RWA Series – Subscriptions

Vector subscription business model concept in flat style – pricing plan for app or website service

A few weeks ago I started an adulting series called RWA (Reading, Writing, Arithmetic). The first post focused on Writing using a technique called Bullet Journaling. Today’s post is the second in that series, focused on Arithmetic and Subscriptions.

Subscriptions are those things you sign up and are automatically billed for each month. You don’t even have to think about renewing the service because the company automatically does it for you (by way of an invoice or more frequently an automatic payment from your bank account or credit card). Items that fit this category are: Spotify (music), Netflix (movies), Audible (books), iCloud Storage and the recently popular subscription boxes (wine clubs, book of the month, beauty products). Just about every company has a Subscription model these days and why not, it’s easy cash for them!

The subscription model is a booming field. In recent years, this market has grown by more than 100% a year, increasing from $57 million in sales in 2011 to $2.6 billion in 2016. This is from a recent article in Stanford Business Journal that also predicts that, “Everything you purchase — from transportation to entertainment to groceries — will soon come with a monthly plan.”

Sure, the costs are nominal; but, this discussion is not about being able to afford the service or not. I’m sure most people reading this could sign up for 10 or more of these monthly services and still be ok financially. I say JustSayNo because once you get sucked in, it’s hard to get out. Gym membership anyone? 🏋🏽‍♀️🏋🏽‍♀️🏋🏽‍♀️

Do you remember that infomercial from back in the day about a popular cooking device that had the popular slogan, “Set it and Forget It.” That’s EXACTLY how I think about subscriptions. Often times we sign up for products/services and either use it VERY SPARINGLY or completely forget about it altogether!

When it comes to expenses, they can of course be need vs want; but, the actual payments themselves can also be PUSH vs PULL. When expenses are PUSHED, you consciously send your money somewhere for something you decide you want. For example, I saw Michelle Obama on the Today Show and decided I would like to read her new book, Becoming. As are result of that conscious decision, I purchased her book. Under this scenario, I have just given my money to someone for a product I chose.  Conversely, when expenses are PULLED you unconsciously send money to someone for something you may or may not want to experience/enjoy or chose. Sure, the monthly charge appears small (i.e. $9.99/month for Spotify); but, the real question is are you using the service and getting value from it or do you keep it around as a nice-to-have or because of a “just-in-case” philosophy.  As in, just in case there’s a new movie, book or album I want to partake in this month…

For needs (rent/mortgage, long term disability insurance, student loans, car insurance), I’m completely ok with the PULL technique – it saves me time and energy on things I know I have to pay anyway; however, when it comes to wants (entertainment, luxuries) I prefer to PUSH at intervals I consciously choose.

Didn’t there used to be a time when people wanted to decide where their money went and for what? Now, we’re ok letting complete strangers decide for us?? 🤔 Are they smarter or more in tune with our actual needs, wants and desires than we are? A popular finance blog, MoneyCrashers lists the cons of popular product-based subscription boxes this way:

  • Overbuying – While a subscription box usually costs less than buying all the items in it separately, there’s a good chance you wouldn’t buy all those items if they didn’t come in your box.
  • Unclear value – You get a different assortment of products every month, and you don’t even know what they’re going to be.
  • Problems With Returns – Sometimes companies won’t return/exchange items you don’t use. Most often people just don’t bother.
  • Difficulty of Quitting – As long as the fee is low enough to make it seem like a good deal, it won’t seem worthwhile to cancel the service.

There is a such thing as a subscription hoarder. According to GQ magazine, people spend more than twice as much on subscriptions as they think they do. The average initial estimate was $79.74 per month. The actual average was a whopping $237.33 per month. When companies uncouple your payment from your enjoyment of their product, it’s easy to forget you ever paid.

I currently have one monthly subscription- Netflix – and that’s because we actually use it. On everything else, I consciously choose to pass. Don’t get me wrong, all subscriptions are not bad; however, the adulting tip of the day in this RWA series is that when it comes to subscriptions, choose wisely!!!

What are you paying for every month?

RWA Series – Bullet Journaling

Reading, writing, arithmetic. Three (3) fundamentals taught to every child in grade school and also things I like to call the basics of life. Today I’m starting a series on these fundamentals – with a twist of course – in which I will share tips on how we can use these simple concepts in our daily lives, to help us all be better at “adulting”.

Today’s topic, bullet journaling, is tied to the 2nd fundamental, writing. Here’s a brief history before we talk about the what and how:

  • Developed by Ryder Carroll, diagnosed with learning disabilities early in life.
  • Best described as a mindfulness practice disguised as a productivity system.
  • Designed to help you organize your what while you remain aware of your why.
  • Truly about: the art of intentional living.

In essence, bullet journaling is writing down what you need to do and getting organized. If you want to go deeper on the topic, you can read a book on bullet journaling, watch a TED talk about living intentionally,  view a YouTube video on how bullet journaling works from Ryder himself (highly recommended) or even see how others are setting up their bullet journals on Instagram/Pinterest (Some of these are seriously next level… I can’t draw so I just keep my bullet journal super basic).  There’s even a bullet journal app (iOS, Android)!

Not interested in all that? Ok! Let’s get right to the question of, “How do I get started?”

All you need is a notebook and a pen (or pencil). Any notebook will do! My suggestion? (because I’m super anal about good quality paper and pens) Get a notebook you love and a pen you like.

Start by creating a mental inventory (bulleted list). Simply write down all the things you need to do, the things you should be doing and the things you want to do.

For each thing you wrote down, ask yourself:

Why am I doing this thing? Does it matter? Is it a vital activity for me (pay taxes) or for someone else? How will this enhance my life?

