Money Do’s and Don’ts

If money is what you value then money will make you happy.

Though for the rest of us the objects, things, the stuff we buy only seems to satisfy us for a little time, then the desire cycle begins again, we want, we buy and then tire of our new stuff. Sound familiar?

Being poor or financially stressed does affect our happiness. However it is not the only factor determining happiness and satisfaction in life and it would be sad for us if it were.

Do you believe that money equals happiness?

If you want to know whether you believe in the money is happiness, ask yourself these questions:

Do I believe that only money leads to my happiness, fulfilment or contentment?

Do I think that, if only I made more money everything would be good?

Do I envy those who make more money than me, have more money or things and assume they must be happier than I am because of their wealth?

When I meet someone who is not wealthy, do I assume that they can’t really be happy?

Would taking a small decrease in my or my partner’s income upset me?
 
Many believe not only that money equals love but that money is a substitute for lack of love. So aiming for love, we go for a better paid job, buy new things, a bigger house to put ourselves and our stuff in and then? We get a career with promotions coming every so often, more stress, more money and on until we retire or die…

Making lots of money in your job can make you question why you are working at your job, even if you chose it for money reasons. The more you make there may not help you be fulfilled elsewhere.

Many of us need to feel that we are not just working for money, the effect of income on feeling good about yourself is recognised as less for those who make less money, because differences in income translate into differences in how well basic needs are met. Such peoples motivations come from what they do, how they do it and how much control they feel they have over their working day. You too could have freedom, but maybe you think freedom comes from money?

Thinking that Money represents freedom prevents you from doing what you want to do. All the time you’re poor you can’t do X, if you got more money you might have to do what you’d love to do but you can prevent yourself from doing it by not getting richer…circular isn’t it?

And like animals in small cages we keep on circling round and round, getting crazier and crazier. The difference is, you have the keys, you can get solvent, think of newer ways of doing things.

Do stop and think about this, would you, given the opportunity, actually live out your dreams?

These are useful points to consider in a journal:

If you spend 10 hours a day, every day, doing something you hate (and maybe having to commute to get to do it) does having a large salary really compensate?

Do you really hate your job or does moaning about it do something else for you?

Could you give up a high status, high paid job and really get behind a low income job that gave you more time to do X?

If you gave up your job what other things would you be giving up, like perks, opportunities and incidentals?

How welded to your status are you?

Do spend time working through your responses, you are worth it.

Are there circumstances where more money brings happiness?

If you are living in poverty then having more money will make a big difference in quality of life. However, once your basic needs are met it’s not likely to make you a lot happier and you may begin again to question the why and what of what you do to earn money.

Do you know what you really think about money?

Maybe you think that more money will fix your problems even though you aren’t totally successful at managing what you already have.  Things don’t bring you happiness. If they did you probably wouldn’t be reading this, so, next I’m going to suggest that you learn control over your finances, which will determine life happiness more than your job, health, family and other relationships. This is because if you are creating chaos for yourself financially then you are creating chaos in these relationships too.

So what do you need to do?

1. Get organised

Develop a system that you understand, where you can find any documents; quickly and without hassle.

Organised people can find what they need quickly and are happier because they’re not frustrated by administration. This leaves energy to do what’s needed.

For one month keep a track record of what you spend your money on.  Then rate the fulfilment that each brings you.

• Pay bills as they come in.

Do this as and when, it’s far less hassle. Your money then goes out when it’s needed rather than the one big chunk at the end/beginning of the month. Keep track by using an ATM and you will begin to budget to meet these needs rather than splurge. The task here is to control your money rather than it controlling you.

3. Keep tabs on your cash

Set yourself an amount of cash per week and only put part of it in your purse or wallet each day. This will focus where your money goes, you may not be able to buy the bits and pieces, the sweets, coffees and impulse buys-but doing without these will help you have more money and control over it.

4. Save 5 percent of your income

Put 5 percent out of each by direct debit or transfer to another account before you have the chance to spend it. Later, as you become used to doing this add to the percentage until you increase the possibilities of what you wish to do with your life.

