First Quarter 2013 Expenses

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Although I preach conscious spending over budgeting, tracking my expenses is a good way for me to scrutinize my expenses after the fact. I don’t claim to be a perfect conscious spender, so this is the time to make sure I’m not letting discretionary spending get out of hand. In the spirit of personal finance and transparency, I present my expenses for the first quarter (January through March) of 2013. After all, what would a personal finance blog be without some financial figures?

Housing: 2113
Utilities/Internet/Phone: 364
Food: 2024
Transportation: 477
Travel: 2430
Gifts & Charity: 786
Other: 1095
TOTAL: 9289

I know some people like to do these expense summaries each month, so just divide my numbers by 3 to get the estimated monthly spending. Tracking my spending every quarter instead of every month helped ease my fixation on money. Although I’ve eased off my money obsession, these summaries will continue to come out quarterly unless it makes more sense to do them monthly. Now for the details…

Housing – $2113

This amount accounts for half of three months worth of mortgage + escrow payments. The “wife” pays for the other half. Additionally, escrow payments are designed to have excess amounts to cover future tax and home insurance payments. We’ve received escrow reimbursements every year, so I expect some of this amount to eventually come back to our pockets.

Utilities/Internet/Phone – $364

Similarly, we go halfsies on the electricity, gas, water, alarm system, and internet. Right now, we each have our own cellphone plan. I share a family plan with my parents, and the monthly charges averages to about $23 for me. The plan doesn’t include a data plan because we’re stuck in the dark ages late adopters. With the temperatures staying cool here in Texas, the A/C hasn’t been turned on much, and that kept the electric bill relatively low. In a few months, the electric bill will jump up by 50-75% as outside temperatures rise.

Food – $2024

Man, oh, man. This quarter, we spent $1195 on groceries, $637 dining out, and $192 on alcohol alone. At least this fed two mouths instead of just mine. Other times, we fed over 25+ mouths when we had a graduation party for the “wife”. Two trips (one to Austin for SXSW and the other to Colorado for a snowboarding trip) encouraged us to dine out often as well. The alcohol was consumed during the graduation party and the Austin trip. We’re not alcoholics…promise. Regardless, we need to trim this down a bit. We started taking weekly meal planning more seriously, so that should help with the grocery bill.

Transportation – $477

Nothing much to say here other than my commute to and from work costs about $150 per month even while averaging 32 mpg. I have three options to lower this expense: 1) move closer to work, 2) find employment closer to home, or 3) telecommute some or all of the time. Currently, I am pursuing option #2.

Travel – $2430

The snowboarding trip makes up 85% of this quarter’s travel expenses. It sure is an expensive hobby, but oh so fun! With flights, lodging, rental car, and lift tickets for two, expenses add up quickly. This is most likely the one big trip for the year, so I don’t expect travel expenses to be this high for the remainder of the year. The remaining $367 is from buying miles and points for airline and hotel loyalty programs…part of my travel hacking hobby to subsidize all my travel aspirations. Hopefully, I’ll get to redeem them for an epic trip.

Gifts & Charity – $786

The bulk of these gifts were snowboarding gear for the “wife”. Clothes that are breathable, waterproof, and insulating all at the same time tend to be expensive. Since we plan on partaking in this hobby in the future, we are better off paying a little more for quality this time around. The charity portion includes the $100 registration fee for an upcoming bike ride to raise funds for multiple sclerosis research.

Other – $1095

All other expenses such as entertainment, gym membership, medical, sporting goods, haircuts, and business expenses got lumped into this category for simplicity.

  • Entertainment consisted of Netflix, paintball, and the movie theater (once).
  • With all my training on the bike, I haven’t had the chance to really make use of the gym pool. I cancelled the gym membership at least until I finish the MS 150 bike ride in April. There is a free gym at work to help me with my weightlifting goals, but I need a pool for lap swimming. Once it starts to get hot and humid here in Houston, the pool will be a nice treat.
  • I haven’t had the confidence to cut my own hair, and I’m not sure if the buzz cut suits me (can you even DIY other hairstyles?). For now, my $12 haircuts once a month will do.
  • Business expenses include hosting for this website and adding a privacy filter on the domain registration.

Total – $9289

I definitely think this quarter’s expenses were higher than normal. Given this total, the annualized expenses would be just over $37k. The total without mortgage payments comes to $7917 this quarter; just over $31k annualized. I should probably be alarmed at these totals since I’m targeting expenses to be under 30k, but other metrics like net worth growth and savings rate tell me I am in a healthy position. Regardless, I’ll work on getting these numbers down this quarter.

One thing to note is the mix of combined and separate spending for me and the “wife”. We’ve kept our finances quasi-separate. We go halfsies on simple expenses like the mortgage and utilities. When it comes to discretionary purchases, we mostly pay separately. Don’t ask me when we will combine our financial houses. For now, this seems to work just fine.

How did you guys do this quarter/month with your expenses? Do you prefer quarterly or monthly expense reports?

