ICFE eNEWS #15-06 - Feb 26th 2015
Getting Control Of Our Finances - As Easy As Pie!
By Jim Garnett, a/k/a Ask Mr.G, a member of the ICFE's Board of Educational Advisors
The reason many Americans do not have control over their money is
because they have the wrong perspective toward their money. They view
their money as a whole pie instead of a pie that is sliced into pieces.
It’s really that simple.
If you will change your perspective, you will change your practice, because how you view your money determines what you do with your money.
Let’s say you invite a family of three over for pie and ice cream this evening. You then learn that two of your adult sons will be stopping by your home for an afternoon visit.
Red flags go up! You envision your sons spotting the pie and, of course, wanting some. You are not afraid they will eat all the pie, just that they will not leave enough for your evening guests.
The action you take is simple. You slice the pie into pieces and separate the “promised pieces” from the rest of the pie. The boys are then free to eat the pie that is left in the pan now that you have made sure your guests will get theirs.
Changing your perspective from seeing a “whole pie” to a pie sliced into pieces will enable you to provide what you have promised. From the sliced pie you easily can see what is “designated” from what is “discretionary”.
This is the proper perspective we must take toward our money. We must see our money as divided into what is designated (set aside for bills), from what is discretionary (left over for non-essentials). This simple change in perspective will help put us in control of our finances.
Most Americans view their money as a whole pie and never know what is spendable and what is not. They spend their last $75 on an evening out, then fail to pay their cell phone bill due the next day.
So, here are three simple steps to follow to change your perspective to the proper one:
President - Executive Director
Institute of Consumer Financial Education (ICFE)
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