One of the things that people say to me is: “I have so little money, it doesn’t make sense to work with my finances.” Actually, the exact opposite is true – that is the perfect time to do it! The truth is that it is exactly when we have tight resources, that it can be most effective to sit down and make a plan for what we would like to do.
This is the perfect time to envision where we want to be – what are our goals, can we change something to move us closer to them? What are the actions we need to take? We identify where we are, decide where we want to be, and map out a path to get there.
The other important thing is that when we sense that we are at the limit of our income (and really, this can happen almost regardless of how big that number actually is), we feel anxious, and it is constantly running in the back of our mind. So even when we try to ignore it, it’s affecting us. Doing our “money work” puts a map in place that allows us to relax. Perhaps we are uncertain about covering the bills, maybe we don’t know whether we can afford something we want, or perhaps spending money just makes us feel guilty. In these situations, a plan for the whole year is a great relief – we look at income, look at outgo, and create an outline that shows exactly what we need to do to be ok. After doing this, one client said: “That was a great comfort”.
Particularly for young people, understanding personal finances and making a clear plan can be so important, because an early start on this can really change the outcome years down the road.
If you know a young professional who would like to learn more, I will be starting the on-line class “Money 101 for Young Professionals” on February 22nd. This class is designed specifically for young adults in the working world, and covers the basics of personal finance, how to make and track a budget, and manage student loans or other debt while also starting to save. There is a 10% discount for early registration by Valentine’s Day, February 14th. More information is on my website or at the Facebook event – contact me at linda@moneymindful.org to register.
And if you know someone who would like some help sorting out their finances in one-on-one sessions, please do send them my way. I greatly appreciate your referrals.
Originally published February 2016