I’ve been taking a look at the books for the past few weeks, and it’s looking none-to-pretty. Basically, I disregarded my budget earlier in the semester and I’m paying for it now. Too much travel, too much eating out, too much clubbing = no monies. I should’ve known better. I’m pretty mad at myself, because I’ve got ballooning credit card debt whereas last year this time I was so responsible I ended up with a “budget surplus.” Yea, and then I got on my “George W. Bush” one time.

So I was joking with my friend that I’m going to write to Sec. Paulson and request federal bailout funds. I mean, he can spare a few thousand for a struggling law student, right? Yea, I may do it just for the fun of it, but I’m not getting any cash from the gov’t besides my student loans.

For the past couple of weeks, I’ve instituted pretty strict spending limits – and I think they’ve been paying off. My spending certainly has gone down a lot and I’m hoping to ride out my current balance until the New Year’s. *Fingers crossed* But to help get focused I’ve subscribed to Ramit’s “Save $1K in 30 Days Challenge” at iwillteachyoutoberich.com. I’ve been looking at the tips, but right now, finals take precedence over being smart about money (lol.) I’ve got two more finals to go, and then I’m instituting my IMF Personal Finance Restructuring Plan lol!

Belt-tightening is gonna be a beast…

Mitterrand tried to create both job growth and wage growth by nationalizing huge swaths of the economy, including some big industries — automaker Renault, for instance. You haven’t driven a Renault lately because Renault couldn’t sell them here. Imagine that: an auto company that couldn’t compete with a Dodge Colt. But the Renault takeover ultimately proved successful, and Renault became a private company again in 1996, although the government retains about 15% of its shares.

Now the U.S. is faced with the same prospect in the auto industry. GM and Ford need money to develop greener cars that can compete with Toyota and Honda. And they’re looking to Uncle Sam for investment — an investment that could have been avoided had Washington imposed more stringent mileage standards years earlier. But we don’t want to interfere with market forces like the French do — until we do.

Someone passed this Times article titled “How We Became the United States of France” to me. Thought it was interesting. Suspect to exaggeration and oversimplification in some ways, but the author makes a good point.

(Image taken from Taluda on Sxc.hu)

When I was a kid, my family would ask ourselves what we’d do with a million dollars. It was fun to explore my imagination and think of all the wonderful things that money can buy. Looking back, it was probably a product of the scarce resources we had – a type of escape. Money was always an issue and we never had enough of it. My parents always struggled to get more, but it always slipped away for one reason or another. Now that I’m older, I think about it from time-to-time, but it doesn’t have the same cathartic effect that it had in my youth. It’s more of a distracting thought now. But I was thinking about it the other day and so I decided to write about what I would do with a million dollars.

Step 1: Get the Lump-Sum

When I was younger, it made perfect sense to “stretch” the money out as long as possible by getting installment payments. The danger of lump-sum was that if you made one crucial mistake with it, it would be gone. But after learning about interest rates and return on investments in my Microeconomics class in college (one of the benefits of a college education imho – you learn useful things that you may not have learned otherwise) I realized that lump-sum is the best option. There is always the spectre that you’ll do something idiotic with the money and lose it, but the beauty of lump-sum is that if you follow a sensible plan and invest wisely, you’re going to get more bang for your buck. Conversely, the problem with installment payments is that although you’re getting the same nominal amount of money, that amount of money isn’t worth as much as it was before. It’s like how a movie once cost 5 cents but now it’s like $9 minimum.

Step 2: Tithing

As a Christian, I’m gonna tithe. I mean, God has hooked me up, and I don’t mind sharing some of the love, ya dig? Haha. But in all seriousness, I think it’s important to give 10% back to God (and not necessarily to one church). I know that there’s a lot of noise about tithing. For me, whether I make the tithe before or after taxes, as long as my conscience is clear I think I’m good.

Step 3: Reset to Zero

Even though my family’s financial situation is more stable and we’re worth more now, we all carry a lot of debt. The increasing costs of higher education means that my siblings and I have had to take on more debt. And since the parental units already have mortgage, credit card debt, insurance, etc. etc. I prefer to shoulder the debt myself. So, considering our heavy debt-loads, I would try to erase that debt, starting from the parents on down. I can imagine that would be anywhere from 500K to 1M. But I think it’s the most important thing to do. It’s a matter of freedom.

Yea, so when I was writing this post, it seemed a bit long, so I decided to break it into three posts. More later.