How I Grew Up Poor But Still Messed Up My Money As An Adult

money-pile-my-personal-finance-journeyThe following post is by MPFJ staff writer,Laurie Blank.  Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.

I grew up in a poor family. For a while, we were really poor. I remember one time – shortly after my parents’ divorce – when we had zero food in the house. Aside from ketchup and mustard, the fridge and the cupboard were completely bare. My dad paid child support faithfully each month, but the monthly amount of support rendered by the judge was enough to pay the house payment and not much more.

The rest of our money came from government assistance until my mom taught herself to type and got a job as a secretary. It was during this transition period that we had the days of the bare cupboard. I vividly remember my mom sitting in the recliner, sobbing with fear over how she would feed her three young kids until the welfare check came in two days later.

You would think an experience so traumatic would make me keen on saving money and staying out of debt, but instead it had the opposite effect.

How could I go through the experience of living a life of poverty and still mess up my money as an adult? Here’s how.

I Thought That People Who Had Money Had Stuff

Somehow in childhood I learned to equate poverty with a lack of stuff and wealth with an abundance of stuff. So my goal when I started working at age fifteen was to own a lot of stuff. I bought all of the clothes my mom couldn’t afford to buy for me. When I got my own home and family, I made sure we had an abundance of food, clothing and whatever else I thought we needed.

I later learned that I had a subconscious fear of not being able to afford to buy stuff, but I didn’t make the connection between the stuff and the money (or lack of it) in my bank account. What mattered to me was that I could buy whatever I wanted, regardless of the means it took to purchase it.

The Cure

The cure for this mindset mistake was to learn to think long-term. The book, The Millionaire Next Door, really helped. It was through that book that I learned that wealth isn’t about having stuff, it’s about having financial security.

I Had a Poverty Mindset

A poverty mindset consists of the belief that “I’ll always be poor/struggling for money.” For many years I believed that wealth or a lack of it was a “luck of the draw” thing. One was either a “have” or a “have not” and whatever group they were lumped in with was up to the gods; individual actions have no effect.

The Cure

Ironically, it was discovering the world of personal finance blogs that cured me of this incorrect belief. Through PF blogs, I found story after story of people who were deeply in debt, yet they managed to dig themselves out of the hole and begin building wealth. The people who shared their stories taught me that a person’s financial situation boils largely down to daily, weekly, monthly and yearly financial choices.

I Used Spending as a Band-Aid

For years I dealt with emotional problems, relationship problems, work problems and any other problems by buying stuff. I “deserved” stuff was my reasoning. I spent money to heal, to celebrate and to confirm my worth as an individual.

The Cure

The cure for this problem came when I began to work to uncover long-held emotional problems and to work through them, one-by-one. Through this technique I began to establish unconditional acceptance of myself and to teach myself what I really deserved and what I truly desired where money was concerned: financial security.

I think the take-away here is that when a person is deep in debt, there are often misguided beliefs behind the problem.  If one can work to discover what those misguided beliefs are, and to exchange them with healthier mindsets, both financial and emotional healing for the long-term can truly begin.

Do you have any subconscious beliefs or life experiences that have impacted the way you handle money?

How To Save To Afford A Car

The following is a guest post Written by Max, a consultant for Superior Honda, a premier new and used car dealership in Harvey, Louisiana.

So you have hit that point where you want to buy a new or used car, and are looking into methods to saving. Cars can be expensive; a new car’s average price can be up to $30,000. While used cars are less money, they can average around $13,000. Knowing what you can realistically afford is key to setting goals to hit. Simple math will tell you it’s as easy as spending less than you earn. However, It’s much easier said than done. Trying to save up a ten thousand dollars can be a very tough task. Setting out a plan on paper will help you be disciplined and consistent with your savings. When saving for a car there are a few things to consider beyond price. From insurance, to gas money and maintenance, the price of the car from the dealership is not the only price you will incur. Below are three steps you can take to save up for all of these costs.

Track your Expenses

This is step one. You must make note of how much you are spending each week, and on what. There are some cool phone apps like Mint that help you track all of your credit card purchases and divides them up into categories, and gives you averages. I have found that this is one of the more useful ways for me to plot out my monthly expenses. Once I figure out where I am spending my money, in which areas, I move on to step 2.

