If Money is Important then Make it a Priority.

There’s an old saying that I haven’t found the original source to. It goes something like this: “Show me a man’s calendar and his checkbook and I’ll tell you what his priorities are.” Though Gandhi may have said it easier when he said “action expresses priorities.” However you express it, you’re saying that it doesn’t matter what people say is important to them. People spend their money and their time on what actually is important to them.


So what does this have to do with money and retirement? Studies have found that more than 90% of people know that they should save more money for the future. Unfortunately most people don’t save much money. The average person in the US on saves about 5.20%. This means people are barely saving any money even though they all know better. So why is that? Priorities. If you want a secure future. If you want to pay off debts and eventually fund a retirement then you have to make it a priority. It doesn’t work if you just say saving is important then spend your money on things that aren’t important.


What’s stopping you from making savings a priority?

The most common reasons say people say that they can’t save is that they don’t have enough income, they have too many bills, and too many obligations. You do have certain things that you have to spend money on. You also are limited by the amount you make (not really, but that’s the subject of another post). You also have obligations to your kids and others. But are these things truly requirements or are they self-imposed? Look at them to see. If your future is a priority you can make it work.


What does it mean to have a priority?

At the simplest level, if something is a priority then you will make sure it happens. You will put that goal above other, less important things. If something is a priority you will sacrifice the unimportant things to make it happen. Once you have saving and your financial future as a priority you can use that to help make decisions about money.


How to set a priority or goal.

To set a priority you need to set a goal. These should be written down. So grab paper and start writing out your goals. For each goal write what you will accomplish, when you will do it, and how you will do it. For example, “Pay off my credit card within 2 years by putting an extra 200 per month to the bill each month and not charging more on the card.” Do this for anything that you want to accomplish. If you have more goals than time or money you may need to rank them. If you put them in order of importance now while you’re not faced with a question it can be easier to make a rational decision. Then when you’re faced with a situation you can look at your goals to help you decide if it’s worth it.


I recommend writing down any other priorities that you have. Writing down your goals helps make them real. Giving yourself a deadline helps keep you focused. Saying how you’ll do it will give you an actionable plan. Without these things it’s just a dream not a goal.


Make it a priority.

Make these goals a priority. Instead of buying something that you don’t really need, like going out to eat lunch when you could bring your lunch to work, think about your goal. Taking your lunch is cheaper and will make it easier to put the extra money towards your credit card. When faced with a decision like this consciously decide which is more important, your goal or what you’re about to do. You can do this with any decision that affects your goal. If what you’re about to do is more important to you then go ahead, but keep in mind you may be sacrificing your goal to do it.


If you want to have financial freedom, or even if you just want a little extra cash in your account at the end of the month you have to make that a priority. When faced with a decision look at the priorities and goals that you wrote down. Does the decision help you reach your goals or does it take you further away from them. Use that you help you make the right decisions.


Have you set financial goals? How are they work for you?

The Three Money Rules and How to Follow Them.

There are a lot of great ideas when it comes to money. There are ideas on saving, investing, spending, and pretty much anything else that you can do with money has an expert telling you what you should do. It’s impossible to listen to all of them since after a while they all start to contradict each other. So what are you supposed to do? I’ve learned a lot of things in life the hard way and this is one of them that was much easier to have someone explain it to me. There are really only three rules to money. At least if you want to have more if it in the long run. Everything else falls into one of these categories. And if you do them right you’ll build up your own stash.


  1. Spend less than you earn.

The Rule

This is probably the most well-known rule when it comes to saving money for the future. If you spend less than you earn you have money left over for the fun stuff. Or to save, or to give to charity, or whatever else you want to use it for. This is also what most of the money advice focuses on. This is where you look at what you spend and cut things out that you don’t need. For example, do you really need cable TV? Or do you really need to eat out? The less you spend the more you have left over.

The Problem

If you spend more than you earn you have to cover the rest with credit cards, pull it from savings, borrow it from friends, or worst of all a pay day loan. You can’t do that forever. If you try then you’ll find that you have to keep borrowing money. First to cover your expenses then to cover the payment to pay back the money you borrowed.

