Learn to Live Like the Rich

"The poor buy things, the middle class buys liabilities, and the rich buy investments." --Marotta Asset Management, Newsletter

I put this mantra right up there with 'spend less than you earn' in terms of simple, straightforward financial principles to live by. Check out the following article, written by an asset management firm, called Learning to Live on Your Own. Here's an excerpt:

The people who are struggling financially buy things and clutter their homes with them. The middle class buy liabilities such as boats and vacation homes and must spend money every month to maintain them. The rich, in contrast, buy investments. An investment is anything that pays you money.

Now that you are learning to live on your own, learn to live like the rich. The frugal millionaire enjoys both financial security and peace of mind. Living well within your means is a skill you may not have picked up from your parents or in school. Rather than learning from the so-called school of hard knocks, consider the following suggestions.

And don't forget to also check out Learning to Live on Your Own Part 2.

Create a Weekend Budget

If I were to graph my spending over the course of a week, I would see a graph that looks like a mountain range - low, low, low Monday through Friday then a HUGE spike on Saturday and Sunday. After holding back all week (save for a few online book purchases), my credit card explodes into the retail world on weekends, spending on breakfast, lunch, dinner, clothes, movies, drinks, you name it. Sound at all familiar? It might if you're used to working and laying low during the week, then splurging on weekends. Try experimenting with a weekend budget. I've found that I have a hard time sticking to a monthly budget since it stretches over what seems like a long period of time with lots of moving parts (although I'd like to stress that I do pay my credit card in full every month). I find it easier to break my budget down into manageable chunks, more specifically into smaller chunks of time. If you're interested in an experiment to help manage your weekend spending, try the following formula for determining your weekend budget:

  1. Add the take-home amount of your paychecks within a given month to get your total allowance
  2. Add up your essential expenses (rent, bills, gas; don't forget to include savings in this category)
  3. Add up your nice-to-have expenses (things you really like to do/have each month but ultimately could live without, like coffee, personal grooming, other recurring purchases)
  4. Subtract 2 and 3 from your allowance
  5. Divide the remaining amount (hopefully you've got some leftover!) by four. This is your "weekend budget." Spend on whatever you'd like each weekend as long as you stay within this amount. If it helps, take that amount out of the bank in cash and distribute that across your weekend activities.

Not sold on the idea? Try it out for a weekend and see how it goes!

Got a better budgeting idea? Let us know!

Balance Within Each Day

Just as your car runs more smoothly and requires less energy to go faster and farther when the wheels are in perfect alignment, you perform better when your thoughts, feelings, emotions, goals, and values are in balance.” --Brian Tracy

I work at a large, corporate company. I hear a lot of talk about "work/life" balance. I'm a personal believer that work is part of the greater life picture, and that by trying to separate it and hide it as something to balance against, we're doing ourselves a great disservice. I believe in life balance - in doing what I can in small ways to move toward a more balanced life, which starts with a more balanced day.

I can get overwhelmed when I think about "life" balance. Am I living in accordance with my values of personal vitality (diet and exercise), personal growth, excellence (professional and personal), while at the same time building and maintaining close relationships with my friends and family? That, my friends, is a LOT to think about. I find it helps to think about balance in small bits - balance within in each day. For example, what can I do tomorrow to live according to these values? I can go to the gym, call a friend, prioritize my tasks at work and set ten minutes aside to think about something I'm really passionate about. By aiming for balance within the day, and repeating that, I move toward balance in life without getting too overwhelmed.

What can you do to move toward balance tomorrow?

Make the Most of Apartment Living

I'm in the process of moving and have become obsessed with all things HGTV: color, interior design, living big in small spaces. I've always been lazy about decorating and personalizing apartments (or my room when I lived at home) - I figured what's the point when its not mine and when I could easily be moving again in six months? I also had a pre-conceived notion that any personalization would be difficult to do myself, and/or too expensive to purchase. But with a minimum amount of research and web browsing, I've come to realize that it doesn't take much to make a space really feel like home. Here are a few of the best articles I've found - please share in the comments if you have any tips or resources to add!

Happy Living!

Naked Economics

Ever wanted to strip down all that complicated, financial mumbo-jumbo from newspapers, blogs and books into something palatable? Consider reading Naked Economics, by Charles Wheelan. It's a fantastic book - written with a sense of humor for those of us who weren't born with an innate understanding of stock markets and bond ratings. As Wheelan puts it, Naked Economics is "not economics for dummies, it is economics for smart people who have never studied economics (or have only a vague recollection of doing so)." While it's not a book on how to invest or what to do with your money, it will get you closer to understanding the basics of how various financial institutions interact and get you up-to-speed on the most widely used economic terms without making you feel stupid.

Pursue The Passion

A friend recently sent me a link to PursueThePassion.com - a site that documents the journey that three college grads took to find professionals in careers they were passionate about. I love this idea, because so often college graduates take the first job they can find, without really thinking about how it will support their own passions and leverage the inner talents associated with those passions. I highly recommend you check out the site (excerpt from their About page below) and their E-Book, Timeless Advice for the Aspiring Individual. Excerpt from 'Our Story':

Pursue the Passion started as a group of three recent college grads who embarked on cross country roadtrips to interview passionate professionals about their career paths. We created this site because we felt that others could benefit from these interviews, and use them to determine a direction to take their careers. It's our belief that everyone should be passionate about their profession.

