– how to earn, spend and save money without denting your lifestyle
It becomes worse if you are working in an industry that is being impacted by recession, companies are downsizing and pink slips are being handed out. If you’ve ever been made redundant, then count your blessings because you are better prepared if that ever happens again. That is a valuable although painful lesson. For those of you, who have not experienced it, better to be prepared with good money management habits to help you survive the experience better.
While inflation, stock market performance and the prospects of unemployment are not within your direct control, managing your money is and there is no reason to downsize your lifestyle – not yet.
Pink slip money management is another story but for the interim, let us focus on money management during inflationary times and how we can actually save money without denting our lifestyle.
Make Friends with Money
If Money is a challenge that you really want to fix, then I invite you to my teleclass titled Unleash the Energy of Money that is available on Teachable for just $10. Click here to learn more ( a new window will open to Karmic Ally Coaching’s online school) or on the image below to access the replay.
Update: 12 April 2017: You are invited to sign up for the Financial Literacy Month teleclass 3 important actions you need to manage your money. Click on the image to be taken to the sign up page. A new window will open with all the details.
4 Things you can do today to get your Money under control
Over a series of posts, I shall share tips that make a difference. All these tips have been tried and tested and do work. Pick those that work best for you and action them. You will see the difference in your money management, savings and maintain a comfortable lifestyle. Make your Rupee (or Dollar) go further!
Tip No 1 Understand your spending habits by making budgets
I firmly believe that everyone should create a budget, even if it only on a monthly basis. A simple tally of sources of income for the month compared to anticipated costs will help to under more about your spending habits as well as ensure that you live within your means. Many times, people don’t really know where they are spending their money and find that they are in the red nearing month end and if a major expenditure comes along, they have to dip into their savings. One you see your income and expenditures on paper, not only will you manage your finances better, but you might just change your spending habits. .
A simple way of making the budget would be to outline the confirmed sources of income like salaries and the anticipated sources like bank interest and dividend payments on the one side and the fixed expenditures like rent, and interest payments, and variable expenditures like utility bills, petrol, internet charges on the other. Factor in the one-off expenditures like insurance premiums and medical check-ups as well to get a feel of your money balance for the month.
Remember, nothing is carved in stone and if a variation takes place in the middle of the month, put it in or else make a note so that you can use that information and your experience to get your budget right for the next month. Control those factors that you can.
Tip No 2 Planning
Planning is a great way to save, not to mention getting the most out of your money. . If you’re going to the market and particularly to a mall, make a list of what you need and stick to it. Be particularly careful in malls….in Delhi at least it appears that nobody seems to be buying much and there are perpetual sales in many mall shops. At one particular mall that I visited recently, the security guard in front of a retail shop catering to teenager and younger women tried to persuade me to at least walk-in to the shop. Sounds pretty bad especially if it has been a decade or two since you were in the right age group and most mothers know better than to buy their teenage children clothes.
You certainly don’t want to come home with stuff you really don’t need just because there is a buy 1 get 3 free offer going on or there is a discount at your favorite shoe store and you end up buying 4 pairs of shoes of which 3 will never be worn because they don’t match your wardrobe or the fitting does not compliment your feet.
Tip No 3 Setting Realistic Goals
When it comes to financial planning, it is advisable to break your goals into short-term, intermediate-term, and long-term. Better yet, set milestones for the intermediate and long term goals. Being able to see your accomplishments is a great motivator for you to work hard at saving.
Achieving the short-term goals of saving will encourage you to keep saving for the intermediate and long-term goals. At the same time, the goals that you set for yourself should be achievable and realistic. Planning to buy a house and paying off your mortgage in 3 years when you know that your resources make the mortgage payoff possible only in 10 years will not give you any encouragement to save and you may end up hurting your lifestyle rather than keeping the status quo.
Tip No 4 Stop Competing with Others
Competition is natural and as long as it is healthy it is good but one needs to know when to draw the line. You do not have to compete with anyone. Be proud of what you have and who you are. It is perfectly alright to want the best that your money can buy, but it should be something that you want for yourself and not to impress others or because EVERYONE is buying it.
If your budget is X amount for a stereo and by paying a little more you can upgrade to a better model, then, provided it fits into your budget and you can honestly justify the upgrade, GO FOR IT. Wanting to keep up with the Jones’s is not healthy and can create much bigger financial problems for you. Stick to what you can afford regardless of what anyone else has or pressure you might be feeling.
These are four important tips for the week in managing your money and require some thought. To begin saving money without compromising your lifestyle requires a bit of introspection and habit modification. I prefer to call this a shift in mindset towards money. A truly happy and content person realizes that money is a means to an end and not the end itself.Look out for next week’s post when we look at some practical areas to implement money management.
In the meantime, remember to sign up for the teleclass here and let me know which of these tips was most helpful for you.
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