Keys To Effective Money Management – The Introduction

What Is Effective Money Management?

There are many effective ways to handle money, and many people have different ideas, plans, and goals when it comes to managing it.  My ideas may be different than yours, and that’s okay, but in this series I will be talking about what I believe to be the heart of any good financial plan.  Ultimately, you have to consider your goals and dreams, in order to determine the best course of action to take.   I strongly believe that this series will help you stay on track, reach your potential, and manage your money the most effectively.

What Will You Learn About In This Six Part Series?

From everything I have read and experienced when dealing with money, the biggest thing I have learned, is that managing your money is not just about having a big income.  Yes, a big income is helpful, but even people with large salaries have trouble managing it.  Why is that?  I have learned that there are many factors to consider when answering this question, which is why I decided to break it up into multiple parts.  Basically, I will sum up effective money management in just six words.  Each week you will learn about a new word that will revolutionize how you deal with your money.

I have placed these parts in what I believe to be in order of importance.  Even if you don’t agree with the order, I believe you can agree that each one is important to effectively managing your money. 

The outline is as follows:

1. Part 1: Attitude – I believe this is the first thing that must be addressed before one can effectively manage their money.  How you think about money plays a large part in how you behave with money.  Do you have loads of debt?  Do you subsidize your income by using credit cards?  Are you one of those people that think you will ALWAYS have a car payment?  Your attitude determines your path.
2. Part 2: Behavior – What kinds of things are you doing, or not doing, when dealing with your income?  Are you prepared for the curve ball that life is going to throw at you from time to time?  Do you know where each dollar is going, or are you blindly following a dark path into the abyss?
3. Part 3: Contentment – I believe that contentment is a direct side effect of the previous two keys.  Once you begin to think differently, you begin to act differently, which causes your values regarding money to shift to a place you may not be used to.  The less you need to acquire in order to be happy, the more you can focus on your goals and desires, because what is important to you changes.  For example, you may begin to think less about buying that new 2010 Ford Shelby GT500, and more about how your retirement portfolio is shaping up.
4. Part 4: Balance – This is key to staying on any financial plan.  If you neglect entertainment in order to speed things along, you may find that your desire to stick to a plan will begin to fizzle.  On the other hand, if you spend too much money on entertainment, you may feel like you are not making progress, which could lead to giving up all together.  It’s about finding that middle ground that keeps you motivated but allows you to enjoy life along the way.
5. Part 5: Intensity – Intensity is important!  The more intense you are towards reaching your goals, the more motivation you will receive.  This is especially important when trying to knock out tons of debt.  With intensity comes sacrifice, and this is something most of us have trouble with.  Do you want to get out of debt, or go on a $3,000 vacation?  Do you want to build your emergency fund, or buy a big screen T.V.?
6. Part 6: Diligence – Haven’t we all failed at something in our lives?  Failure is where success is born, because it teaches you what you need to improve on in order to win.  It shows you what doesn’t work.  If you see failure as the end, it will be the end, but if you see it as an opportunity to learn, your chances of succeeding are greatly increased.  Diligence laughs in the face of adversity and allows you to look forward no matter how many times you step backwards in the process.

In A Nutshell

So there you have it.  Changing your attitude, changes your behavior, which causes you to think a little more about what’s important to you.  Finding a balance allows you to remain content, while your intensity determines how fast you achieve your goals, and staying diligent in your efforts will keep you moving forward.

You Can Only Score If You Play

You can’t score a touchdown from the bench, so get on the field and try.  Continue to move the ball down the field and eventually you will score that touchdown.  Don’t give up!

So what do you think?  Are you looking forward to reading more?  Be sure to subscribe, so you don’t miss this brand new series from EOD!