(Part 2 of 2)
Self-knowledge is the starting point for any path that involves personal and financial growth. For this reason, in last Tuesday’s column we raised a series of questions that will help us to do this, to know how we see ourselves, especially with regard to money.
As we speak, it is very important to write our reflections in our own handwriting – it makes our ideas clearer. It’s good if we erase it, pull it through, overdo it or clean it. This is not an exam, but a very personal reflection, though directed.
We must remember that we all evolve as human beings. We do it all the time. Five years ago we would have written very different answers than today because we are a different version of ourselves. Now we must understand that we have the power to make this evolution favorable – to improve our lives and our financial situation.
We have written on other occasions that deep and true changes begin from the inside out. Knowing ourselves gives us a starting point, but it’s only important to the extent that it helps us plan where we want to be tomorrow. Knowing what is important to us (being clear about our priorities) gives us that clarity and allows us to take action to get closer to – never further away from – what we consider important.
There are two techniques that help us achieve this positive evolution:
1. Take small, positive and progressive steps. It may sound obvious, but too many people try to run before they learn to walk: it leads them to fall, hurt and become so frustrated that they do not even try again. We do not want this to happen to us.
If we feel that our income is very limited and we have never been able to save, we can not strive to deposit from the one day on the next 15% of our income as retirement savings in the Afore. To do so will be counterproductive, because we will surely need the money and we will have to incur debt.
What does work is to start with 1% of our income – if we earn 10,000 a month, save 100 pesos and learn to better organize our spending. In a few months, if we see that we did not need them, we can try 2% and gradually go higher.
The most important thing, at this point, is to break that spiritual barrier that we have to think that it is impossible to save. We make it possible.
2. Keep a notebook where we can record our thoughts, financial decisions, what we did wrong and what we learned about it. This advice is not for everyone, but writing certainly helps to organize our ideas and make our decisions and commitments to ourselves more tangible. It is also important to write down how we feel about our relationship with money and what attitudes and habits are different now. What has changed for the better, what has changed for the better, and what are we going to do about it?
I deliberately did not call it a “diary”. For some it works to write every day, for others a reflection of what happened during the week is enough. But wearing it definitely works for many people to clear the mind. When we also see the progress we have made, it gives us a lot of motivation and a sense of success that we have not had before.
Personal Finance Coach
Senior manager in insurance and reinsurance with strategic business vision, high leadership, negotiation and management skills.
He is also a Personal Finance columnist at El Economista, Personal Finance Coach and creator of the site www.planetusfinanzas.com