So you’re walking all jolly and happy to the ATM. You look passionately at your card, full of hope that you will harvest your bounty that day. But then reality hits...you don’t have money! Then, you start counting the days when your money will return again, like two lovers temporarily separated.
You keep an eye on your online bank account balance every day, every hour, every minute. Waiting, and waiting, and waiting. When money comes in, you spend like normal until one day you go to the ATM and the panic revisits you. The cycle starts again.
Why does this happen? Well, it’s easy to point fingers at the high cost of living and say, “We need more money”. If only we had more money, we wouldn’t be having this problem. But wait, I think we need to take a step back before making that conclusion. Because I think we might skip a few steps.
Undeniably, there are people who genuinely need more money. I’m talking about people who can’t even cover the basics. Forget the wants and the luxuries, they can’t even afford plain rice. These people struggle with basic survival. If you are in this category, then yes: you can safely say that you need more money.
But for many, many of us, I don’t think we are in that category. If you can still afford to buy stuff, things that you want and not things that you necessarily need, then you might want to think twice before saying that you need more money.
Perhaps what you need isn’t more money. Perhaps what you need is more money discipline. In fact, most of us need that more than we need money. Frankly, many of us lack financial discipline and the person who is writing this ain’t a saint either in that department.
However, I still want to share one thing that we can do today as a first step to develop that discipline. This is something that I have done myself and I have found it to be useful and eye- opening. I’m talking about tracking our money spending.
One of the possible reasons why we keep on coming back to the question, “Where did my money go?” when we check our bank account balance is because we are not aware about where and how much money we are spending.
We don’t know where we are financially, and we are spending our money while being blind. We simply surrender to our autopilot self. No more! We need to snap out of it. We have to start being conscious about when, where, and how much we spend our money.
Although the process of money tracking is tedious, it’s not difficult. All you need is a pen, a piece of paper, and the patience to jot everything down. Or, if you want to save the environment, you can use any money tracking app on your smartphone or an Excel sheet and jot everything down.
When I say “jot everything down”, I mean jot everything down. We need to know exactly how much money comes in and how much money goes out. To make things easier, we can divide up our income (money comes in) and expenses (money goes out) into categories.
Money can come in from multiple sources like salary, dividends, investments, rent, etc. Money can go out to different things like food, shelter, clothes, medicine, takaful, transportation, etc. Dividing our income and expenses into different categories can give us a better picture about what is our biggest income source and what is our biggest expenses.
When I did this for about 3 months, I saw a pattern in my spending and I was surprised as to how much money I spent on certain things. Having this record enables me to confidently answer the nagging question, “Where did my money go?!” The answer to the question is always staring you in the face, but I didn’t notice it because I didn’t bother putting in the effort to pay attention to it.
At this point, some of us might be thinking: Oh my God, that’s a lot of work! Yes, it is a lot of work because building discipline is not easy. But you and I both know we need it in our lives. The extend to which we realize how valuable discipline is will be the extend to which we are willing to commit to building it.
There is no room for half-heartedness in building discipline. Either you give it your very best, or you won’t succeed. It is as simple as that.
Without discipline, it doesn’t really matter how much money we have because the problem isn’t in the amount, but it’s in the usage. We could be very rich and all that money could be gone before we know it, because we don’t have a good sense of how we are spending it.
Just because a person has money, doesn’t mean that he knows how to properly use it. So the next time you’re thinking of marrying someone, instead of wondering how much money that goes into his pockets, you might want to think more about how the money goes out of his pockets.