2015 Review, Part 3: What Didn’t Work

After reviewing what did work for me in 2015, I wanted to write about what didn’t. Most of these weren’t total disasters so much as they were things that turned out not to fit with my life or personality, or else they were things that worked at one point but not any more (or that aren’t working now but might in the future.) That sounds so vague! Let’s go to the examples, divided into three categories: danger zones, tools, and accounting practices.

Danger Zones

These are the things that tripped me up this year. It turned out, somewhat to my surprise, that I didn’t have too much spending that I’d categorize as real “gremlins.” The cash spending also helped me with something I already knew was a trouble spot: excess or wasteful spending on groceries, and spending on coffeeshops. But there were a couple of places that, reviewing the year, I learned I need to keep a better eye out for in the future.

First up is Zulily, the site where I spent most of my clothing money for the year. In the post I wrote about it earlier this year when I discovered it, I said it was great but dangerous, and this is still the position I take. But I wasn’t quite wary enough of it! I had such good success with my first two orders, where I loved everything I bought, that I got a little trigger-happy. Since you can’t return anything you purchase, it’s risky, and I ended up with several hundred dollars in spending on clothing that technically fit, but that I didn’t find flattering. I’m in the process of selling some of that on ebay, and hope to make a fair percentage of what I spent back, but still, I need to be really conservative about my use of this site going forward. I’m too used to being able to order a bunch of stuff and return what doesn’t fit.

Second up is that, reviewing my net worth and spending posts, I realized something I should have before: I need a summer budget, basically specifically for produce. My $300 cash draw works great for groceries and the smaller quantities of less expensive vegetables and fruit (apples, kale, sweet potatoes, squash, etc) that I buy during the late fall, winter, and spring. But when the berries start to show up, followed by stone fruit and tomatoes and eggplant, I wanted to take advantage of that and also to buy large quantities for preserving; and I found myself stretching my cash, then needing to use a credit card at the grocery store and/or “borrowing ahead” from next month’s cash, which was really unproductive and caught up with me eventually. For next summer, I’m setting a separate budget of $500 (for the whole summer, not per month) for produce, and I’ll start funding that category out of my January paycheck so that it’s built up by the time the farmer’s markets get going again in June.

Tools

First up: I just have too many checking accounts right now. This is an artifact of low interest rates, basically; I opened one account in order to get a $300 sign-up bonus, another account because of its $20/month payment to me (as long as I use direct deposit and bill pay with them), and then I still had my checking account with Capital One 360. Overall, because I had these two checking accounts I probably netted about $450 this year (not sure yet how much tax I’ll have to pay on them early next year.) But lately they’ve been driving me a little crazy. It just takes too long to transfer money around (two days here, two days there, more if there’s a weekend….) Plus, I think that if I’m going to have a second checking account that isn’t CO360, I’d like it to have a physical branch in town so I could use that for the occasional time when it would be nice to have one around. So, my plan is to cancel both other accounts in January and transfer my direct deposit and bill pay to the CO360 account. I might have a lot of savings accounts, but I’ll just have one bank and I think I’ll appreciate the simplicity.

The second set of things that didn’t really work for me in 2015 were the two tools that were quite important to me during 2014: Swagbucks and Usertesting. I still recommend both of them as ways to make small amounts of income, but as 2015 went on, I found that they were both distracting me from my main work, rather than supplementing it. I quit doing anything except the most passive stuff (search defaulted, etc) with Swagbucks, rather than actively trying to meet daily goals and get bonuses and do surveys, and I did my last usertest a few months ago because I was beginning to find that having the window open and “dinging” in the background was making me anxious and distracted. I’m very open to doing freelance work in the future, but at least for now, I want to mostly focus on what I’m “supposed” to be doing during work hours.

