The Money's All Spent - The Bills Are Coming - Now What?
George Boelcke CCP
January 13, 2012
Now that itīs two weeks after Christmas, and 2012 is upon us, Iīm reminded of an old Irish Rover Song called: Wasnīt that a party, and then talks about the hangover.
Thatīs kind of like our financial lives, having just spent huge amounts of money on Christmas, mostly with borrowed money, and including lots of presents for ourselves. I know, I know, we work hard, itīs our money, we deserve something, it was on sale, we really needed it, etc. Well, if we were to be honest with ourselves, thatīs all nonsense. Broke people canīt afford to buy stuff, and itīs almost always a "want" and not a "need." Thatīs how we end up spending over $40 billion on impulse purchases each year. And, to be honest, that number is way low, because itīs the last thing weīll admit to.
Yes, we work hard, and yes itīs our money. But do you want to keep working hard forever? Freedom 77 doesnīt have the same ring to it as that old commercial campaign of Freedom 55, does it? At some point in time, we do have to get away from the spending party and focus on paying off the hangover and saving something for someday down the road. Intellectually, we know that, but when are we actually going to get around to it is the big question that will change your entire financial life.
Right now, letīs be honest: We spend more time planning our vacation than we do our financial situation. Make 2012 the year that youīll actually turn that around. Here are a couple of suggestions that are small enough where youīll do it, but big enough to have a significant impact. Why small steps? Because our sub-conscious mind will revolt against huge goals, which can seem impossible to reach.
Youīre not going to lose 60 lbs, but you can lose a pound a week. You wonīt run the marathon this summer, but you can go for a 15 minute walk each day. You also wonīt be debt free by February, but you can start on that journey with one step at a time.
Resolve to say no: Whether itīs to yourself when it comes to spending, to your kids, people at work, or anywhere else. Itīs the one word thatīll change your financial life when you can set boundaries. If you have the gumption, take it one step further and change the "no" to "I canīt afford it," which will really get you on track to financial success.
Take your credit cards out of your wallet: At least for January, leave the cards at home. If you have an emergency, youīre one call away from getting help. But going to the mall or charging this or that isnīt an emergency honestly.
Set a cash limit: Pick an amount below which youīll always always pay by cash or debit. The higher the limit, the better if you make it $50, gas, small grocery purchases, lunch, etc., will all be paid cash. That alone will drastically reduce the charges on your credit card. When we use a credit card we spend 12 to 18% more period. Whether you pay it in full or not, itīs still a ton of extra spending that isnīt helping.
Stop being financially stupid for 2012: You know exactly what that means. They are different things for all of us, but make the New Year one where youīll stop doing the top two things that get you further in debt, or donīt grow your savings.
And finally, hereīs a great Facebook post from this week, which certainly fits most of us: Do something today that your future self will thank you for.
Thatīs kind of like our financial lives, having just spent huge amounts of money on Christmas, mostly with borrowed money, and including lots of presents for ourselves. I know, I know, we work hard, itīs our money, we deserve something, it was on sale, we really needed it, etc. Well, if we were to be honest with ourselves, thatīs all nonsense. Broke people canīt afford to buy stuff, and itīs almost always a "want" and not a "need." Thatīs how we end up spending over $40 billion on impulse purchases each year. And, to be honest, that number is way low, because itīs the last thing weīll admit to.
Yes, we work hard, and yes itīs our money. But do you want to keep working hard forever? Freedom 77 doesnīt have the same ring to it as that old commercial campaign of Freedom 55, does it? At some point in time, we do have to get away from the spending party and focus on paying off the hangover and saving something for someday down the road. Intellectually, we know that, but when are we actually going to get around to it is the big question that will change your entire financial life.
Right now, letīs be honest: We spend more time planning our vacation than we do our financial situation. Make 2012 the year that youīll actually turn that around. Here are a couple of suggestions that are small enough where youīll do it, but big enough to have a significant impact. Why small steps? Because our sub-conscious mind will revolt against huge goals, which can seem impossible to reach.
Youīre not going to lose 60 lbs, but you can lose a pound a week. You wonīt run the marathon this summer, but you can go for a 15 minute walk each day. You also wonīt be debt free by February, but you can start on that journey with one step at a time.
Resolve to say no: Whether itīs to yourself when it comes to spending, to your kids, people at work, or anywhere else. Itīs the one word thatīll change your financial life when you can set boundaries. If you have the gumption, take it one step further and change the "no" to "I canīt afford it," which will really get you on track to financial success.
Take your credit cards out of your wallet: At least for January, leave the cards at home. If you have an emergency, youīre one call away from getting help. But going to the mall or charging this or that isnīt an emergency honestly.
Set a cash limit: Pick an amount below which youīll always always pay by cash or debit. The higher the limit, the better if you make it $50, gas, small grocery purchases, lunch, etc., will all be paid cash. That alone will drastically reduce the charges on your credit card. When we use a credit card we spend 12 to 18% more period. Whether you pay it in full or not, itīs still a ton of extra spending that isnīt helping.
Stop being financially stupid for 2012: You know exactly what that means. They are different things for all of us, but make the New Year one where youīll stop doing the top two things that get you further in debt, or donīt grow your savings.
And finally, hereīs a great Facebook post from this week, which certainly fits most of us: Do something today that your future self will thank you for.
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