Its your money - make the most of it!
The easiest way to define what you want is to jump ahead say 5 years or 10 or 15 years. List those experiences, practices and accomplishments that you will achieve. Again be specific about what you want your life to look and feel like to you not just a list of the things you want to have accumulated.
Dreams are good here – do you want to travel? start a business? Remember to be as specific as you can.
What is important to you will become obvious as you continue to think and write.
The most important question – and your answer, in life is about the kind of life you want to make for yourself – to live every day for most of the rest of your days. So many of us slide along thinking that some fabulous opportunity will eventually present itself. Instead life happens and we end up putting together the best that we can while we go on waiting. The state of the economy at the time largely determines what our personal economy will consist of. I am not referring to your specific vocation, I am talking about broader matters than that.
What are your priorities? What do you want to end up with when you have worked for 40 years. Is the next generation of paramount important? or are you more interested in having an impact on the present? You have 24 hours in every day, is it more important for you to spend your disposable time with the important people you have gathered or would you find more satisfaction in sharing your ideas with the unknown masses. Do you want to accumulate massive wealth (for your children) or do you want to spend your time accumulating experiences.
Culture began several hundred years ago with two people sharing the massive responsibilities of building a productive life. Now, in the US, we subscribe to the independent theory that we only succeed as people if we can create a productive life all by ourselves. Produce wealth, raise successful children, enjoy an active social life and create an atmosphere that promotes personal health and happiness. This is a huge plateful and not many have accomplished it entirely on their own. It may not take an entire village but it does usually take more than a single person and that’s okay. Everyone has their strengths and only by recognizing and taking advantage of that fact can we truly feel fulfilled both personally and socially.
Its never too late in life to decide how we want to spend it. It can only rob you of valuable experiences to turn a blind eye to making a decision.
Because they don’t teach you personal finance in school but you are expected to be at the very least competent at it, we’ll start with budgets. There are several different methods of creating a budget. They all come down to as listing of revenues (job income, passive) and expenses (rent, groceries, etc.)
Everything after that is gravy. It’s just to make filling it out or sticking with it easier. Some computer programs turn your numbers into colorful graphs or up sell other products — which kind of defeats the purpose of tracking your money so there is enough leftover to save. [Read more...]