Cutting out what is Unnecessary

So now I’m at a point where I see what I spend on gas, groceries, restaurants, bars. I spend about 20% of my income on food. This number is a little bit higher than what I would like to spend. Ideally, I would like to spend around 15% or 10%. I think those are realistic goals for next month. So, on my fridge, or on a post-it-note on my desk I will write, “Spend less money going out to eat” and “Reduce weekly supermarket shopping by a few items.” These quick reminders will keep me in check, and do help me be more aware of my spending.  In the iPhone iOS 9 you can even set location based reminders. This means when you walk into the grocery store, you can get a pop-up that says “Spend less than you regularly do!” I find this feature particularly helpful.

Review Each Month

Cutting out unnecessary spending is essential towards saving money. But you may not be cutting out enough, or from the right areas in your life. Things like going out to eat, drinks, or even gas money can quickly add up. Each month you need to review your savings and plot out to see if you are on track to save enough. If you set a timeline like 12 months, you must evaluate if you continue to save at that level, where your projected savings are. This will help you revise your budget and your savings. Reforming your strategy and making tweaks each month will help you reach your goal. Feedback is the most important step in actually achieving your goals.

Hunting for House Help: Top Things to Avoid When Looking for an Estate Agent

The following is a guest post by Andrew Alexander. Enjoy! 

Even though you’re making the decision to sell your home, it’s going to be your estate agent who sells it for you. So, making sure you get the right estate agent is imperative when selling your property because this could mean the difference between not selling your home at all and getting a really good price.

The first thing to remember is that the estate agent is working for you and you’ll get the final say as to whether you sell your property for a certain price. The estate agent needs people like you to make a commission, so bear this in mind if you’re negotiating fees or being pressured into accepting a price that you’re not happy with.

How to Create a Shortlist of Agents

Before you start getting quotations and valuations from estate agents, it’s a good idea to create a shortlist based on a number of things. Some of the most beneficial recommendations you will receive are from your family and friends so find out who they used and whether they were happy with the service they received.

You should also try to build up some facts on various estate agents and your property. Look around to see how quickly a certain estate agent sells properties, how close to the asking price they get and what their success rate is. Furthermore, look for specialist agents if you’re selling a property that is unique or unusual, as their expertise will come in handy when marketing your home. You can check out the current properties an agent has to see whether they’re selling houses that are similar to yours (view it at Bridgfords, for example). If they aren’t, they might not be the best choice for you.

What Marketing Does the Estate Agent Use?

You’re also going to need to find out what marketing the estate agent does on the properties they have on their books. And one of the main things to look at is what portals they’re using to advertise properties on, e.g. Zoopla, Rightmove and Primelocation. If their website isn’t the best, don’t worry about this too much, so long as they’re using some of these other popular avenues.

You should also check that the fee they’re offering you at the start includes this form of marketing and the property details that they’ll put together for you. If you can find an agent that includes all of this within their price, then it will be more straightforward for you. However, you may find that some require an upfront fee to produce brochures and that there may be other fees involved with advertising.

Online-only estate agents are another kettle of fish as some of these won’t advertise on popular property portals and can be limited in what they offer you. For example, they may offer you a flat-rate fee which is considerably lower than other estate agents but you may have to do all of the viewings, marketing etc. yourself, so always look into the finer details before deciding to go ahead with an online agent.

Check Out Their Fees and Their Valuations

The pricing offered by estate agents to sell your home will normally vary from around 1% to 2.5% + VAT (make sure you know if they’re including VAT in their prices). Based on a £300,000 home, you could be paying between £3,600 and £9,000 for the estate agent fees. That’s why it’s worth trying to get the estate agents to compete on fees.

When it comes to valuations, you need be open-minded with what the estate agent is telling you and that you’ve made sure you’ve done your research prior to them visiting. You may find that some estate agents will be overly optimistic with their pricing in order to get you to go with them before trying to talk the pricing down once you’ve signed on the dotted line. Equally, you may find that some are more straight-talking and will be honest about the realistic price you can get, telling you not to be fooled by any valuations that are too high.

