thrive

How to Thrive in Uncertainty

Matt Bell — Thu, 08 Sep 2011 10:24:18 +0000

Even a casual glance at the headlines will tell you we’re living in especially uncertain times. But don’t lose hope. There are ways to thrive, even in times like these. (See also: Emergency Plan: Better Than an Emergency Fund)

Control What You Can Control

Psychologists say feeling in control is one of the essential wellsprings of mental health. We can’t control wars, the weather, or Wall Street, but there’s much that we can control, so that’s the place to focus.

Plan to Succeed With a Budget

How do you feel about the idea of using a budget? Excited? Happy?

I didn’t think so.

Non-budgeters use words like “restrictive,” “rigid,” and “constraining” to describe budgets. However, people who actually use one say a budget helps them feel “in charge” of their money and that it keeps them “in a position of knowledge and control.”

Especially when times are uncertain, it feels good to be on top of where your money is going each month.

As explained in my Budget Quick Start Guide, there are four steps to using a budget:

Estimate where your money is now going
Develop a plan for how your money could be used more effectively (see the Recommended Spending Guidelines for different size households and different incomes at the previous link)
Track your use of money
Analyze where your money actually went at the end of each month and make any necessary adjustments.

If you don’t currently use a budget, give it a try. You’ll soon find yourself feeling much more in control of your finances.

Create a Safety Net

Even in good times, life is filled with uncertainties. Unexpectedly expensive medical issues, home or vehicle repairs, and more can pop up at a moment’s notice. The people who are best prepared are those with an emergency fund, preferably stocked with six months’ worth of living expenses.

If that sounds like a lot, just start where you can. Open a separate savings account. Then set up an automatic transfer each month from your checking account to this savings account. Start with $25 a month if that’s all you can afford. The key is to start.

If you have any debt other than a reasonable mortgage, build an emergency fund totaling one month’s worth of essential living expenses and then get focused on getting out of debt. If you’re already out of debt, build your emergency fund up to six months’ worth of essential living expenses.

Ditch the Debt

If you’re carrying a balance on a credit card, commit today to stop going any further into debt. Take your credit cards out of your wallet or purse so they’re not with you when you go shopping. Cut them up, or put them in a block of ice if you have to. Do whatever it takes to make it make it as difficult as possible to take on any more debt.

Next, fix your payments. An important thing to know about credit card debt is that if you stop going any further into debt and you make the minimum payments required by your credit card company each month, then each month you’ll be required to pay less and less.

It isn’t kindness on the part of the credit card company; it’s math. Your minimum required payment is based on a percentage of your balance. So if your balance is going down a little each month, so will your required minimum payment.

Making this declining minimum payment will keep you in debt for approximately…forever! However, if you simply pay the same fixed amount each month, you’ll really speed up the process of getting out of debt.

Even better, see if you can pay more than the fixed minimum.

Stay Employable

There’s no such thing as guaranteed employment anymore, but keeping your skills on the leading edge will go a long way toward staying as employable as possible. If your employer offers tuition reimbursement, pick up a night class in your field. At very least, make sure you're reading the latest books and leading blogs in your field.

Give Some Money Away

In uncertain times, it’s natural to narrow our focus, thinking mostly about our own needs and even becoming fearful. Regularly contributing some money to a cause or organization we believe in can go a long way toward getting us out of those ruts. Giving money away takes our focus off ourselves, keeps us mindful of other people’s needs, and makes us feels good to be part of something bigger than ourselves.

What other steps are you taking to thrive during uncertain times?

This article is from Matt Bell of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Thrive as a Starving Writer--Lessons from the Experts

Philip Brewer — Tue, 25 Aug 2009 20:02:28 +0000

The web is full of advice for starving writers. And why not? Any writer has heard the advice "Write what you know," and one thing many writers know is about being a starving writer. Oddly, most of their advice is on writing. A couple of truly great writers, though, have left us advice on the much more important topic of not starving.

One writer I'm thinking of in particular is Ernest Hemingway.

