Financial Foundation. Below are several principles for a solid financial foundation. After reviewing these, proceed to the Top 10 list.
- Accountability. Consider having someone, such as a family member, that you meet with on a weekly or monthly basis regarding your financial planning and management. This can help establish accountability and continuity. This person need not be a professional, but they should be available to answer simple questions and help you stay committed to a plan of financial well being. They can help act as a means of ‘checks and balances’ to be sure you are following the recommendations of a professional financial services advisor.
- Financial Services Advisor. Financial services and debt management services are available in many communities and larger metropolitan areas. There are also online financial services, such as MyVesta, that can provide ongoing financial support and services via the Internet or over the telephone. [Click here for MyVesta or call 800-MYVESTA]
- Financial Training. The more you know about financial management the better your financial health will be. For starters, consider taking the Money 101 course offered by Money Magazine [Click here for Money 101]
- Holistic Wellness. Problems in other areas of life can impact our financial situation. Consider how you can enhance your overall state of wellness. Click here to visit the Map page at Resources for Life.
Finance Top 10. Here are the top 10 things you can do to help build a strong financial future:
- Live on Less. Rather than looking at your income and then figuring out how you will spend all of it, consider trying to live on as little as possible. Consider living on much less than what you earn and continue looking for ways to cut your living expenses. It’s a much less stressful way of life. By living on much less than what you earn, you will soon have a feeling of sufficiency and abundance with your finances rather than a continual fear of scarcity and constraint. Learn to curb your wants and desires. Consider having your actual cost of living (housing, food, transportation, etc.) be sustainable by the equivalent financial resources that would be produced by a single full-time job at minimum wage. Consider working two or three jobs and living on the income from just one of them. Use the additional money to pay off debts, save for retirement, and to establish an emergency fund. Here’s one person’s testimonial, “The process of curbing my desires and learning to live on less was liberating. I soon began to experience the feeling of having unlimited wealth – a way of life where your wants never exceed your financial resources.”
- Prioritize Purchases. When you feel an urge to purchase a product or service, write it down on a list. As the list grows, prioritize items in order of importance. Consider prioritizing purchases and expenses based on how the products or services might serve your broader life mission statement. Over time, you’ll find that some items become less of a priority and you may be less likely to buy products or services you don’t need and you’ll learn to discern between needs and wants. Postpone purchases for months or years if possible. Purchases should not be made emotionally in a moment, but made over time as you labor and save your money toward a goal. Here’s one person’s testimonial, “When I began the practice of writing down purchases, it helped me to think about them more. By having them on paper, they were no longer in my mind or heart. When several items are in a list like that, you can more easily identify what is truly important and what is frivolous.” For more tips on smart shopping, read this article: Before Going Shopping – Smart Shopping Guidelines and Considerations.
- Budgeting. Track your ongoing expenses so you can discover ways to spend less money. For example, some people spend more money on long distance phone charges than they would on a cellular phone plan that includes long distance. Some people let their cellular phone replace their home phone – saving even more money. Without knowing your expenses, you can’t make financial decisions that can save money. So, tracking your expenses is an important part of financial planning and awareness. Here’s one person’s testimonial, “I began keeping track of my monthly automobile expenses. The car I was driving had been costing me hundreds of dollars per month in fuel costs (at 12 miles per gallon). I soon realized I could buy a more fuel efficient car and spend less on car payments and fuel than what I was currently spending on fuel alone. So, I was able to purchase a new car without spending any more per month.”
- Checkbook Balancing. Consider automated checkbook balancing and financial management. Most banks now offer online banking services that can balance your checkbook for you and keep track of expenses using a home computer. This can help you monitor your spending and look for ways to spend less. Printed reports are an easy and organized way to share your financial spending with those who are helping you with financial management. For some people, balancing the check book is something they do to see how much more money they can spend before their account is overdrawn. Consider keeping a significant buffer in your account so you don’t need to constantly be worrying about your balance. Don’t let money in a checking account tempt or entice you to go shopping.
- Sales. It is sometimes better to wait until something is not on sale rather than to buy it at a sale price. If you intentionally wait until things are not on sale to purchase, you may save more money in the long run because you will learn to break the habit of habitual-binge-impulse bargain shopping. Many people shop not based on need, but in response to what is on sale. Their shopping is primarily controlled by marketing and ads. For some people this can be a type of addiction (physical chemical dependency) to the drugs (endorphins) released in the body by the shopping experience. If an item is on clearance, wait until the next model is introduced. Find products that are a good value anytime and use those regularly rather than depending on expensive items being on sale. If you wait to buy, you’ll discover the urge to purchase is often short-term and you may eventually decide you don’t really need or want the product or service that previously seemed essential.
- Downsize. Learn to be content with less. Consider putting your possessions in storage and living in a one room studio apartment (like the residence of a monk or nun). For some people, the journey toward simplification and minimalism is a slow process. It’s fine to take it slow and learn along the way.
- Walk or bike to work. Live closer to where you work and work closer to where you live. Depending on your level of commitment to simplicity, you may decide to quit your job and/or move if necessary. In the long run, this will likely save you time and money. It is a more peaceful and relaxed way of life. Your income and primary needs won’t be dependent upon a vehicle.
- Grow in your Career. Becoming more experienced and proficient in your career and profession is a good way to help expand your income base. Either by means of a raise or outside consulting, you can earn more money and become more skilled over time. Seek out educational opportunities to learn more. Click here to visit the Career Management Resource Group for more information.
- Start a Business. Start your own services/consulting business so you can fill-up your wasted ‘free’ time with profitable activities. Click
here to visit the Consulting section of the Career Management Resource Group.
- Help us build our top 10 list. Let us know if you have any simple suggestions for what we can add to this list. [Click here]