By doing your own research and looking at similar properties in the area, you should be able to get a good idea of what your property should be worth. And, by asking more than one estate agent to come and value your property, you’ll be able to get a ballpark figure of your property’s value. Remember – you get the final say on what you want your property to be priced at, not them! However, being realistic could help you to sell your house in a quicker time frame instead of trying to push for a higher amount that is too optimistic.

Do You REALLY Want to Be Rich?

The following post is by MPFJ staff writer, Marie. You can read more of Marie’s articles over at her own blog, Family Money Values. Enjoy! 

Let’s face it, most of us aren’t part of the elite 1% financially.  Many of us live paycheck to paycheck.  A lot of us using part of that paycheck to service our debts.

As of 2014, in Canada, the median income was $78,870.  However, the average salary in Dec of 2014 was just over $49,000 (Statistics Canada). Canadian consumer debt topped out at $21,348 in early 2016 (CBC News).

Forty Nine Grand isn’t a lot to cover the cost of housing, food, transportation, education, health care and entertainment for the typical family of four, let alone trying to get those debts paid off and put something aside for old age.

Perhaps we struggle through our daily lives, rising groggily for that 5 AM buzzing alarm to hit the road to hang onto that 9-5 job; searching all avenues to find the best prices on the items we need or want to buy; choosing between paying down the credit card or the mortgage; and shopping that garage sale instead of buying retail while wondering how life would be different if we were rich.

Who hasn’t bought a lottery ticket, knowing the odds against winning are substantial?  The mere possibility of having gobs of money raises visions of luxury and abundance in our minds.


A Vision of what it is like to be Rich

Just think about it!  You would not have to work for a living, someone else would clean your house, mow your grass, and worry about paying the bills.  Vacations would be a blast – whether staying at your own vacation villas in different parts of the world, touring the world from the deck of your condo/cruiser or taking off in your private jet for a dinner meeting in another city.

You would never again have to decide whether to pay down the credit card or beef up your savings; wait to buy the latest tech toy; or dream about having your own swimming pool.

The vision is tempting, but is real life as a rich person really going to match that vision?  Probably not.

There is a reason that old saying ‘The grass is always greener on the other side of the fence” is still around.  Even Royals may wonder – as in the musical Camelot when GUENEVERE sings:

” What else do the simple folk do  To help them escape when they’re blue?  and King Arthur answers:

“They sit around and wonder what royal folk would  do And that’s what simple folk do”

Wondering how the other half lives is a prime pastime, allowing folks like Robert Frank (CNBC & Secret Lives of the Super Rich host) to even make a good living from exploring the topic publicly.

What being rich can mean

Becoming rich won’t make you a new person.  Being rich won’t fix most of the things you feel are wrong in your life.  Rich or poor, we all have issues.  We all make good and bad choices.  The rich just have more opportunity to make the bad ones!


What can be good about being rich

You have financial independence – no more trudging to that boring 9 – 5 job each day.  You can do what you want, when you want (as long as you know what you want!).  Riches usually bring a level of comfort to your situation.  It reduces stress to know that you have the backing to keep your life from tanking if a few things go wrong.

You have the financial ability to pursue multiple interests.

Lets face it, sometimes pursuing opportunities, hobbies or interests costs money.  You can set yourself up in your own business, move to that elite neighborhood so the kids can team up with neighbors in the know; start that charitable organization to help out your favorite cause or buy and restore that vintage auto.

Being rich provides opportunities to help others.  Money can help you make a difference in your world – allowing you to sponsor the education of a child in your area; helping out that senior who can no longer get out to maintain her home; or even just shoot off a check to your favorite political candidate.

Money helps you make more money. 

It can be a great passive income generator if you invest smartly – allowing you to maintain your new level of wealth and perhaps even pass it along to your next generation.

Riches can solve problems.

Having plenty of money may help alleviate some stress and help you sleep better – no more staying up worrying about paying the bills.

Wealth allows you to get where you need to be.  You don’t have to plan months ahead to catch a flight or get to that event – you have the backing needed.

If you have medical issues, wealth can help.  You can afford that special medicine or ignore the constraints of insurance.  In fact you may decide to enlist special health care, such as concierge doctors.


