Life has a way of pushing and pulling us from moment to moment; our families, jobs, desires, dreams, health and then add in the economy, the impact of the media on our thinking and the multitude of distractions that are a part of our every day existence. These factors make it very difficult to feel a sense of control. It is no wonder that we surround ourselves with rituals, beliefs and habits that insulate us from feeling total and complete alienation. Money is an essential area of our lives in which we desire and need to feel control. There are many who live in dread of the arrival of the monthly credit card statement. There are many who are constantly being hounded and touted on investments in which they should put their hard earned cash. There are the wants and desires of our families; clothes, gadgets, cars, vacations; and indeed there is the internal argument over saving vs. spending and soothing the frustration by purchasing a favored 'toy'. It can be overwhelming—even for the strongest-willed. Mostly because it never stops-a constant buzzing, thrumming and beating of input and decision. Control seems impossibly elusive.
Thankfully, the reality is not as hopeless as it might seem. The trick is to acknowledge what you can and cannot control and reduce the time you devote to the uncontrollables. To name a few:
1. The stock market-you cannot control the market, not now, not ever!
2. The media-you cannot control the news and how it's reported and what is emphasized. Remember, whatever you see on TV is there for entertainment value only.
3. What other's do-your friend, boss, neighbor, cousin will do what they do and spend what they spend. You might think they know more than you, but probably they don't.
4. The global economy-it will continue to move, change, grow and contract as it will.
Take heart, there are areas where you can control and in fact, should.
1. The amount of debt you carry. Short-term mistakes can become long-term problems if this is not carefully monitored and controlled.
2. Your fixed and discretionary spending. You can and must exert control over your outflow. Fixed expenses cover your structural costs, such as cost of rent or mortgage and taxes. Buying a more expensive house brings with it long term fixed costs, including, mortgage, insurance, taxes, maintenance and utilities. Discretionary spending needs to be monitored and controlled based on an overall strategy of wealth-building and being able to separate the needs from the wants.
3. Savings and Investing-if you follow the simple rule of 'pay yourself first' then you are exerting control. By creating a consistent habit of saving and investing, you are taking an active step toward financial well-being. Participating in a company 401(k) can accomplish this as well as setting up automatic investments on a monthly or periodic basis.
4. Your attitude. Your attitude is perhaps the most important place to start. You can control your attitude by ignoring the 'noise' and remaining focused on long-term objectives and short-term strategies. For example, the stock markets can be down, however, they won't be down forever. If you are adding to a retirement plan actively each pay period, then you are buying at a lower cost and therefore, increasing your chance for success in the future. If you stop investing because of dismal markets or poor economic reports, you might be decreasing your changes for long-term success.
As intelligent beings, able to reason, think and process information, we believe in our ability to make good decisions. If you take an inventory of your financial decisions over the last five years, how many were good ones? How many didn't work out the way you expected it to? In order to take real control over your financial life, you must create the divide between what you can control and what you cannot and focus on only those you can. At the end of the day, your beliefs, behaviors and habits around money will bring you financial well-being and not the focus on that which you cannot control.