Fighting Multiple Sclerosis One Bike Ride at a Time

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One of the things I always talk about on this blog is staying active. Not too long ago, I made it clear that biking is one of the great ways to stay active with this fitness challenge. I never thought I would take it to another level…

I’ve done it. I’ve signed up for the MS 150.

The MS 150? What’s that?!

The MS 150 is a two-day fundraising bike ride from Houston to Austin benefiting the National Multiple Sclerosis (MS) Society held on April 20-21 this year. That’s a 180-mile journey in two days! Fortunately, there are break points stationed every 8-15 miles, so this ride should be manageable. There are several of these bike rides organized around the U.S., Canada, and Australia. However, this particular bike ride is the biggest in North America. In 2012, 17.5 million dollars were raised from donations. That’s a lot of moolah to fund our fight against MS.

Previous to signing up for this ride, I was oblivious of MS. Just like doing due diligence before making any investment, I had to learn about the cause I was supporting. This has certainly been an eye-opening experience as I learn more about MS. Here are some of basic things I learned about MS:

  • MS affects the central nervous system (the brain, optic nerves, and spinal cord).
  • MS is caused when the immune systems incorrectly attacks the protective fibers, myelin, surrounding nerve fibers of the central nervous system. This results in interference in the transmission of nerve signals.
  • Symptoms can range from intermittent pain to permanent paralysis. The scary part is that episodic symptoms can occur at any time without warning. Other symptoms include slurred speech, blindness, loss of balance, poor coordination, and more.
  • Approximately 400,000 Americans have MS, and approximately 200 are diagnosed every week. MS is very difficult to diagnose because symptoms come and go. Currently, there is no single test to definitively diagnose for MS.

There are some treatments such as prescription drugs and therapy to help manage the disease, but they may carry adverse side effects. These treatments can slow the progression of the disability and lessen the frequency of relapses. Unfortunately, there is currently no cure for MS. 

This is where we can make a difference. I give you the top 3 reasons why you should support me and donate to this cause:

  1. Fight the good fight and help fund MS research - In the spirit of transparency, the National MS Society outlined the 2011 fiscal results here. For every dollar, 78 cents directly funds Community Programs, MS Research, National Activities, Professional Training, and Public Education. This is an opportunity to help the lives of those affected by MS.
  2. Support me in my personal goal of completing the MS 150 well - Not only am I riding and fundraising to support a great cause, I am riding to accomplish a personal challenge. This is going to be the longest bike ride I have ever done. Granted that there are break points to make the ride much more manageable, 180 miles in two days is something I have never attempted. I am confident I can finish the ride, but my unofficial goal would be to hold an average speed of 19 mph. The average speed will be how I qualify finishing well unless someone has a better idea.
  3. Donations are tax-deductible – If you itemize deductions in your federal income return, these donations are tax-deductible. Don’t wait until the end of the year to make charitable donations.

Riders have a minimum pledge of $400, but I’ve set my goal to $3,500 this year. In 2012, the average rider pledge was $1,049. Help me reach my goal by donating through the link below or by simply spreading the word on Facebook and Twitter. No amount is too little, and I truly appreciate your help. If you make a donation, you could also check if your company will make a donation match to double up.

Donate Here. Fight MS!

So how’s my training going?

I signed up for the MS 150 in early March, which is when I officially started training. To prepare myself for the long bike ride, I’ve been attending spin classes twice a week to build leg strength. That will be useful if I want to reach my pace goal. For endurance, I’ve gone on 27-mile rides twice. I plan on doing a longer ride at 50+ miles, and maybe a 75-miler if I can sneak it in before the event. Previously, I was doing 10-15 mile rides at most. I have five weeks left to train before the event. Wish me luck!

What do you think about this fundraiser and cause? Do you know anyone affected by MS?

Price of Happiness: Trampolines, Dodgeballs, Foam Pits

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This is the second post of the Price of Happiness series. Check out the Happiness Ranking section to see how this purchase/experience ranks against the others according to my super accurate and official Happiness Scoring System (HSS).

Last time, I analyzed how much happiness I got from buying and owning a brand spankin’ new BMW. This time around, I want to look at something at the cheaper end of the spectrum – something I consider to be cheap fun.

When I first heard about a place here in Houston that had trampolines, dodgeballs, and a foam pit all under one roof, I knew I had to go! So I set it as the activity for my birthday in November and invited a few friends. It was such a big hit that two of my friends decided to have it for their birthday the next year. I’ve gone three times now, and it’s been a blast every time.

The business is called Sky High Sports. Apparently, this business model seems to be such a success that the company has locations in six other states. And why not? Those three things do end up as a perfect mixture of fun. The whole place is inside what looks like a large warehouse with big open spaces and high ceilings. There are three main areas open to the public (they also have areas reserved for private parties):

Field of Trampolines - If you build it, we will come…and jump. This area is a large grid of about 4×12 square trampolines with trampolines going up on the side walls. Everything is padded with netting on the perimeter that extends high up to the ceiling. You’re free to do whatever as long as you obey the safety rules. I’ve seen some impressive stuff done here by really athletic people like double flips in the air from one trampoline to the next and backflips from one end to the other without stopping. My favorite though is playing some form of tag. Last time, we played zombie tag. It’s where one player starts out as a zombie and players who get tagged become zombies too until only one human is left.

