Less Money Stress = More Happiness!

 The tree is down, the parties are over, the wrapping paper has been cleared away, so now what?  Now is the time to take a deep breath, re-group, and look to the year ahead.  This is the time of year when many of us have made New Years Resolutions with the best of intentions, whether it is losing weight, reducing alcohol use, or making an effort to keep in contact with old friends.  For many of us, especially in light of the current economic climate, one of the resolutions we may make is to look at our finances and come up with a plan.  Whether the goal is to save for a specific item, or just to save something, here are some tips that you may find helpful:

One of the first things to take into account when thinking about a financial plan, are the criteria involved.
A solid financial plan is:
Realistic
Specific
Short-term
Long-term
Written
Shared
Reviewed

Before we learn and adopt new money behaviours, we need to identify our current ones and where these behaviours came from.  Our attitude toward money will determine our spending and saving habits.
Determine your attitude toward money
Spender?  Do you love money for the things it can buy you?
Tip:  Each month take out your allotted savings and expense money immediately, and the rest is yours to spend however you wish.
Saver?  Do you require a cushion of savings for peace of mind?
Tip:  Determine how much is “enough” to meet your security needs, while still allowing yourself to enjoy life along the way.
The most important thing is to know when and where you are vulnerable.

When deciding upon financial goals, it’s essential that they match the important values that you live by, thus ensuring that you are pulled toward, rather than pushed at them.  For example, if quality time with your family is important, your goal may be to save for a family vacation.
Determine your goal(s)
For many, now is the time to start or increase an emergency fund, just in case or maybe to just get through these times in the black
For some, the goal is to pay off credit card debt
For others, its to live within one’s means and stop borrowing on credit

Develop a budget
Distinguish between your wants and your needs
Debt often happens partly because we let our wants become too important and they began to disguise themselves as needs
Track your income, spending, and the difference between the two.  Are there any daily or weekly spending routines that could be reduced or eliminated altogether?
Make minor sacrifices
Small changes and small solutions can help you save thousands
E.g., a latte & muffin is $6 a day, $180 a month, and $2160 a year!
Live within your means
Stop trying to impress other people
Take care of what you have
Get the full use of your belongings and wear them out
Find other activities besides shopping
Do more things yourself, cook, repair
Research value, quality, durability of an item before investing
Consider used, second-hand, garage sale/newspaper classified ads
Eating out less often, packed lunch!
Cut back on personal vices!

At the end of the day, the idea is to control your money rather than let it control you!
If you are in debt, you must either increase your income or decrease your spending; not making this decision can lead to stress, which can impact not only on your mental and emotional health, but also your physical health.  What ever your resolutions this year, keep the following in mind:

The irony of life is that in our youth we give up our health for the sake of wealth so that in our old age we can use our wealth to recapture our health. – Rabbi Benjamin Blech

Sarah Kirby is counselor with the Employee Assistance Programme
Ph. 949-9559 or go to www.eap.ky

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