The Ten Commandments of Finance: Commandment II

May 5, 2011 § Leave a comment

2.)    It’s in your hands – I don’t care what you didn’t learn. And I know all about being raised by wolves. But here we are in the Land of TODAY. What are we planning on doing about things in the here and now.

You must take responsibility for your life, for your happiness and for your money.  Please don’t let me hear that this is ‘too hard for you.’   Dive in and dig deep.  What would you tell your daughter if she told you, ‘finance and learning about money is hard; I don’t really like it?’  Perhaps you’d advise her that she needn’t worry, ‘You’ll get a prince and he will take care of all the hard things…’

The First thing you should know- the most basic thing is: Know where your money goes.  How much do you bring home each pay period or month or year.  Knowing where you money goes is NOT a budget.

A BUDGET, from the French word for PURSE, how awesome is that?!!!! Is a numerical representation of your action plan. It’s the numbers that goes with the dreams of your life and future!  The story might be: I want the freedom to take a job that I really love because I have less debt and more liberty! Make paying off debt part of your plan, your numerical story, your budget.  A budget has what you pay in rent or mortgage, debt repayment and’ living.’  How much goes to investments?

You should be very clear, you should be able to tell me right now- don’t, but you should know!- what percentage of your money goes to various categories. If you don’t know, that’s fine for NOW. We all star somewhere. But by next week, you need to KNOW.

What are some standard figures for these categories? You can do an online search or email me and I can get you something I use, but there are many ways to organize this depending on YOUR brain and your most comfortable tools. Just be a grown-up and do this.

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