Foam Pit - This area is a favorite of mine. You get some running room, then it’s two trampolines before you jump/flip/twist/spin/float/pose/trip into a deep pit full of foam cubes. If you were too scared to try a flip on a trampoline, then this would be the place to just let it loose. I’ve attempted triple front flips, gainers, spinning flips. You name it. Basically everything I’m too chicken to try without a soft landing. It’s safe to say I’ll never make it on the men’s Olympic gymnastics team, but at least here I can pretend (although McKayla is not impressed).

Dodgeball Arena - Dodge, dip, duck, dive, and djump? Dodgeball on trampolines…who would’ve thunk it? This is the most popular thing to do in the place, so there always seems to be a wait. People get really competitive here, so watch out for that fastball!

This seems like a good bit of fun, but how much does it cost? The price to play is $10 an hour. Although if you come in a quarter before or after the hour, you can usually sneak in an extra 15 minutes of playtime if they’re being lenient. Sometimes, they have promotions on sites like Groupon and Livingsocial, so you could potentially get a better deal. On Wednesdays, the second hour is only $2, but an hour is usually enough for me. Who knew jumping around on a trampoline can be so tiring?

There is also the cost of transportation. For me, it costs about $17 for a 30.8 mile roundtrip from home assuming the IRS mileage rate of 55 cents. So for an hour of play including transportation, this activity cost me a total of $27.

That’s not incredibly cheap, but the novelty alone makes this activity a good value. I also don’t do this often (three times in the last couple of years), so the novelty hasn’t worn off. That’s one of the tricks to enjoying things more – keep them rare. When I consider the other benefits, this really becomes a great value. I get to make silly memories with friends, get a healthy dose of physical activity, and challenge myself to master a few gymnastic skills. All of these things make for a happier me!

With all things considered, the Happiness Scoring System (HSS) gives this purchase a score of 32,517 officially overthrowing The BMW Purchase Experience from the #1 spot in the Happiness Rankings. Jumping around on trampolines makes me happier than owning a BMW? Whaaaat?!

Do you agree with how I scored this purchase? If you had the incredibly accurate HSS handy, how would you score this purchase? Thanks for reading. Don’t forget to subscribe and follow.

Is It Worth Paying Extra for Great Customer Service?

honda service

I currently drive a 2007 Honda Civic, and I get my car maintenance service done at a dealership near where I used to live. That’s 13 miles from where I live now. There’s a dealership just 4 miles away from work and a general auto shop not even half a mile from my house. So why go out of my way when there are options nearby?

Process of Elimination

When I moved to my new place about a year and a half ago, I decided to get my next oil change done at the nearest dealership. I didn’t have any complaints about their work, but it was what they tried to sell me that turned me off.

“Sir, I noticed that your car has 50,000 miles now. It’s due for a power steering fluid flush,” the service rep suggested.

“I don’t think so. I just got it done 5,000 miles ago,” I quickly replied. “I even put it in this app that keeps track of the car maintenance,” I continued while showing him the app on my cellphone. “Did you guys even check the fluid?” I asked.

He looked embarrassed as he replied, “the service tech suggested you should get it changed at 50,000 miles.” I guess that answered my question. Sure enough, I didn’t return there anymore.

Since then, I’ve tried one other dealership and two independent auto shops. The other dealership didn’t check the fluids either, and the independent auto shops were just shady. One of them tried to install aftermarket parts while charging me the price of Honda originals (I opted for the aftermarket after researching them, but we bumped the price down).

The Standard

Am I just being nitpicky or entitled? I don’t think so. If I pay for a service, I expect to get what I paid for, especially since I could probably do most of the maintenance services myself (I don’t have the inclination to do them myself now, but want to learn how eventually to save money and gain car knowledge).

There’s a reason why I still go to the dealership 13 miles away. When they told me I needed some fluids changed, they actually walked me to my car and took a sample. They placed the samples on a chart next to what the fluids were supposed to look like. Now, I can be a cheap bastard sometimes and won’t change the fluids even when I’ve reached the mileage milestone. What they did assured me that it was time to change them. That is great customer service, and the standard I compared other auto shops to.

Is It Worth It?

I’m paying extra for gas and taking up more of my time, not to mention the car is depreciating more because of the longer drive. With the added costs, is it still worth it? For me, the answer is yes.

It can be really frustrating trying to find an auto shop you can trust. There are so many out there that take advantage of folks who are naive about cars. I’m not entirely clueless about cars, but I don’t know everything either. That’s why I’ll gladly drive 9 extra miles to get that kind of service because I know I can trust them and I know I’m getting what I paid for.

There are probably some reputable shops closer to home, and I’ll keep looking for them. For now, my go to place is the dealership 13 miles away. Hey, it gives me an excuse to visit my parents nearby. After all, fostering relationships is one of the mantras of this blog.

Do you go out of your way to get great customer service? Is it worth the extra cost to go where you know what to expect? How much do you value customer service?

