MAKING FRIENDS WITH YOUR FINANCES
'Only when the last tree has died and the last river been poisoned and the last fish been caught will we realise we cannot eat money.' Cree Indian Proverb

In choosing a job or a new career path, money has always been a secondary consideration for me. I believed that doing what I loved was far more important. And still, today, I carry this belief but I am also aware of the importance of feeling a sense of control about money in order achieve peace of mind.

Those of you who have been subscribers for the past three years, will know that I've avoided writing a newsletter about managing your finances until now - primarily because a part of me has felt that it's not a subject I want to spend much time focusing on. But in truth, there has simply been an element of denial...until now, I've never felt really in control of my own finances.

The longer I coach, the more I come to recognise that this is a problem for many of us - and more importantly - that feeling a sense of enjoyment about how we manage our finances, is not only possible, but essential if we are to be truly happy in life.

What prevents most of us from feeling at ease with money, is the lack of control we experience, generally because our expenses exceed our income by (on average) 10-20%. Most of you will know that when you have received a salary increase, it is absorbed into your budget within a month or two of receiving it and you don't necessarily feel financially any better off.

Whilst it's a time consuming and often confronting job, it is critical to have some form of budget. It is vital that we have a financial plan in place for the future and it is imperative that at least from time to time, we track our spending to see where we need to make changes.

Making Friends with your Finances Exercise

• If you don't pay your balance in full every month, get rid of your credit card now! Replace it with a debit card (or even two - one account that you only put money into when you need to make a purchase from the internet so that your every day account is completely secure)

• Replace your line of credit with a regular mortgage. As tempting as it can be to tell yourself that a line of credit provides flexibility, it also makes it too easy to get into further debt

• Set up a direct transfer to save a minimum of 10% of your net salary every month

• Create some financial goals that are longer term, even if you feel that they're light years away

• Do a budget!

• Record what you spend - even it it's only for a week. You may find areas where you can make improvements

• And finally...reward yourself for taking control of your finances!

ON A PERSONAL NOTE
From time to time I've drafted up budgets and then (fairly consistently) ignored them. I can always find something far more interesting to absorb myself in. But as the girls get older, I realise the importance of setting a good example for them and as we get older, I recognise the importance of having a plan for our future.

During my time off, I finally completed a proper budget. One that has all the expenses included (even those little things that I generally like to leave out so it all looks a bit better). I've created some fool proof systems for keeping the essential records etc. And whilst it wasn't my preferred way to spend my time, I now feel completely in control about our finances.

I've always used excuses about why I don't set financial goals - 'money doesn't matter that much to me' or 'I'm not particularly driven by money'. I've come to realise that that's what they were - excuses. Reasons not to take responsibility and reasons to excuse my relatively slap-happy approach to our personal finances.

In a lot of ways money doesn't drive me - but experiencing life to the fullest does and I've realised we need money to have choices. I want the freedom to be able to travel overseas again one day; I love having a beautiful home; I want to be able to donate to charity; I want to be cook beautiful meals and entertain friends; I want to buy books and CDs, to take an art class or a dance class; I want to be able to call my mother long distance and talk for an hour...and I want to be able to buy one pair of Italian shoes a year. So maybe, in a way I've been kidding myself - money is important to me because it provides me with freedom and choices - and as much as I'm loathe to admit it, I think in fact that it is important to me.

We are happy for you to reproduce our articles as long as they remain intact and contain the author's details as follows:

'Kate James is a work life balance coach, writer and speaker. She works with professional people who want to enhance their quality of life by making the right career and life choices. You can find Kate at www.totalbalance.com.au.'