Focus Reminders: The basic principles

I write a good bit of very specialized and specific posts here. I realized that sometimes it is good just to get back to basics. I have compiled a simplified list of principles that drive my financial decisions on a daily basis. I realized I never put them all on one post to summarize.

Principles that I believe in:

  • Pay yourself first: Add up your life sustaining expenses, set an amount, and save it first. Then remainder is the budget for incidentals and "fun stuff". Payday is a good time to transfer to savings.
  • Set goals. You cannot get anywhere if you don't have a defined direction to go! You have to take the time to workout where you want to be, financially and otherwise, and create goals and a deadline to get there. Chances are most of the goals require money at some stage and financial planing to reach them.
  • Exercise frugal practices: Find a second use for everything (food containers, shopping bags, etc.). Use coupons when you can. For going out use sites like groupon and half off depot to save money. Be sure to use up all gift certificates so they don't go to waste!
  • Save for and invest in experiences. This is the big one. Stuff costs us money. More than just the price tag. Storage, electricity, gas to go buy it, etc. Experiences create memories and conversation topics. My favorite is world travel. I do it as much as I can. You will certainly enjoy skydiving way more than an iPad or the $300 boots you want.
  • Track your spending. This is probably the most important principle! In order to get and stay out of debt and save money you must track every penny you spend. There are tons of options that range from paper and pencil to Quicken to the various online tools. None of the other stuff matters if you cannot see where your money is going and do something about it!
These are the most basic principles that drive everything and I do.  I curb spending by reminding myself that "If I buy this then it ultimately slows down my goal of traveling the world and not having to work full time." In my case this is an easy sell for me as I would rather be out there enjoying life instead of sitting at a desk!