MP Dunleavey, a columnist for MSN Money, recently came to the realization that her family’s finances were not in order. Wait a minute! Dunleavey has been writing about personal finance for years, and has covered the very issues she is facing. This cognitive disconnect is common in the world, so I can excuse her.
Her enlightenment was inspired by the fact she was expecting (and is now the proud mom of) a baby boy. Knowing another mouth to feed was on the way from that place that manufactures mouths to feed, she got fed up with the fact her family was still struggling with their $8,000 a month income.
Our monthly expenses came to more like 84% of our gross, with about 6% going toward my remaining credit card debt and 10% going toward various savings buckets.
Dunleavey wants to be closer to her expenses being 60% of their gross income. Here’s what she did. She sold her apartment. She was keeping a cheap aparment in New York City in addition to a cheap house upstate. Having both was superfluous.
What can we learn from her experience, by the levels?
Level One: If your expenses are eating too much of your income, sell your extra apartment. Level Zero: If your expenses are eating too much of your income, find ways to cut back, as earning more money isn’t always the best solution.
Level One: If you are ignoring your personal finance situation, have a baby. Level Zero: If you are ignoring your personal finance situation, it’s time to start thinking about the consequences and working on a plan.
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12:45 pm (reply)
I really like MP Dunleavey mostly because I feel like she’s on the same level as the rest of us – the Bankrate Q&A people and even Liz Pulliam Weston seem like they have their shit together a lot more than the rest of us, which can be daunting. So it’s really nice to read about her life and the Women In Red, because I feel like it’s a much more attainable goal to do WELL like they are, and not PERFECT like some other writers. I still gotta say, $7-8k a MONTH?? I know NY is expensive, but that’s a LOT of money. And in my mind, if you’re going to have a second home, you should be able to pay for it like it was a box of Kleenex. That would have been the first thing to go, in my opinion. Hopefully she’ll get a nice windfall out of giving up the apartment since there’s lots of other expenses (like gas and renters insurance) that won’t be necessary either.
3:45 am (reply)
I can’t believe that someone blogging on about personal finance could have gone out and bought a “extra apartment” when they have outstanding debt on their credit card! (Or else got so financially stretched by buying the extra apartment they started buying day-to-day items on credit).
It’s setting the bar way to low for reader’s like Kira…
Regards
http://enoughwealth.blogspot.com
11:36 pm (reply)
All I can say is that i’m amazed that it’s getting to the point that someone with 8 grand a month can’t live a healthy financial life. Hell these days there are people who make 500 grand a year and can’t survive.
But in the end it’s all the fault of so many people thinking that they can spend more because they earn more. I live in Miami which can get more expensive than up north by more than you think. The only area that is cheaper is smokes but our bills, shopping costs, gas prices (Still $3 a gallon) and other things are still big.
I don’t make anywhere close to $8,000 and have my debts as a student but in the end i’m more worryfree than some of these people who earn 2-5 times more than I do per month. I’m paying off everything as early as I can and when I get that six figure job i’m studying hard for i’ll be able to direct all that money into trying to retire worryfree way before 35. At that point i’ll get all the extra apartments & vacations I want without worry.