Foul Tasting Medicine!
I don’t know if this applies to you and your family but as a child growing up I was subjected to a number of different foul tasting family remedies.
Castor Oil was one I remember vigorously trying to avoid! There were a number of concoctions for all sorts of ailments. They were made up of ingredients that usually tasted like something I can’t name here.
I have since realised that there is a misguided belief running right through the rationale behind these foul tasting remedies.
As people, we often want to find a solution to a problem. Our belief system tells us that to get something good, you should be prepared to pay the price and the more you want, the higher the price should be.
If you want a small amount of money then you should feel a small amount of pain and if you want a lot then expect a lot of pain.
Grandma’s cough remedy is based on this principle. If you have a cold and need a cure then you must have to take medicine that tastes bad. In fact, according to the theory, the worse it tastes, the better the cure must be for you. As a result I think grandma must have gone in search of the foulest tasting ingredients she could find and then combined as many as possible of these items into her cure-all remedies.
I think the main selection criteria for an ingredient to go into the brew was how bad it tasted! Don’t worry if it had any medicinal value; it just had to taste foul!
Now I want to ask you if you agree with this logic, or do you think it might be possible to get a good outcome from sweet tasting medicine?
I probably don’t need to tell you that these days there is strawberry flavoured cough elixir and it works really well!
Someone discovered that the old thought process was flawed! You can get a good outcome without paying an unpleasant price.
Let me ask you a question
Are you struggling from pay to pay because you subscribe to the yucky medicine theory? Do you believe you have to pay some horrendous price to be saved from a life of financial hardship?
If so, you may be your own worst enemy! You may only have to change your belief system and thus your corresponding behaviour to break free of money stress.
Managing money might just be fun and easy if you can step outside the yucky medicine paradigm!
What am I talking about? Here’s just one example:-
I know there are people who spend hours keeping financial records and reconciling bank statements as a way of applying some ‘discipline’ to their finances. This is tough unexciting stuff so according to the ‘yucky medicine theory’ it should bring good outcomes.
The pain inflicted on oneself in keeping the records, entering them into a computer, comparing them with bank statements and finding every cent that in unaccounted for is surely enough to guarantee financial well-being, maybe even wealth! It’s yucky medicine so it must make the family budget better!
I have seen plenty of examples of people who take no notice of what they spend, what their Credit Card balance is, what their bank account balance is and how much gets wasted each week. These people are rarely heading for wealth so the theory still seems to be valid to this point.
Keeping meticulous financial records does not work.
BUT, did you know that keeping financial records is NOT going to make you wealthy?
If you drive down the road looking in the Rear Vision Mirror hoping to stay on the road ahead you are in for trouble. The strategy only works till you come to the first corner.
Keeping meticulous financial records is much the same. It just wastes time and makes you feel good that you have been disciplined. You are looking backwards! That yucky medicine theory is going to lead to disaster.
What can you do about it?
Stop taking yucky medicine!
If you are a compulsive-obsessive record keeper you are not going to like what I am about to say; If you were to stop inflicting the pain of being disciplined at keeping records and just made up a simple plan for the essential expenses that lie ahead for the next year in advance, you could probably do something more exciting with all that spare time instead.
So I know your next question; “How do you plan the future without it being another example of taking that yucky medicine”?
Now this is where my expertise kicks in big time. It’s easy!
• Get a bunch of different coloured highlight pens
• Lay your last 12 months Credit Card statements out on the floor
• Lay your last 12 months Bank Statements out on the floor
• Go through and colour code your essential spending. E.g. green for groceries, Red for Electricity, Orange for Fuel, Pink for Insurance and so on.
You will learn at least two important things;
1. How many non-essential items you bought last year
2. What essential transactions you can plan ahead for during the next 12 months.
Use the patterns you will see to predict the future before it happens.
When I was first starting out I used a calendar to mark all of the predictable regular expenses for the next year and how much I expected them to be.
This allowed me to actually calculate target bank balances for the whole year in advance and make it so that on the worst day of the year I still had money.
Yep that took a bit of time to do but it then set me free.
It turned out that successful budget management was a really easy thing, not like taking foul tasting medicine after all.
By the way, the Simply Budgets software does the calendar calculations in a few seconds flat, so with that, there is even less pain to go through to get the good outcome.
Keeping records can then be purely for the purpose of monitoring how well you are following the plan you have for the future rather than being a way to give yourself a serious shock at the end of the financial year.
You don’t need to account for every cent. All you need to do is check once a week that you are close to your plan’s target.
No more yucky medicine!
I’ll be back with more riveting stuff next time…