There’s a reason you keep making the same money mistakes, despite the best of intentions. Some of it has to do with a lack of awareness about how money actually works, and the rest is down to your “money personality”.
According to Money Harmony we are all either a Hoarder, Spender, Money Monk, Avoider, or Amasser?
Hoarder: You like to save money, set financial goals, do a budget and actually enjoy making up a budget and reviewing it.
Spender: You love spending money on yourself and others.
Money Monk: Money makes you feel guilty and you think it is the root of all evil.
Avoider: You tend to avoid looking too closely at your financial situation and have no idea how much you earn or where it is all going.
Amasser: You need large amounts of money to be happy and use it to spend, save and invest.
Think of it a bit like star signs with one of them signifying your main personality and maybe one or two more making an appearance depending on how hungry you are while grocery shopping or how good the sale is at your favourite clothing store.
I am a combination of a Spender and an Avoider however I am on a quest to become a Money Monk. Part of that quest is to keep learning as much as I can about how to manage money, which is why I stumbled across some brilliant advice which reminded me of past mistakes I’d made, which led me to epic financial failure in 2008/2009 from which my family is still attempting to recover.
Christmas is coming up so there’s never been a better time to perfect your budget. Article continues after this video.
Managing your money doesn’t have to be complicated. In fact it’s pretty basic. However if you have a money personality that leads you away from logical thought when it comes to money, you need to visit these next five points every pay day before even a dollar leaves your account.
This time it’s Dr. Phil holding our hands through our money management disasters, with timely reminders of common mistakes we all make.
1. Believing expenses are fixed
It can be so difficult to do a budget when so many of our important expenses aren’t fixed. When I think off the top of my head of the bills I have coming in that fluctuate they include mobile phone, Foxtel, electricity and water, just for starters. Dr. Phil says when it comes to budgeting you need to be ruthless. If you are struggling to paid your utilities, you might need to go without that fresh $30 salmon that forms part of your new healthy eating plan for a while.
“Everything but survival needs to be put aside until you can afford the expenses without going into debt.”.
What you can do to make these bills more predictable is to contact your providers and ask to go on a payment plan where they calculate the average amount of these bills and you make a weekly contribution towards them.