By Hope van Noppen, MTE Documents Specialist
I recently received a notice from my bank, “Congratulations! You are approved for a $10,000 credit increase!”. With one click of my mouse, and without really thinking about it, I had access to a credit limit that exceeded the amount of money I have saved across all my accounts. It was convenient, automatic, and simple.
While modern financial tools like credit cards, automatic payments, and other conveniences are set up to simplify the complicated world of finance, it also works to disconnect us from our money. Dave and Reb developed an acronym that I hear often, both with friends and clients, to protect against this darker side of convenience:
FACE
Financial Awareness Creates Empowerment.
What does this mean?
Gain Control
Financial awareness allows us to gain control of our finances. When we feel as if we are operating in a whirlwind, financial awareness gives us firm ground to stand on. Knowing our financial direction will help us gain control.
What does this look like?
- Writing out income and expenses on a sheet of paper or chart using bank statements to notice trends of spending, saving, and giving
- Including partners, spouses, or co-habitors to create cooperative decision making around financial plans
Remember! This is not a space to blame others or yourself. It is a simple evaluation of where you are, not anger over what has happened. Have the courage to take stock of your current reality so you can regain control of your finances.
Change the Pace
Speed kills. Not just on the road, but also in personal finance. I know how online shopping with speedy purchasing has been particularly dangerous for me. Slowing down my decision making process has become essential. Rather than walking into a store and emerging with fear I can’t pay my bills as a result of the purchase, financial awareness empowers my buying and helps me prioritize decisions.
By slowing down, we can all become more aware of what is important to us and what purchases will align with our values. We will have less worry over how we will survive the month.
How do I slow down?
- Don’t buy anything the first day I think of it
- Set aside money every month for living expenses so I know how much extra I have
- Purchase things in person rather than online if possible
While these tips may not work for everyone, setting up your own boundaries to help you slow down can increase your financial awareness and prevent avoidable stress.
Watch next week for part 2 of how to FACE your finances!