|
Do you spend more time planning your vacation than you do planning for your financial future? The answer for many individuals is yes! Vacations are fun to plan but money management is often a stressful, dreaded task. Therefore, we may avoid thinking about or dealing with money issues. On the other hand, some people spend excessive time and energy worrying about earning enough and saving enough money to the detriment of enjoying what they have. Neither end of the spectrum is optimum. Many of you have experience with the struggles associated with sustainable weight loss. Weight management can serve as a point of reference to understand the impact of attitudes and emotions on money management. Attitudes and emotions can affect ones ability to make lifestyle changes and can enhance or sabotage success. Developing a healthy relationship with food is analogous to developing a healthy relationship with money. Effective money management requires knowledge, positive attitudes, and dealing with the emotions that can derail your ability to successfully manage your finances. A good way to think about managing money is to divide it into three areas: 1) Earning Money: 2) Investing Money: 3) Spending Money. 1. Earning Power: Women dominated professions, sometimes referred to as the pink ghetto; often have salaries less than men dominated professions.In their book, Women Don’t Ask: Negotiation and the Gender Divide, Babcock and Laschever’s research demonstrates that much of the reason for the gender salary discrepancy is the fact women don’t negotiate salary or ask for raises as often as men ask. Failing to do so over time, creates huge discrepancies in lifetime earning power. It is up to each individual to invest in her/himself by developing the skills required to confidently negotiate salary, ask for and get a raise, and set fees for services that are appropriate for the value you provide. Attitudes and emotions often interfere with earning what we deserve. Low self-esteem may mean we underestimate the value of our services; fears prevent us from taking action to negotiate a higher starting salary or ask for a raise. Look inside and ask yourself, "Am I sabotaging my personal earning power?" If the answer is yes or maybe, recognize the impact on your future financial security and take appropriate action. 2. Investment Attitude: Have a saving strategy. Many individuals shun investment education or don’t think they have enough money to have an investment plan. Women are often very conservative and fear investing more than men fear it. No matter how large or small the amount you have to invest or your investment style the important thing is you have a saving and investment strategy. Pay yourself first. Build an emergency fund with a minimum of three – six months income for unexpected expenses or salary interruption. It is also wise to assure your family is protected with the right type and amount of insurance. A negative or overly conservative attitude about investing or outright fear or avoidance may jeopardize your future financial security. 3. Spending: Spend less than you earn, regardless of how much money you make. To achieve financial security you must spend within your means and if you have incurred debt manage your debt. If you are a big spender, stop and ask yourself, “What is driving my spending? What is the impact of my excessive spending on my financial future?” Before you make a purchase ask yourself, “Do I need it or do I want it?" and "How much can I afford to spend for this item?” Money is a highly emotional issue. Money Attitudes
We develop attitudes about earning money, investing money, and spending money in early childhood. Parents may teach us to scrimp and save for a rainy day, or spend lavishly to 'keep up with the Joneses'. We may learn to be generous or frugal. A healthy relationship with money, finding the middle ground, is the desired goal. Psychology of Spending
Resist the urge to splurge! Using money to satisfy emotional needs is a common reason for excessive spending and subsequent financial problems. Many times women’s poor spending habits are a manifestation of underlying emotional needs. Does buying things fill up an empty space inside of you, make you feel loved, or provide you a feeling of status or self worth? If you are an over-spender or impulse-spender, examine the root cause of your spending. Find other ways to get your needs met. Money and Relationships
Money issues are a leading cause of stress in relationships and of marital discord. The harmony experienced in a dating or marital relationships can be disrupted when partners have different attitudes about spending and saving money. It is essential that couples communicate about money and learn to compromise. For couples with children, it is a good idea to get them involved with the family budget and even have children help with the bill paying process. Self-Coaching Tips for Better Money Management
Educate yourself about money and investment: We tend to fear and avoid what we don’t understand. Most of us did not learn much about money management in high school or college so unless our parent taught us well, we are on our own to get your money education. Examine your money attitudes and emotions: Determine how you spend your money and what motivates you to buy products and services. Keep a spending diary for 1-2 weeks to find out where your money goes and discover the “leaks” in your budget from daily lattes, the impulse purchase of a new pair of shoes, cosmetics, or a CD. These smaller items add up exponentially over time. Your spending diary will help you design an appropriate spending “diet.” Research and hire a qualified financial planner or coach to help you stay focused on your money management goals. Use one of the many quality money management resources on the internet. I invite you to visit the resource section of my website www.JeanCaton.net to download a fun quiz on Money Personality to get you started. An empowered woman/man is a financially secure woman/man. | 
