Have You Mastered These Three Foundations of Money?

Got a great/feisty comment the other day on all those savings tips and tricks we shared, and thought we’d take some time today to compare and see where we stand on these recommendations 😉

It comes from Cody Wheeler over at AcademySuccess.com, and according to him these are the things we should be paying attention to the most:

Do these three major things as the foundation of your money, and all of the above matter a lot less (although these are still some interesting tips):

– Make sure your housing is reasonable for your income level, around 20% or so of your “take home” pay.

So many people get caught up in the allure of housing that it wrecks their available cash flow. Only upgrade when your income increases significantly, not when you “run out of space”. Most people don’t need more space. They just need less stuff.

– Same with your car.

Do what you can to avoid ever having a car payment. Save in advance and buy something reasonable, reliable, and safe. Cars shouldn’t define your identity. They should get you from A to B safely and be comfortable. A vehicle sits still 95% of the time. There’s no reason to spend hundreds of dollars a year or something that sits still most of the time.

– Choose a career (yes, you can choose your career) that allows you to get access to a 401k plan or something similar.

Make sure you’re getting paid market value for what you’re worth. Learn how to negotiate your salary and aim to get a salary increase at least every few years. Educate yourself to become even more valuable, and watch your money grow.

Solid stuff, not gonna lie! Do you know right off the bat how you compare?

Here’s how we’re doing over here:

#1. Housing @ 20% — #FAIL Our household take home pay fluctuates around $8,000/mo, which puts us at almost 29% for the roof over our head as we pay a whopping $2,300/mo in rent. And that doesn’t even include *maintenance* which a lot of people forget about when making these calculations! But fortunately as renters it’s minimal 🙂

#2. Reasonable Car — I’m gonna go with #PASS & #FAIL here. We chose a used car with some mileage on it and had it all paid off under a year and a half, but we certainly didn’t *need* a Lexus – even if it was only slightly higher in cost. But since we could afford it and I very much appreciate a comfy ride (all cars may take you from point A to point B, but some are more fun along the journey!), we splurged a little and didn’t stay at the bottom of our budget. Though I do yearn for the days of having another Frankencaddy again when I don’t have to shuttle kids around 😉

#3. Smart Career — #PASS. A lot of variables go into this one of course (distance, pay, benefits, passion??), but I’d say I’ve definitely chosen well in this department, as not in my wildest dreams did I ever think I’d get paid thousands of dollars to just write a diary about money, haha… Even if it was accidental! 🙂 And as anyone who is self-employed knows, the potential for growth/income is limitless when you control the reins. So I’m definitely beyond fortunate to have fallen into this, and it certainly beats out all 40+ previous jobs I’ve had up to this point too. (But don’t let it fool you – even dream jobs have their downsides, and maybe one day I’ll spend a few hours listing them all out – as there is a lot :))

So that puts us at 1 and 1/2 out of 3, haha…. does that make me a bad blogger? 😉

Personally I’m okay with it because at least I know where I stand and *why* I’m standing there (the most important, right??) and while I’m not at a perfect 3 for 3, I know that the future will only improve so long as I keep working hard at it.

Which I think is the key to all of this, really. It’s one thing to not understand how you got to where you are right now, but a whole other to recognize it and then make that plan to get better with each and every day. Because it’s not our pasts which define us, but our future!!!

So as long as you’re fully aware of what’s going on right now, I’ll give you a passing grade as well 🙂 But still divulge how many of the 3 you hit here – and why – so we can continue the discussion!

And I still stand by all those tips we shared last week btw, because while the Big Things are important, so are the smaller ones. They all work together to improve momentum!!