Last week, I made the final payment on my student loan, the last remnant of financial debt I’d been carrying.
That makes me… DEBT FREE, baby!
Over the last 10 years I’ve made it a priority in my life to be conscious about my relationship with money. Early on, I had a lot of fun attending seminars about financial health and wealth. I learned how much meaning I was giving money, based on the negative beliefs I’d held, and how it was affecting my life. Now, my focus is on reading financial blogs, my favorite being The Simple Dollar.
This is what I’ve come to discover:
My relationship with money is like any other relationship in my life – disrespect it, and it will decay; respect it, and it will be strong and clear.
Money has no power, except the power I give it. It is neutral, a thing, a piece of paper. If I think money is evil, evasive, complicated or confusing, it will be, because I have given it that power. Conversely, if I see money as a friend and partner in my success, it will be.
My financial net worth is a perfect mirror of my spending habits. When looking at the difference between income and expenses, it is impossible to ignore the trends that emerge and who is to credit for them. There are lots of ways to track your finances, but I use Mint.com.
Financial health = steady, positive habits repeated over time. Here are a few of my favorites:
(1) Spend less than you earn.
This one is pretty self-explanatory, no? If you spend less than you earn, you can save and invest. If you don’t, you’re in debt. Debt = limits. Savings/Investments = freedom.
(2) Save consistently for specific things that you care about.
Saving for something that means something is easy to get excited about. I see the numbers go up and up and when I reach my goal, it is satisfying to make that purchase.
Best part? No credit card debt to pay off afterwards because I paid in cash. Going on vacation? Save for it! I think those have been the best trips I’ve taken – because I know it’s covered and I won’t need to second guess or pay for my purchase later. I can enjoy it right then in that moment.
For the last year or two I’ve been throwing money at this student loan like it’s hot. So now, all that energy needs a new direction. What next? Whatever it is, it will be something I care about, something that brings me peace and balance.
I get to decide. Because I’m in the driver’s seat.
MAKE IT REAL: Journal Moment! Ask yourself, “What are my habits around money?” (Do I overspend/never spend/hoard/avoid?) Fill in the blank, “Money is…” Once you get a sense of your beliefs around money, you can start to adjust them if they no longer serve you. And then, my friend, you are freeeeeeeeee!
Photo Cred: Sarah Lapres (pictured below)