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Saturday, February 21, 2015

Day 695: Managing Money

It is a funny thing... Children are not taught about money. School does not teach us how to manage our personal finances, how to do tax returns, how to start a business, tax implications of various personal and business actions or how to manage even the most basic of budgets. Many young adults must learn by trial and error, often racking up large sums of debt which they realise, only after the fact, is completely unmanageable.

Further to that, the complete lack of monetary education leaves many people with a very selfish and impractical way of spending. Physical appearance has become so important in so many societies that people will choose to buy unnecessary material items instead of things they actually need, causing scenarios where a person may not eat for extended periods of time just to fit in with the status quo. Selfish buying habits both contribute to and are caused by the issues we face in our society as a whole - it is a vicious cycle that feeds itself.

Money represents value, so people will put their money towards the things they value (most of the time). There are some few people who will buy almost anything on a whim, but there are other factors involved here that I will not go into in this post. It is quite rare to come across a person who manages their personal and/or businesses practically and without the influence of emotional irrationality.

So how do we fix this scenario to make money a practical tool to build on improving our society and interrelationships rather than a destructive force that breaks down social cohesion?

  1. Evaluate and redefine your values. People spend money on the things that they value, or on things that represent what they value. Do the things you value actually contribute to creating a value in life? Do the things you value contribute to creating a world that is best for all? What are you supporting with your money? These days, your money represents your vote - to a degree - you are contributing to the continued existence of what you are spending your money on. I am NOT saying that you should stop buying work clothes or anything like that - for the moment there are things that must be done in order to survive in the system SO THAT we can create a new world - becoming a beggar will help no one - make sure that you are in a position to support yourself and support that which brings value to ALL LIFE. 
  2. Once you are clear in your values, evaluate your practical needs. Do you really need all the things you think you do? Are there areas of your spending where you are spending your money unreasonably? Now this point of reasonableness will be determined by step 1 - evaluating your values. There is a difference between making your life comfortable and being excessive. What do you need to do in order to survive - and not only survive, but empower yourself so that you are in a better position to create change? If you are running a business, spend your money in such a way that you are ensuring, as far as possible, the stability and growth of the business. 
  3. Do not be a miser. lol. What I mean by this is that it helps no one if you then spend your money as sparingly as possible - it's not about NOT spending money - it's about putting your money towards supporting yourself and supporting what is best for all. 
  4. Create a budget. Now that you know what you need, work out the average monthly cost of this. Make a list of each expense. Deduct the total amount from your income. If your income is not high enough to cover your needs then you need to create a solution for yourself - find a way to make more money. At the same time you will obviously need to prioritise your needs and minimise the cost thereof. What may be a more difficult position to be in is to have money left over after your expenses, because now you are dealing with the question of self discipline. Now is the time to practically evaluate what can be done with that money. A portion could go towards a savings account to cover those unexpected events in life. It is up to you to evaluate how you can best use that money to contribute to what is best for all - sometimes this will be in the form of creating a new source of income which can then be used to create or support change. 
  5. Make a point to reassess yourself and your values often. It is very easy to slip into a moment of "it's MY money! I EARNED the right to spend it ALL on ME ME ME!"
  6. You don't have to live like a minimalist - unless that is the lifestyle you enjoy. It's not about denying yourself comfort and efficient living! Don't force yourself to keep on using equipment that is falling apart simply because you don't want to spend money on yourself. There is a difference between practical living and inconsiderate / selfish living. SO it's not always about NEED - when you are in a position to invest in the things you enjoy then do so - a funny little quirk to look out for is to not claim poverty in an attempt to contribute to other areas of your life. Human nature is a funny, funny thing - never stop being aware of who you choose to be!

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