Personal Finance Is Easy: We Fail When Our Money Has No Purpose
The most basic rules of personal finance are fairly simple and unchanging . However, it is really difficult for us to save more than we spend, and the reason may be that we are lacking “why”.
As ClubThrifty notes, motivating yourself with the words “I really need to stick to the budget” won’t get you very far, and the fact that savings are increasing may only motivate you for a while. However, a persistent motivator that can keep you on the right financial track in the long run is the “why” question – why do you want to save money? Why do you want to become rich?
The strength of your “why” is what will take you to even greater heights. “I need to make a budget to pay my electricity bill.” Not very motivating? “I need to meet my budget to save enough money for my kids to have a nicer home, in a safer neighborhood, and with a better school system.” Here’s what might inspire you.
The question is why you can use it in almost everything you want to achieve in life. Perhaps you have decided that you are going to the gym? Why? The strength of your “why” will determine how long you spend on your new project. If it’s just to look good in the summer, that’s all you get. If you’ve made a commitment to living a healthier, longer life, you’ve made a much stronger commitment.
Define a purpose for your money and think about your long term life goals when you budget. This definitely worked for me. I was especially careful in spending and saving money until significant events such as buying a house and preparing for a trip. The key is to always have a larger goal in mind.
The Why Question | ClubThrifty