Monday, March 26, 2007

I don't know how to do money!!!

There are 16 core areas in our Life Puzzle that we’re each responsible for if we’re going to create a whole and dynamic life. One of them is Financial responsibility and sadly for many it is a gaping hole in their Life Puzzle! When this piece is missing—no, I guess more adequately I should say, when this piece is “jammed” into your Life Puzzle it greatly impacts the life you can (or can’t) create.

Money is clearly not a piece anyone can ‘miss’ because every one of us touches money in some form all the time. So it is more rightly expressed that we “jam” this piece into our Life Puzzle instead of proactively, consciously learning how to manage money. Most of us walk out high school or college completely clueless! We rush off to start making money and maybe saving a little but because we are so ignorant of how to use money it ends up a jumbled mess. Before long we don’t want to deal with this part at all—it’s just too confusing.

As a result, we are sleepwalking through life. Too many of us are desperately hoping we don’t wake up because when we do and examine the financial situation, we’ll collapse! We hear of the ‘one paycheck’ away from losing it all, but for many people, it started long ago through a lack of awareness and knowledge of how to manage money.

And please don’t think this “one paycheck” away phenomenon is for people with low incomes—there are scores of wealthy people who are stretched out beyond belief. I remember sitting in a banker’s office one day while waiting for some paperwork to be corrected. The real estate boom in this up-scale area of Florida was going crazy and we were chatting about the fast pace of sales and the amazing prices people were getting for their homes. Then the banker looked at me and said, “You would think with all the BMW’s and Mercedes flying by my window and the million dollar houses, that this is a wealthy area—but you might be quite surprised if you looked under the splashy sports cars and real estate sticker shock. If we ever have a downturn in the economy, many of those cars are going back to the dealer and they’ll be empty homes on every corner. This place looks rich, but half of it’s an illusion. He said, “I know it’s true—I see the income statement when they come in for loans and so many of the people in this area are leveraged to their last nickel!”

Which brings me to what a friend said to me at lunch one day, “I don’t know how to do money.” And I said, “I don’t think many people know how to do money!” I see it in my private practice and you can watch the nightly news and see it too. We are 0-5, unconscious, reactive and as bankruptcy rates sky-rocket (only slowed recently because Congress made it so much more difficult), we end up playing victim to a green piece of paper!

If you’re reading this blog and thinking “Yup, that describes me!”, I hope you will give your SELF permission to say, “I’m going 6-10 from here on out.” I’m going to spend the next year intensively learning how money works, how to make it work for me and how to manage it towards creating the life I want.” To do this means you’ll be one of the rare honest people who is willing to say, “I don’t know how to do money, but I’m going to find out!”

Here are 3 books which will be a good start for knowledge. Read them just to gather data, do the exercises in them—again, just to gather data. By the time you finish all 3, you’ll have a new perspective on how you want to manage money for the rest of your life. The 3 books are:

Your Money or your Life by Joe Dominguez
Smart Women Finish Rich (or Smart Couples Finish Rich) by David Bach
Make Money, not excuses: wake up, take charge and overcome your financial fears forever by Jean Chatzky

Another option is to take an on-line course that will teach you, step by step to get control of your finances. Here’s one I could recommend—I like it because it is so detailed and yet, still a fun way to explore/learn and take charge. It is

If money is one of your biggest fears—make a 6-10 choice today and do something about it! Read one of these books, take an online course and build your Life Puzzle!

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