My high school business teacher was fond of repeating a famous quote that I paraphrase here: "When your outgo exceeds your income, your upkeep becomes your downfall."
Anyone who has had to struggle to make a living or make ends meet can easily relate to this idea. Even those of us who are not in financial peril can use any approach to conserve resources and make the most of our money.
Here are a few strategies to consider in this regard with a concentration on using technology to help.
- A failure to plan is planning to fail: This especially is true in your financial life. I resisted living by a budget for years. It seemed to be against the grain of my personality. I eventually found that my personality needed to take a back seat to good sense. I found that a very old technology - a legal pad and a pen - became my new best friend. I later moved this work to my computer but still get great results from those old technical tools.
- Less can be more: A wonderful concept I teach guitar students is called "economy of motion." This means never moving twice when you can accomplish the same task moving only once. Using this system, you plan out the scale or piece you want to play then organize your movement in the most direct and simple fashion.
One way I apply this idea is to constantly question wants and needs. When you love technology, you begin to think you need the latest and greatest of whatever you use. As I've said so many times, it just ain't so.
I sometimes make a game out of getting by with older technology just to see how long I can do it. For example, I used an old Gateway 500x Pentium 4 computer running Windows XP long after dual- and quad-core processors became available. It became a challenge for me to see how long I could wait to upgrade to a new computer. I upgraded when the Gateway finally died.
Less became more as I was able to use money I would have spent on a new computer on other items I needed.
- Use subtraction instead of addition: We live in a society of consumerism, being bombarded on TV and the Internet with the message to buy and buy again. Many complain that the federal government is on the same spending binge, as are many consumers, perhaps even worse. Regardless, it is a fact that personal and national debt is becoming a critical issue.
I like to use the metaphor here of focusing a camera lens or framing a picture, specifically the process of zooming in and out on a scene. Sometimes you have to zoom out a bit to see the whole scene in its complete context. One way of doing this is to take time to track and question habitual expenses on luxury items. Again, the computer makes this easy to accomplish using spreadsheets and basic financial software such as Quicken.
Any tool that gives you a clear picture of your spending habits is valuable. You then can identify wasteful spending that can be subtracted from your budget.
- Ask "What if?": Plan for the worst, hope for the best. Save whenever and however you can. Make it a game. Have fun.
Email Donnie Jenkins at donniejenkins@yahoo.com.