Wouldn’t it be nice if you never ran out of money? It may sound like a get-rich-quick scheme, but there is actually one simple rule you can follow to make sure that you never, ever run out of money.
“Spend less than you make.”
It’s a simple rule, explaining a simple concept, that is very difficult to stick to. When I meet a new client, one of the first financial questions I ask is about the cash flow plan. Most people don’t have one, or they used to have one but haven’t looked at it for years, or they once did pre-marital counseling, they once wrote down what they hoped to spend…etc.
Very rarely have I met a client who paid serious attention to their spending. One recent client said it well, “…as long as there’s money in the account, we don’t really think about it.”
For most of us, our lack of concern is rooted in a lack of education. I was in school for a long time before starting in financial services – Elementary through a Master’s degree – and in all that time I did not take a single class in personal budgeting or cash flow planning. These are essential skills that no one in Canada is formally taught.
So, let me make you an offer. Schedule three meetings with me over the next month to develop your cash flow plan. I’ll make two promises:
(1) You will have more money available each month.
(2) Your cash flow plan will be simpler, and take less time than it does now.