Survivalist Financial Planning # 2: From the Bunkers to the Statehouse
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Filed under: Money Management
Need financial help? The truth is, many of us choose to live in the cozy but foggy realm of fiscal white lies. Instead of taking a precise account of what we spend and what we earn, we let discretionary spending go forth at its own discretion. Besides being unable to save, our bad discretionary spending habits may begin to spill over into other fiscal realms that aren’t so forgiving.
Diligently counting our pennies is uncomfortable for many of us because we don’t want to accept who we are on paper. The feeling is approximate to calorie counting, and may be just as revealing. But like losing weight, fiscal health is an outcome of good choices and sober reflection. Here are a few more “fiscally fit” ideas:
Impulse management
Marketers are freakishly clever. Next time you are about to splurge on that new digital camera, ask yourself, “What do I realize about myself or gain through this purchase? Does this purchase put me closer to my long-term goals and aspirations? Am I likely to feel buyer’s remorse?” Exploring what motivates your consumption can be revealing. You may discover you purchase to compensate for a lack of purpose or fulfillment.
Become a cash economy
Make a list of essential everyday expenses (clothes, groceries) and plot those across the next week, two weeks or month. Once you have come to the sum of your expenditures, withdraw cash from your bank to cover the exact amount of that sum (you can subdivide later into neat categories like “groceries,” honing your precision spending to a fine grain). It is imperative you do not exceed the artificial limit you have crafted by calculating the sum of your essential, weekly expenses.
The idea is to actually, physically witness the transaction of real cash for real products. Psychologically, plastic credit cards remove us from the act of spending. Seeing those $20 dollar bills flit by grounds our finances in the real world. This reinforces those financially fit saving habits you work so hard to preserve.