How to Follow It

In general look at what you spend, look at what you make and make sure you spend less. That sounds lovely, but how do you do that? That could be an entire post itself. I’ll write that soon. First, though, add up all the money you bring in. This includes your job and any other money you have coming in. Then add up everything you spend. You might have to track this over a few weeks. And remember everything counts. If you’re spending more than you’re making then it’s time to look at what you’re spending and figure out what you can cut. If all you’re spending money on is food and shelter and there is nothing left to cut then that gets us to rule number 2.


  1. Make more than you spend.

The Rule

This sounds a lot like rule number 1. The difference here is that we’re focusing on what you make instead of what you spend. If you know you have certain expenses then it’s time to make sure that you make enough money to cover those expenses. If there is something special that you want to spend money on then find a way to make enough extra money to cover it.

The problem

Similar to the first problem, if you don’t make more than you spend then you’ll have to borrow more and more money to cover your bills. This will dig you deeper into a hole. With all the extra debt it will be harder to get the good stuff later on in life.

How to Follow the Rule

So what do we do about it? After following rule one and cutting out the extra stuff that you don’t need you can also look at the money you are making and find ways to make more. This could mean getting a new job or a second job, getting more hours at work, or even starting your own side business to help make more money. I’ll talk more about ways to make more money soon, too.


  1. Put the difference to work.

The Rule

If you have more money coming in than going out then you have the surplus that you need to get out of debt and even be rich. That’s what this rule does. Follow this rule to take that difference and put it to work to make you more money or to make your own financial situation stronger.

The Problem

Most of the time when people have extra money the money goes to buying more toys. Luxuries, like cable TV subscriptions, get expensive. They also become addictive. When money is spent on things like this it’s gone forever. You’re in no better position than before you had the money. Maybe even worse if you spent more than just the extra money you had.

How to Follow the Rule

This is where there is the most contradictory advice. That’s because everyone’s situation is different. This is also probably where most of the posts on this site will focus. The best place to start if you’re just starting out is to put some in a savings account then put the rest towards debt. Once you have a good base then you can start looking at options that will make you even more money like investing. Investing can be riskier and definitely more volatile, so I recommend starting with a savings account first.


  1. Effort

Several people I’ve talked to like to add that there is really another rule. They all call it different things, but they all come down to effort. Anybody can make money. Anybody can save money. Anybody can be rich. It just takes effort. Sometimes it takes a lot of work. Obviously if your parents were rich it probably won’t take a lot of work. Most of us don’t have rich parents. So we have to work for it. That’s rule number 4. Do the work. Don’t give up just because it can be hard and don’t accept excuses. It really is possible to retire rich.


Did I miss anything? Are there any other fundamental rules that you know of? Let us know, and let us know what you’ve found that helps you make these rules work for you.


Sometimes it seems like just yesterday, and sometimes it seems like a long time ago. But when I started on this journey I had a negative net worth. I owed people more money than I had. Yup I added it up. If I sold everything I owned I wouldn’t be able to pay my debts. I wasn’t making much money, and perhaps I spent money on things I shouldn’t. When I looked at that I knew it wouldn’t work. I knew I couldn’t do that for much longer.


So, I decided something had to change. So over the years I fixed my income, I fixed my debt, and though I’m far from rich, I’m on my way to gaining financial security. That took a lot of effort. I spent time reading and trying new things. I failed a lot, but I learned more and eventually had more successes than failures. A lot of what I learned came from reading books and the blogs written by people that had been where I’d been. That’s where I think that anyone struggling with money should start. Learn from those that have been there.


One thing I did find difficult though is that a lot of blogs and books are written for people that already make good money. They help people refine and get better. But they assume you’re starting a bit further along than I knew I was. I had to fill in a lot of those gaps in other ways. Some of that by asking questions and learning from people that have been there.


So what does this mean for you? Well, this means we know how you feel. Whether you’re just starting out on your journey or you’ve been working on it for a while. We’ve been there. Here you’ll find information on how to start out. You’ll also learn how to put some of these ideas to work for you. We’ll share our failures, so you can learn to avoid them. We’ll also share what we’ve learned since starting out so wherever you are in your journey you’ll be able to make things easier.


Learning about money isn’t hard. Sometimes it takes work follow through with what you learn, but anyone can do it. No matter where you’re starting from it is possible to get better. Even if you have nothing now it is possible to retire given time and effort. Retirement is Possible.


We look forward to sharing what we’ve learned and learning with you as we move forward. If there is anything in particular that you want to hear about email us or post it in the comments.