Financial Empowerment: What are your financial strengths and weaknesses?
This is the third in a series of articles designed to help you empower your finances and take charge of your fiscal well-being.
No matter how much money advice you receive, or how many financial blogs you read, there’s no one-size-fits-all when it comes to managing your budget and finances the right way. In fact, sometimes using these tools, designed to help you get on the right path, can hurt your money plan in a big way: by effecting your mindset on how you’re managing your money.
Some people are really good when it comes to saving on the small expenses. They never spend money on their morning coffee, and always order water when going out to eat. They’ve cut cable and dropped to a minimalist cell phone plan. On paper, they’re doing an awesome job, and might think it’s an accurate reflection of their financial status. But if they’re still spending more than they make, and covering it up by taking on bigger amounts of credit card debt, they’ve been lulled into a false sense of money security.
Meanwhile, someone who splurges regularly and finds their impulse control lacking, and can’t seem to consistently keep to their small budget, might see themselves as failing their finances. This can lead to stress, depression and can even effect their health. What they don’t realize is that their positive habits, maybe having paid off lots of student loans or regularly adding to their emergency fund, puts them in a better position than they assume.
Being financial sound is less about following certain rules, and more about seeing the big picture of your finances, both those in and out of your control. If you know where you’re weak and where you excel, you’ll have a better time establishing a money plan that really works for you, and fits your needs. If you feel you’re really struggling, re-evaluate your total financial picture – you might be in better shape than you thought! But it’s also important to step back when you’re feeling confident, because something might be slipping through the cracks unnoticed.
No matter how you organize your finances, one thing is crucial: know thyself, and do what works for you, above all else!
What money tips have you tried that did and didn’t work for you? Share them with us in the comments below!
Like this article? Check out another from this series: "Financial Empowerment: Your Worst Case Scenario"