Finally, the various ways of making money off the blog are also not working out that well 🙂 My major goal here is to make enough to pay for the blog itself — hosting and whatnot — and I’m still $20 away from my first Adsense payout, which I probably will get sometime in 2016. I also made about $30 in 2015 off affiliate links. So I’m getting there in terms of paying for hosting, but not there yet. I’ve hesitated about whether or not to try for things like sponsored posts, but I’m also worried about alienating readers and — see above — about getting distracted from my main work.

Accounting Practices (Warning: Very, Very Boring)

This is just a learning curve. This was the first full year I kept a proper budget and as it went on I settled into writing net worth and spending reports. (If you look at the earliest few I wrote for the blog, you’ll see it took me a while even to settle on a format, and my budget categories were pretty protean for a while.)

I was also getting used to using YNAB, where one signature feature is that you “live on last month’s income.” So, money I make in December is budgeted for January. Fine. The problem is that I found it hard to resist moving the money designated for savings right away, heh. I didn’t have a problem waiting to spend the spending money, but I did have a problem waiting to save the savings money! This isn’t a real problem but for boring technical reasons it made writing net worth updates annoying. I’m going to change how I deal with this beginning in January, so my numbers may look weird then, but ultimately it’s not a big deal.

Another thing I did was to count my second monthly retirement contribution in my month’s income even though it doesn’t usually show up until later. When I get paid on the 30th of the month, $250 (currently) is deducted for my 403(b). However, it doesn’t show in my Mint account until the first or second business day of the new month. I’d been just adding $250 to whatever showed in that retirement account, on the grounds that I had actually been paid that money already, but it’s been bugging me that it means the net worth updates I post don’t quite match what shows in Mint or Personal Capital. So I’m changing that in January too. It’ll make the first month look skimpy, but after that it will even out (back to two contributions/month) so it won’t change much on the reader’s end, just on mine.

Finally, I talked in earlier posts about how I don’t quite know what my savings rate is. That’s because of some confusion over the difference between savings and planned spending. Specifically, the issue here is my travel savings account — or is that my travel budget? Problem is, I’d been reporting my contributions to my travel savings account as “savings,” which in one sense it was. But often enough I turned around and took money right back out for a trip. Which figure counts for my savings percentage? I don’t know! What I’m going to do in 2016 is make travel a sinking fund in my “spending” budget, rather than a savings line. As my savings percentage I’ll only count what goes into longer-term accounts (retirement, emergency, down payment.) I’ll allot my normal $250/month to travel, and roll over what I don’t use from month to month, but I won’t count that rollover as savings.

I can’t imagine that anyone is all that interested in my accounting practices but since my numbers will be somewhat affected, especially in January as I put the tweaks into place, I figured I should air it all somewhere.

 

15 thoughts on “2015 Review, Part 3: What Didn’t Work

  1. Amy says:

    I love this post! It’s not boring at all. I also have “budgeting” and “savings” issues. It seems like there is never any savings because it is all planned spending– just not “right now” spending. I find that percentages don’t work for me, just solid dollar amounts when it comes to putting money aside for future goals. Our income fluctuates each month, but so do the budget categories and amounts. Urgh!

    1. thesingledollar says:

      Hi Amy — glad you liked it! Don’t we all have “budgeting” and “savings” issues, when you get right down to it? 🙂

      I also totally avoid percentages except for my savings percentage; I don’t want to get trapped by the idea that I should be spending 30% on housing or whatever.

  2. I support this, especially removing your travel budget from your NW. For me, a drop in NW usually means something bad happened: medical bills, bad markets, taking on debt. I don’t want any of those negative feelings associated with travel.

    Zulily sounds dangerous. No return policy? I’ll stay away.

    Also- not a boring post. These are the little things I spend too much time thinking about.

    1. thesingledollar says:

      I’ll leave the travel money in my net worth — I just want to stop counting it as “savings”. I agree — I don’t want negativity associated with spending the travel $$ — speaking of which, welcome home!

