Redefining Your Relationship with Money
Some people will have you believe that money isn’t everything, and while it doesn’t trump family, love, or life experiences, the truth is that everything we do in life has some type of financial attachment. Our financial standing directly impacts how we live our lives and the quality of life we can provide our family and those around us. This fact can cause a lot of stress, especially for those of us who weren’t taught about money growing up and may still struggle to have a good relationship with money.
Unfortunately, many things can impact our relationship with money, such as our knowledge about it, our experience, and how much of it we have, want, or need. No one person’s relationship with money will be the same, but you can build a better one no matter what your current relationship is. Everyone can take steps toward having a relationship with money that supports living their best possible lives.
Don’t let a delayed start keep you from building the life you want.
We can use strategies in our daily lives to improve our personal finances. Think about how you can improve on your bottom line to live the lifestyle you desire in the days, months, and years to come. It’s easy to get away from fundamentals critical for making good decisions and increasing our wealth. One of the biggest myths about building wealth is the thought that you have to start out with a lot of money or that you need a large amount of annual income. That’s absolutely false.
There are three money moves you can make today that will help you build a more balanced and secure relationship with money.
Start tracking your expenses
84% of people vastly underestimate how much they spend on recurring payments every month. Many would be surprised to hear that the average American spends approximately $237 per month on subscriptions. We lose a lot of our income to blind spending, subscriptions, or memberships we may not even be really utilizing gets an automatic withdrawal from our accounts. Do a 5-minute money audit: pull your statements and highlight every recurring subscription or membership. Take it a step further and highlight every expense in a different color, i.e., transportation, medical, childcare, entertainment, travel, etc. This will allow you to see where exactly your money is going. Take the time to assess what’s a priority and what’s not, and immediately cut out the expenses that are not critical to your daily life.
Build a budget
Create a budget or road map to your ideal future that adapts based on age, income, and priorities. When creating a budget, your number one goal should be to create clarity around your essential priorities. Your budget is a blueprint for your ideal future; this will get you spending, saving, and investing with a purpose. So first, be specific about your goals. This will help you identify what resources are needed and what areas you need to cut back or advance on.
Establish a Savings System
Last but definitely not least, build a simple savings system. Every function has a system that allows it to operate successfully. Building wealth requires a system for your personal finances. When it comes to saving, you must put yourself first. You have to be selfish in order to build wealth. Being selfish when it comes to your money means paying your bills on time and setting aside money for savings and investments. If building wealth is your goal, this is non-negotiable. The best way to achieve the savings you need and want is to set up automatic savings transfers. Come up with an amount or percentage that you will set aside, no matter what, then set up with your bank or direct deposit to have that amount transferred automatically. When manually transferring money to savings, your emotions will tempt you to reduce the amount or skip out on transferring it at all. With automatic savings transfers, you save yourself from this temptation and reinforce your dedication to building wealth and securing the future you want.
You owe it to yourself and your family to find the resources that will allow you to improve on your finances. It’s never too late to start building wealth; use these strategies to build a life of financial wellness
