Pressure and Time Limits
As you read for information to get a better mindset for money, I feel you need to have a good sense of time and for time.
There is pressure related to time limits.
In a game, like football, where there is a time limit, you have the constraints of time that presses each team and the players to score more and defend better than the other team before time runs out.
Some jobs are like that. I was an accountant for a company whose stock was publicly traded in the stock market. The market requires quarterly financial statements and monthly statements for internal purposes, complete with a deadline. I had to finish my part on time. That was not bad if the numbers seemed accurate. However, when numbers looked off I had very little time to research and make correcting journal entries. The pressure was on me to fix it!
Timing
Timing is one of the most important skills you can develop as you learn to have a better mindset for money!
Good timing will both save and generate money in very beneficial ways over your financial life. At the center of good timing is patience and planning.
As an investor, you will learn to time the market to buy low and sell high. You will need the funds to invest based on the savings from other good timing habits and not spending all you earn.
Timing for Sales
Whether it is groceries or an automobile, you will benefit greatly from planning and managing your price to pay.
As you fill your pantry with goods for meal preparations, your meal choices are limited by what is on hand. Do you really want to eat that tonight?
A more pleasant scenario is to have meals planned out that you will enjoy and buy supplies to make that possible. Now, will the store have those supplies on sale?
I have one more twist to this example. Many recipes have common ingredients. And, if you watch for sales, you can build your likeable menu after you get the best pricing on key items for that menu. And, yes, you may have to eat some things on a different night than you really wanted to. So, make it taste very good!
Saving Over Time
If you were to press me to make a choice between saving time or saving money, I would pick saving money.
Make time to consider saving money, which usually translates into being more patient, as in wait for the right time. The refinement of that thought is save for the right time to buy when the item you want is on sale.
And, yes, that may take more time than you want to spend on that subject. Be patient.
Saving has three main goals in my money mindset. First, save to cover emergencies. Second, save for investments and retirement. Third, as a variation of the second, save to be ready for a “window of opportunity”.
Save for Emergencies
The best way to remember is through repetition. So, I will repeat what I have included in earlier posts on spending controls.
The use of a credit card is convenient and requires little thought on your part to consider, “Can I afford to make this purchase?” Most credit users think about this when they get their credit card statement and then, they say, “How did I spend that much?”
At that point, you have an emergency. The question is, “Do you have enough savings to catch up?” Remember: Your mindset should be not how much credit do I have but how much money do I have on hand.
To build your savings over time, you may have to resort to playing tricks on yourself or making a game of saving, like putting back (in an out of sight location) a $5 bill from each $20 bill you break or putting your change in a container every day. Only count the accumulation twice per year and plan to use it when you have to travel, etc.
Invest to Afford Retirement
Start early on a retirement fund contribution. Let time help you with this process. Social Security will not provide much over keeping food on the table. So, remember, you are saving for the fun stuff in retirement and the realities of failing health.
You will need big numbers for retirement. Over the past 30 years, most companies have stopped their pension plans and converted to 401k plans. In essence, that puts the responsibility back on you to build your own retirement. And, considering you may live another 30 years after retirement, you will need a big pile of cash to stay secure and make a job in retirement optional.
Your retirement fund will start with small amounts but can grow very large, given enough time and knowledge about investing. By that, I mean you must learn by reading and talking to expert advisors on investing, depending on your risk tolerance. Learn all you can to avoid those who only pretend to know.
Beyond Emergency to Open Window
An early step to financial independence is to build an emergency fund. The early goal is to accumulate at least $1,000. The larger goal is to build your savings to an amount equal to six months of your average living expenses, which will help cover a job loss or serious medical issue.
That sounds like doom and gloom planning. However, imagine the peace of mind you would have, knowing you can cover expenses until the crisis is over without using a credit card!
It takes time to build a big savings account and you must establish some good habits to get there. You will have to focus on building a better mindset for money and a better financial position. Be conscious of the fact that you will have to work on making changes and forming good new habits.
Once you save beyond the emergency fund, you can start working on dreams and the open “windows of opportunity.”
Timing for Opportunities
For some, that “window of opportunity” may look like a great deal on a boat or a favorite car or a special handbag or coat on sale!
For others, that opportunity may relate to a hobby or some side gig income that needs special equipment that is available at an estate sale. I have had so many opportunities like these that I had to pass on because I failed to be a good saver.
The main goal for saving must be to build a passive income to the point that a job is optional.
Grow your efforts to save. Be patient. Opportunities will appear when you least expect them. Will you be ready to act on them?
Give yourself that chance. Be a saver!
Plan for Time
Want more time? Plan for it!
Want to be ready to make better use of time? Plan on it!
Do you want to save on purchases and be able to capitalize on income opportunities, then, do planning to help you prepare.
Have goals in mind. Think about it. Make a list. Note what is most important to act on. If it involves purchases, plan to research for the best places to get the best prices. Learn when sales occur. Did I mention that you should plan to time your purchases based on available (savings) resources?