My Financial IQ

[fried]

Hi All,

I am from South Africa, but I believe saving money is basically the same the world over. I am on a mission to get my finances in order. I have always spent money impulsively, never stuck to my budget, have quite a bit of debt and I really want to sort all of it out. I try to save, but never 10% and my savings are used up when extra cash is needed. I also have a part time business, but don't distinguish between personal and business finances.

So as you can see, I'm hopeless when it comes to money. We had a baby boy earlier in the year so it is important for me to be able to provide for my family and save for his education and have financial freedom. I do put away some money for my retirement(not enough) in a retirement plan and have unit trusts(don't know if that exists in the US)

I am here to learn and get my financial IQ up to scratch.My first question is where do I start on this path? How do I get my discipline, myself and in turn my finances in order?

Thanks,

fried

[littleroc02us]

Here is your answer, listen to this "http://www.daveramsey.com/radio/home/#archives-tab" and do what he says. It will work.

[fried]

Thanks for that. I have actually ordered Total Money makeover last week. Just waiting for it to arrive.

[buildmybudget]

You need to put it all on paper. Only by seeing how much is coming in and going out each month and where it is going will you be able to formulate a plan to best attack your situation. By seeing where you are headed financially, you can make decisions today that will help you build a strong financial foundation and allow you to better reach your financial goals.

[maat55]

I put all my expenses on a sheet of paper in their order of importance. In order to change your habits and financial picture, you will need to cut as many expenses as you possibly can.

Sell all unnecessary assets(toys,electronics, nitnacks etc.).

Track all of your spending down to the penny. How many daily expenses can you eliminate. You can take a lunch, I bought used financial books to pass the time while giving motivation.

Under Dave's plan, you will save a 1000 emergency fund first.

Next, you will pay the minimums on all your bills and apply all extra funds to your lowest debt until it is gone, then move to the next. This is the debt snowball.

While you are doing this you will develope a restraint from over-consumption. You will acquire a better prioritization for your finances. Once you get rolling you will not miss your old habits.

[krantcents]

When you are trying to change, take small steps, but stick to it. It take approximate 22 days to create a habit. Build on those small steps to the level you want to achieve. Personally, I find if I deduct for savings, I learn to live on less.

[jpg7n16]

It's about changing your behaviors. See post above me and give it at least 3 weeks to stick. Keep doing it for much longer.

I have always spent money impulsively,

Don't spend impulsively.

never stuck to my budget,

Stick to your budget

have quite a bit of debt and I really want to sort all of it out.

Start paying down your debt, and sort out your life.

I try to save, but never 10% and my savings are used up when extra cash is needed.

Practice intentional savings to build an Emergency Fund.

I also have a part time business, but don't distinguish between personal and business finances.

Make a distinction between personal and business finances.

So as you can see, I'm hopeless when it comes to money. ...

I am here to learn and get my financial IQ up to scratch.My first question is where do I start on this path?

So as you can see, you are NOT hopeless with money. And it's not a knowledge problem. All my advice is to do what you KNOW you should do. (I am just repeating back your own words)

That means it's a behavior problem.

So start slowly changing your behaviors. You already know the right things to do.


Certified Financial Planner Board of Standards Inc. - Best Practices When Approaching Financial Planning

[cjscully]

It's about changing your behaviors. See post above me and give it at least 3 weeks to stick. Keep doing it for much longer.


Don't spend impulsively.

Stick to your budget

Start paying down your debt, and sort out your life.

Practice intentional savings to build an Emergency Fund.

Make a distinction between personal and business finances.



So as you can see, you are NOT hopeless with money. And it's not a knowledge problem. All my advice is to do what you KNOW you should do. (I am just repeating back your own words)

That means it's a behavior problem.

So start slowly changing your behaviors. You already know the right things to do.

JPG is right. I suggest starting with your budget. Get your budget down on paper and work to stick to it. That's going to require that you cut out impulse buys as well. You can't stick to your budget if you can't get the spending under control.