5 Tips to avoid Money Mistakes

Money mistakes; yes we all make them, but do you ever wonder why? It’s all about what is going on in our head. But you knew I was going to say that didn’t you.

This is what happens.  The more we attach emotion and meaning to money, the more we lose sight of what it really means. The maths bit goes out the window. It is when 1+1 equals more than 2 that mistakes kick in.

money mistakes

Here are five tips to help you avoid money mistakes

1. If you are feeling emotional, don’t make important financial decisions.  Sounds really obvious doesn’t it; but when you are emotional your perspective narrows and you can lose sight of the big picture.  A warning here, have you tried to help someone see logic when they are in a highly emotional state?  It can backfire and they dig their toes in even more, empathy and understanding is needed more than reasons and logic until they have calmed down.

2. Being stressed or tired are also not good times to make financial decisions. We just don’t think straight. Wait until the tension has eased.  I remember my Mum saying, never go to bed angry as you may say things you regret later, the same applies to money decisions when you are tired you may regret what you buy. Continue reading

Money or Time?

Quite a dilemma isn’t it.  We work hard to earn the money to give us the good things in life but then we don’t have the time to enjoy them because we are working too hard.  Bit of a chicken and egg scenario.

clock compressed

When we think about what we are trading (or compromising) for money, time tends to be the first thing that pops into our head.  The 40hr working week that our forebears fought so hard to get seems to be a distant memory.

I received an email from a client at 11pm she was still in the office (she arrived at 7am) and would be back at 7am the following morning.  She has two children who she feels spend more time with the babysitter than they do with her.  But she is building her career in a profession that expects that kind of commitment.  Whilst she loves her work, she is really concerned about missing time with her children as well.  So why does she do it?  She feels she has no choice, she needs to provide for her family, and the hope of a large salary and less hours at some point in the future keeps her going.

This is a common story, not only from people on salaries, but business owners as well.  We seem to be prepared and feel we need to work long hours for some financial goal in the future. Continue reading

Money. Love it or hate it, you have to live with it.

Strange as it sounds we all have a relationship with money.  When you think about it, it does make sense.  Money is everywhere, we really can’t ‘opt out’ and say we want nothing to do with it.  Unless you want to be a hermit in the deepest darkest Amazon jungle where there are no other people and you can be self sufficient, not my idea of fun.

Love compressedI hadn’t really thought about it either, money was just there (or not) depending on what day of the week it was and how close to payday it was. OK, that was many years ago when I was young, single and carefree, or I liked to think I was, but looking back now, even then money permeated my thoughts and actions.

Whether you like it or not, you have a relationship with money.  Love it or hate it, money is everywhere and like any relationship there are good relationships and bad.

A little tongue in cheek, but think about it this way, if you were dating money what would it say about you? Continue reading

Instant Gratification: the other side of the story.

Earlier this week I wrote a blog on Instant Gratification.  Just like the movie Sliding Doors, the story can have a different ending…..

Twelve months ago, I had a Freddy Mercury moment. “I want it and I want it now”.  What was the object of my desire? A red leather lounge suite.

leather compressed

It would look perfect in our house, not that there was anything wrong with the lounge suite that we had, but the red leather was divine.  It wouldn’t just enhance the room, it would transform it.

We weren’t even looking to buy new furniture, it was one of those moments when you walk past a shop and something grabs your attention, next minute you’re in the shop chatting to the salesman like he is a long-lost friend.

I did all the things that I tell my clients to do when impulse kicks in.  Walk away, give yourself time to assess whether this is a Need or Want.  What is the opportunity cost of the purchase?  Is the purchase worth it in terms of our longer term goals?  We looked at the price tag and decided we weren’t prepared to pay that price.  So we didn’t buy it. Continue reading

Instant Gratification: I want it and I want it now!

Twelve months ago, I had a Freddy Mercury moment. “I want it and I want it now”.

What was the object of my desire? A red leather lounge suite.

leather compressed

It would look perfect in our house, not that there was anything wrong with the lounge suite that we had, but the red leather was divine.  It wouldn’t just enhance the room, it would transform it.

We weren’t even looking to buy new furniture, it was one of those moments when you walk past a shop and something grabs your attention, so you go in to have a closer look.

I did all the things that I tell my clients to do when impulse kicks in.  Walk away, give yourself time to assess whether this is a Need or Want.  What is the opportunity cost of the purchase?  Is the purchase worth it in terms of our longer term goals?  We looked at the price tag and decided we weren’t prepared to pay that price.  So we didn’t buy it. Continue reading

What do you base your money decisions on? Logic or emotion?

We always make our financial decisions based on logic don’t we? Of course we don’t, we are human after all, and where money and emotions are concerned 1 + 1 doesn’t necessarily = 2

??????????Take us for example, we live on a lifestyle block of 10 acres (or as we say, no life and no style) so not only do we have a house to maintain but also paddocks which need fences repaired, water troughs, fertiliser, weed control and we grow a lot of grass!!  So we can either use a really big lawnmower; or as we have chosen to do, buy some cattle and have environmentally friendly lawn mowers.

Does any of this make financial sense?  Probably not.  The number of cattle we ‘grow’ over the 12 – 18 months we keep them, do increase in value as they grow in size. We get a nice cheque when we send them off to the sale yards and we use the proceeds to buy the next lot of ‘babies’ and get some of the maintenance done. Continue reading

It’s a New Year, let’s get serious and find a mentor

Setting goals for the New Year is great, but if you really want to get serious and achieve them then you need help from a coach, mentor or accountability partner

campsite compressAfter the excesses of Christmas and a week of relaxation at the beach camping, the last thing I wanted to do on the first day back at home was get up early and head to the gym. Let’s face it, I am still in holiday mode. The sun is shining, most of my clients are still on holiday and there is nothing pressing on the ‘to do’ list so why not chill out, relax; the gym will still be there next week.

Does this sound like you after a break away from home?

So why did I leap out of bed and head to the gym and push my reluctant body to do a weights workout and some cardio?  Well, in two days time I had a session with my personal trainer.  He always kicks my butt and pushes me to my limits and I know if I don’t get a couple of days of training in first it’s going to be tougher than usual. Continue reading

Nine million adults in serious debt – but few seek advice essential to escaping it

See on Scoop.itmoney management

A study from the Money Advice Service shows 18% of the population are struggling with the devastating effects of debt (Nine million adults in serious debt – but few seek advice essential to escaping it http://t.co/n78ADaCI1L)…

See on www.mirror.co.uk

Does our perception of what makes us happy change?

I read with interest Deborah Hill Cone’s article in the NZ Herald about her change in perception towards wealth and happiness.

QueenstownMaybe it is an age thing.  The more mature we get the more important other parts of our life like health and friendships become not just the size of our bank account.

We have just come back from a fantastic weekend in Queenstown (bit of a tourist plug here).  For the last four years, we have an annual gathering with some of Simon’s friends from Wellington College. The boys’s boarded at Firth House from the 3rd to the 7th form. Most of them lost contact with each other for over 38 years;  it was only the official school reunion that brought the group back to together, and we have been meeting ever since. Continue reading