Think, Shrink and Grow – 3 steps to get the perfect relationship with money
Published on June 24, 2015 3:55 pm, by Beck Cofrancesco
Every relationship needs constant love, nurturing and attention.
Some relationships are fleeting, some need work, and some are just too hard and you have to let them go. Money is the same. Get that perfect money relationship by following these 3 steps.
1. Think about money
Good with money people are always thinking about money in some way – it’s a regular part of their inner dialogue and is a conversation they can have with partners, family and friends.
- Pay attention to your money thoughts
Cultivate a positive belief about money – there’s plenty more where that came from – and ditch any language around scarcity that may pop into your head (e.g. There’s never enough, we’ll always be poor).
- Know where it’s coming from and keep looking at ways to improve.
Are you earning enough? Are you happy with your job? Are there opportunities to make money you’re not tapping into (e.g. Govt Benefits).
- Know where it’s going. Keep an eye on your accounts, bills and where you are spending your money. (Did we mention MoneyBrilliant’s new app is awesome for that?)
- Know its value (defining your money purpose)
What is it about money that’s valuable to you? Is it providing for your family? Is it about setting yourself up for the future? Is it affording the latest car? Is it being able to travel the world? It’s up to you.
- Talk about it. Sure, you may not want to advertise how much you earn or don’t earn, but money isn’t a dirty little secret any more. We all need money to provide for the life we want to live –there’s no shame in talking about how to make more money, save money or create a better life for ourselves.
2. Shrink (and get rid of) debt
Debt is an expensive way to get money – you’re always paying extra for what you’re buying when you add the interest up. We can’t always avoid debt (how else can we afford a house in the suburbs?), but it makes sense to pay it off as fast as you can.
- Pay off debt as quickly as you can
- Try and pay more frequently (i.e. don’t pay a monthly mortgage, pay weekly or fortnightly and it will reduce the interest you pay)
- Don’t set and forget – review your loans and credit card debt regularly – and make the switch if the sums work out (remembering establishment and exit fees may not always make it worthwhile).
- Switch from credit card to a debit card. You’ll save on fees and you can only spend what’s in your bank balance.
My favourite part! Getting to that point where you’ve got all your basics under control and there’s finally spare cash. The possibilities are endless when you know why.
- Make savings automatic – taking advantage of technology to make sure it happens.
- Don’t increase your spending with your salary (unless you were super super broke before).
- Save your pay rise – it’s an easy way to save without noticing any difference to your life.
Know what you want your money to do for you. If you’re saving ‘what’s your why? Knowing this will help you keep saving.
A sneaky fourth one, just because I love a good freebie! Reward yourself.
You’ve put in the effort to organise, manage and grow your money – put it to good use. Don’t be afraid to spend on your ‘WHY” – after all, there’s plenty more of where that came from.