10 Habits to Keep You From Going Broke – Second City Advisors

 

Have you ever wondered how some people just seem to have money?  I am not saying they make a lot of money – just that they seem to always have money regardless of how much they make or don’t make.  This is amazing for me to see and I have spent a great deal of time trying to understand just how that happens and is possible.

I don’t know about you but no matter how much money we make or don’t make – we always seem to live paycheck to paycheck.  I totally hate that cycle.  About a year ago I was determined to get out of that cycle.  The never ending struggle definitely seems to be that even if you get a decent raise or some sort of windfall or bonus – it disappears.  For example – if I get a 2% salary increase – let’s say it is $1,000 increase a year.  Do I really get that for an increase when utility rates go up 30% in one year; property tax 7%; car insurance 5%; health insurance 12%; etc… Clearly that $1,000 doesn’t even help to maintain the status quo.  Therefore, we (everyone) are in a never-ending cycle to make changes – look for efficiencies and ways to save money.

Don’t worry – I am totally her to help you regardless of how much money you do or don’t have and I am sharing this all with you!

Habits to Keep You From Going Broke – Second City Advisors

Develop Goals

You need to know where you want to get to.  We all want to not be broke.  But what does that mean?  What does it look like to you?  Does it mean you want one million dollars in the bank by the time you retire?  Does it mean you want to retire as soon as you have one million dollars?  These are two very different goals and will require very different strategies.   I personally feel the latter is actually easier to achieve.  If I want to have one million dollars by the time I turn 65 I can take my time saving and strategizing.  Unfortunately that may also mean procrastinating and ultimately jeopardizing my goal.  The goal to retire as soon as I save one million dollars will require strict changes and a great deal of commitment to your plan.  The sacrifices are less long term and more short term than the previous option.  So document your goals.  Set yourself several goals.

Prioritize the Goals

This strategy will help you reach those goals.  Determine which is most important to you.  You don’t need to try to reach all of them at the same time.  Maybe I want to have one million dollars in the bank by the time I am 55 but my next goal doesn’t need to come to fruition until I am 65.

Focus

Focus on your priorities and do the best you can do.  You can’t do your best on ten things all at the same time.  But you can do your best on one or two.  Never compromise quality and success for speed.  This is your life and your future.  Make sure it is done right.

Personal Development

The world changes and the older I get the more quickly it seems to change.  No wonder my grandmother couldn’t keep up with technology.  She went from nothing to the world of the calculator, adding machine and electric typewriter.  My generation has gone from that to a computer that used to take up and entire classroom size room – to all of that and more now fitting in my pocket in the form of a smartphone.  Who knows – maybe by the time my grandkids are my age they will be able to teleport!

Thought and Reason

Learn to not make impulse purchases.  Okay so maybe you need that jug of milk for the kids.  But, do you really need that new purse?  Or the new laptop?  Think about the cost and benefit – do an analysis.  Give yourself some time – what seems important today could be a thing of the past by tomorrow.  We have all made purchases and as time passes we find it and think – what ever possessed me to buy this?  I knew I would never use it.

Be Open to New Ideas

In my job I do a lot of hiring.  Often when a department is looking to fill a position they already have a person in mind because they are comfortable with that person.  I always insist they consider the pool of applicants ( as long as they contractually have that option ) and keep an open mind to the possibilities.  Nine times out of ten they are reminded through the interview process that bringing in new ideas may really be able to help their department.  The same holds true for you personally.  Be open to changes, advancements, opportunities and ideas.

Create a Budget and Follow the Budget

Let’s be clear – a budget keeps you accountable for meeting your goals.  No budget = no accountability = then what?  Do not make your future a guessing game.

Multiple Bank Accounts

For example I have a typical checking and savings account.  But, I don’t want all my money to be right at my finger tips.  I also have Acorns, StashInvest, Dobot, Digit, Paypal and PNC.

Keep an Emergency Fund

I keep two accounts of this type – one an emergency account for us (my family).  I use this account for things that happen at the house that are unexpected, cars, sick horses, or anything that comes up that I cannot plan for.  I keep a smaller emergency account with $100.  This is my donation account.   This is tied to a debit card and I keep it with me at all times.  Once a year or so I donate that money to a worthy person or cause.  Something that stands out and I know my $100 will make a world of difference to a person.  I don’t use it for something like GoFundMe.   I save it for something much more personal.  Like making one person’s Christmas possible or fixing one person’s car so they can keep their job.  This is my fun emergency fund.

The Dreaded Credit Cards

Get rid of them.  All of them.  The one exception is a credit card to hang on to for emergencies.    If you need to build or rebuild credit the advice may be different.  But to keep from going broke – stay away from credit cards.