Friday, June 12, 2009

The Rewards of Financial Planning

Often times people focus only on the stresses, the sacrifices, and the long-term goals that will be achieved some where in the distance from budgeting, learning different financial habits, and choosing to make choices now to have more options in the future. It is important to note the small successes and ample rewards that start to emerge on the journey.

At first, all you notice is the intense focus it takes to remember everything that needs to change. Being more disciplined requires more organization and for us it required more tools to support our new habits. However, as time moves along it becomes less labor intensive, the plan, more self sustaining. While we’d always had a casual plan of monthly action, the formal plan did take time to organize and negotiate to account for every penny, every month. Now however, it is a matter of opening a template, plugging in the month’s numbers and evaluating the situation based on that month’s needs that are different from the previous month’s allocations. There really is no more money than there was before there just is less stress about where it went. It’s clearly documented.

What is fun is noticing the money you can find to do things without any guilt attached to it. You can have cash to go out if you want it which was always something that was paid the following month. We have the money to pay for a family outing with extended family, with cash, another item that would have been paid with next month’s money. When these outings are over, there will be no reminder in the mail to twinge our guilt strings. These are guilt free moments, paid, enjoyed, and stored away.

That’s not to say I’m not still plugging away at long-term goals. Along with throwing larger payments at the principle on our car and house, we’ve started a plan to balance our checkbook to an even balance and save all our loose change to throw at the house. By today’s count I’m over $4.00 towards my house savings in change for the month. It sounds like a small amount but combined with my extra principal amount that we have been working hard to increase each month, we are whittling away at the balance. Considering the difference I’d earn on putting the change in the bank vs. sending it to pay down my house, I still winning the game paying off the house and continuing to stay ahead of the ever falling mortgage market. There is something satisfying in watching balances drop. It inspires us to keep paying more of it off.

So there need to be short term achievable goals and successes and you have to keep your eye on the larger things you need to finish. Along the way you gift yourself celebrating the victories.

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