Some of the potential negatives rich people may experience

No matter how rich you are, it is probable that you can’t have all of the things you want all of the time.  Like the rest of us, you are limited to enjoying some of the things you want (but maybe all of the time) or all of the things you want (but maybe just some of the time).  Rich people still have to make choices about what they spend.

Being rich might make you a target.

Many really wealthy folks try to hide their wealth, attempting to avoid situations where relatives, friends and strangers ask for money.

Rich folks may have security issues.

Depending on wealth level and general public knowledge of their wealth, the rich may need to have safe rooms, bodyguards and may worry about their children being kidnapped and held for ransom.

Wealth can make you subject to lawsuits.

It is an unfortunate fact that the world is full of unscrupulous folks who might make unjustified accusations about you – filing lawsuits to try for some of your wealth.

Some rich folks work long hours at high stress jobs.

If you earned your wealth, there is a good chance you have been and will continue to put in long hours to keep the money flowing. Work life balance remains out of kilter and health issues can result.  Time away from home affects family life and relationships.   In fact, it can be a major complaint for children of first generation wealth producers.  They don’t really develop typical relationships with the earning parent.  That parent is not there.  The child is raised by surrogate parents, like nanny’s or sitters and can only see the parent from afar.

Having money may result in behavioral expectations.

The sad story of Princess Diana comes to mind.  The Queen, the Prince and others in the royal household had definite expectations about how she should look, speak and behave as well as the kinds of activities in which she should engage.  If expectations don’t match your desires, problems result.

Privacy may be at a premium.

Not only may you be surrounded at all times by household or other employees, you may also be subjected to pestering by the press, or the public.  What you do, say, spend on or wear may become news!

Managing household employees may not be your cup of tea.

Although it might be great to never have to dust or clean out a toilet bowel, I doubt if it is much fun interviewing or managing maids, gardeners, butlers and the like.  Having to let someone go is a stressful event, yet you can’t allow shoddy work, right?

You may lose your sense of worth or purpose.

If you become rich, you may find that striving for money and having it are two different feelings.  While you are striving, you are working towards a goal, making an accomplishment happen.  Once you are there, you may look around and say, so – now what.

Your kids may grow up spoiled.

Giving children everything even before they think of wanting it can lead to a sense of entitlement.  How do you raise grounded kids when you are rich?  What is your logical stance for having them learn the value of work – when you pay other people to do yours?

People may treat you differently.

Stories of lottery winners losing life long friends abound.  People knowing about your wealth can make them treat you differently, or cause them to expect you to behave differently (like pick up the tab for everything!).  Former friends may start to exclude or ignore you.  You may be treated with (undeserved) obsequious behavior by strangers in hopes of favors.

You may either give up some control over finances or spend a lot more time managing investments.

Having money brings the responsibility for making sure it is managed well.  Doing it yourself may eat up more time that anticipated.  Having someone else do it results in a loss of control and a less than desirable sharing of private information.

You aren’t inhibited financially from making really bad life choices.

If you have a propensity for drinking, gambling or drugs, finances are no longer an issue.  You may find yourself deep in an addiction cycle.

Likewise, you can’t blame a lack of funds for avoiding pursuit of opportunities that come your way.

Although many of us think we want riches, having them isn’t all cake and pie.  Money is only a tool.  It won’t make you a better person, give you everything you want or make your life paradise.

So, are you sure you really want that the rich life?

***Photo courtesy of

Training Plan: Endurance Cycling and Personal Finance

The following is a guest post by Troy Lambert from TroyLambertWrites. Enjoy! 

On March 11, 2016, I tore a calf muscle playing basketball with my son. I went up to shoot a three point shot, felt a sharp pain in the back of my calf like someone had hit me with a racquetball or stabbed me, and collapsed onto the court.

One week later on March 18th, I got married. It was the most expensive party either my wife and I have ever thrown, and it was a stretch to say the least. She has some health issues, and we took an unexpected and expensive trip to Seattle for treatment a little over a month before the wedding.

