It is a universal fact that it is easier to spend than to save. Human has high level of needs and that is the main reason why we spend more than we save. Statistics showed 1 in 20 of us are unable to control the urge to spend, men and women alike.
It is also true that we spend as much as we earn if not more. There is never enough. If you have been working for 10 years and more, you can make your own comparison.
Assuming that you were earning just $24k annually 10 years ago, you get along fine with your income and expenses and now 10 years later if your earning has increased let say to $60k annually, I am sure you are not just spending $24k but that you probably are spending $60k or even more. If you are spending more then this will equate to the fact that you are in debt.
Conclusion here is, if you are one of those who said to yourself that you will start saving when you are earning more, stop it, because it will never come to that. If you do not have a financial plan in place, each time your earning increase you will have this other thing that you need or something that you are committed to. And “poof” there goes that additional amount of money you have.
So, are you a spender or a saver?
Savers
If you are a saver, fine and good but just saving your money is not enough to guarantee you a good retirement plan that will give you the lifestyle you are so used to now.
Read about “Put your money to work for you” and some of the posts here under “Invest” category. Find out how you can put your savings into earning money for you over the next 20 or 30 years before you opt to retire.
Spenders.
Spenders beware! Are you in the high-income, low net-worth category? It’s time to make drastic changes if you are reading this and you are aware that you are spending too much. Similar to people with tendency to violence, they are born with an extra “y” chromosome. You are probably born with a defective chromosome maybe a “s” chromosome :). You are born to shop, shop and shop. Or you may be suffering from a sickness called “shopaholic”. Following are 2 ways to help you fight your “sickness”, they can work but it takes some will power:-
1. Pay yourself first – before you can get your hands on your money end of each month, commit by auto-transfer the amount you want to put away to a special account where you have taken out with no “ATM” card. (Read about some posts here in “Wealth Creation” category).
2. Lock away all your credit cards. Credit cards are meant for convenience and building your credit score but if you are unable to control your spending, the best way is to get rid of the spending avenues. Keep only enough cash for you to get by daily and by all means avoid window shopping. The temptation may be too much for you to resist the inconvenience of running to the bank. After a while you will hopefully (depend on individual and the strength of your will power) get use to your forced new lifestyle of minimum buying and live with this new found lifestyle comfortably.
2 comments:
It's hard to control the temptation to shop, but i doubt avoiding and hoping to get used to frugal lifestyle... will cure a person's addiction to shop.
For example, if i force myself not to smoke for sometime, trying to kick the habit... I may stop for sometime, but once the first puff again... All my previous effort will go down to the drain.
Hmm... I think what we need is Reasoning and Conditioning with ourselves. Errr... Need to find out the "how" about this :p
I agree with you. Its easier said than done. It really depends on how badly you want something. And if you fail to do what you set out to do is because you did not want it enough.
A typical example is this simple story I read somewhere:
"A young man came home feeling exhausted after a hard day's work. His mother requested him to help her change a blown light bulb but he just flopped on the couch and told his mother that his is tired. A few minutes later he received a call from a girl he likes and she lives like 30 minutes drive away. She wanted him to help her change her blown bulb as well."
Can you guess what was his response to the girl's request?
Of course, he immediately without hesitation get out of his comfortable couch and drove to the girl's house.
Now can you see the motivation ??
So, if you really want to give up smoking, you will have to fear death or fear the dreaded big "C" to end it once and for all...
Here again, easier said than done....
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