Let’s talk about strategy
It is critical to know what you want from your money. Regardless of how much money you are earning it is of cardinal importance for you to have a well-thought-out financial strategy. Let’s see what we can do to set up a simple and effective financial strategy. I’m not going to talk about investment at all yet. This is a first step.
I’ve loved playing strategy games from the moment I played my first one (StarCraft). I didn’t get into it in the same way as some other friends and was never really competitive, but it was so much fun coming up with my own unique strategies. Even if they were terrible. When I was starting to earn money I did not have the enthusiasm to translate those skills to money. I had only this in my mind.
- Money is boring.
- I just need to earn more, and then I won’t need to worry about it.
- I have better things to do with my time than coming up with ways to spend it wisely.
And after I got a couple of raises I realised that somehow my money had the gift of disappearing no matter what I was earning. This is something we all need to deal with. We are constantly told that we need certain things to be successful (car, house, second house, second car, T.V., etc.). Why are we not taking a more personal route?
So, after a while I started realising that not only was my money disappearing from my account every month I was also very unhappy about this happening. To break this cycle, I started to track where my money was going. First on paper and then thanks to an app. If you do not trust an external company with your banking logins then please take the Excel, google sheets, or pen and paper route. There are more specific methods to achieve mindful spending as well should you want a more structured strategy. The important part is to have a bird’s-eye view of your expenses. This is something that will help you regardless of how much you earn and spend.
Needless to say my spending habits looked as good as a table in a tornado (all over the place). There was a lot of emotional and impulse buying paired with useless large purchases. Stuff I didn’t even use and subscriptions that lay dormant. Three months of tracking and I had a pretty good idea of what I was actually doing with my money. Seeing the raw truth in front of you has a more profound effect than you could ever know until you experience it. Try this. And confront your financial situation head on. You might not like what you see (I didn’t) but it will help you move towards spending your money in a way that works for you.
When the dust settles and your shock wears off just remember that even in the most inhospitable places on earth nature finds a way to grow. Just like that you can also spur new growth for your financial situation. From the information you have gathered you can cut expenses that you don’t need or are unnecessary to achieve your goals. If you don’t have some goals you’d like to achieve, then get some. I hear they are nice this time of year. Think of these two questions:
- Do I need this to survive?
- Do I need this to achieve my goal?
By survive I do mean anything and everything you need to physically survive as well as all the things you need to earn the money to survive. And by goals I mean any personal and professional goals you have. But try to have your employer pay for your professional ones if you can.
There are many tactics to achieve this, but this is best left up to experimentation in my opinion. After all you and the people around you know you best. Ask your friends, family, and partners to be involved in this process. And have fun with this. There is no reason why spending money needs to be stressful.
