The One-Page Financial Plan: A Simple Way to Be Smart About Your Money by Carl Richards

Author:Carl Richards [Richards, Carl]
Language: eng
Format: epub, mobi, azw
Publisher: Penguin Publishing Group
Published: 2015-03-30T22:00:00+00:00

But given the inevitability of these bumps in the road, why do we get sucked into other, supposedly “one-time” events that are totally within our control? I’m talking about one-time events that promise a big deal: think the Friday after Thanksgiving or Cyber Monday. It’s one thing to set aside a holiday budget that you’ve planned and saved for; it’s another to use “one-time events” like sales or promotions as an excuse to throw planning out the window.

Then there are the days when we tell ourselves we need a special treat, a pick-me-up to make a bad day better. It’s not a big deal, we tell ourselves; it’s just this once, and we’ve been so good that it won’t make a big difference to our budgets. But what about the next time, and the time after that one?

I’m not saying that we should never do something special that requires some financial maneuvering. But we need to be honest about why we’re doing it and the consequences that may follow. And if the spending happens often enough, we have to stop referring to these things as one-time events. Instead, we need to start accounting for them in our budgets.

But remember: if we continue to allow these optional, one-time events to, in fact, be regular, they can be the very things that stop us from achieving our dreams and goals. And the last thing we want to do is look back and wonder if that trinket was really such a good deal after all.

How Long Do I Have to Do This?

Many people who balked at the idea of budgeting end up embracing it as a daily practice. Others pick a month per quarter whenever they feel it’s time for a recalibration. What’s most important is that you use what you’ve tracked to determine whether or not your values are in sync with your behaviors.

Once you’ve tracked for a month or two, you’ll have some solid information about whether or not you need to start rethinking any of your behaviors. This exercise can end up with a couple of different outcomes. Some people realize that they’ve been spending way too much on things that aren’t important; they immediately pinpoint some changes they can make to take them closer to their goals. Other budgets help people see that things like organic food, travel, or continuing education are a lot more important to them than they thought: they’ve used this information to rethink their values and goals, making sure to factor in time and money for their new discoveries.

A Spending Cleanse Is a Great Way to Get Back on Track

I won’t lie: Sometimes this process forces you to recognize that you may need to make some big changes. Tracking your spending may reveal some bad habits that you’ve managed to ignore or overlook. And sometimes breaking these habits takes radical action. It’s not enough to have a few conversations with a spouse, a personal coach, or a shrink. Some habits require a complete intervention.

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