Hemingway is hardly the only person to have written about a year or two spent as a starving writer. Another is George Orwell, who wrote the masterful Down and Out in Paris and London. But although Orwell lived as a starving writer, the vivid descriptions in his book offer little in the way of practical advice for someone trying to carve out time and space to make a go of being a writer. Hemingway on the other hand, has plenty to say on just that topic.

There's a short piece by Hemingway available on-line: Living on $1000 a Year in Paris. The article describes how cheaply it was possible to live in Paris--a room for $30 a month, breakfast for $6 a month, subway rides for 4 cents--thanks to the exchange rate at the time.

At the present rate of exchange, a Canadian with an income of one thousand dollars a year can live comfortably and enjoyably in Paris. If exchange were normal, the same Canadian would starve to death. Exchange is a wonderful thing.

That was in 1921 and the dollar-franc (and now dollar-euro) exchange rate has long since reverted to something reasonable, but the central message is still valid: To thrive as a starving writer what you need is a very cheap cost structure for your home economy.

Living on $X a year

First of all, don't throw your hands up at the figure of $1,000 a year. Adjusted for inflation, $1,000 a year in 1921 comes to (according to the Bureau of Labor Statistics) $12,031 a year in 2009 dollars.

Getting by on $12,000 a year would be tight in the United States--especially so if, as Hemingway was, you're feeding two people. Tight, and yet not impossible. Hemingway's $30 room translates to $361, and rooms for that price can be found in many parts of the United States. There aren't many places where a subway ride could be had for an inflation-adjusted 48 cents, but where I live a bus ride can be had for less than a dollar. You can eat very cheaply if your room includes access to a kitchen and you're willing to eat mostly rice, beans, and whatever vegetables are cheap that day at the grocery store.

In A Moveable Feast, his memoir about those years, Hemingway mentions many little ways he economized. Gertrude Stein advised that he spend no money on clothes (although she thought he should spend the money saved thereby on art). He writes about saving money by not getting his hair cut--which had an added bonus for Hemingway:

I found out very quickly that the best way to avoid going over to the right bank and get involved in all the pleasant things that I could not afford and that left me with, at least, gastric remorse was not to get a haircut. You could not go over to the right bank with your hair cut like one of those wonderful looking Japanese noblemen painters who were friends of Ezra's.... "You mustn't let yourself go, Hem. It's none of my business of course. But you can't go native this way. For God's sake straighten out and get a proper haircut at least."

There are a lot of things that can be cut out of a budget--if you're a writer and if cutting them makes it possible to spend your time writing.

Live someplace cheap

The exchange rate no longer makes Paris a cheap place to live, but there are plenty of places around the world that are cheap. I'm sure in a couple of decades we'll be reading memoirs by a new generation of great writers who right now are living and writing in Malaysia or South Africa or Brazil. (Foreigners think it's funny that Americans worry about how dangerous it would be to live overseas, because they think of the United States as a violent place with dangerous cities and terrible health care.)

It's really not necessary to go overseas, though, in search of a cheap place to live. There are plenty of cheap places in the United States. Rather, the big stumbling block for most aspiring writers is debt. If you can dodge that--get through school with little or no student debt, or else get your student debt paid off before you imbed the expenses of a middle-class American standard of living into the cost structure of your household, then you can go down the starving writer path--and probably do it without starving.

And, if you can't avoid starving just a little bit, Hemingway managed to find an upside even to that:

You got very hungry when you did not eat enough in Paris because all the baker shops had such good things in the windows and people ate outside at tables on the sidewalk so that you saw and smelled the food. When you were skipping meals at a time when you had given up journalism and were writing nothing that anyone in America would buy, explaining at home that you were lunching out with someone, the best place to do it was the Luxembourg gardens where you saw and smelled nothing to eat all the way from the Place de l'Observatoire to the rue de Vaugirard. There you could always go into the Luxembourg museum and all the paintings were heightened and clearer and more beautiful if you were belly-empty, hollow-hungry. I learned to understand Cézanne much better and to see truly how he made landscapes when I was hungry.

This article is from Philip Brewer of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Thrive: Your Online Personal Financial Planner

Nora Dunn — Wed, 22 Apr 2009 04:47:40 +0000

Thrive: Free Online Personal Financial Planning

So you figure it’s time to proverbially grow up and get financially wise. But you don’t know where to start: you didn’t learn much in school or from your parents, the folks at the bank won’t give you the time of day, and you can’t afford a financial planner. What do you do?