5. Protect your family and yourself

Do what you need to with life, accident, travel and sickness insurance. Write your will, make sure your finances are in order and live knowing that your family are provided for.

6. Minimise credit-card debt

Credit cards carry higher rates of interest than loans…

Don’t borrow money to pay off existing debts, it only creates more problems.

Stop using your cards. The last thing you need to do with debt is add to it. Take all your credit cards out of your wallet or purse and leave them at home. Cut your cards up if it will help you to stop using them. Cards are not your friends-ever. Each month pay more than the minimum amount, this is calculated not for your benefit but to extend your payments for as long as possible. This makes money for the credit card company; remember, they are Not your friends

Check your cards, do you know what interest rates you are paying? Write down the balance for each card and the interest rate. Start by paying off the card with the highest rate first, then the next highest and so on.  Try to reduce the interest rate, negotiate with the company for a lower rate. Lump your debts together, combine your debts onto your lowest interest rate card, maybe transfer all debts to a new card if they offer a 6 months interest rate free, then transfer back to a lower rate or another rate free account. It’s a hassle but you save money and remember, cut up the cards you are not using!

7. Spend sensibly

These are the difficult bits, I guess you’re expecting me to offer the stock phrases you got as a kid, but they didn’t work did they? What I want to suggest instead is that you use your best asset, which is you and your ability to think. Think before you buy, read, research, gain and ask for information from those without an interest in getting you to buy. Check out Internet sites such as ‘The Motley Fool.’

I can’t resist these truisms though: If you can’t afford it don’t buy it and if you don’t need it, don’t buy it. Simple enough but so hard to do. (Bitter experience)

Try waiting before you buy and think, there’s got to be a far better, less expensive way to buy, either from the internet, auction houses, second hand specialists or from a discount place. Make the acquisition fun as well as the owning and make these fun ways to acquire ‘stuff’. Discover the truth in that if I can’t pay for it today then I can’t afford it.

If you train yourself to money saving ways they will get to be fun. Haggle with car sales people and everywhere you go, always ask for discounts. You don’t have to save coupons but if you do, find the place that redeems all of them in one go and save yourself hassle as well as money. Learn to feel about how much money you have and don’t go over your budget. I bought this laptop I’m writing on (second user) by telling the salesman which model I wanted and how much I’d give for it, cash. He hummed and hawed and when he saw I wasn’t flinching, then sold it me. These guys have quotas, sales targets and their own money to make. I offer this here because I felt good about my purchase, still do and I feel I paid what it was worth to me and not what somebody could get out of me…

Ps. I got a carry case and guarantee for free too, because I asked for them…

8. Start working toward your goals

Set yourself targets along the way to your goals. If your goal is financial security with money in the bank and no debts but right now you are a long way from that, then write a Business Plan. Put in targets along the way, it’s good to go on a long journey but if we miss the view then there’s no enjoyment in the travelling.

Outline your plan, goals, your debt management ideas and reasons you think they will work. Maybe make this presentation to your family, get feedback, revise it and give it again, this time finally setting it out as a plan. Put in rewards for your targets, they don’t need to be extravagant, just a reward here and there to encourage you and them to keep on track. If this became all hard work with no reward, I wouldn’t continue…

9. Communicate

Communicate the ideas of your business plan, maybe use it to stop arguing with your partner about money, that’s definitely not happiness.

(If you are still arguing after agreeing a plan then maybe, just maybe, your problems are not about money.)

Budgeting, saving money and making debt payments can make for a dull life. If there are important others involved get them to set rewards, they will notice that money is tight, there are less treats etc. Get them to set the fun rewards to keep you focused and to reward them for being involved with you in your plans.

10. Resolve to spend less than you make Oh yes, if only it were that easy I hear you say. I’m hoping that these will guide you towards this. Happiness may not initially be a result, more that as time moves on and you become more financially in control and less beholden to others, that being in control makes you less worried, less involved with chaos and lesser time is needed to worry over your finances. This time and thinking can be better used elsewhere.

Neil Benbow

(c)neilbenbow