Get In Control Of Your Money

– not the other way around.

Money is great! It is a tool that enable us to get the stuffs we want or need. Since its first invention, money have been used extensively, to the point that it is no longer just a tool. It evolved into what we call as an Asset – and everybody loves it! It has become so valuable that it can control pretty much every aspect of our lives. To some extent, we can’t live without money.

In this blog, I wanted to approach money differently. If you are reading this, I am sure that you understand the difference between a Master and a Servant. These two are complete opposite roles. If we are a movie director, we have the power to choose what role your money should do – Master or Servant.

Money as the Master

Let me be upfront here. Assigning money to the role of a Master is super easy. All we need to do is to have a mindset that money is EVERYTHING in your life. Yes, this sounds true to some people, but for most of us, we are all probably in denial. Let’s get to the point. Money can make us either happy or miserable at the same time.

Treating money as our Master can make us miss a lot of other important things in our life – like our family, and health. Surprisingly, a lot of people keep working for a lot of hours (not out of necessity), but out of the thought having more money is better. This can get worse as we can be completely consumed with money which lead us to greed.

Greed is another level of “money master”. If you think that you put your own money as your master is bad enough, imagine putting someone else’s money as your master. Yep! It’s name is D-E-B-T. I bet you know the rest of this story when debt starts to get involved. It’s not fun at all!

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Money as the Servant

This is a complete opposite assignment to money. It is pretty self-explanatory, but it is hard to do. It involves A LOT of self-control, humbleness, unselfishness, and more. Many have started to use money as servant, but down the line, they lost control and became obsessed with money and its capabilities.

So, what is the general idea of using money as a servant? In essence, chasing money is not wrong. We need it to pay our bills, sustain our lifestyle, and more. The key to maintain the servant status to money is to have extraordinary self control. There are a lot of tools out there to help us maintain our self control. If you look into the App store (like Apple or Google), there are tons of them. These are good tools to remind us about self-control, but we can easily violate these tools.

So, what should we do?

I would start with a reality check-up. Get a pen and paper. Start writing down your priorities. Next, start looking over and categorize all of your expenses in the last 3-6 months. It is probably easier to do this on a computer (Mint.com is a great tool to do this). After you do these exercises, start totaling up each of the expense categories. This should help you to understand where your money went. Most importantly, this could answer why you are in debt, or why you are working so hard yet you still have no money in the bank.

Once you figure out all these, start setting a budget according to your priorities. At this point, you may already have realized that you need to cut down on certain things – especially monthly subscriptions!. You an even set a financial goal (for example, you want to buy a $20,000 car within the next 5 years). As you go along, between receiving your paychecks and daily spending, you should be diligently start allocating those expenses to the appropriate category.

These things are just the beginning of training yourself to have self-control about your money. Another one important key, when you set your budgets, you should allocate your income as if you are only paid at your normal work hours. Never have the thought of setting higher budgets just because you think you would get overtime pay or bonus to cover your ‘inflated’ expenses.

We will go over some more personal finance items to help you make better financial decisions. Stay tuned for future postings! In the meantime, if you have any questions or comments, please feel-free to leave them below. Cheers!

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