10 Things That Will Make You Happy for Free

happy bacon and eggs

Nothing seems to be free nowadays. When looking to do something fun, that something always seems to have a price tag attached to it. Whenever my friends want to hang out, it’s always over dinner in a restaurant or drinking at the bar. It’s like we forgot how to just enjoy each other’s company, which should be free.

I’m not whining about my friends’ choice of venues here, but I’m just pointing out that most people tend to overlook the free alternatives to having fun. We don’t always have to spend money to enjoy life. We’ve just gotten used to it. Here’s the good news: the free things in life also tend to give us the most happiness and fulfillment. So what would make me happy and not cost a thing?

Before we start listing them, let’s set some rules on what we consider to be free. I’ve seen similar lists on the internet, so I wanted to make sure that we define the boundaries to truly identify happiness at no cost.

Rule #1 - If the activity requires money to operate like a computer needs electricity or a bubble bath needs running water and sewage, then it’s not really free. Unless you live off the grid. Most people don’t, so we don’t count that.

Rule #2 - What about activities that require equipment? What if you already have them because you bought it 5 years ago or it was a gift? This could make things confusing, so we’ll consider those activities free. If you have to buy the equipment, then it’s obviously not free.

Rule #3 - What about transportation? Most things happen outside of the house, and we have to get there somehow. Cars need fuel, and fuel cost money. Since there are alternatives to cars and paid public transportation like biking and walking, the activity can be free if it’s reasonably close. When I lived in Austin, there was a bus that would take me from the university to downtown for free.

So here’s the list of 10 things that will make you happy and don’t cost a cent…

  1. Be Active - Being active means exercising, dancing, playing sports, walking your dog, hiking, and mountain climbing just to name a few; basically anything that requires you to move around for a sustained period counts (getting up from the couch to walk over to the fridge and back, doesn’t count). All of these activities can be had for free. You don’t need a gym membership to exercise. Running is free and can even be done barefoot (streaking would be the ultimate example of no cost happiness, but you didn’t hear that from us ;) ).
  2. Get Creative – You don’t need to be Leonardo da Vinci to conjure up art. Simply grab a pen and paper (everyone has those around, right?), and start drawing. There are other mediums as well like writing a novel or practicing spoken poetry. The point is to exercise self-expression and fire up the right side of your brain. This also gives you the opportunity to master a skill or craft associated with that creative activity.
  3. Read a Book – Books are freely accessible at your nearest public library (you can even find other forms of media there like audiobooks and movies). I know a lot of people who think reading is boring. What they don’t know is that it can be incredibly satisfying to read a book. You see, books are a source for knowledge and stimulating stories.
  4. Commit Random Acts of Kindness - Whether it’s volunteering at the homeless shelter or helping a friend move to a new place, seeing your surroundings and community become better because of your actions is incredibly gratifying. Try this: give a complete stranger a genuine compliment. You’ll leave knowing that you just made their day better.
  5. Be Optimistic - Life has its ups and downs. During the downs, it’s important to know that things will get better. This can be incredibly difficult to do especially when going through an ordeal, but that’s the best time to practice optimism.
  6. Avoid Negative People - Negativity from the outside world can affect the internal practice of optimism, so we don’t need pessimistic people around. Avoid them at all costs. Although, true masters of optimism cannot be defeated by any amount of negativity.
  7. Count Your Blessings – Actually take a moment and list the things that you’re thankful for. Doing this regularly can put you in a better mood, and could make you realize that your life is great. Say “thank you” to people even for smallest of things.
  8. Have a Conversation - Meet up a friend and have a conversation. Talk to them about their family, livelihood, hobbies, and goals. Tell jokes and funny stories. Spending quality time like this will build a strong and long-lasting relationship.
  9. Have Sex – During sex, your body releases dopamine, your body’s way of telling you that something is pleasurable. In fact, seeing the person you’re in love with can have the same effect (but probably not as enjoyable ;) - that’s the second wink in one post).
  10. Meditate – We can actually train our minds to produce states of happiness through meditation. Stress can also be reduced in the same fashion. We’ll call this the ultimate mind hack.

I hope you’re not surprised by what’s in this list. We’ve known about them all along, but it’s up to us to put them into practice. If we spend as much effort on these things as we do on things that cost money, we would be richer and happier for it.

Using the rules above, what other activities or things make you happy at no cost?

Price of Happiness: The BMW Purchase Experience

bmw-purchase-experience

This post is the first of its series I like to call the “Price of Happiness” where I’ll be reviewing purchases and ranking them using my own super accurate happiness scoring system. Keep an eye on the Happiness Rankings page to see how the purchases rank against each other.

In 2009, I bought a brand new BMW 335i (forgive me, my frugal folk, but I didn’t know any better just less than a year out of college). Buying a brand new car is an exciting experience. Looking at the sleek and shiny showroom cars are enticing to the senses. The test drive gives you just enough to leave you wanting more. This is true for any car buying experience, not just for luxury brands, but this is where the BMW marketing team shines and works their magic. When you buy a BMW, you’re not just buying a car but the purchase experience by participating in the European Delivery (ED) and Performance Center Delivery (PCD). I participated in both, but they were optional. Here are the details for both deliveries:

BMW European Delivery:

  • Get to and from Munich, Germany on your own expense to take delivery of the new car
  • Free tours of the BMW Welt, Museum, and 3 Series Factory
  • Access to private lounge with food buffet
  • Drive around Europe for 14 days before dropping it off for shipping to the U.S.

