Do you ever wonder where your money disappears to every month? You work hard to pinch pennies, spend frugally, and stretch every dollar... yet you can’t seem to grasp where all your cash went at the end of the month. It just seems to vanish without you really knowing where it ran off. So if every time you see your credit card bill or a bank statement you are surprised, keep reading…
The solution to the problem is simple, but it does require some work on your part. Being organized with your money is a guaranteed way to track your savings and spending. No one has limitless time to obsess over finances. So, developing a reasonable system that works for you will eliminate excess stress. You should personalize this system as something you find easy to maintain; something you can keep up with in the long-term. Through a series of articles, we will walk through an approach - an entire system that you can adapt to create your personal routine to keep the guess work out of your finances.
The first thing to do is to better understand your financial psyche. Here are three common things that may be standing in your way of taking control of your finances.
- Financial management is reactionary. Many people wait for a problem with their money to arise before they take action. But if you stay organized, you can often times see these problems well before they surface. Often times this is a cyclical occurrence. We encounter an issue with our money, and once the problem is solved, we go back to our old bad habit of ignoring our money until the next problem comes up. This is a dangerous, vicious cycle that leads us to spin out of control, and can cause us to live in fear of our own money. This cycle is easy to break if you commit to manage your funds. Once you understand your finances, it is easier to make a smart spending strategy.
- Facing your money fears is a gateway to financial freedom. It is not hard to feel as if you are a slave to your own bank accounts. As your savings go up and down, you may often feel like you’ve been living on a roller coaster. When opening that credit card statement, it’s like you’re about to go over the first drop on that roller coaster and your stomach has twisted itself in knots. When your finances are in check, you are at the part of the roller coaster when you are smoothly coasting. Roller coasters are fun for a few minutes, but to live on one is crazy. The only way to take control of your finances is to face them head on. Once you take the anxiety out of your finances, the benefits and results of financial security will follow.
- Know thy self, and know thy bank account. There is no guardian angel watching over your finances. Many people ignore their finances because they trust that the money is safe in the confines of their bank, or tucked away in a mutual fund. Or they just don’t know enough about their options so their strategy is to ignore their finances, which can be an expensive lesson. Abandon these thoughts promptly! No one is looking out for your finances but you! The more familiar you are with your financial standings, the more control you will have over your financial situation.
There may be other reasons why you haven’t taken the time to get control of your finances. What is important is to acknowledge what is keeping you from dealing with your money, and then face that problem head on. We will help you through this process and it really is not all that formidable once you understand it.
The accompanying articles detail the process to organize your finances. Some of the things we list may be things you already do, so feel free to skip over to the parts that don’t apply to you. Follow these steps to see how easy it is to get organized, and finally take over your finances.
This is the outline of how we will together design your financial system:
1. Collect - The first step in designing a system that works for you is to collect all your accounts, credit card statements, bonds, and investments.
2. Organize your money - Once you have this information at hand, we will take a look at how to organize your finances and figure out a budget.
3. Automating - You don’t have all the time to watch over your finances. The strategy is to automate as much of this as possible.
4. Tracking - Once you have your system in place, we will help you put in the checks and balances so you know what is happening with your money.