There’s no magic in this. No quick way out, click here and your woes go away. Or worse yet, pay me and I’ll take care of it for you. This is just a set of simple, plain common-sense solutions that will work, and can work amazingly well when consistently applied.
As human creatures we have a tendency to not want to deal with the unpleasant stuff. Our natural proclivity is to select pleasure over pain, especially in the midst of this instant information age, and has cultivated a culture in us of ignoring those things that might be unpleasant. That’s likely one of the reasons we get into this financial predicament in the first place, but the distraction of instant gratification is not the only way we got here.
We’ve also been taught in our evolving culture to seek ease in our lives. Pain avoidance and pleasure seeking both tend to breed an attitude of sloth. Unfortunately some of us have been taught to not seek anything, in no small part due to the coddling our boomer and pre-boomer parents have fomented; the entitlement attitude that is so pervasive in society these days. They wanted it better for us than they had it, but in the long run we see a disservice having been performed.
There is another factor contributing to how we got here. This mess isn’t completely our faults. There is also the big unknown variable … unanticipated changes in our circumstances. Sometimes they’re sudden ones, and when they happen we find ourselves in the position of not being financially prepared for dealing with them. For those living paycheck-to-paycheck an abrupt surprise can be financially devastating, which in turn triggers our pain avoidance response and deepens the financial spiral downward. When we don’t have any buffers in place to absorb them we often tend to become discouraged to the point of paralysis.
While we cannot always control our circumstances, we can definitely control how we process and deal with them. You can only stuff a closet so full of things you don’t want to deal with, until it builds up so much pressure and gets so full it breaks down the doors. Then you’re completely overwhelmed when everything tumbles out onto the floor in front of you.
We’re tired of struggling while pushing that big rock up the hill. We’re getting older and don’t have the verve we once had. We may have squandered parts of our future away on the more temporal things of our younger days. But the end result is the same: we’ve been so inactive with our financial independence for so long we don’t know where to begin to fix it.
There is a way out
It has to start with desire, the primary motive force. We cannot just wish it into manifestation, it has to be more than that. Desire and wishing are two entirely different things.
We have to say, “Enough is enough. I refuse to live like this anymore.” And mean it. Mean it enough to commit to it Every. Single. Day.
Before embarking on any trip, it’s wise to do some figuring. What mode of transportation and route are you going to take? If driving (or, especially if you’re a pilot flying), how much fuel will you need? How much will it cost? How long will it take to get there? Do we need to stop for potty-breaks, naps, food? When should we leave? When will we arrive? And so on.
Figuring out all of these items constitutes a plan. Pilots are bound and live by this sort of thing. It’s one thing to choose where you’re going, but one should also educate oneself on how to get there.
Make a plan
Last July, I finally said, “Enough is enough.” To get ahead one needs to either make more, spend less, or a combination of the two. I make a decent livable wage, why was I not getting ahead?
The beginnings of planning any trip includes knowing where your starting point is. That is where my map and my trip began. I had to know where I was to begin with in order to be able to figure out where I wanted to go and how I was going to get there.
Track It
I’m certainly not an accountant; this stuff is Basic101 to them, with their deeper nuances still essentially Greek to me. I created a spreadsheet, one which I can access anywhere there’s a somewhat secure internet connection. I wanted to see where my money was going, and why I didn’t have any of it. So in this simple spreadsheet I made three columns: In, Out, and Balance each for a couple of checking and savings accounts. Wrote some very simple formulas and copied them down several hundred lines. Take the balance from the preceding Balance line, add the “In” and subtract the “Out” on the new line to get the new balance. Simple. Basic. There are a gazillion apps out there that will do the same…I just like to build my own, because I can tailor it to my specific needs, and adapt it as I get more proficient with using it.
I do online banking, and can see at a glance where I financially stand; I usually check on it a couple of times a day. I took a financial pulse, though the blood coursing through the veins was woefully anemic.
Next, I figured out what my monthly bills are, fixed and variable (you just have to guess at first at the variables), and what day of the month I have to pay them. Then I created a “Date” column to the left of my In/Out/Balance and, starting with today’s date, I dated each cell in the date column, incrementing each line by one day so I could see at a glance where I am or plan to be on such and such a date. I would begin to track every single penny coming in and going out. Of course, there are days when I buy more than one thing. I just add a line and copy the date and add the entry.
