Before people start Financially Fit Bootcamp, there’s one phrase I hear pretty often: “I feel like I never have any money, because as soon as I get it, it’s gone!”
Is there an epidemic of paychecks magically disappearing from bank accounts across the globe?
The Mysterious Case Of The Disappearing Money
Probably not. Most people come to the end of their paycheck and have no idea where their money went. This uncertainty causes you to feel out of control. Your money is disappearing, and you feel powerless to stop it.
You don’t need to live your life this way. You can eliminate your Money Stress by developing a plan that will not only provide for your future but also for right now.
You’ve heard us talk about the Four Money Principles. Principle Two teaches that to reach Financial Freedom, you need to Live Within Your Means. The way you accomplish this is to choose where your money goes rather than wonder where it went.
Choose Where Your Money Goes
Don’t let your money happen to you, be proactive and choose where your money goes. This is an empowering process that puts you in the driver’s seat. Now, I’m not here to tell you how to spend your money. You need to be the one who decides what is important to you so you find the balance in your life. But get clear on your priorities in your life, and develop a financial plan that supports them. Pay Yourself First, Live Within Your Means, and you’ll be surprised at how quickly you’ll feel confidant and in control around your finances.
Start allocating money to what’s important instead of only spending on what’s urgent.
Create A Roadmap
There’s a two-step process we follow in Financially Fit Bootcamp to help our students regain control of their financial lives.
First, it’s important to understand and analyze where your money is going. Most students find they continually run out of money but have no idea where it went or why.
Second, our students use the Money Planner to consciously choose and prioritize where their money should go. To support these choices, we help them automate the flow of money through their Perfect Account Structure.
Taking these two steps allows you to take control of your money like never before. Once you have this framework in place, it’s time to put it into action.
Setting Healthy Boundaries
One key point to Living Within Your Means is that when you run out of money, you stop spending.
A large number of people get stuck here, because they fall into the trap of “I need it now.” They’ve lost sight of what is a need versus what is a want. They use a credit card to spend money they don’t have with the hope they’ll have it “someday.” But that day never arrives, and they’ve only succeeded in getting themselves further into debt.
Before you make a purchase, stop and ask yourself if this is something you truly need, or if it’s just something you want. I’m not saying you can never have the things you want. Far from it! But sacrificing your Financial Freedom for wants that will never be satisfied isn’t worth it.
Living Well On Less
Once you work through the Money Planner to develop a spending plan, you may find you can live on far less than you realized–without sacrificing your enjoyment in life! When you Live Within Your Means, you’ll find your Cash Surplus. You free up cash flow to Pay Yourself First and build Financial Freedom. Get this step right, and your financial life starts to fall into place.
Left to your own devices, you–like most people–will find ways to spend up to and over what you make. You’ll be farther away than ever from Financial Freedom, and you won’t be able to plan for your future. When you choose where your money is going, you’re never left wondering where your money went. You put your future first, and before you know it, you’ll be at the point where you stop trading your time for money. You’ll be Financially Free!
Financial Freedom is your ultimate goal, but you need to get control of where your money is going to achieve it.
Do you have a plan to choose where your money is going? If not, what steps do you need to take today to make this happen? Head over to the Financially Fit Community, and tell us!
image credit: Bigstock/AndreyPopov
Dr. Tony is the co-founder of MindShift.money and the best-selling author of three books on personal and business finances. Having achieved Financial Freedom at 27, Dr. Tony believes that through Financially Fit Bootcamp and Cash Flow Cure everyone can get there. He has made it his life’s mission to help others live a life where their money works for them—not the other way around.