Making Sense of Your Cents

*In the tune of Johnny Kemp….”Just got paid…Friday night!!

Let’s talk about money.

There are any number of idioms regarding money and finances. To rattle off a few -“Money comes; money goes”. “Money is the root of all evil.” And finally, my most favorite – “Make that money, don’t let it make you”.

In reality, though, money is simply a tool. And as with most tools, it can be used to cause destruction or build greatness. It is how you manage your cash that will be the decider of its use. So, let’s get into it.

There are 5 “A’s” that will help guide you through financial management. This is an amalgamation of many different money management tools and completely remixed by yours truly.

Assess your Current Financial Situation

This may or may not hurt a bit, but it is the necessary first step. In the emergency room of a hospital, the first thing that is done is called triage. Triage is an assignment of degrees of urgency to a patient’s illness or injury. So, in other words, you need to triage your finances. It can be a long process, but you won’t get very far if you do not commit.

How to do that? First you go through each of your bank accounts. You can print them out if you are old school or use an excel spreadsheet. Go back 6-12 months to determine how much money you have coming in (and from what sources) and how much is flowing out. Break up your spending into different categories such as Necessary vs Recreational. Necessities are bills such as Rent, Utilities, and Food. Recreational spending includes dining out, gym memberships etc. 

Photo by The Creative Exchange on Unsplash

Ascertain Your Strengths, Weaknesses, and Drains

Next step- analyze yourself and your money habits.

Do you pay bills on time on your own or are you more efficient with auto-pay? Where are you overspending or overextending yourself? How many subscriptions are you signed up for, and how often do you use them? Do you prefer using cash or credit cards? And which leaves you more likely to spend more? 

Agree with Yourself to Make a Change

Simple but also very difficult to do- make a promise to yourself in the form of a budget or list that you post on your mirror to remind yourself. This list includes, not only your future goals but your present limits.

Make a verbal agreement with yourself and be firm. For example, “I WILL ONLY SPEND X AMOUNT EACH WEEK. MY FINANCIAL GOALS ARE X.” Set a daily alarm reminding yourself of both. The best way to make a change is to be consistent and follow through. 

Photo by Darío Martínez-Batlle on Unsplash

Automate Your Bill Payments 

Designate a specific credit card and/or bank account and set up auto-pay for all of your recurring bills. It is the most efficient way to prevent late charges and unnecessary interest.

If you are using a credit card and have the funds to cover your purchase (which you should always have unless you are making a big purchase with zero or low interest), then set up a weekly payment plan to pay for daily charges. 

Accumulate Extra Funds

Once you have your regular wages in check (funds accounted for and routed to their proper places), your next step is to find other sources of income.

Assess your skills and passions and then monetize them. If you enjoy cooking, cleaning or crafting, then set up a simple website and begin to share your tips and secrets.

If you enjoy writing and need a forum to showcase your work (Hello!! Hi…that is what I am doing right now.), sign up for websites that allow you to show off yourself and your writing talents. Try websites such as Medium or Quora that allow you to write any and everything.

If you enjoy animals, sign up for dog walking or animal babysitting. Same thing with children, cars or event planning. Basically, find your joys a la Marie Kondo style, and then figure out a way to make money off of it. The Interweb is full of people just like you who have gone and tried. So, follow suit. Get out there and TRY!!

Money is not a finite resource. It is literally printed paper. So, go out there and get you some!

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