Control Your Finances
Flickr: Artbandito
Much of personal finance is about self control, or control in general. Control your environment by keeping yourself away from the temptations of your vices (clothing, dinners out, luxury travel). Control your career trajectory by working hard, keeping your skills current and learning transferable skills. Control your money by telling it where to go with a budget, not wasting it on wants instead of needs, and repairing instead of purchasing a new item. If you do have the disposable income, think about investing rather than simply spending. Many people now do anything from buy stocks to buy gold and as a result make a tidy profit, which will eventually eclipse the initial investment. This requires a large degree of time, commitment and self-control, but that’s no bad thing in today’s consumer market. Control your future by being prepared for it with an emergency fund, insurance of various types (car, home, life), and saving for retirement.
Most people who find themselves in trouble with their finances typically have ceded control, willingly or not, to someone other than themselves. Who or what they have ceded control to is not really an issue, as it or they don’t care if you’re going broke or not, they are just “living in the moment”. This was one of my problems. Although I used quicken, It was not in a proactive way at all, it was more of a reactionary thing where I’d look over my monthly charges and what I spent where, and started the next month with no goals to do better in certain areas or drastic cutbacks on discretionary spending. I had an astoundingly small amount of control (If any at all) over my finances and my financial situation. It took me quite some time to realize this was a major problem and the primary reason I had debts to my name. While I made a few (very few) smart decisions, they were few and far between, and were peppered with me “crapping in my own mess kit” frequently. Once my mess kit was fouled up, I began to clean it out, but didn’t really put a lid on it so to speak. I had no control over when circumstances out of (or completely within) my control were going to come foul it up again.
This continued on for a few years (yes, years) and as you can imagine, it was quite expensive. I have the ability to put a number on it (or at least a well educated guess) but I think I would make myself sick or angry if I took it in that direction, so I wont. However, the cost was not even the worst of it. The worst part was how it changed my attitude towards my finances, and my overall view of the situation. After I looked at my spending, I knew that I would need to cut back in some areas (and in some much more than others) but at the end of the next month, I was lucky if my expenses flatlined. This, in my eyes, was a huge failure and then I began to mentally rationalize the problem. Unfortunately, I did not have to go far at all to find someone of my age in my situation, and the more I looked, I found many people in my situation. I had found it: an easy cop-out to managing my finances. Due to the fact that everyone had credit card debt, car debt or some other type of debt, then I could have it too. The rationalization continued “If everyone has debt, then I guess it’s not so bad” and on and on and on. Everywhere around me, people had ceded control of their finances, so I did as well. This took the sting off of my failure.
After a while, I just stopped thinking about it, stopped monitoring it, and it didn’t get any better. After a change in my environment I decided to give it another go. I was making a bit more money (which I thought was the reason that I could be successful at the time). I started to look for resources, and began reading a lot of blogs. I learned a lot of helpful tricks, and jettisoned the mindset that I previously had towards my finances. I realized you did not need to live a life filled with worry, headaches and monthly payments on things you may or may not be using (or even own) anymore. I stood up, and finally took control of my finances and got out of my own way, and everything has improved. If I can do it, you can as well.
Just Remember…
They are your finances, and you are the only one who should be in control of them. Nothing is out of your control, but it may be out of your mind. It shouldn’t be. All of these things are in your control, and once you get off the debt treadmill and start taking control of all the things mentioned above, you’ll feel much better about your situation and your life in general. The money stress will be gone, you wont have to fret about a potential emergency because you’ll be covered and can roll with whatever you get thrown at you.
For readers who liked this post, there will be two more posts on control of the environment and control of your health. They will appear on Friday June 11 and Friday, June 18. I hope you stop by to read them.
Good luck, and I assure you, someone out there would LOVE to help you dig out. [Like me].
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