BMW Performance Center Delivery:

  • Get to and from Spartanburg, South Carolina on your own expense to take delivery of the new car
  • Free night and dinner at the nearby hotel (I think it’s a Marriott)
  • Drive one of their cars on the track with instructions on slalom, braking, cornering, and stability control
  • Drive one of their SUV’s on an off-road track
  • Ride shotgun with a professional driver in an M5 doing all sorts of stunts

After all that was said and done, I got to drive home in my brand new “Ultimate Driving Machine” as dubbed by BMW. I drove the car as my daily driver on commutes to work for two years until I sold it in early 2011.

The Cost

The total cost for this purchase including the two deliveries and the cost of ownership comes to $16,065. Here is the breakdown:

BMW ED ($500)  – Fortunately, the ED was part of a family trip to visit my brother in Germany, so I don’t count most of the expenses like flights, lodging, and food. Just to be conservative, I’ll estimate this amount.

BMW PCD ($565) - The costs listed only cover half of the total expenses because we made a road trip vacation to visit six cities out of the delivery trip.

  • flights to Atlanta: $200
  • Rental car from Atlanta to Spartanburg: $15
  • Gas for the entire trip: $75
  • Lodging: $125
  • Food: $150

Cost of Ownership ($15,000)

  • The car was financed for about $42,000 at 0.9% APR. By the time I sold the car, I already paid $15,000 for the loan. The sale price was $2,000 over what I owed, so the sunk cost was at $13,000 for two years of ownership
  • Maintenance was free.
  • Replacing four tires cost $1,000.
  • To calculate the cost of gas, I compare it to what I would have paid if I drove my current car for those two years. The BMW averaged 26 mpg, while my current car gets 32 mpg. At roughly 15,000 miles a year for two years, the cost difference comes to about $1,000.

The Score: 6,972

The scoring here is purely subjective, but there is some logic to it. I won’t explain the technical stuff behind it here (maybe some other time if anyone is interested), but I did share my thoughts on valuing purchases based on cost and value over time in this post. What I will do is talk about how this purchase affects the three innate needs identified by the Self-Determination Theory that are essential for lasting happiness. These three are:

1. Competence

This purchase did not contribute anything to the competence need since there was no new skill learned or talent used. Perhaps I felt competent by discovering the availability of these delivery options (BMW didn’t seem to advertise them widely), but that’s a reach.

2. Relatedness

When I was researching this car and the different delivery options, I stumbled upon what seemed like cult following for the BMW brand. There was a bustling internet forum that had topics ranging from DIY’s to trip reports for the recent European Delivery. There were even national and local car meets for people to share in their love for the brand. The brand following was strong, and I got sucked in it. All I needed to do was own one of these Ultimate Driving Machines. I did meet new people through this, and the conversations about BMW’s were a delight, but nothing that lasted. Nevertheless, the sense of belonging to a community was there.

3. Autonomy

There is something to be said about wanting something and getting it. That’s exactly what happened when I purchased the BMW. Even if the choice was unwise, being able to act on my desires and fulfilling them was a happy thought.

Extrinsic Motivation

Buying a luxury car basically amounts to me showing off to the world that I was successful. At the time, I believed I was for the sole reason that I was able to buy this $42,000 car. ”Yeah! Not everyone can afford this. I’ve made it,” I thought to myself. Even if this proved to be false over time, simply believing it caused a spike in my happiness right at the beginning and sudden plunged once I realized I was only fooling myself. Don’t get me wrong. I was successful in my own right, but certainly not enough to afford such an expensive car.

Conclusion

Hedonic adaptation came into play big time here. The novelty of owning a status symbol wore off after a while, and it just became a car to me. I regret the car purchase, but the delivery experiences were awesome. Were they worth the amount I paid? In hindsight, no, but let’s say I wanted to have the experiences since I seem to regret the car purchase but enjoyed the rest. How do I replicate those experiences? What are the alternatives?

First, I don’t need to buy a BMW to drive one in Europe. A one-day rental from Hertz currently costs about $180 in Munich. Visiting the BMW Welt is free, while admission to both the BMW Museum and 3 Series Factory costs about $12 each. The buffet lounge and dramatically choreographed presentation of the car can be experienced if you tag along with a friend who is taking delivery of one. My family experienced all of it with me, and it cost them nothing.

All the same delivery activities at the Performance Center in Spartanburg can be experienced through one of their many classes. The one-day class with all the same activities plus more currently costs $700.

So there we go. There are some cheaper alternatives. If I had to do it all over again, I would have skipped the car purchase and just paid for the experiences.

Being the first post of the series and the happiness rankings, the score won’t make much sense yet since there’s nothing else to compare. As I add more to this series, the scoring should begin to make sense. It may even change since this isn’t an exact science.

