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7000 Peters Creek Rd., Roanoke, Virginia
1-866-260-5994 |
CCCS of Southwest Virginia |
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Developing the Right Attitude About Money |
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Have you ever known someone who does very well with investments and savings, even though they make the same money you do? They never seem to be lacking a decent car, nice clothes, and other non-essential luxuries, while you live paycheck to paycheck, only able to dream of a savings account.
You ask yourself, how is this possible? The best way to answer that question is to try a simple exercise that will illustrate how much money you spend needlessly.
Start by listing your monthly fixed expenses, such as rent or mortgage, utilities, cable television, insurance, loan payments, and minimum credit payments. Include every monthly bill, estimating those that are variable, including what you spend every month on groceries and gas.
Add them up and compare the total to your monthly take-home pay. Most people are shocked at the difference. Now ask yourself, and be honest, can you live on what’s left over after the bills are paid. I’d bet that you can, and have plenty left to build a savings or pay off debts.
Don’t feel bad. Almost everybody wastes money to some degree. It’s important to understand that every purchase we make – excluding such absolute necessities as food, rent, and gas for the car – is a choice. So if you want to stop wasting money, it’s as simple as deciding to stop.
Start carrying a pocket-sized spiral notebook with you at all times, and write down every purchase you make, including the amount. Even if it’s only a soft drink from the convenience store, or a trip to the drive-thru at a fast food restaurant, record it in your notepad. Most people discover that this exercise curbs spending automatically because it draws their attention to it. After two weeks, review your notes and ask yourself if you really need all the things you buy.
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To develop a winning attitude about money, think about your spending habits. Do you buy things you don’t need when you’re depressed? Do you treat your friends just to gain their approval? Do you spend money for convenience, such as eating at a restaurant or having food delivered? Do you spend a lot of money at convenience stores? The answers to these questions could reveal the root cause of poor spending habits.
For the most part, though, this type of behavior stems from an inability to distinguish between what you “want” and what you “need.” When you think about something you “want” for any length of time, you eventually convince yourself that it truly is something you “need.” Once the thing you “want” becomes something you “need,” it gets lumped in with all the things you really do “need,” like food, shelter, and electricity.
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The key is to make sure you separate in your mind the difference between “wants” and “needs,” and put achieving your financial goals in the “need” category.
A winning financial attitude means not buying items at a convenience store if they’re available at a supermarket. It means cooking meals at home instead of having them delivered. It means being sensible about credit and not piling up enormous debts. Most of all, it means making smart decisions about your money.
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CCCS, A Division of Money Management International
Regional Headquarters - 7000 Peters Creek Rd., Roanoke, Virginia
Corporate Address - 9009 West Loop South, Seventh Floor, Houston, TX 77096 |
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