I am sure that almost everyone would say they would like to improve their financial position in some way. For many, it would be getting out from under mountains of credit card debt or paying off school loans. Others may be trying to accumulate money for a down payment on a home or saving up for a new car purchase. I have come to the conclusion that it is time for me to improve my own situation by refocusing on the basics of attitude.
Dictionary.com defines Attitude as a “manner, disposition, feeling, position, etc., with regard to a person or thing; tendency or orientation, esp. of the mind.” It’s our human nature to have a generally negative attitude in regards to our finances. We tend to dread paying the monthly bills, feel nauseous when it comes time to review the year-to-date losses on our 401(k) statements, and simply get frustrated when we don’t see our situation improving. Using the letters in the word “attitude”, I have identified eight specific things to focus on while on the journey to create financial security for my family.
A – Attention
Money is one of the most important things in our lives. When I say this, I don’t mean that our lives should be centered around money and possessions, but merely that without money, it would be difficult to live. We do not live in a self-sustaining society where we build our own log cabins for shelter and farm our land for food. At a basic level, we use our money in order to provide for the physical needs of our families. As such, our savings and investments deserve our keen attention, and it’s impossible to improve our finances by disregarding them.
T – Time
Following right behind and directly related to the idea of attention is the topic of time. If we are going to give our finances the attention they deserve, we need to be prepared to invest our time working on them. Our time will be spent investigating our spending habits, working on budgets, reconciling bank account statements, researching investment opportunities, and the list runs on. Moreover, with the goal of improving our finances, we cannot expect to see the changes overnight, but it will be a slow and tedious process.
T – Trial
Improving our finances sometimes involves trial and error. There is not always a clear, cookie-cutter solution to each of our individual situations. As an example, you will find tons of conflicting advice when you read Money magazine, read subject matter books, watch CNBC, research via the Internet, and listen to friends. At some point you may not know how to proceed with a particular decision and doing nothing is not going to be an option. When you don’t know which direction to turn, you’ll have to experiment with a course of action. Just make the best decision you can and learn from your mistakes.
I – Income
Recognize any additional potential income that we may have available to us. I am not referring to your career and normal “day job”, but anything extra you can do to generate additional cash. Would you consider a part-time job if it enabled you to pay off your credit card debt? What about selling that box of baseball cards on eBay? If photography is one of your hobbies, what about trying to make some money selling your photos on a website like Istockphoto.com? Be creative and you may be surprised by the additional income you can make after your workday or on the weekends.
T – Target
We need to have a target for where we want to be in the future. Like any worthwhile goal, we have to be willing to give up some pleasures today, in order to reach our destination. I once read that if you don’t know where you’re going, any road will take you there. Once your target has been determined, it will be easier to steer your finances to this place, by making decisions that will keep you on track to reach your goal.
U – Understanding
The degree to which we can improve our finances is directly related to our understanding about money and investments. How can we expect to make good financial decisions if we don’t understand the basic principals and “rules” about how money works? This is why it’s important that we continue to strive to educate ourselves. The better informed we are about our options, the better we can assert control over our future.
D – Discipline
Improving our financial situation is dependent upon self-discipline. Another thing I learned from my dad was that building financial security was simple, but not easy. Following budgets, purchasing only what we can afford and saving money where possible are simple concepts to understand, but they’re not easy things to actually do. You need the ability to say “no” to yourself. Not only to one-time large purchases, but even on seemingly small, daily purchases. How about substituting tap water for the $1.50 Coke every time you go out to a restaurant?
E – Effort
Finally, changing your financial situation will take a great deal of effort. This is obvious from the earlier ideas we mentioned, especially Attention, Time, and Discipline. When you first come up with the plan to grab a hold of your finances, there is adrenaline and excitement to keep you going. As the “newness” wears off, the routine of daily discipline may start to feel too difficult. You begin to realize that you do have to give up some of your time, and you start to miss what you would have been doing otherwise. If you choose to give up Cokes, it won’t take long before you begin craving them again. Saying that we need self-discipline is the easy part; following through on the discipline takes massive effort.
These eight words summarize much of what will be required along the journey, if I am to be successful at reaching my final destination. I remember a poster from one of my middle school classrooms which said, “Your Attitude determines your Altitude.” I thought the phrase was pretty cheesy, but it has stuck with me ever since. The next time you have a setback or get discouraged with your financial picture, remember to check your “attitude” to help you refocus on your goals and get back on track.
Image courtesy of JustUptown