Thrive is an online financial planning platform that may be the solution to your immediate needs. As a free service, you’ll receive personalized advice and sound recommendations free from biases. Thrive has been around for the last few years and after receiving accolades from the likes of the Wall Street Journal, and Fast Company, Thrive is paving the way to financially empowering anybody who wants it.

After catching up with a few team members at Thrive, I gained a new insight into the services they provide, as well as the fun approach that the entire Thrive team embraces when doing the dirty work of helping people with their finances.

“I started working on Thrive after a few years of my friends asking me for advice on what they should do with their credit card debt, 401ks, students loans, or how to budget better. After a couple of years of this, I realized that our generation is overlooked by banks and traditional companies and what we need is a Charles Schwab for people in their twenties and thirties,” says Avi Karnani, Co-Founder. “Now, three years later, we've been acquired by LendingTree while building on our promise to provide financial advice to anyone who needs it, over the web, for free.”

What exactly does Thrive do, you ask? Thrive helps you manage your money. By entering in your bank accounts, investments, and credit card details, Thrive will help you budget, keep your spending on track, and make sound investment decisions.

But banks around the world are not on-board the Thrive-train quite yet: “It is harder to get in contact with banks outside the US to get them into the system. But we've done our best, we have some of the top Canadian banks in there, and we work every day to get more banks,” says Matt Wallaert, Lead Scientist and social psychologist (a great skill to have when working with behavioral patterns around money).

So although Thrive can be used by anybody around the world, they are currently best set up to help US and Canadian residents.

Among these people, Thrive aims to be a viable solution to people in their twenties and thirties. However, Avi says “we're seeing an increase in users in their forties and fifties. When we ask them why they signed up for Thrive, they tell us that since the economy has battered their retirement savings, they need something to help them with budgeting and rebuilding better financial lives.”

This of course, begs the question: Who is Thrive’s ideal client, aside from age?

Avi: “If you're worrying about your third vacation home or how you'll afford that second luxury SUV, you're probably not the ideal Thrive client. We've built the our company to help average Americans make the right financial decisions, as opposed to wealthy folks that all the other companies compete for.”

Where I become confused (and skeptical) in the process is when it comes to making money. As a free service, how is Thrive financially sustainable?

Matt had something to say to me about it: “Basically, we get money from banks so that it is free for users. Among our myriad of free services, one of the things Thrive does for users is help them find the best bank accounts for them. And when people take that recommendation, and go and open that account, the bank will sometimes pay us a small "account generation" fee. It isn't much, but when you add it up, it is enough to keep our doors open and our service free.

“It is important to note, however, that we recommend the best bank account regardless of whether we make any money for doing it. The algorithm that determines the best account for you literally can't talk to the money making part of Thrive; they are completely separate programs. And we actually maintain this distinction at our company as well.”

I tend to cringe at automated advice-generating programs, especially as a former Certified Financial Planner myself. But between the accessible personal support team and the advanced calculations, Thrive is bridging the gap.

When I asked why I have to enter my personal financial information, Matt said “By giving us access to what you do financially, you enable our algorithms to use some logic to determine appropriate advice, which is actually very similar to what a friend who knows a lot about both you and money in general would do. We can see you're overspending, so we can tell you to slow down. We can see that your accounts aren't set up right, so we can tell you to fix them. You can tell us "I dream of owning a home" and we can say "OK, here's how you go about doing that.” So we're basically your smart, has-the-finance-mojo friend, except online, free, and you don't have to buy us a birthday present (not that I'd reject it: I'm a fan of good cream soda, hint hint.)”

In regards to how Thrive’s recommendations are generated, Avi shared their secrets: “Some recommendations are made on the basis of pure math, for example, a credit card with lower interest rate is better than one with a higher interest rate, and we can compute the fees you'll pay versus your total debt to factor those in as well. Other recommendations are informed by the opinions and best practices of experts, users, and our polling of financial advisers. For example, that you should have at least 30 days worth of emergency spending socked away in a savings account, but not before you pay off your credit card debt. In terms of investments, our financial advisory engine will focus on the lowest cost index funds rather than picking stocks…Too many first time investors make expensive mistakes picking stocks instead of index investing and even more potential first time investors are afraid to get started because of how hard all of this sounds.”

