Financial Planning

We all have habits.  It seems that being human means we develop habits.  Actually it isn’t a bad thing.  And some habits are really good.  If we didn’t have the habit of brushing our teeth in the morning our teeth would fall out.  If we weren’t able to have the habit of knowing how to drive a car, each time we got in we would have to read the instruction manual.  Habits help us to shape our days.

But there are bad habits that we all experience.  Those times when we spend all our time on things that we shouldn’t, like debt or financial insecurity.  Or maybe eat things we shouldn’t because we like them or even because they are more convenient than other options.

Money is no different.  We can get into some very bad habits there too.  So I have identified 3 possibly strategies to help you overcome those habits.

Identify where money leaks out

Money leaks.  It’s not always fast, but it does leak.  It’s like water how it does it.  And like water it seems that the more you try to hold tightly onto it, the quicker it runs out.  But you can hold water: you have to freeze it first.  So this is your first tip – identify where those money leaks are by using something such as one of the accounting software packages, and freeze your spending in those areas.

Slow down your spending

This is somewhat similar, but not the same!  One of the biggest pulls on our resources has got to be the impulse buy.  We live in a ‘gotta-have-it-now’ culture that just sucks at our available resources.  My whole family battle with it.  So, slow down.  I started operating a save for it mentality which is what I had to do when I was a kid.  I also decided that even if I did have the ready money for something, then I had to wait at least a day for every £5 it cost.  So if it cost £50 then I would have to wait nearly a week.  If by the end of that time I still wanted it then it was ok to buy. During that time I would saturate myself in information about it, obsessively so.  And at the end of it amazingly I could make a rational decision rather than and impulse buy.

You can do the same thing by taking out a certain amount of money before you go shopping down the store: you go with a plan.  If you see something else that you like the idea of, take a note, and leave it a few days.  Don’t be conned by the offers unless they are already part of your plan or a regular buy.

Be accountable

How many people fall out at home with their partners because they have gone and blown the household budget on something?  And neither men nor women are the only ones to blame.  It is not a gender specific problem.  Instead, don’t do any internet shopping without the other being present as a voice of reason.  Don’t join any clubs without someone else.  And talk about what you bought down the shops even at the general store.

And if you haven’t got a live-in partner who you share the household finances with, buddy up with someone at work.  Find the best home accounting software which will help you to keep track of your expenses and show your friend the accounts.