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Setting Your Financial GPS

financial GPSSetting your financial GPS is a strategic plan for reaching a life goal or planning a future destination. First, you need to know where you are and where you want to go.

When people get in a car and activate their GPS, it is assumed the device knows where the car is and will arrive at the correct address. From experience, you cannot always rely on it to be accurate. The same concept of reaching a target in your life must include your starting point and what you want to achieve. To make good financial decisions, you need to break the autopilot mentality and start thinking for yourself. Being on autopilot when facing money decisions means you allow roadblocks and congested traffic existing in your head.

On an actual freeway, you can see hundreds of cars ahead of you on the road. The roadblocks you have set up in your mind tend to be less obvious. Nobody is setting out an orange cone with blinking lights telling you to merge your credit card debt.

Budgeting inertia and increased mental stress take place when you try to juggle payments on seven credit cards or transfer money from one bank account to another. Have you ever freed up expenses on one credit card so you can charge more on it while making a payment for another card? Do you wait for a paycheck to cover checks you just wrote? Time for a new roadmap!

A financial GPS can be a terrific tool for setting a destination from your start point to a future goal. Even when your financial advisor and your accountant set up external steps for you to follow, you are ultimately the driver of your “monetary” vehicle. I have several clients who, in the face of grave consequences, have driven right off a fiscal cliff – despite having been informed of its presence.

Collectively, many of us have become unconscious and drift through the “business” of our lives. As you become aware of what direction you want to go, you can work your way out of that dream state. Slow down and make conscious choices for the next three months. “I will not charge my credit card; I’ll just skip going out to dinner this week.” “Maybe I do not need three new outfits.” “I should balance my checkbook.” “Take a breath and focus.” (It is good to remind yourself to slow down.) Now you can actively manage your money rather than frantically reacting to fiscal surprises.

Makes life more enjoyable!
Bob

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