When I pressed the security issue, the reply I received was: “Thrive doesn't ask for your social security number, we don't know your bank account numbers, and we can't move your money around…in a worst-case scenario, you may leak some shopping information you aren't ready for people to know.”

If you aren’t prepared to enter some financial information into the program though, you won’t get much of a chance to sample the fare, shy of viewing the features you could enjoy if you used the program to its full capacity. “At some root level, if you don't trust us enough to tell us what you do with your money, why on earth would you trust our advice?” says Matt.

Fair enough.

Being a platform specifically for people in their 20s and 30s but with older people now flocking to the service, I wonder what Thrive’s limitations are. When should a Thrive client get a personal financial planner?

Avi said: “A good analogy to answer your question would be to compare financial planners to travel agents. Sometimes you need to go to South Africa and maybe you want someone who can guide you that. But, most times you need a plane ticket to LA and rental car waiting for you and for that you use the web.”

Surprisingly enough, Thrive actually works hand-in-hand with financial planners, who enjoy the user-friendly interface that clients can continue to use when the planner has gone home.

And although insurance recommendations are not part of Thrive, Avi says “we know from listening to users that insurance decisions are among the hardest decisions to make. We're working on it!”

With a dedication towards growth and a constantly evolving financial planning engine, Thrive just may be a financial planning solution for a self-starter who is motivated to improve their finances but not yet ready to work with a full-on personal financial planner. In this world where it seems that the Internet can do everything except walk the dog (give it time), it seems logical that financial planning programs would wend their way to the Web. Thank goodness that the likes of the folks at Thrive are at the cyber-financial-planning helm.

Note: The author has no vested or affiliate interest in Thrive.

This article is from Nora Dunn of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

How to Survive (and Thrive!) in a Job You Hate

Sarah Winfrey — Wed, 28 Feb 2007 17:10:43 +0000

Somewhere, sometime in life, everyone has a job they hate. Whether the hours are terrible, the pay is awful, the coworkers are wretched, or the boss is horrid, hated jobs are very much a thing of the present. We work them for different reasons, for different lengths of time, and with different levels of satisfaction, but almost all of us work them at some point. For many people, these jobs are a drag that make them feel like hollow shells of their former selves. However, there are a few people who manage to survive and thrive in jobs they really don't like. Here are a few of their secrets for making that hated job easier. (See also: What to Do When You Want to Quit Your Job)

Know Why You're There

Whether you took the job in the first place because you thought it was something other than it turned out to be or because you absolutely had to make rent and couldn't do it any other way, knowing why you took the job will help you maintain perspective while you're there. Remembering the process that led up to your current situation: the job search, the interviews, your conversations with others about the job, your conversations with yourself about it, hearing that you had the job, your acceptance of it, and anything else you went through during that time will remind you that you are more than your job. YOU took IT for a good reason. If that reason isn't so good anymore, well, then it's time to reevaluate. But you can do that, because you are more than the job.

Know What You Really Want

Often, a terrible job will help you know what you would want in a good job. So go ahead and note what these things are! Are your current coworkers loud? Note that you would like a job where you can have quiet time to focus, at least when working on large projects. Is your boss always second-guessing or changing your decisions? Note that you would like a job where employees are trusted and tasks are truly delegated. Go through the process of actually writing these things down. When you have a physical list of what you want, your current job won't seem so worthless. After all, it helped you learn what to look for next!

Once you have this list, add to it the things you've dreamed about doing. Would you like a job that requires a lot of problem-solving instead of a set group of tasks? Include that. Would you rather work for yourself? Note it. Have you always dreamed of writing for a living? Put it down.

Whether you're in a position to actually go out and look for another job or not, this list shows what you know about yourself, job-wise. And knowing what you want is often the first step towards getting it.

