The following guest post was contributed by Dan Boylan.
Dan Boylan is a lifelong practitioner of debt free living. He teaches classes out of Fort Wayne, IN at the University of St. Francis. He has a basic belief that all people can live healthy, happy debt free lives. He has spoken at numerous events and venues. Contact him at [email protected]
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Many individuals skip thoughts of personal finance because they think of personal finances as unpleasant. Resisting paying attention to one’s own finances could put the person in a weaker position long term and one should not ignore guidelines that can be valuable. For example, one may believe that budgeting forces you to deprive yourself of things you like to do. This does not need to be the case and by simply planning ahead a bit the person may actually be able to do more than they originally had thought with a few small adjustments. Here are a couple of tips that you can use to aid you increase your existing finances.
In the likeness of St. Francis, keeping life simple can earn great rewards. This means trying to eliminate the unnecessary. In personal finance this can be working on the elimination of unneeded paper work, elimination of tasks that detract, straggling payments, and small easily payable bills. An example of eliminating unneeded paperwork can be illustrated with this example, having 5 outstanding credit card balances means having 5 monthly minimums, 5 mailings, and 5 check writings a month. If this can be reduced to 3 credit cards, 40% of the work will have disappeared. An example eliminating tasks that detract may be, having a nice meal at home with family and friends can mean less work. Here there is no arranging times, organizing transportation, waiting in line, and fussing over food to worry about. We haven’t even considered the amount of money that can be saved. For me sometimes less is better. To address small and straggling payments one might look to see if they have any bills that are paid routinely that are small. Here you might want to eliminate those $10 or $20 payments by focusing on their payoff first.
When considering stretching this means that you should look at all the items that money is spent. Once looked at you need to make a determination of whether or not the items are really wanted or a matter of habit. For example many people have a lot of magazine subscriptions that are renewed yet the magazines sit unread. Others may have gym memberships that go unused. In this situation we are stretching our finances for no needed reason. To get rid of these items could free up money for things that are really meaningful to you. A cheap and easy way to track these costs is to pull out a legal pad. Make 5 to 7 columns. At the top of each column write an area that you spend money on such as: home, car, food, education, entertainment and of course a miscellaneous. As a month progresses in the appropriate column write down the amount of money spent. This task should be done daily to ensure everything is logged properly. At the end of the month you may be surprised at what you find in regards to your spending.
Lastly, support important to consider when looking at personal finances. Here the individual needs to surround themself with others that will either support them in spending patterns or who will not encourage poor spending. Consider entertainment as an example. If one is to go to the movies once a week with a date ($15) and buy popcorn and a drink ($12) then an ice cream afterwards ($6) the evening could cost over $30. Alternatively, if one were to rent a movie ($1.50) and pick up some snacks ($6) the evening is considerably less expensive. Being with like minded people can help one feel less of a strain. Here if your friends “have” to go to the movies you might need to look at if these people are being good influences to you. Read books from the library or go to your favorite websites on personal finances.
One will discover that, as soon as you begin to apply simple ideas to life, that decision will become natural. While spending can be a habit, it can also be habit to spend wisely.