The Nuts and Bolts of Personal Finance

September 17, 2009 | Posted by Brad Chaffee

When you think about personal finance, does your head start to spin?  It is easy to understand why.  Dealing with our finances quickly shows us just how overwhelming it can be.  Here’s the thing—it doesn’t have to be.  It really is only as hard as YOU make it, and the key is to take control.

You have to make a decision to take action to address your finances, which often means facing your behaviors head on.

If you continue to do the same things, you will continue to get the same results.  So why not try something different?

By examining the behaviors and habits that make up your financial DNA,  you can figure out what changes need to be made in order to reach your financial goals.  A lot of people make the mistake of believing that the path to financial growth is simply to make more money.  Making more money helps, but it is certainly not the key to managing your money effectively.  The idea is to manage what money you do have by building a strong foundation that will stand the test of time.  How much you make is irrelevant when it comes to having a plan.

If having more money was the secret to wealth, there would be no such thing as broke lottery winners. People that should be millionaires aren’t, and it is because they did not tell their money what to do.  You have to be the boss of your money and make sure it behaves, otherwise you’ll spend a lifetime wondering where it all went.

I want to share with you a process that I used to take control of my finances.  A healthy financial plan involves understanding and mastering these key components:

• saving money
• cash flow planning
• money and relationships
• debt elimination
• dealing with creditors
• frugal living
• buying insurance
• cause and effect of marketing
• investing for retirement
• college planning
• real estate
• discovering your vocation
• charity and giving

These are just the nuts and bolts of personal finance, and it is up to you to become well-versed in each of these areas.

Brad Chaffee is the Enemy of Debt, and a regular contributor here at the Self Reliance Exchange. Learn more about Brad by reading his bio. You may also contact him here.

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Categories: personal finance | Tags: financial planning, personal finance, self reliance | No Comments »