Money Mondays: The Futureshock
The future will mirror the present, until your present action, takes steps toward future results.
Most of you that comment here regularly are the exception to the rule. You have to be. Based on your responses, I can tell that you are smart and you take the steps you are supposed to take despite the staggering number of indebted Americans that live amongst the population. But what about those that don't comment or aren't doing o.k., what can they do to begin to turn it all around?
Take the appropriate actions now that will give you the desired future results.
Most people are generally optimistic about the future, especially when they are young. It's not uncommon to feel like jobs will get better, salaries will increase, you'll gain a spouse and another income, or some event will occur that equates to more money and better days. For the most part this is the American train of thought. This isn't a bad thing, but what this type of attitude does is give you an excuse not to be vigilant about changing your future now. It also doesn't prepare you for the day that either none of this happens as expected or it does, yet you still find yourself in the hole.
The numbers don't lie, for years Americans have been saving less while debt has been on the rise. Now with the basic living expenditures continuing to rise, Americans are finding themselves in a pinch and contrary to popular opinion, the future will not take care of itself. If you don't change your behavior now in favor of the future, you will continue to experience your present state of being when the future arrives. Either that or things will be worse.
The future two-step
Step 1. Put your guard up.
Repeat after me - Credit cards are not for emergencies. The company responsible for selling the American public onto that idea made a mint. Credit cards are tools for sucking up future wages, plain and simple. You use the card now because you can't afford not to, thereby you pay later for what you need today. Because of bad spending habits, most cardholders usually don't have enough credit limit available to take care of an emergency if one presented itself. So, the reason for getting the card in the first place has been negated. So if you told yourself that you needed a card to handle emergency's, tell yourself the truth -- All I need to handle an emergency is a well funded Emergency Fund.
So the first thing you need to do toward preparing for the future is to stop spending future income. A great step toward doing this is to start an emergency fund by setting a goal to put aside $500 to $1000 in the event of a real emergency and use those funds as opposed to a credit card. Eventually you will need to add more to your emergency fund, but $500 to $1000 is a good place to start. The only other thing you need to do is to define before hand what constitutes an emergency so that you aren't hitting up your emergency fund like you did when you swiped your credit card.
Step 2 - Get to slicing
Once you have bought into the idea of an emergency fund, the follow up move is to cut up those credit cards. If you aren't up to that step just yet (some of you will find you can't fathom the thought) try placing your cards into a ziplock and fill the container with water and freeze them. In this manner, you ween yourself from being able to swipe them so easily.
The quickest way to affect change on the future is to stop spending future income now.
Questions? Comments? Criticisims?