Broke and... Single.

When you go from years of “us” to being on your own, it’s not just your personal life that changes.  Splitting the cost of bills, nights out, gifts for friends, and general life expenses suddenly become a huge one woman (or man) responsibility.  Cheap nights in spent cuddling on the couch and sharing a bottle of wine turn into expensive nights out in an attempt to socialize and not turn into a depressed, lonely hobbit.

So how can one be single and social without going broke?  That’s the question I’ve been exploring the last few weeks and here’s what I’ve found.

Share your story.  Everyone feels like poo after a break up, but it’s important to remember how many people love you.  Be open with your experience and those people will do everything they can to get you back on your feet.  A place to stay.  A warm dinner.  A drink.  Someone to talk to.  Enjoy and appreciate the love.

Be honest.  It’s weird to lay all your shit on the line the first time you go out with someone new, but if you want to date, and you’re pinching pennies, you have to be honest and up front about your financial situation.  Within the first two or three dates make it clear that you’re all for having a good time, but regular nights out of drinks, dinner, and a movie aren’t in your budget.  Brainstorm cheap things you can do together.  Not only might you discover something new and exciting, but you’ll lay a groundwork for your financial expectations going forward.

Coordinate.  Take on the role of social coordinator.  Instead of following friends to expensive bars and restaurants, be the one to make the plans.  Organize a potluck or host a game night.  If you want to have a night out, see if you can find a groupon, livingsocial deal, or restaurant.com discount for your favorite nightlife spots.

Cut yourself some slack.  As anal as I am about budgeting, there are times I just need to take a breath and treat myself.  I don’t want to make a habit out of it, but I’m not going to let my finances stand in the way of my happiness.  If you need a massage or a fancy night out with a friend or an elaborate, romantic date, go for it.  Just remember to keep track and make sure it’s not becoming a regular overindulgence.

It turns out single can be exciting, fun, and affordable too.

How I Started Choosing Stocks: A Clueless Novice’s Approach

While I tend to think of myself as being uber responsible and careful with my money, I’m strangely not overly cautious when it comes to my stock picks.  Thus far, it’s all worked out pretty well for me.  I’ve had anywhere from an 8%-25% return on my individual investments over the course of this past year.  Of course, my luck may change at any time, but I’ve got myself in the game, and that’s what I’m most proud of.

Like many of my fellow broke beauties, I was intimidated by the market. Let’s be real, I still am.  But I knew enough to know that my chances of growing my money were way better in the stock market than in the absurdly low yielding checking and savings accounts the banks were offering.  So after contributing the requisite amounts to my savings, checking, and retirement accounts I decided to set aside some “experimentation funds”.

I opened an account at a brokerage with $1,000 and decided to split that money between two stocks.  $1,000 was as an amount I could “afford to lose”.  Like the money you walk into the casino with.  In truth, I’d be devastated if I lost $1,000, but I know it’s an amount that won’t destroy me and it’s enough to get my feet wet in the reality of the market. 

So onto the stock picks.  I wanted to invest in companies whose product I used, whose message I supported, and whose potential for growth I could visualize.  I thought about the products and services I use every day and the brands I’m loyal to.  I settled on Amazon (AMZN) and Whole Foods (WFM).  I looked up their ticker symbols and saw they were both priced near their 52 week low.  With totally random, unscientific reasoning I decided they must be a good deal and bought my respective shares of each.  Like I said, not overly cautious but it got me started. 

Just by having my own money in the stock market, my desire to read and learn as much as I could grew ten fold.  I found new ways to save and cut back expenses so I could set more aside and use my newfound knowledge from books, articles, and blogs about the maket.  All of the sudden, just by experimenting with $1,000, I was not only invested in stocks but in the reality of my financial future and my own financial education.  I put aside more money for savings, more for retirement, and more for my stock portfolio. 

There is an attitude of “I’ll figure it out later” or “someday” with the young and broke when it comes to investing.  And while stocks will often dip and sometimes fail, I think the real mistake is not getting involved at all, especially when time is on your side.

I went on to buy Facebook (FB) at around $21/share this summer.  It dipped to about $17/share in the fall and stayed there for a while.  Now it’s around $30/share.

My AMZN, which I bought last year around $185/share, is now up around $270/share.

My WFM was around $85/share when I bought it, it went up to about $100/share this summer, now it’s back down around $88/share.

My recent purchase of Apple (AAPL) at about $535/share is down around $503/share now.

While I’ve been weathering the ups and downs of each stock, I’m not stressed.  I believe in each company I hold.  I’m not running to ditch AAPL or WFM.  I’m 26 years old, I’ve got plenty of time for those shares to rise.  What’s important to me is that I’ve made the decision to face the reality that is my finances by getting started and learning everything that I can to make my money work smarter, so that I don’t have to work harder and longer.

Start trading. Start learning.  Start earning.

https://www.tradeking.com/node/30195?ADTRK=sr-RAF90-t-05dhkod08clmf

Resolving to Save

Did you resolve to save more money in the New Year?  It’s a common resolution.  It’s also common for people to break their resolutions.  Chose to succeed by committing to your financial goals and following some simple savings strategies.

1.    Track your spending.  I’ve said it before and I’ll say it again.  Until you see how you’re spending, you won’t be able to assess how you can cut back and save.  Write down every purchase, every penny.  You can use a spreadsheet, your phone, fancy financial software, or the back of a napkin.  As long as it’s all in one place for you to see, you’ll be able to get a picture of your spending; what’s necessary, what’s not, where you’re overspending, etc.

2.    Make a Plan.  Be specific.  How much do you want to save this year?  Divide that number by 12, that’s how much you have to save each month.  Once you’ve tracked your spending you can decide where that money is going to come from.  If it helps, break it down even more.  Divide it into weeks, even days.  Saving an extra $3,000 a year may sound daunting, but when I break it down to $8.22 a day, it’s a number I can manage.  Packing lunch and skipping Starbucks.  Done.

3.    Substitute New Behaviors for Old Ones.  It’s all easier said than done.  I can sit at home writing out the perfect plan, but unless I can put it into action on a daily basis it won’t do me any good.  Beware of habits.  The daily purchases you make just because they’re the purchases you’ve always made, things like coffee and lunch are probably the most common, but also things like water, cigarettes, snacks, drinks, etc.  If you find a recurring expenditure when you track your spending, figure out if there’s a way you can cut it out, replace it, or reduce the cost.  Know exactly what new habits or routines you need to establish to make these new changes.  For example, getting up early to pack lunch instead of buying out or scheduling potlucks instead of meeting friends out for drinks and dinner.

4.     Pick a Cause for your Savings.  There are times when going out for drinks after work or ordering takeout will sound unbelievably tempting.  Breaking the routines and habits of spending on the little luxuries will be difficult.  To help you stay focused on your larger goals, pick a cause for your savings.  My extra $3,000 (or whatever number you decide on) in savings this year is going to help me buy my first home, or set me free from student debt, or allow me launch my new career.  By attaching a relevant and personal dream to your savings, you will give your goals the meaning and urgency you need to trump short term, fleeting desires.

5.    Track your progress and go public.  Acknowledge your successes.  Measure how far you’ve come and let it get you psyched to save more.  Share your progress with family, friends, and social media.  The more you put it out there, the more accountability you’ll develop with yourself and others to stay committed to achieving all you’ve set out to save.

May it be a prosperous and successful New Year!