Thank you for reading such a long post. Don’t forget to subscribe and share your opinions in the comments section below. Have a nice day!

Fitness Challenge: Cardio on the Way to the Gym

2011 Diamondback Response MTB

I hope I don’t have to explain why fitness is such a hot topic on this blog. I hope it’s obvious that our health and fitness have a direct connection to our overall well-being and happiness, so it’s important that we challenge  ourselves to be more active. Today’s post is a fitness challenge to you and to myself.

I have a gym membership mainly for access to an Olympic size swimming pool and the many assortments of weightlifting equipment. I mainly focus on weightlifting nowadays and try to mix in cardiovascular workouts in there somewhere. Normally, I would drive to the gym right after work, do my workout, then head home. That seems normal, but then why be normal. Why couldn’t I do my cardiovascular workouts to and from the gym? I do only live 4.4 miles away.

So I did. On a cold winter afternoon in Texas (yes, it gets cold here too), instead of heading to the gym straight from work, I headed home first before riding my bike there. It was a little too far to run there, but that could have been an option if the gym was 1 to 2 miles away. I had a few layers over my gym clothes to protect me from the cold, and I made sure to bring my bike light for the ride home in the dark.

It took about 20 minutes even through several traffic lights and stop signs. That’s a moderate pace of about 13.2 mph and estimated 200 calories burned (see what 200 calories looks like). Not bad for a warm-up. Riding my bike home took me roughly the same amount of time. That’s a total of 40 minutes of moderate effort on a bike burning roughly 400 calories. When I got home, I promptly crashed on the couch and ate a gallon of ice cream (kidding!).

I accomplished several things by doing this. One, I avoided wasting time in a car by using that same commute to and from the gym as part of my workout instead, not to mention the money savings from gas and car depreciation. When I arrived at the gym, I was thoroughly warmed-up and energized ready to exercise more vigorously. The bike ride home was also a great cool down exercise and felt more like a leisure ride. Some outdoor time didn’t hurt either, especially whenever the sun was out.

This isn’t simply a fitness challenge, but a challenge to step out of our comfort zone and let go of our conveniences to experience a little bit of physical and mental hardship. Overcoming these temporary inconveniences will only make us better and stronger in the long run. The saying “What doesn’t kill us makes us stronger” comes to mind.

Here’s another mind hack: when we experience a bit of hardship, the conveniences we’ve come to enjoy ordinarily suddenly become godsends. Like an oasis in the desert.

So I challenge us to ride a bike to the gym (run or walk if possible). I’ve only done this a few times and will push myself to do this more. One weekend morning, I just might run those 4.4 miles. I’ll let you know when I do. What say you?

Why I Stopped Budgeting

budget team has a conscious spending problem

Since earning a decent paycheck, I’ve relied on a strict budget to steer my personal finance ship. And why not, it was the smart thing to do. Save this much, spend this much, allocate this much. It was a system programmed to make decisions for my future spending, and it worked. It made life simpler…until it didn’t. Huh?

Let me explain. Although my financial decisions were easier, there were some unintended consequences in using such a system let alone having it work accurately and up-to-date.

Managing a budget became a time sink. I spent countless hours entering every single cent I spent into a spreadsheet. The budget grew more complicated as I wanted more control and insight over the different types of expenses. This became a pain in sorting and separating purchases in the same receipt. How ironic, the purpose of doing all this work was to be free of financial worry yet managing money took up more time than I wanted it to. This leads me to my next point.

Budgets (and money, in general) became stressful. Not only was I mulling over the numbers obsessively, I was constantly worrying if I was going to go over budget. There was added pressure to buy cheap instead of going for value to stay under budget (this was mostly true for discretionary spending categories like clothes, travel, and gifts). There were arguments with the girlfriend over spending disagreements. I had internal philosophical debates about insignificant purchases. All of this made for a stressful experience. Life was less enjoyable because thinking about money and budgets was stressful.

Cheating on my budget was easy. Since the amounts were set by me, they were easily modified by me. In fact, it encouraged spending inflation in some discretionary categories. This seems counterintuitive from the point I was making in the previous paragraph, but being cheap and a spendthrift at the same time is possible. Maybe I lacked the willpower, but this made me question the point of having a budget in the first place.

Let me be clear. I’m not advocating that budgeting is a bad thing. There are certainly great benefits to budgeting, especially if there is very little margin between your income and expenses. I would not recommend skipping budgeting altogether because it is important for understanding the state of your financial house. I am merely emphasizing the negative effects of budgeting if you take it too far like I did. Budgets are meant to encourage smart spending. Once those systems are in place, we should focus more on our spending habits and carry those habits over after eventually breaking free of mundane tasks like spreadsheet data entry.

So what’s the alternative?

Conscious spending. It’s the habit of deciding what is worth buying based on the value gained. It’s the separation between cheap and frugal. Most importantly, it’s about focusing on what’s truly important to you.

“OK, but this sounds like an excuse to splurge and go broke.”