Now come the good parts. Once you begin to get a handle on what you’re spending, you can start filling out the future, what you know you’ll need to spend.
Pay yourself first
You’ve heard it before. Pay yourself first. Save first, before anything goes out. Everybody seems to have an excuse, saying, “I can’t save anything because I have to pay everything out, and there’s not enough left over to save.” That’s why the word “first” is in there. Believe me, you’ll find a way to make ends meet. Save something, ideally at least 10% of what comes in, but less at first, until you start getting into the habit of saving. Then it becomes easier.
We, who have traditionally been unable to save any money in the past, were unable to save because we spent or overspent what we had coming in, no matter how little or how much we were pulling in. Then when something goes south we don’t have any reserve to absorb it, and we’re thrown into financial crisis.
We resort to magical thinking. “Maybe I’ll hit the lottery.” Maybe, but highly unlikely.
I keep my cashflow log projected to between eight and twelve months into the future. That way, if there are shortfalls a few months down the road, I can adjust my savings ahead of time, and prepare for it. The important thing is that when something like an unanticipated car repair or other expense comes up, we have a savings buffer to adjust.
Another benefit to projecting so far down the road is that, although not particularly accurate long-range it gives you something to shoot for.
What has been borne out in my practice is that I’m constantly adjusting longer-range projections to account for any windfalls or shortcomings as I go along. It has worked out rather well, I’ve finally been able to start saving.
And the very curious thing I’ve noticed is that I usually have more discretionary funds to spend in between paychecks. Even with a comfortable grocery and personal spending allowance I set aside. That in itself disproves the validity of the “I don’t make enough to save,” argument.
We naturally tend to exceed our financial containers if we don’t mind the store.
The Commitment
It’s a surprisingly easy habit to fall into. All you need to do is set aside a few minutes in the day to keep everything updated. You don’t have to run to the spreadsheet and run an analysis everytime you buy a pack of gum. I make it my first routine in the morning, part of my “get my act together for the day” script.
I wake up, get a coffee or tea, sit down early and do what my grandfather taught me to do. Make a list of what you need to get done today before anything else. At the top of the list every day is update the finances spreadsheet. First thing, then it’s checked off the list, and I can devote my attention to the other matters of the day. A huge encouragement for me to keep up with it is the results. Seeing a pile of money start to germinate. A small pile, to be sure, but at least headed in the right direction. It helps in making it develop into habitual behavior.
Every month or so I’ll extend the dates on the spreadsheet. Sort of perpetual goal setting. The goal is to become financially independent; not necessarily rich, but well enough off to not have to worry week to week. And ultimately to use any excess affluence to help others. Pay yourself first, remember? Love yourself first before you can truly love another. Help anyone who wants to help themselves, but you have to first be in a position to render that help.
Like Anything Else In Life
The basics can really be carried over into anything in life worth doing.
It takes a plan, a commitment, and a focus to stay with it. Too often we get discouraged and give up.
Olympian Inga Stasiulionyte wrote a series of steps for attaining a financial goal in a November 2016 issue of Success. In it she wrote of simple steps, which she applied to her physical goals, but is also directly attributable to attaining success with financial goals:
- Set big goals.
- Set clear goals.
- Know that every day matters.
- Don’t argue with the plan.
- Build a no-matter-what mindset.
- Plan a routine.
- Commit.
- Understand the transformation process.
- Go above feelings.
- Resist the brain.
- Find pleasure in the hard work.
I had unwittingly already embarked upon this set of steps six months before I read this. As I said, it’s no secret. It only takes a true desire and an application of a consistent motive force.
Ms. Stasiulionyte amplified these steps in her explanation of how she became an Olympian. Again, these concepts can be translated to financial goal attainment, or indeed any goal attainment.
1. Set big goals.
When you challenge yourself to achieve bigger goals, you really dedicate yourself to the craft. The more time you spend on it, the harder it becomes to quit. Once you have spent so much sweat, time and effort on it, if you quit, it will be for nothing. The bigger the goal, the more invested you become.