  3. ARBM says:

    This is totally not a boring post… I really like reading about how others budget, save and figure out their finances. It really helps me see the other options out there and helps me figure out how to make things work best for me too.
    I think it’s a great idea to budget and save up for the known added expenses of the summer preserving season.
    I think I may start tracking my net worth and my savings rate in the new year, and so I’ve been debating on whether I should include my planned spending funds, like travel and home renos, in that calculation… and sort of consider it savings… or if I should leave it out, since the plan is to eventually spend it… I’m glad that I’m not the only one having that debate, and with your decision to leave it out, I may lean that direction myself…

    1. thesingledollar says:

      I am going to keep including unspent travel money in my net worth, but leave it out of my savings rate — that seems like a totally fair balance between the reality that I have the money in hand, and the reality that I intend to spend it soon!

      1. ARBM says:

        That totally makes sense… Having that money on hand does increase net worth, so it makes sense to count it, but as you do say, it isn’t really “savings” because the intention is to spend it… Hmmmm… I like it… I may do that as well.

  4. Leigh says:

    Fully living on last month’s income was easier for me when I got paid once a month. I get paid twice a month now and it’s taken some experimenting to figure out what to do with it. I’ve finally decided I’m done with budgeting (but will still track my spending) and I’m just going to deposit all income to my savings account and then transfer 1/12 of the previous year’s spending to my checking account on the last day of the month. That’ll help smooth out my cash flow issues with ESPP and front loading my 401(k) and be just awesome in general! I’m excited for my new 2016 experiment.

    I remember counting travel as savings my first year post college but now it’s just part of my normal spending which is all highly variable to be honest. Savings for me is my contributions to retirement, HSA, general and tuition savings, ESPP, mortgage regular and extra principal payments, and taxable investments less withdrawals from any of the above. Part of why I started counting the withdrawals is that I contribute to ESPP each paycheck and the sell once the shares are purchased and reallocate the funds to other savings goals and I didn’t want to be double counting that savings or avoiding counting it until the stock sold either. It also helps with the planned spending case of tuition.

    I do count my checking account in my net worth because until it’s spent, it is still my money and I could always change my mind on some planned spending plans.

    1. thesingledollar says:

      I just had to google “ESPP” — now I learned something for the day! I agree that it was easier to “live on last month’s income” when I got paid once a month. It seems so weird to just let the first paycheck of the month sit around and wait for two weeks before I do what I was going to do anyway and put it into a savings account. It never occurred to me to have the check direct-deposited into savings and then just move $X into checking, though. That might be a good psychological solution for me.

  5. I’m never quite sure how to calculate our savings rate. Is it just the amount you put into your accounts? Or is it net for the year? Because we socked away plenty, but about $7k went into various repairs.

    It sounds like you’ve gotten some good introspection for next year, which is what matters in the end.

    1. thesingledollar says:

      I calculated as income vs expenditures for the year — that’s how I got to my 51% figure, even though some of the expenditures came out of money that had been saved the previous year. If I hadn’t counted those as expenditures the rate would have been a bit higher (although not *that* much higher.) I’m not sure there’s a perfect way to do it, much like with calculating net worth where people have different ideas about what assets to count. I agree it’s all really about tools for self-reflection!

  6. Budgeting seems to be a learning curve. Every year we budget, we learn something new. This year’s discovery was the same you had, saving for “planned spending” should go under expenditures, not savings. You live and learn. Next year we are planning to include only “long term savings” into our savings percentage 🙂

    1. thesingledollar says:

      Hello! Sorry it took me so long to approve the comment — I’ve been traveling for the holidays. Nice to meet you. And yeah, “live and learn” seems to be the basic rule of budgeting 🙂

  7. I hear you about Zulilly. I’m generally pretty good about deleting the emails without opening them, but every now and then I do, and it’s not pretty. For example, I bought 5 pair of Crocs for myself and my daughter last May or June. We wore them all summer, but, still…

    1. thesingledollar says:

      Hee! That is a lot of Crocs. Hopefully you can wear them for a few years (well, you can, anyway, your kid probably grows out of shoes more quickly than that.)

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