The Christmas crunch has ended and the bills are starting to appear in the mailbox. Reality has set in and it’s time to get back to managing the budget. I did some research to see what experts have to say about balancing our personal finances.
The majority of Canadians, I have discovered, are known as a nation of workers who feel deeply the responsibility of taking care of their own obligations and those of their family. We are prepared to work not just to earn a living but to enhance our futures. But, apparently, the management of our earnings, expenses and assets in the best possible way (financial planning) is not a strength area for many of us.
Historically, control of the money rested in the hands of the chief bread winner and many women knew little or nothing about the family finances generally. Although Canadian women had a reputation for excellent management of household accounts and for frugality, on the whole our grandmothers were not informed about family investments or the family business. In the twenty-first century that should not be the case.
It is imperative today, when most households have dual incomes, that both partners be aware of the bills and the income. Decisions made about long and short term spending should be made together. In addition, the completion of wills by both parties is the most effective way to provide for good family protection. As children, our education regarding financial planning came mostly from our parents, watching the process not discussing it, since money matters we considered private in those days. The education system provides us with training to make money in the future, but with very few skills for spending it wisely. Today finances have become a topic for lively family conversations and negotiations “…you earn or save enough for half the price of your new bike and we will help with the rest…” Some high schools are trying to provide a greater scope for money management skills, but budgeting is still a very personal matter.
It requires hard work, perseverance, discipline and often sacrifice. We must learn to differentiate between our “needs” and our “wants’. If we don’t commit to living by our planning we end up having to use our unearned income from the future to cover today’s expenses. Our overspending is like digging a huge hole, one shovelful at a time, until we end up falling in and being buried by the weight of our own debt. (Does this sound familiar only on a larger scale when you think about the upcoming federal budget?) Using credit begins by choice and, if used unwisely, progresses to necessity, while we hope that we will win the lottery, receive a bonus or inherit a legacy to bail us out. Budget is a word like “diet”. Some think of it as a punishment. But if we don’t do something soon, someone else will be making up the menu.
The best advice I could find were several items which may be words to live by in the next few years – don’t add new expenses (unless it’s an emergency), borrow money only when it’s for something you NEED not WANT, watch your budget like a hawk and ask for advice from someone you trust when you’re not sure what your decision should be. And be proud of yourself when you are fiscally responsible!
“The future depends on what you do today.” Mahatma Gandhi