purchases for the past couple of years in Quicken with my downloaded list of transactions and putting more accurate categories on them. Looking at all my spending for the past couple of years gives me a much better picture of where my money is going and what is truly necessary. It allows me to think about how I could prioritize if I were to cut back.

I'm wondering about analogies to dieting. The first step towards eating right is to be mindful and aware of what you are eating.Serious focus on that requires writing it down - tracking every bite. Because I've automated the wazoo out of my money, it is frictionless and I have not bothered to be mindful. Just looking at the history has made me more conscious of what I'm spending as I'm spending. I know many people use cash as a conscious budgeting tool. I don't think I want to do that, but I could use tools like Quicken or Mint to more actively and even daily review what I have spent and what I want to spend on next.

Hmmm.... how to use my data analysis tools and learning from weight management to make me a better financial manager?