I'll tell you what I want

Identifying your needs v. your wants is hard. But identifying your wants is easy . . . isn't it?

No. What drives the industry of consumer debt is not just a lot of people buying what they don't need. It's fueled by our inability to recognize when we're jonesing after things we don't even want.

For those of you who weren't English majors, my blog title is actually stolen from Vanity Fair (the novel, not the magazine.) It's one of my top ten fiction-for-personal-finance books.

The book's anti-hero, Becky Sharp, is the smart and unprincipled daughter of a drawing instructor and an opera singer. She's educated as a charity case in a girls' school and is expected to earn her meagre living as a governess, school teacher or companion for little old ladies. But Becky wants real money, not some pathetic stipend. And she'll do anything to get it.

Poor girl! She explains herself: "I think I could be a good woman if I had five thousand a year. I could dawdle about in the nursery, and count the apricots on the wall. I could water plants in a greenhouse, and pick off dead leaves from the geraniums. I could ask old women about their rheumatisms, and order half a crown’s worth of soup for the poor. I shouldn’t miss it much, out of five thousand a year."

It's a lovely picture, isn't it? Gentle indolence, painless charity, a quiet life governed by the seasons. Maybe it'd work for some people, but for Becky Sharp, it'd be like trying to use a racoon as a messenger pigeon. Not only is the attempt doomed to failure, a racoon's not something you want hanging out in the pigeon loft.

We all have similar mental images of things we think we want. How about your kitchen? You'd like to take out the old cabinets and the lino floor. You want cherrywood, granite, a Viking stove, stainless steel appliances, and probably a marble board for kneading bread dough. (Bakers say there's nothing better.) Perhaps you have a mental image of yourself, channeling Julia Childs. You can see the bunches of fresh herbs on that granite countertop, almost smell the peppers you're chopping as you prepare for a dinner party. Your face is serene. Your kitchen is spotless. Your kids are behaving or have mysteriously disappeared.

If you are a lousy cook and dinner parties stress you out, spending a fortune on new countertops will not change Real You into Imaginary You.

Too many of our mental images of "living well" are from some car commercial or Martha Stewart magazine. You know what? Doing nothing all day sucks. I don't like to travel, unless it means I get to play in the ocean. I don't make my own bread. I have zero interest in a graduate degree. Think of all the money I've just saved myself on trips to Europe, KitchenAid mixers, tuition and early retirement.

Here's your challenge: look over your personal List of Wants and cut out what you don't actually want or wouldn't really use. (Hint: a huge amount of recreational equipment goes in this category.) Permanently eliminate three items. I think you'll be surprised at how much you think you want but don't.

Now take those three items and figure out why they were on your list in the first place. Did you list granite countertops, when what you really want is to be the kind of person who cooks with fresh herbs and throws dinner parties? Buy a cookbook instead. Mark Bittman's How to Cook Everything is $14.93 at Amazon.com. Twenty five square feet of granite countertop will run you around $2500. Yes, you just saved $2485.07. Congrats.

Accountability

One of the hallmarks of good goal-setting is a system of accountability. I hate that.

As a single woman, I do what I want with my money. This is one of the big upsides to being single, IMHO, but it also means I can run fiscally amok. I could, for instance, buy over $500 in out-of-print Signet Regency novels in PDF form. (Not that I would do that, or anything. Oh, damn.) I suspect that a financial partner-for-life would look at me and say, "WHAT THE HELL IS WRONG WITH YOU, WOMAN?"

How did I get sidetracked onto that embarrassing confession?

Back to accountability. It seems to me that one of the purposes of personal finance blogging, from the blogger's perspective, is to encourage accountability. You see, I don't need accountability in the flesh, nagging at me in the grocery store. I already nag at me in the grocery store. What I need (what many of us need) is a place to post the goals and then post the small steps to completion, or the setbacks. By publicly declaring that we will beat the debt, save the money, buy the house or ditch the shoe habit, we have started writing our own stories for an audience. And we, as authors, love happy endings.

(And I, as someone who has spent too many years telling stories and studying literature, am very hung up on the significance of narrative creation. So I think everyone frames life experiences into comprehensible plotlines. So sue me.)

Here's the deal, dear reader. I write down how I'm doing. You read. You occasionally add a comment, such as, "$500? You're smoking crack." Validated, I write down how I'm doing. Et cetera. Thank you for joining my therapy group.

Smart goals

Why "Smart Goals"? They sound better than Stupid Goals.

SMART is also an acronym for Specific, Measurable, Attainable, Relevant and Timely. I'm not a major fan of the cute acronym, but it is a good way to double-check goals for practicality.

For example:

I want to publish a novel.

Unfortunately, I don't run any presses, so this goal is not attainable without modification. Setting up a goal that depends on the money and goodwill of major publishing companies (or your spouse or your bank or the financial markets) is a big mistake. Good goals focus on personal actions, not desired results.

I want to finish my current novel.

Better, but still missing some basic points. When? What do I mean by finished? (You think there's one answer to this, try it sometime.)


How about this?

I want to work on revising and completing the rough draft of ECHO for at least 30 minutes every weekday. By June 15th, I want it copy-edited, formatted, printed, and mailed to my agent.

Now that's a goal. Specific, measureable (both in progress and completion), attainable, relevant, and timely.

This will keep me busy from a creative standpoint for some time.


On the financial side:

I want to pay off all debt except for my mortgage through accelerated payments or the "snowball" method by 2/28/2010. The total amount is approximately $15,800, and my current rate of payment is about $500 per month. In order to meet my goal, I need to pay an additional $160 per month.

There will be lots more on the subject of snowballing, budgeting, frugality and debt repayment, but this is a good start. If you can't wait for my words of wisdom, please head over to Paid Twice, one of my favorite M-Network bloggers.

Living the vida loca

I always wanted to publish a novel. I know, that makes two of us. But I was so close. I have an agent. I have a finished manuscript. I've gotten encouraging letters from editors. And then.

Then I stopped working on it.

This may seem nuts, but it came out of a concatination of messy life events. I won't bore you with the details. I'll just mention they include a corpse, a PI license, and a plane ticket to Zürich, and we'll leave it at that.

So these days I'm living the American version of the vida loca. I have a mortgage and credit card debt. I want to redo the bathroom. I work 40 hours a week for a midsize company, and Powerpoint has become part of my life.

I hate it. My job isn't bad at all; what I hate is the realization, which hits late at night, that I have abandoned my dreams for the sake of a 401(k) and decent health insurance. There has to be a better way.

So this blog has two purposes: to document the journey from corporate working bee to cool artistic type, and to explore ways to finance the dream--my dream or yours.