Mr.
Managing Money on a tight budget
During my time at Xplosiv Enterprises I have researched
thoroughly some mindsets about the home finances. We used a wide
variety of people who budget for the home and found that the
most common problem was not a lack of money but a
misunderstanding on how to appropriate the finances.
The typical symptom of this kind of problem is for the person in
question to spend more than what they earn. I would say that out
of the people we interviewed and talked to about the home
finances, this was a clear concern to me. Most people simply
don't think it's necessary to live within their means. I am not
talking about the poor who are living to their means as much as
they can I am talking about Mr. average who earns a good living
and spends what little extra they get on silly things.
Why is it that when we get more money we spend more ... do we
realize the paralyzing situation that we are putting ourselves
in by doing this? If you continue along the road of spending
more than you earn the problem you have is not a financial...
it's psychological. If you think you earn more than you do, then
you are deceiving yourself ... even if you earned double you
would still spend it. So how can we curb this 'adjusting up'
mentality?
Keep a strict budget. I know you have heard this before. The
problem isn't the budget it's in enforcing the budget. For
example, say you are a party animal and want to spend a fortune
on beer. What would you have to sacrifice to make it happen?
Perhaps you are given to bursts of obscene shopping then if
there was no way for you to pay cash what would you use? What
element of your budget would have to shift? Think about it. If
we were in the feudal system and you had a wad of goats to trade
... you would. But if you didn't then whatever you wanted would
require goats that you didn't have therefore you would go about
acquiring more goats, right? Yes. Why would you spend money
that's needed in other areas on beer? It's because in your mind
you think this is a good idea. You need to change your mind on
this matter before the repo-man takes all that you own my
friend!
So when you are thinking of managing money better and what that
'little extra' will go to - then use some kind of positive
reinforcement technique. If you want to drink heaps of beer
instead of making a car payment carry the finance company's card
around in your wallet. What shoes instead of saving that little
extra. Dream up a goal ... say taking a holiday or hiring a
boat. Now get a picture of that dream and put that in your
wallet. If you spend that money tear up the picture and then
replace it. Soon you will see your folly. Feel like spending
that money still, then CUT UP your credit card now and learn to
live without like they did in the feudal days.
In closing I would like to offer you one piece of advice. What
you do today is not an isolated event. It's part of a broader
string of events that make up all of your life. You can make one
mistake and spend years paying for it. Believe me I know.
Remember nobody knows you like you do so find a way to stick to
your budget and do it. You will thank yourself for it later.