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Money Habits: Expectations Versus Reality (And How To Bridge The Gap)

Most people our age have a dream of being financially free. While this may look different for everyone, one thing we can all agree on is learning to manage our money better can only aid us on our path to becoming financially free.   

Expectations:  

“Let’s go on a road trip to Las Vegas in my private jet. I bought the hotel we are going to be staying in; who’s in?”   

While this might not be the precise way you would phrase it. Many people would classify the thought of being able to do this without first having to consult your financial advisor (i.e., your notion table) as material success.   

Many of us dream about a life free of stressing about the numbers on the screen. Life would be better if we could only _____ *insert blank*. “If I could only win the lotto” “If my crypto investment would only increase by like a mere 10000%, I would be a millionaire.”   

Reality:  

Making money takes time.   

While we all know “Get Rich Quick,” schemes never work. Our money habits paint a different picture. We invest in the hot new topic the financial gurus throw at us. Last year it was Dodge Coin, Bitcoin, this coin that coin. However, there might be space for people to discuss the value of cryptocurrencies here. I’m sure you are in the same boat I am. I’m not financially free just yet.   

This year the hot new topic is NFT’s, what they are and how to become a gazillionaire. This might be achieved through flipping “Cyber Apes” or starting your own “Gigabro” NFT brand. Gurus are popping up left, right, and center trying to sell you’re a course or someone in your Instagram DM’s trying shove unwanted information down your throat about why their brand are the “Up-Next” thing. It would be best if you got their lazily made NFT now before it is triple the price on OpenSea. You may even have considered following their advice—anything to jump off this burning bridge.   

But Guess What?  

You’re still broke.  

If you want to achieve your goals, it’s time to consider creating habits that shape you into a better person. It’s vital to develop these habits in all aspects of your life, especially your finances.   

Stick to your budget!

You know what you SHOULD be doing. But still, you are having trouble sticking to your new habits. You want to create a budget, but that chocolate cake always looks so tasty. It gets you every time. Now you can’t stick to your budget because you already have spent your money in a way you shouldn’t have. You start feeling like a failure, so you go on a spending spree to make yourself feel better. “I mean, my budget is messed up already anyway,” you whisper to yourself.   

Maybe it’s time you accept where you are in your financial journey. Include that cake in your budget. While spending R1000 a week for cake – every week – might not look great on paper. You are creating the HABIT of sticking to your budget. Once you have the habit locked in for a month, see where you can dial back on some expenses. Don’t get caught up trying to become perfect in your first month of budgeting. Do things one thing at a time. Consistently improve 1% each month. Creating habits enables you to become the type of person who manages their money well instead of sticking to the perfect budget until you become numb to the internal guilt you would feel for not sticking to it. Once you become numb to this guilt, you relapse to where you started.   

Create the habit, and become the person.  

How should you create a budget that actually lasts?  

Start by tracking.   

Before you try and guess where your money is going, instead find out what holes your cash is currently bleeding through. You can do this in 3 ways:  

  • You can get a bank statement and put in the work trying to figure it out  
  • You track your current spending as you go through the month and asses at the end of the month  
  • You could use a free app called 22Seven  

Once you see where your money is going, you can pick one area and improve, remember the one percent rule. Consistent small moves that stick beat inconsistent more extensive actions that are once-off.  

We all have the goal of becoming financially free. Create systems and habits that serve you, and you are well on your way to achieving material “success.” A goal without a plan is simply a wish. Either create a plan or blow out your candles; you are not getting any younger.