As I reflect on this past year, I realized one thing. And it is…holy sh*t, I’ve learned a ton!
It’s refreshing to look back and see how far you’ve come and what all you have learned! So here are my 10 biggest financial lessons I learned in 2016.
1. Cost of living matters
I used to live in rural Iowa, where I could rent a 4 bedroom house for $500 a month. I moved to Charleston, South Carolina in 2014 and every single year, the cost of living increases astonishes me.
They estimate 40 people are moving to Charleston every single day, so the housing costs, in particular, is skyrocketing. Every year, our rent is being raised, so every year, we have moved to a new apartment complex.
I forever find myself wondering what our finances would look like if we could even save $500 a month on our living expenses, but for now, we both have jobs that pay us well enough that the high cost of living is nothing more than an annoyance. We couldn’t be paid as well in an area of lower cost of living, so we are trying to adjust to seeing our rent cost.
2. My current money situation is because of me
This is a hard lesson to learn. I have student loan debt because I didn’t pay for school as I went or apply to enough scholarships. I earned a degree that wouldn’t have paid well (and required a ton of hours). So there was a period of time I wasn’t able to put hardly anything towards debt. Now that I have switched careers and have also started freelance writing on the side, I earn more, but man, I have had to work my butt off to make what I do (not to complain…I love my job and writing!)
I can’t point fingers at my school for being too expensive or blame people for not educating me. Because I should have taught myself. I was just plain stupid.
You might find yourself in a similar situation. Once you claim responsibility for your current situation, you’re setting yourself on the right path to achieve financial freedom. And the good news is that even if you got yourself into a bad situation, you are the ONLY one who can get yourself out of that situation. It’s empowering. So go kick butt.
3. Weddings are NOT cheap
I try. I knew having a wedding in Charleston would be ridiculously expensive, but it was something we wanted to do anyway. I’m fighting tooth and nail to keep the cost of this wedding as low as possible, but man. It ain’t easy!
I knew going in that it would be expensive, so I would have to lower my standards. There are so many creative ways to save! I haven’t been afraid to break tradition, so I think that helps!
4. I can make more money
This year, I was able to start making money off my blog and by freelance writing. Honestly, I didn’t really think it would be possible for me. It took a lot of hard work, but I love earning more money!
Making money on the side has been extremely empowering. It’s comforting to know if I ever lost my job or had a financial emergency that I have another source of income. And I feel proud of the little business I have built!
5. Budgets will never be perfect
No matter how much you try, your budget will never be perfect. Every day, week, and month are different, and that’s why I am fairly flexible with my budgeting.
If a super strict budget works for you, go for it! It just doesn’t really work for me. In the near future, I will be writing a post all about my flexible budgeting.
6. I’m capable of a hell of a lot more than I thought
Okay, so this might not be a direct financial realization, but taking ownership of my finances this year has shown me a lot. I had debt to pay off and a wedding to save for. I had major goals, and I realized I needed to make even more money to make it possible.
So I started earning money freelance writing and putting that towards my financial goals. I also worked extremely hard at my full-time job to earn a raise. I made it my mission to provide value and then demand to be paid for my value.
It hasn’t been easy AT ALL. Planning a wedding by myself while my fiancé is in a grueling grad school program has not been easy. Plus freelance writing, blogging, working, and studying for a certification has been tough but so worth it. Yes, there have been meltdowns on my part and times I wanted to quit everything, but I am proud of what I have done to meet my long-term goals.
I don’t say this to humble brag, but I hope you can realize that you can achieve more than you ever thought. If you aren’t relentlessly pursuing your goals, then they aren’t big enough. I didn’t learn that until I realized my student loan debt would be the biggest barrier to my goals of going to further my education, so I am thankful to have learned this lesson.
7. You can’t be “average” with your money
I talk to a lot of people about money, and I have to laugh at how many times people tell me they are just “okay” at dealing with their own money. Though I admit I do tend to see things in black and white, this just doesn’t make sense to me.
If you are just “okay” or “average” with your money, that means you don’t have as much control as you should have. While everyone has room for improvement with finances, there are some very black and white things. Debt is bad. Savings is good. If you have debt but are telling me you’re working your butt off to pay it back, I would assume that you are recovering from being bad with your money.
These are more my thoughts, so feel free to agree or disagree. I’d love to hear your thoughts in the comments!
8. Comparison is stupid
Everyone, especially women, are guilty of comparison on a regular basis. I am terrible at it! I find myself getting so jealous of other people. I compare myself to others, when I have no idea what their personal situation or feelings are.
Comparison is definitely something I want to work on in the new year. Because it’s a huge time waster! I’m excited to see what I can achieve when I put my blinders on and keep the focus on myself instead of comparing myself to others.
9. Emergency funds are a life-saver
I can’t emphasize emergency funds enough. You. Need. One.
My emergency fund gives me so much peace of mind and security. That $600 car repair bill earlier this year? I had cash for it. Without my emergency fund, my budget would have been blown for months!
10. Communication is ABSOLUTELY the key to healthy finances
Perhaps the most important lesson I learned this year is about communicating with my fiance about our finances. We have always been very open and honest about our own financial situations, and now that we are in the process of combining our finances, we really have to talk about it.
We don’t really have money fights because we have worked out our agreement. We each get some cash every month to spend at our own discretion. It’s been a huge learning opportunity this year, and I’m excited to see how our finances look when they are all officially combined (I know…nerdy to be excited about this!)
These are a few of my lessons learned this year! What are your biggest financial lessons learned in 2016? Comment below!