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Tuesday, March 6

Simple Finances

Why is it necessary to track every minute detail of my finances, down to the penny?  The big picture is this:  My net worth needs to grow so that my passive income covers my spending.

This year I will stop using Quicken.  Over the weekend I signed up for a site called Personal Finance.  It's a cloud-based tool that aggregates my finances.  I'll keep an eye on things using that site.  The plan is to build up my checking account balance so that there are always funds available to pay any bill.  As soon as I receive the bill, I pay it.  I've been using Quicken for so many years.  It's super robust, and I can find out just about anything I want to know.  But it's time to move on.  Here's the benefits:


  • I have a PC dedicated just to Quicken.  I can sell it, reducing clutter.
  • I'll save a little on upgrading the software every couple of years.
  • Having enough liquidity means not having to postpone paying bills, transferring funds from various accounts, and remembering to log transactions all the time.




What else am I doing?  Well, to make this work, my finances need to be super-simple.  I will eliminate Prosper (P2P loans) as an investment.  As money comes in, it will be withdrawn from Prosper.  I'm going to pay off my student loans and my car.  I won't be doing this to save interest (both charge less than 2%), but instead it's to eliminate recurring monthly expenses.   Next, I'm consolidating my spending to one or two credit cards.  Lastly, I will have a single financial goal:  increase passive recurring income.  I have a couple ideas already for doing this which I will share tomorrow.

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