Know Your Motivation for Staying

If you're planning to stay in a job you dislike, it's important that you know why. Is your current job the only one in your area that fits your skills? Or do you need it to keep your children fed and clothed? Whatever the reason, remembering what it is and keeping it at the forefront of your consciousness makes working a difficult job easier. When you do this, you end up working not for the job itself, but for whatever the motivation is behind your being there. The job becomes more than a job: it becomes a way to fulfill whatever desire moved you to take it in the first place.

Make a Conscious Choice to Stay

Knowing your motivation also makes it possible for you to evaluate it. Maybe you wanted a job close to home because you were newly married and wanted to spend as much time as possible with your new husband. Now, he's working regular hours and taking some night classes, so your short commute doesn't net the two of your more time. While working the hated job might have been worth it for the time together, it's not when it doesn't produce that result. Or maybe you realize that you qualify for lots of different jobs of the same type that you're working now, and you realize that a different work environment might make things much more tolerable. Whatever your motivation, consider carefully whether it's enough motivation to stay at the job.

If your motivation is enough for you to keep the hated job, make staying a conscious choice. Own your choice. You do not HAVE to stay at the job, but you CHOOSE to. And you know the reasons behind your choice, and that they are enough to outweigh the fact that you hate what you're doing. Deliberately choosing to stay will help you own the job. It will help you to feel, in some small way, like you are doing what you want to do (because you do want it, even if only from the perspective that it is better than any current alternative).

Make that Choice Again If You Have To

Even after you choose to stay, there will be parts of the job that you dislike. Those parts may even make up the majority of your time there! If you can notice those parts and notice the feelings of frustration/rage/anger/sadness/hopelessness/whatever that rise up in you, you can choose to make your choice again. Run through the motivations, and the reasons why those motivations are worth it. Remember that you are more than this job, that you chose it.

This is really hard (particularly when you're used to letting the negative emotions take over)! Stick with it. Remember that you will fail sometimes, and go home complaining and pissed off again. Over a long period of time, though, your choice will become the habit instead of the emotions.

Feel Your Feelings

When something comes up in your job that you hate, feel that. Let yourself feel whatever emotion comes over you. Don't try to hide it inside, or it will just blow out later. If you need to take a walk, or go to the restroom, or even put the emotion on an internal shelf to feel later (just be sure to take it back out!), do that. Letting things build up until they might explode is never a good idea. So let yourself feel. And, in the midst of your feelings, remember your choice. Remember why even these awful feelings are worth sticking it out.

Have Realistic Expectations

Don't expect yourself to ever love your job. Don't think that you should be loving it so something must be wrong. Instead, expect that you won't like it. Expect that the things that have frustrated you since the first day will still frustrate you now and will probably continue to do so as long as you stay at the job. If you expect that, the job will never sink below your expectations. However, at this point, you know that you are more than the job. You don't expect all of your satisfaction to come from that, because there are more areas in your life than just that.

Take Advantage of Any "Extras" the Job Offers

Some jobs suck, but have great perks. Right now, I work a job that I actually like (well, most of the time!). But, even if I didn't like it, I'd probably work here because it gets my husband huge discounts on his grad school tuition (I work at the university). Knowing that my working here helps us financially like that can make a big difference when I want to throw in the towel. Different jobs have different perks, but almost every job has at least one. My husband is a server at a local restaurant. He doesn't like it, but he gets to bring home any mistakes they make. Knowing that we'll get delicious pasta for lunch the next day often makes his shifts feel lighter and go faster. I know it sounds crazy, but taking advantage even of these small things makes staying easier.

Personalize Your Space

Put up pictures of the people who are your motivation for working. Decorate the walls of your cube with colorful material. Decorate your computer screen with sayings that inspire you. If your workplace won't allow any of those things, wear a locket with a special picture in it or carry one in your wallet. Put something small and special in your pocket so you can at least touch it whenever you want. These things help make your space, your computer, you person YOURS, and if they're yours then they don't belong to the horrible job that you hate. Once again, these things help you feel like you are more than your job, help you remember why you're really there, and help you choose to stay.

It's pretty clear that no one wants to stay in a job they hate. But if you choose to, whether because it satisfies some deeper motivation or because it's the best of a bad situation, these ideas should help you thrive there without feeling dead inside.

This article is from Sarah Winfrey of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: