Not too long ago, a friend made the comment that people don’t really change, do they? At the time, I agreed with my friend but that conversation gnawed at me and now I feel differently. Like many, I spent a great deal of my life struggling with money management. I’ve improved that significantly over the last few years. Let me explain.
It’s all about habits
Habits, be they good or bad, determine how you live your life. I used to have some bad habits with money that left me in a situation where I never seemed to have enough. It was seldom an issue of not making enough money. I’m not too bad at that part. It was more a matter of spending money I knew was coming in before I had it in my hands. Then when the money did come in, instead of paying off the credit card I’d used, I’d find some other use for the money. That’s a bad habit to have with money.
About three years ago, I just stopped spending money until I had it. For the first 30 days, it was a struggle and took conscious thought. But then it got easier. While I continued to carry one credit card for business travel needs, all other spending moved to one of two debit cards. One card was for business incidentals and the other was for personal spending. The thing about a debit card is the money has to be there or you can’t spend it. So the habit change was simple. I took the credit cards out of my wallet and never carried them.
Positive habit changes have a payoff
I chose the example of turning my financial life around because the payoff is so easy to see. We went from living with very little safety cushion financially to having some extra money each month. We’re only three years into this makeover and the difference is night and day. When it came time to buy a new car, neither the down payment or the monthly payment was a problem.
I look at what our family does with essentially the same income we had three years ago and am amazed how much better of a lifestyle we live. We even ended 2010 very roughly income-wise but weathered that storm with money we’d managed to put away in 2009 and early 2010. The simple change of deciding not to carry or use credit cards allowed this to happen.
I changed you can too
I don’t tell this story to brag about where I am financially. I’m actually a little embarrassed it took me this long to figure out some of these financial basics. The point is I did and it started with a small change in a habit that then turned into a new habit. I just don’t spend what I don’t have anymore – ever. If that’s not change, I don’t know what is.