As I read the news, I can't help but reflect on how much money affects our health. So in order to get healthy fiscally, it's important to remember that "personal finance is 80% behavior and is only 20% head knowledge", to quote Dave Ramsey. I've seen this in my life as I've gone from deep debt to debt free. I would go as far to say that personal is more akin to weight loss than anything else. So here are some things that helped me get to a great place financially.
1. Get Organized
This was a huge step for me because I am not an organized person by nature. It's important that all mail and bills are opened upon arrival and bills are stored where they can be found. I found it really helpful to schedule a time to look at bills weekly or bi weekly, for me it's payday. I've also got one of those multi-layered trays and label them New, Pay and file. Obviously new means new mail, Pay is opened but need to be paid and file is paid and ready to file or shred.
2. Budget and stick to it.
This is a tough subject. Budgeting is a key to financial success। It is important to write everything down every month and be thorough. I write down my income at the top of the page and give every dollar a name. I spent a long time writing down just the bills and whatever was leftover just got spent. I would have never gotten anywhere if I kept on that track. After expenses, I just give everything else a name whether it's blow money or savings. Most important, once you make the budget stick to it.
3. Limit Eating out.
OK, I think this might get most people out there; I really struggled with eating out and still do sometimes. When I really started to pay attention I took a look at how many times I ate out the month before a started and I nearly lost my lunch. I figured out why we didn't have any money, we were eating it. Not only will this help to save money but it will also be more nutritional. Cooking is becoming a lost art for the "average Joe", but I really love it. I can control the ingredients and it's cheaper by far. Be careful though, you can still spend a lot at the store so make a list and don't go hungry.
4. Shopping is not a form of entertainment.
We used to be so bad about going out and looking around at stores when we were bored. Honestly, this did nothing but make me want to buy stuff. I usually use the 24 hour rule when purchasing anything big. I wait 24 hours and come back, if I still want it and have the cash, I can buy it. A lot of the time I'll look at something and never go back, out of sight out of mind. Find another means of entertaining yourself. Start exercising, go to the library or hang out with friends. There is so much more you can do that's free or low cost and will be better for you.
5. Pay off Debt.
Most financial experts don't like this notion, "you have to establish your credit" they say। Since when do we let someone else tell us how we are going to operate? I get really mad when this notion of a credit score is thrown around like it's some indication of success. All the credit score says is that you like to borrow money often and continue to pay it back forever. There is not one indication in your FICO score of how much money you actually have. If you don't believe me check out myfico.com and see the break down of the FICO score. Practically speaking, the less debt you have, the more money you can keep. We often just can't see past the propaganda fed to us by everyone.
6. Move Forward.
Most of the time people address out-go and how to spend less, but it's important to think about income too. Think about where you want to be 5 years from now and start making a plan to succeed. Read a book, take a class and learn new things. The average millionaire reads 1 non fiction book a month. Maybe we can take some tips from them. Do something different, the definition of insanity is doing the same thing over and expecting a different result. Get out there and take the necessary steps to move forward.
7. Be Positive
Henry Ford Said, "Whether you think you can or think you can't; either way you're right।" Be confident and positive about yourself, your money and life. While the media and others want you to believe that the world is coming to an end, you can ignore them and decide that you will succeed.
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