How to Make Money Management a Blast (or At Least a Breeze) Money management can be exhausting, intense, and stressful. But is it possible to make the experience fun? Despite the high stakes of the wealth generation world, you don't have to...
This story originally appeared on Due
Money management can be exhausting, intense, and stressful. But is it possible to make the experience fun?
Despite the high stakes of the wealth generation world, you don't have to sweat bullets every time you move money around. It is, indeed, possible to amp up your energy and enjoy the process a bit — at least, it's possible if you have the right perspective, tools, and strategies in place.
If you're a wealth worrier, here are a few tips and suggestions to help you have a blast with your money management responsibilities — or at the least, make the process of managing your money a breeze.
1. Start By Learning About (and Accepting) Risk
Whether they realize it or not, most people are familiar with the concept of financial exposure. This refers to the uncomfortable understanding of how much money you stand to lose from your investing or money management activities at any given moment.
Financial exposure is a term that finds expression in phrases like, "If this investment goes south, I'm toast." or "I'll go bankrupt if this doesn't pan out."
While it's important to understand the risks involved in your financial circumstances, fear of over-exposure shouldn't be the only factor you're considering. You also want to learn to be comfortable with and even accept risk at times.
In fact, the phrase "accepting risk" is a legitimate financial term replete with its own unique money-related definition. It means consciously exposing yourself to financial loss or unwanted outcomes in the deliberate attempt to gain a particular payoff or other reward.
To put it another way, accepting risk refers to the attempt to be okay with taking calculated and understood chances with your money. If you want to feel comfortable and even enjoy your money management journey, take the time to learn about and accept that risk is a realistic part of the experience. Your job isn't to avoid risk like the plague. You just have to make sure it doesn't get out of hand.
2. Use Goals, Benchmarks, and Personal Challenges
There's nothing like an end goal to motivate a person. When you establish a clear picture of what you're trying to reach, it can breathe purpose and focus into what you're doing now, in the present.
The thing with goals is that they're nuanced. You can't simply set a 10-year goal of "making a lot of money" or "getting out of debt" and stay focused every time you do your bills or choose a new investment strategy.
Instead, you want to take the time to study how to set healthy financial goals. These should be both SMART goals and short and long-term in nature. The SMART goal acronym stands for:
These parameters can ensure that each of your goals is crystal clear and capable of motivating you with precision.
When it comes to setting short and long-term goals, you want to consider both of these critical pieces of financial success. Short-term goals are relatively urgent. They might be setting up an emergency fund, paying off a wedding, or saving for an upcoming trip or home improvement project. In most cases, short-term goals don't go further than a few years into the future.
Long-term goals are the big-ticket items. Retirement, saving for your kid's college, buying your dream home — these are the things you're willing to work toward for months and years at a time without giving up.
Consider what your short and long-term aspirations are. Then set those objectives using the SMART goal methodology. The result should be a financial blueprint that streamlines your financial activity and keeps you motivated and even excited as you go along.
3. Gamify the Money-Making Experience
Setting goals can give you motivation and make money management more rewarding. However, if you truly want to amp up the excitement level, you can go a step further by gamifying the entire experience.
You can start this transformation by changing your verbiage. Rather than referring to something as a goal, call it a "quest." Don't just pay a bill. Consider your paycheck your personal army and see if you can win each billing battle of attrition. Set up a personalized reward system for yourself if you reach a certain benchmark. Challenge your significant other to see who can save more money over the course of the next month.
If you're struggling to come up with ideas on your own, you can use apps to get those creative juices flowing. (More on fintech apps and tools, in general, in the next section.) The Envie app, for instance, is a simple and fun way to gamify your savings right on your phone.
The free app allows you to set up fun goals, like a vacation, and see your daily progress toward that benchmark. It also lets you track your progress and earn cash rewards, like the Goldie.
You can even take pre-set challenges. Envie is the digital version of the 100-envelope challenge, so each of its five challenges are designed to help you reach your goal in 100 days. Whether you're using an app or playing by your own rules, gamifying the money management experience is a great way to stay positive and encouraged over time.
4. Find Tools to Simplify Your Management Activities
It's a lot easier to manage your money if you have a strong system in place. Fortunately, we live in an era where there are countless tools and resources to help.
Sometimes, these are as simple as an online calendar. This can help you schedule important events, remember when payments are due, and even get into a healthy rhythm for consistent budgeting.
Speaking of budgeting, it's also worthwhile to find a budget system that truly fits your personality and lifestyle. The 50/30/20 budget, for instance, is a straightforward option (50% of income toward necessities, 30% toward wants, and 20% toward savings and debt.) Zero-based budgeting ups the ante by assigning an up-front purpose to every penny that you make. Keep in mind that the kind of budget that you choose can factor into your gamification efforts, too.
Other less "sexy" tools that can still have a major impact include things like spreadsheets to track expenses and online banking portals to streamline money management. Remote check deposit mobile features and auto-bill and direct deposit options are all powerfully simple tools, as well.
These may not have a direct impact on how enjoyable your money management is. Nevertheless, the menagerie of fintech tools available can go a long way in keeping you on track, organized, and de-stressed.
5. Prepare for Disappointment (and Take Steps to Stay Inspired)
Thomas Edison is famous for saying, "I have not failed. I've just found 10,000 ways that won't work." Winston Churchill uttered the infinitely inspiring words, "Success is stumbling from failure to failure with no loss of enthusiasm." C.S. Lewis reiterated a similar message when he wrote, "Failures, repeated failures, are finger posts on the road to achievement. One fails forward towards success." The list of inspiring quotes goes on.
There will be failures and disappointments along your financial journey. Investments won't pay off. You'll lose your job at some point along the way. Perhaps you won't be able to pay a bill or may even have a larger catastrophe, like losing your car or home.
Whatever your financial hardships might look like, it's important to keep your emotions and perspective clear on what failure is in the first place. It isn't a stopping point or place of shame and despondency. Failure is a lesson. It's a reset. It's a chance to pick yourself up, learn from the past, and do better on your next try. The more you understand that, the more you'll be able to manage your money through the ups and downs of life without, as Churchill would say, losing that all-important enthusiasm.
As a final note on all of these quotes, one emotional tool that can help guard against the fear of failure is the wisdom of the past. Take the time to find your favorite inspiring quotes like those listed above — famous sayings that pertain to financial activity, failure, success, and so on. Then create a list of your favorites to reference when you're feeling thrown off or overwhelmed.
Finding the Fun in the Fiscal Parts of Life
Taking care of your finances is not an inherently glamorous activity. On the contrary, even when you're building wealth, it can be an overwhelming and intimidating part of life.
But it doesn't have to be.
If you take the right steps, you can turn the humdrum activity of doing your budget into an exciting challenge. You can transform the fear-filled moments spent managing your investments into confidence-building points in your daily life. From understanding risks and disappointments to setting goals, finding the right tools, and gamifying the entire experience, there are plenty of ways to make money management a blast — or at least a breeze.
The only thing getting in the way is yourself. So assess your situation and consider where you're lacking inspiration, creativity, or direction. Then use the tips above to turn your finances into one of the greatest adventures of your life.
The post How to Make Money Management a Blast (or At Least a Breeze) appeared first on Due.