Home > The Master Plan > Quick financial wins – you gotta start somewhere!

Quick financial wins – you gotta start somewhere!

Manufacturing Motivation

A while back, before my financial mindset shifted, I had a lot of trouble connecting small amounts of money to long term prosperity.  Saving a dollar at the grocery store didn’t seem to correlate with retiring early.  I had no incentive to begin seriously saving/investing money because the two concepts were orders of magnitude different.

In order to get motivated, I made a few small changes that yielded short term, tangible results.  I call this my list of quick wins.  None of them really “moved the needle” in terms of my net worth, but they were necessary steps.  They helped me link short term savings to long term savings; tiny to life changing.

As Bob Marley said “If you don’t start somewhere, you’re gonna go nowhere.”  Truer words were never spoken.

My Quick Wins

  1. Invest in Compact Fluorescent Light bulbs –  I replaced the incandescent bulbs I still had.  This was one change I made all at once, I got 13 W (60 W replacement) bulbs for under $2 dollars each.  If you use that light for four hours/day, this investment will pay for itself in 3 months!  After that, your bulb is earning you profits upon profits!  I’m angry I can’t pour more money into investments that give me a 376% ROI.  (more on LEDs later)
  2. When I have the choice to bike/walk or drive a mile, I choose to bike/walk – While I’m walking, I figure out how much gas money I saved and savor the quick win (for me driving costs $.30/mile…).  Plus, I hate driving.  Consistently choosing to walk just makes you feel stronger with every step.
  3. Open a High Interest Savings Account – I opened an Ally Bank savings account.  Then I moved all of the money in my US Bank savings account (.01%), to my new online account (.95%).  The first month I received my interest (about $10), I felt like I won the lottery, because this change earned me 100X more money within a month!
  4. Inviting friends over to have a few beers instead of going to the bar – I ask a few friends to bring over some six packs, and for a couple bucks a person, we have a great time hanging out on my deck.  If you do the math, you end up saving quite a bit just by not paying for the tip/restaurant margins.

So How’d that go?

  1. CFLs – When they were first introduced into the market, they were expensive, they flickered when you turned them on, and they were a bluish office-y color.  Now, in 2012, they are almost as cheap as incandescent bulbs, they turn on right away, and you can buy them in any color range.  This remains the best investment I’ve every made.
  2. Walking and biking instead of driving has slowed me down a little, but it has added untold value to my life.  I am in the best shape of my life, I am spending less on gasoline, and I have truly enjoyed getting the chance to be outside a little bit longer than usual everyday.  Sure it has its downsides (the cold), but I wouldn’t ever go back to sitting in that big hunk of steel.
  3. The savings account is one of my favorite “wins” because I get to see the interest that it deposits in my account every month.  It’s such a great motivator to remember to save a little extra and boost my contributions.
  4. Hanging out with friends at our own apartments is one of my favorite activities.  Sure it saves  a bunch of money, but I like it more because it’s more fun.  Relaxing at a friends place and getting to try their cooking offers so many exciting and new experiences.  There’s no challenge to going out to eat with friends.  Now pulling off a great casserole and pie in the same evening, that’s a challenge.

What’s next?

So you may say that these ideas are too small to make a real impact, and taken individually, that’s probably true.  But investing time and money in these ideas will earn me exponential marginal returns instead of diminishing returns.  If just a few quick wins really stick and make an impact, it may matter in the long run. The goals I set in my Cash Analysis didn’t seem so crazy after I had some initial success.

These four quick wins are just a sampling of the ideas I tried out.  As you can see, some have to do with saving, and some are about investing (in a savings account).  After seeing that saving deposit grow month to month, I knew it was time to learn about investing, and the rest of the puzzles of personal finance.  Quick wins were the introduction I had to my own cash.  Once I saw realized the potential, my perspective was changed forever.

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  1. December 17, 2012 at 4:05 AM

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