2. Set clear goals.
Clearly define what your goal means to you and what you will specifically do to achieve it. If you set a goal to live healthier, for example, will you go running every day? At what time and for how long? Will you eat healthy? If there is no clear goal, there is no opportunity to create the specific steps you’d need to do to accomplish it.
3. Know that every day matters.
When you wake up in the morning, do you know what’s most important for you to accomplish that day? Every goal, every priority, you have set for yourself has to be done—it will determine whether your dream lives or dies. Athletes know if they skip even one training session, they are already behind; they know they will lose a competition that is still three months away if they don’t do what they said they would, if they don’t follow through with their plan—if they aren’t disciplined.
4. Don’t argue with the plan.
If you want to go to the Olympics, each training session matters; there isn’t one that’s less important than another. It’s the same with everything else in your life. When you start the process, you cannot question it, you cannot hesitate, you cannot back down—you have to work hard every single day to reach your dream, full force.
5. Build a no-matter-what mindset.
Build the mindset that no matter what, you will accomplish things when you said you would. No matter what. You have to create pressure for yourself, otherwise nothing will get done. There is good stress and bad stress, and you have to make sure you are operating under good stress—butterflies in the stomach, a manageable adrenaline that stimulates you.
6. Plan a routine.
Create a routine that becomes second nature, automatic, normal. Athletes, for example, know what hours they train, when to break for lunchtime and dinnertime, and when to rest. In training, they know they have to do a warm-up, main training, and cool-down and recovery. By following the same routine, it becomes second nature—the discipline preps them to win. Planning your own routine—and sticking to it until it becomes automatic—can prep you for success, too.
7. Commit.
Discipline was instilled in me by my mom. When I would ask her if I could start art, dancing or volleyball classes, she would say, “Be careful in choosing where you will spend your time, because you won’t be able to quit. You will have to follow through with it until the end, and do it well.” So I really considered whether I would be able to commit to something for a long time. And when I knew when I chose the one thing I wanted to do, it made me want to figure out how to keep getting better at it—it made me want to commit.
8. Understand the transformation process.
Your body and brain will do everything it can to resist change and growth. You need to know that it’s natural to feel lazy and undisciplined—but you also need to know that you have all the power to fight it. Start with your thoughts.
9. Go above feelings.
The hardest part about discipline is maintaining the actions needed to achieve your dream or state of happiness. It requires constant hard work and fighting against comfort and instant pleasures. To do so, you have to separate yourself from the feelings that stop you, like fatigue, laziness or self-pity. You have to go above them, even if your feelings tell you that you are tired, stressed and alone in this struggle. Discipline is the direct training of a fighter.
10. Resist the brain.
All people are lazy, even the most successful businesspeople, the most accomplished athletes and the most talented actors. But it’s not simply laziness—it’s your brain saving energy for you. Any movement takes energy, and the brain is doing everything to stop you from moving by sending body signals about how hard it is to move and thoughts about how scary it would be if you fail. But you can trick your brain: Imagine your body is a beautiful machine and you are operating it as a higher force from above. Separate yourself from your body. Play it as a computer game. You are the one who commands your body to accomplish tasks.
11. Find pleasure in the hard work.
Shift your focus to the process and concentrate on getting the work done faster and better every time. Speed is important; you have to move quickly in order to achieve perfection in a set amount of time.
So many people quit too early. Success is all about persistence, and discipline is what gets you to your final destination—the realization of your dream. The more you learn about your craft and your capabilities, when you start seeing yourself improve, the results will make you hungry for more. Self-improvement is an amazing drug.
I love discipline because it is a source of power. It is an engine that helps us understand and explore our capabilities and life’s opportunities. Discipline is not boring; it’s the freedom to put all our energy into creating something meaningful and beautiful.
It’s up to us to choose the life with discipline or without, with a goal or without, with a dream or without.
You’d be surprised at how invigorating implementing these steps can be. Sounds exhausting, but it’s really not. The habits form quickly, especially when you begin to see results so quickly.
This may be simple second nature to whoever is reading this now. If so, excellent for you. But I know that there are lots of folks out there who could benefit from hearing this simple advice. No excuses.