This is the first article of a three part series on “How to Create a Financially Balanced Lifestyle” based on what has worked for me AND what I’m still learning.
This is going to be a very important series if you are serious about making a better future for yourself and your family. Let’s get started…
“All days are not same. Save for a rainy day. When you don’t work, savings will work for you.” – M.K. Soni
It’s been very interesting to watch how our economy has changed over the last few years. When I first entered corporate America, there was so much excitement and opportunity. Firstly, to make money. Secondly, trying to choose which job to take which would provide the most income. Beautiful homes, fancy cars, nice clothes – you name it – we had/have it ALL. Including the debt trailing behind us, but we were/are maintaining.
Fast forward eight years, the unemployment rate is up and the morale is down (depending on who you talk to). Ask someone “How’s it going?”, you may get one of two responses: “Pretty good, just trying to make it” OR “Wonderful, life couldn’t be better.”
Why the different responses between people?
I think it’s based on perception AND preparation. Could it be that the “life couldn’t be better” responder hasn’t been affected by the economy? I don’t think that’s the answer. But let’s dig a little deeper and look at the two different components.
Perception. Perception is defined as a way of conceiving something. A person with a positive perception sees life through a different set of glasses. The whole world is their oyster. They enjoy every moment of their life, but most of the time they balance that enjoyment by way of…
Preparation. Knowing a rainy day will come and they must get ready.
So, is everybody that has a positive attitude prepared for the future? No, not everyone, but they have conquered half the battle and with a few key concepts could be well on their way to a better financial future.
The Fundamentals Have Not Changed
As I’ve watched the recession unfold over the last year or so, I’ve noticed that the people who are least affected are those that have built their lives on a basic fundamental of money management…
- Building an asset. And the best asset we can build is saving money for times of emergencies. It’s not a question of “IF” an emergency will happen, it’s “WHEN?”.
Sounds really simple doesn’t it? The real truth is that most households don’t have a savings account earmarked just for emergencies.
So What is the Right Way to Build and Asset?
The first thing you need to do is lay the framework to build your fundamental asset: Pay yourself first. Kind of like a forced savings plan. This means to treat savings as the first expenditure after you receive your paycheck. It becomes a permanent fixture within your budget.
The key point to understand is that though saving is not a glamorous event, it can and will give you a peace of mind and a sense of accomplishment. Remember the tortoise and the hare? Slow and steady wins the race.
While there is more to your journey for financial happiness, this is a huge start. Just remember…perception and preparation are your keys. The rest is a breeze.
Sometimes we get a little relaxed with our goals and plans because life does happen every single day. You may have to take a quick step backwards every now and then, but to win the prize you have to keep taking steps forward. No matter how big or how small. One foot in front of the other.
Here’s the Goal:
- Build and maintain an emergency fund sufficient enough to cover at least six months to a years worth of expenses.
- Use high-interest savings accounts to preserve your emergency fund. You may find the best rates locally here.
- Keep your emergency fund in a savings account that is easy to access just in case disaster strikes.
- If you haven’t already, create a budget (spending plan). This will help you in achieving your goal.
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Now, don’t be misled to think that I have thousands and thousands of dollars in the bank. Since my husband and I have paid off our debt, we have been and are continuing to build upon our emergency fund. This has been a process of continual growth. An act of taking it one day and one month at a time. But what we do know is that we are better off today than we were five years ago. We’ve made substantial progress. That’s something to be thankful for
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What are your comments? I’d love to hear them…
Click here to read on to Part 2 of the series
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