Friday, August 9, 2013

Poor Personal Financial Management

What happens when you are not in control of your personal financial situation? Well, you can't sleep at night because you are worried where you are going to get the money to pay for bills that seem to increase in number as time moves along. It doesn't matter that you may be getting increases in your revenues through means such as raises or bonuses. You just seem to never catch up. Being in such a predicament is not conducive to good health never mind being fit. You are so stressed out because of worry and lack of sleep. Being healthy and fit requires you to be in control of such a situation.

If you remember in one of my earlier posts I had talked about losing weight and how you must get to know your eating habits to even begin to be on the road to losing one pound. We talked about the way to getting to know yourself in this respect is by keeping a daily journal of your eating habits. This journal had to record everything that went into your mouth everyday for about a month. To make this exercise reasonably effective you had to be disciplined and truthful to yourself. At the end of the month you were to review the journal and more often than not it shocked you into some sort of motivation to begin to do something about your weight and eating habits. The same thing can be done here with your your personal financial situation.

The journal of how you spend every cent everyday can bring to light very bad spending habits which are the cause of your financial difficulty and inability to get ahead. Essentially the picture presented is one of spending on wants rather than on just needs. The need to eat, you can buy groceries and cook at home rather than go out to a restaurant each time you feel hungry. How many pairs of shoes do you need? Certainly not 10 or 15 pairs. The journal and what it shows in terms of spending habits can become an effective tool to build a personal financial management process that will bring peace of mind  to you and everyone else around you.

The personal financial management process I speak of is a budget that plans how you will spend your money each month within the confines of the revenue that comes in. Writing down your spending plans is very effective at knowing how much is coming in and how much is going out. In this budget plan you will make a decision how much you will set aside for the bills that are stressing you out and causing you sleepless nights. Just knowing and picturing what is going on with with your finances will calm your mind and spirit down and as a result you will be able to sleep so much better. As time goes along the exercise of budgeting and managing the budget will become a way of life, your bills that were killing you will soon disappear. In fact, the discipline skills you acquire in this exercise will allow you to set aside funds for investing purposes eventually. You can actually become rich, or at least well off because you will have trained yourself to not be so materialistic but be able to fulfill your needs and have funds left over to invest.

To aid you in this matter there are a lot of writers and books out there that will help you as you move along on this subject. One of the books that assisted me in this journey was THE TOTAL MONEY MAKEOVER by Dave Ramsey. You can order the book from the following location if you wish It is well worth your while to get this book. You can also google the subject and you will get lots of information that will guide you to a more prosperous you.

As I wrote this post, I couldn't help but admit it was hard to do so. It is hard because no one likes to admit they have a problem. This is what I had at one time, a problem managing my finances. At the point of making some tough decisions regarding my situation I was $43,000.00 in debt on revolving credit i.e. mostly credit cards. I was making quite a bit of money at the time and I just couldn't understand how I could be in that situation. But what I learned in my recovery journey is that it doesn't matter how much one makes, if you don't know how to manage your money and your spending you are always going to be in trouble. In any event, I took complete control of my bank account and did what I was learning through the books and information from elsewhere and in 2 years I was debt free. So it is true you can do this and be more calm in your life. Look at your life and see if what I just talked about resonates with you and start doing what I did.