Then & Now: How my financial habits have changed

It is safe to say that my financial (and personal) habits have definitely changed over the years.  Back in 2005, 2006 and 2007 when the bull market was booming I was working in financial sales on 100% commission.  I was earning well over $125,000 per year.  At the end of 2008 I decided that the life of a fully commissioned employee was not for me, and I changed positions within my financial institution to become a salaried employee with a quarterly and annual bonus. With my choice to make a career change from commissioned sales to a fixed salary came a major financial and lifestyle adjustment.

My salaried job does not require me to work any over time. I work in my bank branch Monday to Friday from 9 to 5 without any late hours and without any working hours at home.  As a commissioned sales employee I was working 60 hours a week and also working a lot on the road.  I would meet clients wherever they wanted me to meet them and my cell phone was on until 10 pm at night.  I lived and breathed with my cell phone in my hand because when that phone rang it was money.  Needless to say this definitely took a toll on the relationship with my boyfriend Nick.

Making over $125,000 per year was great but since it was commissioned sales it was not steady money.  Believe it or not I actually accumulated debt during these 3 years of my life because a young professional sales person is “supposed” to have a certain image.  I spent money (sometimes that I didn’t have) on clothes, cars, and other materialistic goods just to show off. The money allowed Nick and I to enjoy the finer things in life, but we were enjoying them separately.  Sometimes I would get home after 8 pm and still have a few hours of work left to finish up things for the day.  The majority of my time was spent working, when it should have been spent with my boyfriend Nick.

When I changed positions from working on a 100% commission base to an annually salary I lost a lot of my annual income and I lost the majority of my disposable income.  I have adjusted my personal money mentality from we can never have enough money, to its only money, and money isn’t everything.

I don’t agree with the philosophy to spend money now to save money later.  However, I do believe that in some circumstances we can spend money now to make more money later.  It’s called an investment, and that’s what I did. I invested in myself and it did pay off just as I planned.  However, I (not so quickly) realized that money doesn’t buy happiness.

My lower annual income has definitely humbled me. I am grateful to still be employed because many people have lost their jobs in the past few years. Have less money is better than having no money at all. It is really the little things in my financial life like saving a little bit of money, paying our bills on time, and having a place to live that are important to me now. Buying the best of everything is not.

Here is how my financial habits have changed:

Spending Money

2007: I thought that I was financially invincible. I could drop $1000 on anything and not even think twice about it.

Now: I think twice about every single purchase I make. I rarely spend on myself and usually spend on things for our family and our apartment. I have learned that money will not always be here so we shouldn’t take it for granted.

Saving Money

2007: I would save money only to spend it later, I would transfer $3000 to my savings account and within 5 days it would be right back in my checking account. Thank goodness for forced savings plans.

Now: I still contribute regularly through forced savings. Most of my savings are directly invested to avoid temptation, but since I have learned to live on less I have been able to keep a balance in both my checking and savings accounts.

Investing for Retirement

2007: I always did it.

Now: I am still doing it through a personal retirement savings plan as well as my employer pension plan.

Personal Budget

2007: I could not live on a budget because my commissioned sales were not steady and therefore I didn’t have a steady income.

Now I have a fixed income so I live on a fixed budget.

Personal Expenses

2007 I had tons of debt that accumulated because sometimes I had really big pay checks but sometimes my pay checks were negative.  Even if I didn’t make any sales my employee benefits, savings, and insurance would still be deducted so they would actually debit money from my checking account. When I did have a pay check it was used to pay past due bills and catch up on late credit card payments.

Now My biweekly bills are automatically deducted from my account every two weeks to make sure that they are paid on time. I don’t manage the cash flow because when given the opportunity I mismanaged my money.