Question for you. How aware are you when it comes to your finances?
I would consider myself hyper-aware. That’s just my personality in general I think. As a single parent though, I had to be super diligent as well. I have a spreadsheet to track my finances and generally update it on a daily basis.
I’ve come to the realization over the years that most people are not as fanatical as I am. I’ve worked with people who have no idea when their pay dates are. Some people have no idea what their pay rate is or how it’s structured (commission people).
In regards to people who have joint finances, one person in the relationship usually has no idea or just a very vague concept of what their monthly bills are. Some people, usually the ones who really need to know, have no idea how much debt they have accumulated.
Things I Got Wrong
My husband and I realized early on in our marriage that I needed to be the one who handled the finances. I loved that guy but he did not know how to handle money and he freely admitted it. That’s not to say I’ve done things perfectly. I have a whole list of things I wish I had done differently.
- I wish I had insisted that we get extra life insurance beyond the piddly amount his company provided
- Shouldn’t have bought too much house my first time out
- Never should have got caught up in the lease trap with cars when I was younger
- Should have changed jobs earlier
And believe me…I could go on and on. I feel like now I’m definitely playing catch up but I am also more financially aware at this point.
Things I Got Right
Here are some things I feel like I’ve done right financially:
- I’ve been honest with my kids about my finances and the things I’ve done both right and wrong with them
- Finally switched jobs so my income has increased and my job skills. I won’t hesitate to change again if it’s a better career move for me
- I’ve learned how to live beneath my means
- Educated myself on how to find bargains to stretch my budget
- Been willing to work multiple jobs and look for side hustles to reduce the debt that I do have
- Drastically increased my life insurance
- Created an emergency fund
Easy Action Steps
Knowledge is power. There are plenty of steps you can take to strengthen your financial awareness. I think sometimes it’s fear that stops us from trying to learn more about our finances. You need to know where you are at financially if you want to improve your situation.
- List all your debts
- Make sure you know what your income is (pay rates and dates)
- Take a look at your bank and credit card statements to see what you’re spending your money on. You might be surprised at some subscriptions, etc., that you’d forgotten you’re paying for and could cancel
- If you have credit card debt or loans, always try to pay a little (or a lot) extra with each payment
- Pay your bills on time. Late fees, NSF fees, and collections will not help your financial situation
- Open a savings account and start an emergency fund. Everyone can scrape together $50 a month and after a year you’ll have $600 in there. And here’s the thing…as you see that money grow, I guarantee you’ll get excited and try to add more and you’ll also do everything you can to not touch it
- Feeling a bit pinched and need to cut back on expenses? Find substitutions. I have some great suggestions here.
- Find an expert. There are so many great books and podcasts and shows and blogs that can help you manage your finances better. Or find a friend or relative that has made good money choices and ask them to share their advice.
Wrapping Things Up
It’s so easy to just bury your head in the sand about your finances. It’s especially tempting to do that if you’ve made mistakes and things are tough because it can be scary to face your financial challenges head on. Again, knowledge is power though. You need to have a clear understanding of where your finances are in order to make changes. Maybe things are better than you were afraid they were. Great! Use that knowledge to make them even better!
Maybe things are worse then you thought. Well, now you know. It might be scary and depressing and infuriating but now you can create a plan to make things better. No one is perfect and things happen. I have way too much credit card debt. It’s not because I took fancy vacations I couldn’t afford or bought designer clothes or drank too many lattes (well, that could be part of the problem). The credit card debt came from medical debt and educational expenses and car/house repairs, etc.
Guess what? It took awhile to get in this debt and I’m aware it’s going to take awhile to get out of it. Life still happens even though my finances are in a much better spot now. Some months it’s 2 steps forward and three steps backward. Just keep your head up and keep moving forward. Someone told me once they were afraid of making the same financial mistakes as their family and I told them that even a bad example can be a good example. That applies to ourselves also. I’m not going to beat myself up over the things I did wrong, I’m going to congratulate myself on the things I’m doing right.
How about you? Are you financially aware or unaware??