This is where intentionality comes into the picture. If you determine the thing you wrote down doesn’t matter or that it isn’t vital, remove if from your list by scratching it off and move on to something else! When you complete a task, mark it as complete (by putting an x on the bullet next to the task).

OPTIONAL: Sure, you can get fancy and organize your tasks or to do items by month, week, monthly calendar, create themes (called collections in the bullet journal system – i.e. books to read, restaurants to try),  color code your tasks, assign due dates/priorities and even create an index (yes, like in a book where you number each page and have a quick reference on the first page of your notebook). You can decide if your bujo is just for your personal stuff or it if will also include work as well. This, in essence, is how to bullet journal. You can organize your bullet journal however you like or choose not to organize it at all. The choice is yours!

Notes about my system/approach

  1. I do not use daily views/logs/tasks. I personally think they are too cumbersome. I prefer to only use monthly and weekly views – this allows for flexibility.
  2. If there’s a task you assigned to today, this week or this month and you were not able to get to it for whatever reason (i.e. clean the baseboards), just simply move it to the next day/week/month by putting an -> (arrow) on the bullet. This is called migrating in the bullet journaling world.
  3. As you learn more about the system and which approach works best for you, know that you can change your format/setup at any time! This month’s spread/task list may look totally different than next months and that’s ok.

Keep your bullet journal with you at all times and review your bulleted lists/collections daily.

When something comes to mind that you want to do or explore, write it down immediately! This called reflection – you should constantly re-evaluate your to do lists and update them as needed.

2019 is almost upon us so get yourself a pen and a notebook and get started! Start by writing down your goals for the new year or figuring out what collections you want to include. At the end of the year, you will have something of a master piece.

Happy Bullet Journaling!

(be sure to watch the video below for a quick overview)

Zero Debt

When you read the title of this post I bet your mind immediately thought about money. Well, I’m sorry to disappoint you but this post is not at all about money. It is about another form of debt, one that subtly creeps into our lives and creates must-do situations. Can you think of what it might be? Let’s start with the definition:

something owed; a state of owing

See, that definition doesn’t say anything about money. Debt is a state of mind, created when you feel like you owe something to someone or something. Owe as in you are obligated, there is no other choice. When we start to think about debt that way you can see how you can fall deeper into debt in any area, no credit card required.

brain-tiredI ran across an article, Busyness is a Kind of Debt. The article wasn’t what I expected but I do like the title so I want to reframe the conversation in terms of what my expectations were after I read the title. We sign ourselves up for things all time, sometimes weeks or even months in advance. We’re optimistic that we’ll have time and we over commit. The act of “signing up for something” makes us feel important or special or part of something or whatever we like to call it. Commitments are debt that creates busyness. Busyness is a kind of debt. And we all know the toll financial debt can have on you: it makes you feel overwhelmed, you stress out about it, you have to spend time and energy figuring out how we’re going to deal with it or make it work, along with a host of other emotions!

The goal of this article is not to convince you to stop committing to things or to stop you from taking on more debt. in the case of busy debt, just like when it comes to money, the maximum level you can tolerate is up to you and only you; but, unfortunately there is no bank or other entity setting a limit for you, in other words you can easily go over the limit, your limit. Yes, you can take on as much or as little debt as you want. When we think of debt in the financial sense, we know what to do when it gets to be too much: we stop using our credit cards, we cut we them up, give them to a friend to hold onto or we might even freeze them; but, what happens when you get overwhelmed with busyness? Do you know what to do? Maybe you get tired and just need some down time. What do you do when you find yourself with a string of debt affording you zero time to relax, recharge or rejuvenate. How about we freeze our busyness every now and again, get our debt level back to zero???

Take a few moments to think about the debt you create in your life. And maybe the next time we’re presented with a debt-creating/inducing situation or opportunity 🤔, we can all practice saying, “Let me get back to you on that.” Check your tank first, then decide.

Financial Peer Pressure

Before you read, L-I-S-T-E-N to this!!!!

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Over the years, I’ve noticed that moment when each of my children started caring about what other people think of them. One by one, I’ve watched as the opinions of others become a big deal in their own decision-making.  As smart, mature adults, we have a term for that: peer pressure.

game-of-lifeThis can cause all sorts of trouble in our financial lives. Instead of making financial decisions based on what will be best for us, we start doing things based on what others will think. We end up trying to live other people’s financial lives. Very few people actually pay attention to how and why they use money. When pushed, they have a hard time separating their “why” from someone else’s “why.” Not everybody you try to “model” your life after has the same financial makeup as you (income, expenses, assets, liabilities), so trying to “match” what you see in fact may work for someone else but may not work for you!

The goal is to separate what we want from what everyone else wants. Only then can we start to ignore the peer pressure we all told ourselves we left behind in high school. Personal finance is exactly that: personal. There are some basic pillars of personal finance, sure. Beyond that, all you can do is soak in the advice, learn the basics, and make decisions that benefit you the most.

The content of this post originally appeared in The New York Times and Lifehacker.

Interest = Stupid Tax

interest-rate-cutThis article I ran across this morning is BRILLIANT! The title is Pay Your F#$%ing Debt; but, to sum it up in one sentence, the author states: “Interest is a stupid tax added to your loan balance every time you make the wrong decision with your money .

This concept is best illustrated with the following example:

  • If you owe $20,000 at 5% interest and your minimum monthly payment is $150, it will take you almost 17 years to eliminate your debt and you’ll pay $12,125 in interest.

  • Increase your monthly payments by a mere $50, and not only will you be debt free 6 years earlier (yes, SIX YEARS), you’ll have spared yourself $2,710 in interest.

It always amazes me how people don’t get the simple concepts like this and consciously choose to tackle lower-interest debt first, when really the MATH shows this is not the best financial approach. You can read more of the article at Money After Graduation.