Don’t Budget! Don’t Save! Don’t Plan!

I’m just having some fun with you now. Seriously, I wonder if all the logical, rational financial advice given by any and all professionals only prompts more eye-rolling. I mean, if everyone knows what it takes to obtain financial well-being, why aren’t they doing it? (I suppose the same is true for losing weight…)

I was recently interviewed for an article about getting a handle on your finances but it was basically the same old drill: budget, save, plan.

So, my goal in this post is to make you think about these three a little differently so they maybe resonate with you, and you just may be motivated by the “Ah Ha” experience to make some changes. Maybe not, but it’s worth a try.

It’s easier to budget when you don’t have to. So, establish automatic savings programs (for bills, emergencies, retirement and anything else important to you) and just spend the rest however you want. Seriously. But you have to do step one first. Stop beating yourself up about your apparent lack of self-discpline; set up systems that do the discipline for you and get on with your life.

When you are saving for something, it does help you spend less on other things so that you can have it. This works much better with a vacation than with retirement because the vacation is closer and the motivation is stronger (even though many people eagerly await the day they don’t have to go in to work). Your goal item gives you something to shoot for; a target so you don’t “wander and squander” as I say.

Some people struggle with setting goals and that’s okay, they just need time to dream and think about what’s important to them. That’s all it is, really. And establishing goals that are realistic and achievable. (Is that why you haven’t planned for retirement? Do you think it’s unachievable?)

I think the people who struggle with sticking to a plan:
(a) need to evaluate their commitment to the plan itself
(b) need to evaluate their trust in whomever designed it or
(c) have the wrong plan (meaning it doesn’t really reflect their goals, values, and priorities).

Sometimes only one spouse is involved with the “plan” and the other spouse hasn’t really bought into it or maybe wasn’t even consulted. It’s hard to commit to something that was never yours to begin with.

Sometimes (most times) our emotions drive our financial decisions. Most of economic theory is based on the faulty assumption that we make rational decisions; we don’t, and that’s okay but we have to know what we’re working with. I think it all starts with self knowledge; knowing who you are and what it is you want out of life. When you’re motivated to achieve something, you’ll be able to stick to a plan and won’t waste resources on things that aren’t helping you.

Financial stewardship hasn’t changed since the invention of money but most people don’t know the rules or the tools, and so few people are good at explaining either, and not many parents are able to model good financial habits for their children.

So how are people to learn?
It’s hard and yet it’s simple: Know yourself, dream, set goals, get help, act on advice, smile with satisfaction.
Photo courtesy of ClipArt.

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About Amy Jo Lauber

I help people who are overwhelmed take control & make good financial decisions with confidence and experience peace and abundance. Are you ready to say goodbye to working hard but not having anything to show for it? Go to www.lauberfinancialplanning.com "Let's Talk" tab to schedule your complimentary initial consultation and take the first step on the path to financial empowerment.
This entry was posted in Budgeting, Personal Finance with a twist. Bookmark the permalink.

3 Responses to Don’t Budget! Don’t Save! Don’t Plan!

  1. Leah says:

    Honestly Amy, you had me with that title… wait a minute! But honestly, I’ve sort of developed a no-plan strategy with some things by trying a little everyday or weekly- like only eating out 2x/ week to.save up money or spinning 4x/week to get fit. Perhaps it is sort of a plan- but not in the traditional sense. 🙂

  2. Great piece..Amy.. You should send this for publication in NYT and WSJ personal finance blog section for more people to benefit from reading it..

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