Our life is overflowing with people telling us how to manage our money and how they can help us do it. The thing is, everybody out there has a different opinion – so how do you know which one is correct? Simply doing a Google search with the keywords ‘personal finance’ yields a variety of different companies (people) telling us how we should do it, why we should do it, and what we have been wrong all along! The list is endless and can seem very daunting to most of us.
The biggest problem is that we tend to believe that there is one set of rules for everyone to manage their money. What we don’t factor in is that we all lead different lives, we enjoy different things, we earn different amounts and we like to spend our money differently – So to assume that one program will fit all is ridiculous!
Money is often a source of anxiety for most people, whether you have a lot of it or too little. This is because we don’t know how to manage our money and we are constantly seeking advice from others. We live in perpetual fear for will we have enough for our future, will there be enough for the end of the month, will I be able to pay my mortgage, what if I need it later and I spend it now, etc. Basically we lack confidence when it comes to managing our money.
Take On The Responsibility
One of the key factors to managing our money is that we need to stop seeking the answers outside of ourselves. We need to analyze our lifestyle and figure out what the best course of action will be. We live in a world of extremes and people are no different. They either spend too much or spend too little. The ones that have money often save, as they are too scared to spend; and the ones that don’t have money usually incur debt to meet their lifestyle. Bottom line is we don’t know how to manage our own money!
It’s called spending or saving with intention. When we sit down and look at our finances we can then really begin to see what set of rules we need to follow that is customized to our own lifestyle. Much emphasis is placed on either saving all you can for the future or obtaining more debt to consolidate your old debt. Spending is as important as saving and it has got to do with enjoying your life.
What we usually find is that people who were in debt, and got out of it, become scared of spending money and place an extreme emphasis on saving. They don’t want a relapse in their life and watching their money grow almost becomes an obsession. But at some point you have got to draw the line and feel content that you have put enough away for the future and now it’s time to live a little.
David Weliver in his article ‘When it’s okay to spend money’ said, “The key to financial balance is to both save and spend with intention!”
Reaching That Financial Equilibrium
Many people justify their need to save money by saving for a new house, a better car, your wedding, retirement, holiday or travel, or just saving for emergencies. It’s good to save for these things but there needs to be a limit or else we just get into a habit of saving permanently. By becoming an intentional saver, you will look at each one of those items and decide:
- How much will it cost?
- How long do I have to save?
- Where will I invest my savings?
This will aid you in determining exactly how much you need and if you can meet that target. Intentional saving helps you structure your goals and adjust them if need be and that way you are more likely to obtain them.
When we look at spending with intention it is important to analyze what makes one happy. Is it through those experiences such as travel or adrenaline sports, or is it something more tangible like a new car or one of the latest gadgets? Whilst we are not condoning reckless spending we are saying that if you find those things that make you happy, you then sit down and plan how you are going to afford yourself those luxuries, how you will grow your money to meet those wants and needs. That is the underlying principle behind intentional spending.
To Sum It Up…
We all need to take control of our lives and manage our own money. Through intentional saving/spending we become self-assured because we plan. Learning to save and spend is vital to acquiring financial balance. Life is meant to be enjoyed and if you plan for your future and save accordingly you will have enough to spend on those things that make you happy right now. People who are happy earning stacks of money and watch it grow in the bank, are referred to as financial hoarders and this money is useless to you should you die tomorrow. All of life is a balancing act, why should money be any different!