Thread: Are You Good With Money?

So I've been living in Japan for about 6 years now. When I came, I had nothing except craploads of debt...which I started to increase with my nice new Japanese credit card.

I am, and have been for years, terrible with money. Just aweful--spend it as soon as I get it, and when people gave me access to money I didn't have, I used that too. In college it was ok, my folks helped me out, but then when I got a job and stuff, I was constantly on the borderline--overdrafts and late bills were the norm.

I didn't mind, really. I mean, I was never hungry or anything, and I knew it would get better (it didn't), but looking back now, I think I am lucky I didn't utterly ruin my life.

The thing is, I was not that different from anyone I knew then. A few of my friends were good with money, but most of us were the same. And I don't think it's that rare--I was listening to a podcast of Fresh Air form NPR the other day and it was about how to choose bank accounts based on their low overdraft fees and the possibility to PREVENT overdrafts by cutting you off early. Not financial advice like "save, keep track of your spending, etc." but "Make sure the bank won't let you overdraft, because otherwise you will." So, perfect for me in other words.

However, something happened to me to change everything: I married a woman with a head for numbers. My wife has an associate's degree in bookkeeping, and has done semi-pro accounting work for years. She didn't have any savings when we got married, as she had spent all of hers on her family, but watching her with money is like watching magic.

IN THREE YEARS, we have paid off all of my debt, almost paid off a car, and put more money in the bank than my parents ever had (my parents are probably the source of my spending habits...)

Now, we do both work, and there are no kids in the picture, but the vast majority of our spending power comes from the simple fact that my wife 1.) knows how to budget, 2) KEEPS to the budget and 3) values savings more than credit.

That's it. We don't buy on credit. We have a credit card, sure, but we ALWAYS pay it off, every month.

And this is NOT at all unusual in Japan. There is a VERY small poor class; there are homeless, sure but let me put this in numbers: By the age of 24, it is not at all unusual for a Japanese person to have saved over $10,000. The average Household savings rate in 2006 was 27%. 27!!! In the US, it was right around 2%.

Why is this? Why don't Americans know how to save?

Can you save? Do you save? I am really curious as to why this might be, in you guys' opinions...

Jim,

I don't know if you know who Dave Ramsey is, but I took his 13 week class called Financial Peace University last year. I followed his plans, and now I am down to only my primary mortgage. His plans work great for anybody at any point in their lives. Obviously, the earlier the better.

Just Google him and you can find his programs.

While I was taking his class, I build these Excel sheets for our group. This is a template with instructions. You will have to do some customizing in the income area, but overall it works well.

I have left all of the names of my expenses on the sheets to give you an idea how to fill out thos worksheets. I deleted my actual budgetary amounts. The tab that says Rodan and Fields is my wife's home based business.

Let me know if you want to use it and if you need any help.

David

I would say I'm good with money. I save well, I don't spend money I don't have, I generally don't dip into my savings account. Certainly not for things that provide only short term pleasure.

I hate not having money in the bank to fall back on.

I only have my parents to thank RE my attitude to money. My brother and I are very different people, but our attitude to money is extremely similar.

I would say that this is quite unusual though. Every one who I work with sends their wages into oblivion almost as quickly as they get it. I'm really not sure how they manage to do it to be honest.

I can't remember exactly the details but the case of Japan's saving rate is rather unique. It all started after the WWII when the economy was completely ruined.

And no, I am not good with money... but I try!

I come from a country where credit cards were not an option while growing up. The culture was you save then buy, I am used to that. When I came to US however I went the "easy way" credit cards and debt. I did not over spent or anything, but couple health related issues in the family put my wife and me in a nice debt hole. My wife manages the budget and now we are debt free, pay the credit card balance every month and put money aside.
I do not buy stuff on a credit card unless I can cover with saved money, and I do not use the family savings on purchases that are not for the whole family, i.e razor/kniffe related stuff and so on.

Yes, I am good with money. I am allergic to the idea of debt. The only thing I owe money for is my mortgage. I save money at the beginning of the month, enough to count yet I leave enough for the foreseen household budget, and then make do with what is left.

If we want something we buy it when we have saved up. This is more efficient than lending money because you'r still missing as much money as when you would have saved, but with added interest as well.

Honestly, is you can't make it to the end of the month without going into your savings on a regular basis, you should probably review your spending patterns. Financial health is all about planning and realism. Living on credit is evil.

I'm not too bad I suppose.

The only thing I have debt on is my car, but that was my moment of madness for finishing my CIMA exams..! I've wanted a sports car since I was old enough to say the words and I thought I'd do it now while I have no dependants and the money's available for it.

I have a regular saving thats drawn on my salary each month, as well as putting the maximum allowance into my pension each year as well.

I do have a little bit on my credit card left over from Christmas, but I should be clearing that soon.

Could be better, but could be worse as well..! Its the RAD y'see...

every time my debt goes down i find another AD
yes im probably at the limit of what i can manage

I owe a few grand on the cards. I could probably pay it off in one to two months if I resolved to do it. But my problem is I'm actually good with money - I can budget to the cent, my problem is I only need a bit of money to live off and so I only work part time with enough hours to earn that amount. Then I go and buy crap and spend any money I had left over. So here I am at 35 with no money. Fortunately I have a few assets, and generally the stuff I buy is good and lasts for ever.
But thanks for raising the issue, Jim. I'll keep it in mind and will report back in a few months.

Originally Posted by Alembic

Jim,

I don't know if you know who Dave Ramsey is, but I took his 13 week class called Financial Peace University last year. I followed his plans, and now I am down to only my primary mortgage. His plans work great for anybody at any point in their lives. Obviously, the earlier the better.

Just Google him and you can find his programs.

While I was taking his class, I build these Excel sheets for our group. This is a template with instructions. You will have to do some customizing in the income area, but overall it works well.

I have left all of the names of my expenses on the sheets to give you an idea how to fill out thos worksheets. I deleted my actual budgetary amounts. The tab that says Rodan and Fields is my wife's home based business.

Let me know if you want to use it and if you need any help.

David

Thanks for this David. I like to tell myself that I'm better, but I know it's just my wife's influence. If something were to happen, God forbid, who knows where I would end up...

Thanks for the info, and I'll definitely give it a look...