We have made it our mission to provide inspiration, guidance, and community support to help you find work you'll love."

SPAM Vigilance

I recommend you to take care of the minutes for the hours will take care of themselves.” -Lord Philip Dormer Stanhope, 4th Earl of Chesterfield (1694-1773)

David Allen, my personal idol and author of the book Getting Things Done, has a two-minute rule for answering emails:

If the Next Action can be done in 2 minutes or less, do it when you first pick the item up. [Do this] even if that item is not a "high priority", because it takes longer to store and track any item than to deal with it the first time it's in your head." (p. 131, "Getting Things Done")

I find that SPAM (whether it's for V1Agr$ or a newsletter I don't want) almost always fits in the two-minute rule. Be vigilant about it! If you receive an unwanted email, unsubscribe immediately and delete. Save yourself the annoyance of deleting the same spam over and over again. If you're not quite ready to unsubscribe from something like a mailing list, at least set up a filter within two minutes of receiving the first mailing so you don't have to label each email individually.

Got other tips for handling SPAM efficiently? Let us know!

Organization Tip: Use Consistent Labeling

Here's a tip that has served me well for a while now: label folders consistently across different organizing platforms, such as hand-held devices, bookmarks, computer folders, paper manila folders, email folders, etc. The benefit is that you always know where to find things, regardless of their format. For example, if I'm looking for something related to this website, I know immediately what folder to look for whether it's a Bookmark, a Word Doc, or a paper printout. The consistent labeling allows your brain to relax when looking for something rather than having to guess at where that thing might live. Another great tool for this is Google Desktop, which will index and quickly search files on your computer, emails, and even websites you've visited. 

The Dreaded Snooze...and a Tip for Avoiding it

I completely overslept today. Snoozed first, then in a sleepy haze turned my alarm off completely, stuffed it under my pillow and went back to sleep. For TWO hours. Thankfully by the time I woke up I still had a chance to make it to work before my first meeting. I've got a snooze habit, and ever since I've returned from the holidays its been worse than usual. I wanted to share one of my strategies for avoiding "the snooze" - it's not something I do every day, but it can help for a few days to get you back on track: Write an 'I will' statement the night before on a piece of paper, particularly if you've got a busy morning ahead. For example: "I will wake up at 5:00 a.m. tomorrow. I will not snooze. I will shower at 5:10. I will leave the house by 5:30...and so on." The benefits: planning your morning in advance, writing it down and being specific all help commit you to your plan. And make you feel that much more guilty if you break it. 

Eat that Frog!

It has been said for many years that if the first thing you do each morning is to eat a live frog, you can go through the day with the satisfaction of knowing that is probably the worst thing that is going to happen to you all day long." -Brian Tracy, Eat that Frog!

If there's one principle to live by at work and in life, I truly think this is it. Especially now that my blissful holiday vacation has ended, and I've returned to stockpiles of emails and seemingly endless tasks at work. Brian Tracy wrote an incredibly straightforward book on the concepts of prioritization and avoiding procrastination for important tasks. He says

Your “frog” is your biggest, most important task, and "the one you are most likely to procrastinate on if you don’t do something about it now. It is also the one task that can have the greatest positive impact on your life and results at the moment."

It's so easy to get consumed by emails (or to procrastinate by responding to every single email the minute it enters your inbox) instead of working on high-priority projects or tasks. We whittle the day away doing what should be follow-up work. At the end of the year when you look back on your accomplishments or update your resume, how many of you will say "answered every email"?

Choose your "frog" the night before. Commit to starting that frog first thing in the morning, before checking a single email. At first this is going to be really hard. You've got to stick with it. I found that after getting my highest priority task over with, I felt productive and happy for the rest of the day. As Tracy says,

Think about it – if you postpone your most important task, it hangs over your head all day, weighing you down with dread and guilt. If you knock it off first thing in the morning, the relief buoys you up all day long, literally energizing and boosting your productivity as you tackle the rest of the items on your to-do list.

And don't forget: "If you have two frogs, eat the ugliest one first." Click here to order Eat that Frog!

Own the Day

The trouble with the rat race is that even if you win you're still a rat." --Lily Tomlin

The way I see it, you can either choose to Own the Day or let the day own you. Owning the Day means purposefully taking time to make the day yours before it even starts.

If you let the day own you, it might go something like this: wake up to an obnoxious alarm clock, jump out of bed after snoozing a few times, rush to get dressed, rush to get to work, get annoyed with traffic, get bombarded with emails and requests and interruptions and meetings, rush to get home from work, subject yourself to bad tv, go to sleep, repeat.

Owning the Day means taking some time to think about what you want to do today. What will make you happy? What will help you start the day feeling fresh and move you through it with peace and calmness? I "own my day" in several ways, depending on how much time I have: reading the newspaper, working out, doing at least 15 minutes of yoga, sitting down and enjoying my breakfast (either alone or with friends), having a nice cup of coffee, thinking in my car on the way to work.

If it were up to me, I'd do all of these every day. Actually, it is up to me. I just have to get creative and make the time for it. The point is, if you don't make it a priority to Own the Day and start in a way that is refreshing and invigorating, your day will run right over you, and you'll just be another rat in the rat race.