It’s story time

So you fill up a pale of water (quite like a familiar nursery rhyme, one of my personal favourites), and you begin your journey back to the campsite so that you can start the washing up. By the time you get back to your tent your bucket is empty. You look down and see that there are a number of small holes in the bucket and notice that they water has been slowly leaking through. Upset with the situation, you ignore the holes in the bucket, walk a back to the tap and refill the same bucket with more water… once again by the time you walk back to the dishes the water  has leaked all over the floor. Still upset with the situation, you walk back to the tap and try again…’

The problem here is that despite your effort, and despite the fact that you REALLY want the water to stay in the bucket it didn’t. It doesn’t take a genius to work out why – there is a hole.  I’m sure that the person in the story was really nice, that they had great intensions, and that they really wanted the water to stay in the bucket – but yet it didn’t.

My point here, in this long winded illustration, is that this same concept can be applied to our finances. If you do not ‘plug the holes’ in your budget you will inevitably find yourself back where you started.

The truth is, if you do not acknowledge the problem, you cannot move forward.

What are some of the holes in your financial plan?  They might be:

• Constantly missing the payment date on a credit card
• Paying the minimum balance on your credit card and feeling like you will never pay it off
• Borrowing money for depreciating assets

What are the little things that are making it difficult to make progress with your finances?

I get it, I know how frustrating it feels to have taken ten steps forward and nine steps back. I understand how frustrating it is to finally feel like you are making progress and then have a setback. Or, more specifically related to money, I know how annoying it is to reach one of your financial goals and then be slapped around the face with a huge telephone bill – it is seriously painful.

I also know how demeaning it is to finally get a good paying job, and still, for some strange and unknown reason, run out of money before the week is out. I get it, I have been there, done that – and still at times do THAT!

I remember being at University and living on about $150 a week (I was paying rent and fixing the world’s most unreliable car). I understand how frustrating it is and how terrible it feels to be earning money, and yet, despite all of your efforts and all of your scratching around behind the couch for extra dollars to get through.

I know what it feels like to be living from payday to payday. The truth is, everyone goes through these things, and you’re not alone.  And, the truth is, you can either be restricted by these challenges or see them as wonderful opportunities to develop your financial understanding. I am not old, (despite having somewhat of a mid-twenties crisis at times), but I have been around enough to know that each thing that you go through can be an opportunity for personal growth.

Many people choose not to ‘invest’ into their financial literacy, that is fine, you will make your own descision, but I strongly advise you to do something. You can either live your life ‘beshind the eight ball’ or you can make decisions that will develop and grow your financial awareness.

What better place to start learning this than in our schools?

Habits are interesting things:

We are what we repeatedly do

Excellence, then, is not an act, but a habit

                                                                  Aristotle

The famous educator Horance Mann suggests that:

‘Habits are like a cable. We weave of strand of it every day and soon it cannot be broken.’

I  understand what Mr. Mann is suggesting and believe that habits that we make, and break, are important – but I don’t agree that they cannot be broken. Habits may be hard to break, but they can be changed and replaced with ones that empower you – it just takes time, effort and an acknowledgement of our reality

A habit is an interesting thing. I have been intending to go for a run at 5:30am each day for about 12 months now. I honestly prepare myself for it each night and I am totally convinced that when the alarm goes at 5:15am I will spring out of bed and excitedly put on my runners – it has never happened, but some day I will do it.

I heard a saying once, by Stephen Covey, that it ‘take 21 days to break a habit’ – I tend to agree, I think the man is a genius! Mr. Covey suggests that:

“Habits have tremendous gravitational pull – more than most people realise or would admit.  Breaking deeply imbedded habitual tendencies involves more than a little willpower and more than minor changes in our lives.”

                                                                Steven Covey ‘The Seven Habits of Highly Effective People’ p47

I thought would apply these principles to handling your finances – ‘surprise, surprise.’
How does your past affect how your handle your money today?
What financial habits have you developed?
What habits do you need to change?

We all fall into habits and ‘ruts’ in our lives, we all have things that we do that frustrate us.

What changes can you make TODAY to manage your money better in the future?

Mat