Here’s a fun exercise to add to your net worth reports every month :)
(Or just RIGHT NOW – because who doesn’t like playing this game??)
Today is the day for me to track my net worth (up 5% from last month!), and I started a little exercise where I think about what I would do if I just received $1,000. How would I want to split it up? Here is how I think I would split it this month. I think it’s an interesting exercise to see what my current priorities are.
If I received $1,000 what would I do with it?
- I think if $1,000 dropped in my lap I would want to save at least $500 immediately. I think that would all go into my Roth IRA so I can easily forget about it.
- With the remaining $500? I think I would want to put some towards ski/snowboard season. So lets say $150 goes towards that (gear, gas etc)
- With the remaining $350? I would want to take my girl out somewhere nice so lets say that’s $75.
- With the remaining $275? Some towards knowledge, lets say a low $30 because books are cheap.
- With the remaining $245? Let’s say $45 towards chain mail stuff (I started creating chain mail after visiting a ren fest for the first time)
- With the remaining $200? New socks, let’s say $20 (I really like socks and I like to wear crazy socks during my sporting events)
- With the remaining $180? Gifts, lets call it $50 (gifts for no one in particular, but probably just family and friends. Maybe something for GF’s cats)
- With the remaining $130? Here’s where charity can come in. I’ll call it $100
- With the remaining $30? Goofy juice.
I think I’m going to continue to do this exercise every time I do my net worth calculations.
A few things about this:
1) Always fun to play with imaginary money! Helps bring out our inhibitions more, which some of us (tight-fisted budgeters) can use!
2) Our priorities/goals are always changing. And you’d def. see that occurring the longer you do this exercise (though maybe better doing quarterly or bi-yearly since not that much changes on a monthly basis?)
3) That 50/50 balance of “pleasure” vs “responsibility” up there is great. You sock away a chunk up front to help you feel better about what’s to come, and then you splurge away, haha… And even better when it involves other people too, like Matthew’s girlfriend and the charities.
4) Though did you notice all the I thinks there in the beginning? He was probably just writing in the flow, but it’s always interesting to see how you *think* you’d spend new money coming in vs how you would *actually* spend it. Unless you’re the complete opposite of me and feelings don’t get in the way at all ;) A much better indication of how you’d spend an extra $1,000 would be looking at how you just spent your LAST $1,000! Haha… Though I know that kills the thrill of the game…
and then lastly, 5) What if this prompted you to actually go out and EARN AN EXTRA $1,000?! Turning these “what ifs” into reality? Seeing all that fun stuff it could bring would certainly motivate me to hustle more than a vague wad of cash would… You never want to chase money just for the sake of “having more.”
So yeah – I approve of this! Anything you can implement to try and trick yourself into being better with money is always a win in my books :) So thanks Matthew. Would love to hear if it sparks any new changes for you over the next handful of months?
As for what I’d do with an extra $1,000 right now? I’d probably apply it towards furniture for two rooms in our house which are still completely empty despite moving in over 4 months ago, haha… I hardly have the desire – or energy – to go shopping these days, but maybe it would buy me a magical fairy that could do it all for us so we don’t feel like failed adults? On the plus side, my kids sure love using them as soccer fields and wrestling mats, so at least they’re getting something out of them :)
What would you do with an extra $1,000? Think it’s worth an exercise every month?