How to Make a Budget: My 2 Cents

By 2 Cents on January 20th, 2010 | Category: Budgets | Leave a comment

There is no one giant step that does it.  It’s a lot of little steps.

~ Peter A. Cohen

Update:  6 Remedies for a Debt Hangover is mentioned in today’s Money Hacks Carnival #100 @ The Ultimate Money Blog. Thanks Mrs. Money!

Over the past 2 years, I have had to rework our budget a half a dozen times or so, in addition to running various budget scenarios for potential job changes. So this stuff is pretty fresh for me. For what it’s worth, this post describes how I handle our budget. I don’t decide on percentage allocations up front. This might work for someone just starting out, but most of us have spending commitments that are well-entrenched. Rather, I start by looking at our net income and all of our expenses in detail.

Tools of the Trade

Quicken: I use [...]

Read on and enjoy … How to Make a Budget: My 2 Cents

Category: Budgets | Tags: , , , , |

Your Financial Hierarchy of Needs

By 2 Cents on January 14th, 2010 | Category: Money Psychology | 11 comments
My Hierarchy

The elevator to success is out of order. You’ll have to use the stairs.

~ Joe Girard

Update: This article made it into the editor’s top 5 picks in The Carnival of Personal Finance – Support Haiti Edition @ Million Dollar Journey. Thanks Frugal Trader!

Abraham Maslow is the psychologist best known for his hierarchy of needs. He basically postulated that humans need to have more basic needs fulfilled before we try to satisfy higher level needs. If we try to attain higher self-esteem while more basic needs like steady employment or a stable family life go unmet, we will feel uncomfortable and stressed out. This goes along with the idea that discomfort means change is required.

Now I am certainly not the first to draw a parallel between Maslow’s hierarchy of human needs and our financial needs. In doing the [...]

Read on and enjoy … Your Financial Hierarchy of Needs

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Goal Setting: My Report Card

By 2 Cents on January 12th, 2010 | Category: Planning | One comment

The best way to succeed in life is to act on the advice we give to others.

~ Author Unknown

A couple of weeks ago I wrote a post outlining 5 Goal Setting Guidelines as part of the Balance Basics series. Yesterday I wrote about our financial plan for 2010, and I got to wondering whether I followed my own guidelines or not.

The short answer is no, not really. But I found the process of comparing my advice to my own actions really informative, as it raised some issues that might help you out too. Lucky you. My inability to follow my own advice has resulted in more advice. I hope that’s a good thing. If not, I hope it at least makes you go hmmmm . . .

My Goal Setting Report Card

Put Them In Writing:  Read on and enjoy … Goal Setting: My Report Card

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Why You Should Care About Economics

By 2 Cents on December 28th, 2009 | Category: Economics | 2 comments
economics

An economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.

~ Laurence J. Peter (1919 – 1988)

Economics is often called “the dismal science” for its general lack of prediction accuracy. There are lots of other reasons financial experts and non-experts alike detest it. For most laypeople like you and I, it’s incomprehensible and just plain boring. I can understand all of those criticisms.

Still, there must be some value in it if thousands of people study it and governments make policy decisions based on it. Maybe it was never meant to be an exact science anyway. Maybe science itself isn’t always all that exact. After all, we can’t learn anything new without first making tons of potentially erroneous hypotheses.

What economists do best is report on general trends and that information is valuable to everyone. Now I’m not suggesting you [...]

Read on and enjoy … Why You Should Care About Economics

Category: Economics | Tags: , , , , , |
 
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