Financially and physically, we were at a low point. We needed a plan to get our finances back on track, and I needed to get back in the gym and on my bicycle. I didn’t know it at the time, but I would spend the last half of the summer training for a mountain bike race involving 53 miles of gravel road. Our plan for financial recovery and my training plan have some interesting parallels.


Moving Forward is Key

I’m a writer, and writing is a business. In both business and personal finance, we often hear that cash is king.

We ended the wedding with little cash, but with good cash flow. While physically injured, I had the potential for rehab and healing. That potential and our cash flow were more important than my actual strength or our financial position at the time.


Have a Plan

For our wedding day itself, we had a budget: planning a wedding is like starting a small business you plan to run for only one day and never expect to profit from. We suffered financial setbacks in that process, but managed to cut where we could.

Once we were past the big day, we needed a recovery plan. We needed to renew our savings and pay off any debt we incurred in the wedding planning process. However, just as in training for a cycling race, a general plan wouldn’t do.

  • Specific short term goals need to be set. Whether those are miles for cycling or dollars for savings, these need to be reasonable and achievable, but aggressive enough that reaching your goals will not be easy.
  • Milestones with a contingency plan need to be established. To successfully complete a race, you need to reach certain mile counts by specific dates set by your training plan. If you have not met them, you need to decide what that means, and how you will make them up, or reset your goals more aggressively. It is the same with savings and budget: aggressive milestones that stretch your income need to be set and established until you can achieve stability.
  • Relax and Level Out. In every training plan you need to take days off for rest. During recovery from a financial setback, you need days off too, whether that is a date night out, or a family fun day where you allow yourself to splurge, at least a little. Once you have reached a certain financial or physical fitness level, adjust your plan to maintain your current level while allowing for growth at a more reasonable pace.

Having a plan is one of the most important keys to success. However, it is rare for things to work out exactly as anticipated.


Priorities and Plan B

Contingency plans are one of the most difficult things to do under any circumstances. Whether in endurance training, personal finances, or business, the issues are similar. You have to anticipate what could go wrong and determine what you will do if it does.

Injury. Injury can be physical or financial. Essentially this is a loss that impacts your ability to achieve the final goal. In finances this can be any monetary setback, from job loss to an unexpected car repair or hospital visit.

Theft. While injury is accidental, theft is loss intentionally caused by someone else with the intent to harm you. Not only does this hamper your ability to achieve your goal, but can affect your confidence in your skills.

Acts of God. During cycling training, there was a wildfire in our area that filled the air with smoke to the point where it was unhealthy to breathe. While there were indoor training options, none of them truly replicate mountain biking on gravel adequately. Financially, natural disasters can occur that you are not prepared for.

How do you deal with these setbacks? First, set priorities. What are the most important financial obligations you need to meet, and what can be pushed off until later? Do you need to dip into savings?

Second, deal with the issue at hand. Whether that is shifting resources to cover an injury, reporting and following up on theft, or dealing with insurance or whatever method you have in place to cover Acts of God, taking care of the problem before it gets any worse is essential.

Finally, reestablish a recovery plan. This is your path back to Plan A, and stability. This may look different than your original plan, as you may have learned things through setbacks.


Ready, Set, Go!

You set out on your financial plan with a goal in mind. Whether that was simply to have a cushion in savings, a dream vacation, or purchasing a new home, at some point you will have reached the starting line of your goal. In cycling terms, it’s race day.

The first part is probably uphill. Races usually start this way. The first part of vacation will be the outlay of money for plane tickets and hotels. The first few months of owning a new home will be filled with furnishing and fine tuning the space to make it yours.

Things even out at the top. Once you have passed the initial expenses or the first hill of the race, things get smoother, and moving at a steady pace is the most important thing. Slowing down means you won’t reach the finish as soon as you have planned, speeding up means you may run out of energy or money before the finish.

Finish Strong.  It’s likely this one financial goal is not your last, nor are you only going to ride in one race, then quit and stop cycling entirely. Each goal accomplished gives you confidence to move on to the next, so finish each as strongly as you can.

There are many things we could compare to personal financial planning, but if we think of it in terms of endurance cycling, it can help us think in terms of the long run. Always moving forward, having a plan, setting priorities and having a plan B, we will be able to achieve our goals and then some.

***Photo courtesy of