Have you ever had a restless night sleep because of stress about money? In this post I want to give you 4 steps you can take today to take control of your money to avoid those sleepless nights.
I’ve been there. I know what it is like to be worrying about whether that bill that falls due in a week can be paid.
Not knowing whether there will be enough left in your account to meet the bill and buy food for the week at the same time…
This is an all too common stress for a lot of people.
Aside from the stress that these situations cause, there are additional flow on impacts to other areas of your life and your mindset…
You know what it is like, when you are stressed your confidence also suffers.
How can you portray an air of confidence in everything you do when in the back of your mind you don’t know whether you can pay your bills?
When this happens, it is fair to conclude that your money has control over you…
It will affect your mood, your relationships, friendships, even your work performance.
Your continual stress about money will prevent you from being present, from living your life and sharing your passions with those that you care most.
Take Control of Your Money
To achieve your financial goals and live that life that you always dreamed about, you need to make changes to the way you are currently doing things.
Financial freedom is not going to just happen… and you can’t expect to change your money habits once you achieve financial freedom.
It just doesn’t happen that way…
Lottery winners are a great example of this problem. More than 75% of lottery winners are worse off 5 years after having won the lottery. They haven’t changed their habits!
So to take control of your money, there are some basic initial steps that you can perform.
1. Manage It!
Oh not that again I hear you say…
But yes, you need to manage your money.
I have written before that managing your money is a ritual of the wealthy here. It is one of the things that the wealthy do with absolute consistency.
In order for you to take control of your money first you need to know what you are doing with it as it comes in and goes out of your possession.
Understanding how you spend your money will provide insights of why you have lost control of your money and what areas of your spending you need to address to gain back some control.
Create a simple system that allocates spending based on the type of expense, such as housing, groceries, transport, insurances, entertainment, hobbies, and general living expenses.
Make sure you can then separate the essential expenses from the non-essential. It is the non-essential that you will want to spend the most time reviewing.
2. Create a Budget… (and stick to it)
Once you understand what you are spending your money on from step 1, the logical next step is to create a budget.
Again, it doesn’t have to be anything complicated.
Identify a period of time that you will use that matches your income. That is, if you are paid monthly, use a monthly system, or if you are paid weekly, use weekly.
Ideally you want to create a budget for one year, but if that is too much of a stretch to start, do it for three months.
There are a number of bills that are quarterly, such as utilities, so doing a budget for a quarter will at least incorporate one cycle of these expenses.
If there are times when you are spending more than you are earning, this should be an indication that expenses need to be reduced, or you need to save some income from an earlier period to cover the shortfall.
Once you have your budget, to take control of your money, you need to stick to it.
Ignore it at your peril… remember what is at stake here. Can you see that picture of you having achieved financial freedom?
3. Learn to Have Your Money Work for You
Next step is to learn everything there is about wealth creation.
Having created a system to manage your money, and then a budget to project forward, now you want to gain an understanding of what you can do with any surplus money.
The goal is to take control of your money, and my favourite way of controlling it, is to have it work for me, not the other way around.
By having your money invested, you create a situation where it has the potential to grow, without you having to perform any WORK.
There are many ways to invest your money… property and stock investing are two of the most common.
Learn all you can about an investment vehicle that suits your personality or interest and start to have your money work for you.
This is a component of my Wealth Formula and is particularly relevant to your success in taking control of your money.
A total commitment to the first three steps is required for success.
If you are not totally committed there will be too many road humps along the way that will derail you.
As you will know by now if you have followed my earlier posts, wealth creation is not a straight forward, set and forget, process…
There will be challenges, so you need to commit to the process to achieve success and take control of your money.
These steps seem reasonably straight forward, and they are, but their impact on your wealth creation goals will be significant.
It is like creating the foundations for a new home. Without the foundation bricks, your new home would be unstable and make it unlikely to complete the home itself.
It’s the same with wealth creation…
If you don’t have a solid foundation, which starts with your ability to take control of your money, then adding complex investment strategies to your portfolio is not likely to result in a happy ending.
Your dreams of financial freedom will fall down at the basic level, YOU.
If you can’t control what you receive, the universe will conspire to give you less.
Take control of your money with these simple steps today!