“It would be fun to sit down and go through my finances tonight,” said no one, ever. I’m not crazy enough to suggest that a monthly reckoning of your financial situation is a task to look forward to but I was still shocked to read that a recent survey revealed 60 percent of us would rather have a painful injection than sit down and review our finances.
I know there are plenty more enjoyable ways to spend your time but getting to grips with your finances is not that bad. Here are some reasons why you should start now.
It will save your money
If you are in debt, you are throwing your hard-earned cash away in interest repayments and are effectively a slave to your money. Get the debt paid off and start building up credit and suddenly money becomes your servant. Ditch the Starbucks, jog instead of paying an expensive gym membership. And cut up those cards to avoid future temptation.
It will make you money
Once your debt is zeroed, you can divert the amount you dedicated to paying it off to saving, and that is when your money really starts working for you via the beautiful process of compounding. Once your stash starts to grow you should look at investing it somewhere where it will be earning a higher return.
It will improve relationships
A US survey found that couples would rather talk about almost anything than money. Which goes along way to explaining why financial problems are one of the biggest causes of failed relationships. Honesty and openness about your financial situation is surely the only way forward for those seeking a long-term partnership. By understanding where the potential for conflict is, you can find compromises to set budgets that are acceptable to you both.
It will make you healthier
The connection between stress and illnesses, such as stroke and heart disease, is well documented. Stress is often a result of a lack of control over your own circumstances, which is why stress levels spike when your finances are in freefall. Even if you are drowning in debt, budgeting and taking control of your finances will reduce anxiety over money.
It will give you peace of mind
Financial planning is also about protecting wealth against unforeseen events that could put your household finances in jeopardy if you haven’t put protective measures in place. We are talking insurance here. Health insurance and life insurance protect your family’s financial situation if you were to be injured, contract a serious illness or die unexpectedly.
Financial planning may sound boring but it really can improve your quality of life. Go on, try it, I dare you.
By Paul Dodd
Infinity Financial Solutions provides impartial, tailor-made, personal financial advice to clients in Cambodia and Southeast Asia. Should you wish to contact Paul, please send an email to firstname.lastname@example.org or visit www.infinitysolutions.com