It is that time of year again. YuletideChristmas in the air. Nostalgia, goose pimples and casting off all financial discipline. It was originally meant to commemorate the birth of Jesus Christ. Joy to the world, and good will to all men Then the commercial establishment descended and hijacked the season. Coca Cola dug into the archives, fished out Saint Nicholas, dressed him in Coca Cola colors with a long white beard, and christened him Santa Claus. It has become: Joy to the world, and good sales to all shop owners. It is the biggest sales season of the year. Shops prepare all year for this moment. To boost sales, high street shops offer some tantalizing price reductions, 50% off, buy one get one free etc. They work on your psyche until you give up the fight, switch your brains off and give in fully to your emotions. There is a nice sounding word for this victory: consumer confidence. Buy now, regret later. You must buy new clothes for every member of the household, especially the kids, take them to Santa arcade, and send gifts/hampers/cards to relatives, friends and foes. You must upgrade your living room, get wider screen TV, upgrade your cable subscription, give your home a fresh coat of paint, change the curtains, the list goes on. Buy one, get two free, and suffer buyers remorse later. It is all in the spirit of the season. You can think of the credit card companies later. You are helping to crank the engine of the economy. How do you withstand this massive onslaught against your fragile purse strings, this war against the soul of your finances? Befriend your budget. Run back home and make friends with your budget. Period. The standard advice is, Make a budget and stick to it. A lot of folks like us have attempted that. If you make a budget and stick with it, you are home safe and dry. This article is not for such lucky folks. It is for folks that are still struggling, budget after budget. Befriend your budget. A well-made budget is a good sight to behold. The snag is, you have to follow it. That is when the rubber hits the road. This is where most folks take a bow. If your budget is balanced on paper/computer, and unbalanced in reality, something is wrong. That budget is not you. It is an expression of your wishes. There is a communication problem between you and your budget, though you live in the same house. It happens all the time. Married folks will understand what I mean. You guys are speaking in foreign languages. How do you befriend your budget, and speak the same language? How can you turn your budget into a friend, rather that a cruel taskmaster? To attempt to answer these posers, let me tell you a story about two friends: Mr. Nice and Mr. Necessary. Meet Mr. Nice. An easygoing guy, does not like stress; cares a lot about what others think about him, especially his clique and peers; generally goes with the flow of current trends and fashion; does not like to be the odd man out; does not mind buy now, pay later; likes eating out a lot and enjoying the moment to the fullest; hates cracking his brain etc. Likeable guy, Mr. Nice Now meet Mr. Necessary. Easy going but seriously minded guy; thinks long term; does not care much about public opinion; has a long term focus and is ready to delay immediate gratification; does not care much about trends and fashion; has his eyes on his goal and dreams; does not window shop; would not touch consumer debt with a ten foot long pole etc. Mr. Necessary, seems quite boring to his friends Now imagine both guys coming together to form a partnership to float a small-scale business. Sparks will fly, guaranteed. They will forever quarrel about money and expenditure decisions. Now do you still wonder why you are having problems with your budget? Can these two guys ever get to work together towards a common goal? I think so. It takes a lot of work. All relationships do. Ask your favorite Agony Aunt. Something has to give. If both guys remain in their trenches, then status quo rules The only way forward is to come to a common ground: an alignment of two different paradigms. First, get to know your budget. How it thinks and operates, its mindset and idiosyncrasies, modus operandi etc. Then you evaluate your similarities and differences. Then work at bridging the gap. There are three ways of approaching this. Lets call it option A, B and C. Option A: Meet your budget all the way. Change your ways and habits, and adapt to suit. Option B: Middle of the road option; you give some and your budget gives some. This will entail re-writing your budget to suit the new scenario. Option C: You dont move an inch. Your budget comes to meet you. This will also entail re-writing your budget to reflect your current cash flow. Of course you will make provision for deficit financing. You are not making any progress here, but at least you know where you are. Whichever option you choose, you will end up with a budget that works, a budget in touch your reality. Being frank to yourself is key; if you deceive yourself, you will continue in the merry-go-round. Put your finger on where you need to change, and work on it. Stay focused at you short and long term goals. Having a budget that works is your only bulwark against the yuletide madness. When you befriend your budget, you form a formidable team. While making your yuletide budget or wish list, always remember that your November salary is for December expenses and your December salary is for January expenses. It is so easy to forget this in the midst of battle, especially as some employers pay December salary mid month. If you mix it up, you will join the bandwagon of folks that believe that January is the longest month in the year. For them, it is, and their creditors will love them for that Joy to the world, and goodwill to all men. Merry Christmas |
