To recap, in Part 1, I wrote about how important it is for a man to have a vision for himself. I want to emphasize that this vision is not intended to be set in stone, and will certainly change over time. The point is not to decide here and now the path we take for the rest of our lives. The point is to give ourselves an objective and a general direction to start moving towards. In Part 2, I wrote about why it’s important that we focus less on society’s perception of Asian men, and more on developing ourselves independent of external opinions.
PART 2.5: MONEY
Note: Some of you may already have this on lock. If so, great. But I personally think this is an under-discussed topic that is very important to the rest of my posts.
Before we start talking about building ourselves into the person we want to be, we need to first talk about money. Let me make it clear right now that money does not make the man. However, until you become financially independent, it will be difficult, if not impossible, to freely pursue your interests. Personally, my parents taught me essentially nothing about money. In some respects, I’m lucky that they supported me financially so that I could focus on my schooling and not have to worry about money during my adolescence. In any case, I’d like to share what I’ve learned.
Your first task at hand is to pay off your debts. Again, I was fortunate enough to not have to worry about paying for my tuition, so I don’t think I’m in a position to speak on this particular topic. I highly suggest picking up Ramit Sethi’s book, I Will Teach You To Be Rich
I Will Teach You to Be Rich. In fact, all of this section will draw from that book.
The importance of keeping a budget cannot be understated. If you want to live freely and be able to invest in yourself, you need to take control of your money. What we’re going to do is calculate as close to possible what our monthly expenses and savings are, subtract that from our take home income, and then set aside the rest to spend however you please. The great thing about having everything calculated out is that you don’t have to feel guilty about spending any of that “Spending Money”. Splurge on a fantastic meal with friends. Sign up for a martial arts class. Build a nice wardrobe. Buy a sweet drum set. Go crazy on that Steam Summer Sale. Here’s how to do it:
Pull up a spreadsheet.
Calculate your monthly income, after taxes.
Figure out what your monthly expenses are. I’m talking about rent, utilities, gas, food, insurance, etc. basically all the necessities in your life. For things like food and gas, you’re going to have to make an estimate. As you track your finances over time, you can better adjust these values.
Decide how much money you want to save per month. Personally, I put $150 into a Roth IRA, $150 into a savings account titled “Wedding”, $150 into “House”, and $200 into “Misc.” for things like travel or a new car. If your employer offers a 401k match, contribute the maximum amount they’ll match. It’s free money, man. These values will depend on your income and how much you feel like saving. I think Ramit suggests saving a total of 10-15% of your take home income.
Subtract your expenses (3) and savings (4) from your monthly income (2), and boom! The rest you can spend absolutely guilt-free.
A great tool to use is Mint.com. The website allows you to connect all your financial accounts and create budgets that let you see at a glance where your money is going. I created four budgets based on a few of the expense categories that Mint uses for transactions: “Auto and Transport”, “Food and Dining”, “Home” (I use this for my rent checks), and “Shopping”. The first three categories I use to make sure my estimates for my expenses are correct. Every now and then, I look at my transactions and correct the categories that some of them fit into. For all transactions that are non-essential, or that I think of as recreational, I categorize under “Shopping”. This way I can tell at a glance how much money I have left to spend on non-essentials.
Say I give myself a “Shopping” budget of $500 a month. As long as I don’t spend more than that, I can use the money however I please. Maybe I go all-out and use it all to build myself a basic wardrobe. Maybe I don’t spend nearly that much, and just let the budget rollover into next month, or decide to dump it into my savings. The point is that now you have the freedom to spend the money on things you enjoy, and not have to wonder whether or not you can afford to do so. Now we’re free to start investing in ourselves and working on that vision!
Original Post: https://www.reddit.com/r/AsianMasculinity/comments/2d0tvn/power_leaps_guide_to_manhood_part_25_money/
Reposted with permission from /u/Power_Leap with slight modifications