Typically I spend my days in wonderment about how much I love my work. My sheer desire to do what I do for a living makes my job in many ways very easy. After years of working jobs I hated, this feeling of fulfillment is something that still takes me by surprise.
However, no job is without its challenges. And the job of writing about personal finance comes with two very unique challenges:
Remembering to keep in mind that not everyone spends their days wrapped in the world of personal finance
Taking my own advice
It’s funny how the more time you spend with a subject, the more removed you can get from it. How that relates to finance is the idea of how easy it is to dispense financial advice….and how hard it can sometimes be to turn that advice into action.
In other words, the advice I give is sometimes easier said than done.
Though I try to make that clear in my writing and not give the perception that I think these changes are all very easy to make, what you don’t see is how many attempts and failures I’ve gone through to implement these tactics into my daily life. The fact is, maintaining good financial habits is a daily effort – for everyone.
So when I think about maintaining the daily effort myself, the question I have to constantly answer is why. Why do I have to skip that second coffee of the day – even when I’m really tired and need to get through the workday? Why do I have to say no to a lunch or dinner out when I really don’t want to eat what’s in my fridge? Why can’t I take a trip to Macy’s when I want to try something new – or even after the third button in a row falls off my Fall coat?
The answer to all these questions is: because splurging on these things now goes against the needs of my future self. Sure, they’ll all make me feel better right now…but at the end of the month I’ll feel a lot differently after reviewing my bank statement. When I see the missing money, I’ll think about how I could have brewed that second coffee instead of bought it, how I could have eaten what I had at home, how I could have created new outfits with my existing wardrobe, and how I could have just sewn those buttons back on my coat myself (or taken it to a tailor – which is still cheaper than a new coat).
In short, the present me wants everything NOW. But the future me wants to think purchases through and see if there are ways to spend my money more wisely rather than going willy nilly with every whim. So the only way to truly stick to my good financial habits is to always be considerate of the future me.
Who is the Future You?
Before you can think about the future you, you need to understand who the future you is. I like to think about the future me in third person. Starting with that separation somehow makes it easier to objectively consider “her” needs (and leave out my current wants).
So who is the future you? What does he or she want to accomplish? What kind of life does he or she want to lead?
Try not to think about this in terms of what you think you can accomplish. Think about what, in your ideal world, your future would look like. And forget about any expectations that anyone else might place on you – or that you might place on yourself. Be real with yourself. What kind of future do you want?
What Does The Future You Need?
Once you have a grasp on what the future you wants, think about what the future you needs. What habits or systems do you need to create in your life now to lay the foundation for the future you?
Separate your must haves and gotta haves. My future me wants a solid savings and retirement account. Not because I ever actually want to retire, but because that will give me the stability necessary for whatever life throws at me down the road. I see that as building a savings fund and working towards it each month now. The future me sees it as freedom from financial worry.
But my future me would also really like to own an apartment someday. Since I live in New York where the price of owning even a shoebox-sized apartment can reach into the million dollar range, that’s a pretty hefty goal. Definitely not a gotta have for me, but certainly a nice to have (and not a bad investment either!). So the present me will start putting a small amount of savings away each month for that goal, but not as much as I would put into other goals like student loan payoff and retirement savings. Worst case scenario is that I never get that apartment but have a healthy extra savings account. Best case scenario is I reach a financial position someday to increase that savings fund more and actually put away enough for a down payment.
The beauty of that flexibility is that as life changes, my goals may change. So viewing it as a nice to have and working towards it (instead of thinking there’s no way it’ll ever happen so what’s the point) keeps me focused on building a savings that I may decide to use for other goals later. It’s all about laying a foundation now that will lead to flexibility later.
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How to Reconcile Your Needs and Your Future Needs
The hardest part of reconciling your needs now and your future self’s needs is that they don’t always seem to align. In fact, most of what we want now goes directly against what we need to do for our future selves.
So how to keep your future self in mind? Lay the foundation through your budget or spending plan. Then trick yourself into sticking to the plan through reminders of your future self.
These reminders could be a picture of what your future self wants tucked inside of your wallet or it could be trigger statements, questions, or quotes that can bring you back after the desire to splurge hits hard. You can even use social media to help. My Pinterest page is packed with pictures of places I could travel to if I save a solid retirement fund and photos of beautiful apartments that allow me to daydream about how I’d decorate my own if I were ever to buy one.
Remember – thinking about the future should be fun, not a drag! And nothing worth having comes easily, though working for it makes it all the sweeter when it happens. So now it’s your turn! What does the future you want?
Image credit: Andrea