That would be true if you haven’t practiced good budgeting as I suggest above, and a $500 handbag hardly counts as a value purchase. I made the leap, or rather elevation, to conscious spending in early 2012. Although I’m not close to being perfectly aligned to the definition of conscious spending above, I am living proof that it works. Since then, my net worth increased over 63%, I haven’t had to waste time with mundane data entry tasks, and managing money has become less stressful. I can finally enjoy an overpriced beverage once in a while without over thinking it. It’s very liberating.

Don’t get me wrong. I still check on my spending every quarter, but am now making the move to only do this annually. Big disclaimer here: I wouldn’t be able to do this if my expenses were uncomfortably close to my income and had I not developed smart spending habits through my experience with budgets. Obviously, if a big purchase or life event occurs, I would reevaluate my “budget”.

Do you stress over money and/or your budget? Would you consider abandoning it and switching to conscious spending?

The Healthy Road to Happiness: My Fitness Goals

funny-workout-guy

I am generally an active person. I say generally because although I like being active and moving around, I spend most of my day sitting in front of a computer. Unfortunately, this is the case for me and many Americans who work in an office.

Experts say every minute I spend sitting down takes more of my life expectancy away. I don’t know how true some of the numbers being put out there are, but what I’m sure of is that being active produces positive results. I don’t even need to look at the molecular level to know the benefits of physical activity. It relieves stress, I have a surge of energy after a workout especially in the morning, and I don’t feel like such a wuss.

Ever since I was a kid, I was always doing something to stay active. In grade school, I was in the swim team. Throughout high school, pickup basketball and breakdancing were my favorites. I was in the Junior ROTC drill team too. In college, I was part of a hip-hop dance team, and I started swimming again. After graduating, Crossfit was my thing, but I quit that sometime in 2011. Since then, I haven’t been as active until about October of last year when I decided to turn things around (embarrassingly, part of the reason for the sudden passion for fitness was the Hawaii trip in December. Gotta look good for the camera, right?).

The first thing I ever did after not doing a proper workout for almost over a year was run to a nearby park then back home. That run was roughly one mile, and it took me about ten minutes. I could run one mile in eight minutes in the past, so it was disappointing. I didn’t let that get me down though, so I kept at it every morning right before work. After two weeks, I was running three miles at a 9:30 minute pace. I was pretty ecstatic with my progress, so I decided to add in other familiar workouts namely swimming and weightlifting.

2012 Fitness Goals

For 2012, I set some swimming and weightlifting goals for myself. The weightlifting goals are supposed to be one rep max effort in pounds, and I based some of them from the standards listed in ExRx.net. The others were guesses.

  • Swim 1000 yards without stopping – Success, swam 1200 yards
  • Bench press 120 - Success, 130 with dumbbells
  • Deadlift 255 - Success, 287
  • Standing military press 75 - Success, 95
  • Push press 115 - Success, 115
  • Power clean 145 - Success, 155
  • Power snatch 65 - Success, 89
  • Front squat 225 - Failed, 205
  • Back squat 225 - Success, 225

Only one failed goal. Not bad for starting in October 2012, but I may have set the bar too low for some of them. I wasn’t sure where to set the goals after not doing any of the movements for over a year, but now I have a good benchmark to work with.

2013 Fitness Goals

Naturally, I have upped the ante for 2013.

  • Swim 750 yards under 15 minutes – I chose 750 yards because I am toying with the idea of doing a sprint triathlon. Fifteen minutes is not setting the bar too high, and should be very achievable.
  • Master the swimming tumble turn – I need to relearn this technique if I want to train in a pool efficiently. What I do now is just touch the wall and turn around, which breaks my swimming rhythm.
  • Bench press 185 - Skipping the novice level for my weight class because I really want to push myself here with this being my biggest weakness.
  • Deadlift 325 - A little higher than the intermediate level for my weight class but 40 lbs more than my max last year.
  • Standing military press 130 - Weight for the intermediate level. This could be a challenge.
  • Push press 155 - I’ve been able to lift this much in my Crossfit days, so I am confident I can get back to that level.
  • Power clean 180 - Intermediate level.
  • Power snatch 115 - Novice level. I am not too confident with my current form for this movement, so I want to focus on that. At the same time, it’s still about 25 lbs more than my max last year.
  • Front squat 225 - The front squat is very awkward for me, so I’ll focus on improving form this year. Besides, I didn’t meet this weight last year anyway.
  • Back squat 250 - Intermediate level. Back squats are my strength, so I am very confident with this one.

I have until the end of 2013 to accomplish these fitness goals, but I’ll report back between now and then.

At some point, I will get tired of reaching for weight goals, and I’ll start asking myself what is the point of lifting heavier and heavier. Where does it end? I haven’t decided yet what my long-term fitness goals are besides the abstract one: stay active. I’ll tackle that in a future post.

What are your fitness goals for this year?

How to Buy Happiness

buy-happiness

hap·pi·ness (noun)
state of well-being characterized by emotions ranging from contentment to intense joy

We all want it. We’re all pursuing it. There are many ways to attain it and a number of factors that determine it (see The How of Happiness and PERMA to name a few scientific studies), but can we buy it?

