A couple of years ago we posted an article here titled Setting Financial Goals. The, at the end of 2014, we posted another article asking people if they were going to set financial goals for the new year.
  Sheila Sund via Compfight |
Like almost everyone else, we like to stress the reality of knowing how much money you’re making, being able to pay your bills, putting money away for a rainy day and still being able to have a fun life. Yet, we’re not sure that there’s enough emphasis put on the “now”, the more immediate needs of life.
Talking about the ability to pay one’s bills is pretty immediate, but maybe not immediate enough. For most bills, you’ll get them and have at least 21 days before there’s an expectation of payment. If you don’t have enough money and you know the bill is coming, that’s an extreme amount of pressure to deal with. If it’s multiple bills… way more pressure.
An article we wrote 3 years ago talked about whether it was better to pay off bills or save for retirement. Our conclusion was that paying off bills with higher interest rates is the wisest move, which is something one has to address while still working, because carrying debt into retirement will drain your limited income faster. Thus, you should be working towards a “now” mindset instead of thinking only of long term goals.
There was also an article on another blog on financial issues that gave a plan where, if you started young enough, you could have significant savings when you retire by learning how to put money away monthly, increasing it by $10 every year from age 20 to 40, then continuing that same investment amount for the final 25 years.
It’s a good plan but it still means that one has to think more of “now” than later. As a general question, how many of you are ready to start investing $100 a month into a long term savings plan and still pay all your bills and have a regular life? Actually, hopefully most of you do, but it’s something you might not think you’re ready for, which means a mindset change is needed into understanding the “now”.
What if you really don’t have that $100? Scary to think about isn’t it? This is why we talked about finding ways to increase income a couple of years ago, as well as talk about budgeting all the time. It’s also why we often mention working with an accountant if you need help in figuring things out; it never hurts to work with professionals on your financial goals.
Working towards “now” involves these things:
* having a significant enough income now
* paying down your most significant debt now
* budgeting what you have now
* being comfortable now
Think about it, and if you have anything more to add, let us know.