Yes. At least, indirectly.

In fact, we already buy happiness whether it’s the buying of basic necessities to preserve your current level of happiness or the purchase of luxuries to boost your happiness however fleeting that may be. Paying your water bill? You’re buying happiness. Brand new flat screen TV? Happiness. Buying gas for your car? Well, that’s buying happiness, too. Not that gas directly gives you enjoyment (unless you just love gasoline and you gotta have it), but gas in your car gives you the convenience of driving somewhere. That somewhere may be the home of a loved one where you can strengthen the relationship or a place where you earn income for more funds to buy happiness.

We don’t necessarily make conscious decisions this way. Certainly not based on the amount of happiness we get back, but maybe we should. After all, we can probably attribute some of our unhappiness from the misdirection of our spending. Just like buying anything, we usually want to get the most bang for our buck. If we think about it this way, the landscape of buying happiness becomes simple to understand.

Charting the Cost of Happiness

cost of happiness

The figure below visualizes the happiness market landscape. If we pay a lot for something and get very little back, then it’s not a good deal. Conversely, the best deals are when we get a lot of enjoyment out of something for very little cost. The “break even zone” is a zone and not a line simply because happiness is hard to quantify, so we leave room for subjective judgement. Obviously, we want our spending to fall somewhere above and to the left of the “break even zone”, although breaking even is not a bad thing either. It’s the red area we want to avoid.

That seems simple enough, but there’s another dimension to all of this. The amount of happiness we can hope to extract from something may vary over time. The plot below shows just one out of an infinite possible outcomes of how one’s happiness changes over time. The “it’s getting old” declining trend applies to most things or experiences in my life. If I do something routinely or too much, that just zaps the fun out of it. It’s just in my nature to want variety in my life. I suspect this is probably true for most people too. Obviously, the ideal outcome here would be for happiness to increase over time.

happy-vs-time

Guidelines to Spending for Happiness

There is no straightforward method or step-by-step instruction to guarantee maximum happiness from our spending because happiness is incredibly difficult to quantify. The above exercise offers an understanding of what we need to aim for when consciously buying happiness, but the final decisions are determined by subjective and personal factors. Ultimately, it’s your call and you shouldn’t be judged for your decision. If the happiness profile of that luxury car purchase has an increasing trend over time for you, then you probably maximized your happiness spending (although I haven’t met anyone where this is the case). With that said, here are some guidelines that may help in deciding whether something is worth buying to maximize your happiness:

  • Know yourself and identify what makes you happy - This is probably the most important step and should be accomplished first among all things. When you know yourself, you will identify your wants, needs, likes, dislikes, reactions, and, most importantly, what makes you happy.
  • Prioritize your life - For most people, life is busy. Full of responsibilities and distractions. Prioritizing your life not only lets you spend your time wisely, but also where you spend your money. Make happiness a top priority, and you can start asking questions like “will this help my cause to increase my happiness” and “will this purchase hinder my goals that will result in a major happiness payout”.
  • Learn from other people’s mistakes – Even though happiness differs from person to person, there is still much to learn from other people’s experiences, especially when you find that you have plenty of things in common with that person or the circumstances. At the very least, this will educate you about obvious blunders to avoid like living above your means. Conventional wisdom, in this case, can be a good thing to know for those just starting to take control of their personal finances.
  • Educate yourself – There are many books and studies about happiness. I listed a couple in the beginning of this post. Learning about the science of happiness will make you more aware of how your everyday decisions affect your happiness.
  • Minimize the cost when you need a quick fix – We often need a pick-me-up. One of the popular pick-me-up activities is retail therapy, which can be expensive and often offers a poor return on happiness. Find other alternatives, and stick to those when you need a quick boost of pleasure.
  • Variety is key – Mix in long-term and short-term payouts of happiness. Reaching financial independence could be the jackpot of happiness payouts, but don’t skip on life in the present. With that said, refer to the previous guideline about minimizing cost when looking for an elevation in your sensation.
  • Don’t over think - Your goal should be to break even. Don’t over think whether a purchase will return 100 points of happiness or 200 points. You won’t notice those small differences, but will certainly feel the pain when you purchase a bad deal.
  • Review and reflect – Because happiness is personal, sometimes we must be trailblazers. Someone else’s experience won’t always coincide with ours, so make sure you reflect on your own past purchases and learn from them. Try to compare your past purchases with each other to determine where they fall within the landscape of buying happiness.

Buying happiness is not only about buying stuff. It’s a bit more abstract than that. Donating to a charity could yield a good boost in your happiness. Paying for a gym membership (that you actually use) could result in health and fitness gains, which have been often linked with happiness. How about taking a pay cut so you can spend more time with family or work on things you enjoy? That’s a good one too. These are just some examples of how to spend money wisely in order to maximize your happiness, and hopefully it builds a good argument that we start to make financial decisions consciously with this in mind.

Readers, do you consciously make decisions based on how your money affects your happiness? What have you spent on that maximizes happiness and minimizes cost? How would the happiness profile look like for that purchase over time?