Make a committment to spend less and save more

Published: Thursday, July 1, 2010 at 3:54 p.m.
Last Modified: Thursday, July 1, 2010 at 3:54 p.m.

Our finances often cause more worry than they should. With not knowing what direction the stock market will go, that worry is especially exaggerated. How are you supposed to plan for retirement when stocks are so volatile it's impossible to know how much money will be in the bank at retirement? It's a worthy worry, but it's also not worth worrying over.

More important factors need to be worried about when investing and saving for retirement, goals or even daily expenses. The biggest worry we should have now is worrying about spending too much. Do you worry about your expenses? Do you worry you are spending money you do not have? You should.

Oddly enough, people who don't worry about overspending end up in the most trouble later in life. Instead of spending, if that money was invested, odds are the worrying about the stock market would cease. That's because it's not how your investments perform that counts as much as how much you are investing.

That brings up the next worry point - not saving enough. This is a legitimate worry most of us should have. The more that is saved, the more likely enough will be available to meet expenses now and in the future. Not to mention eliminating the need for borrowing money to pay the bills, which can lead to more overspending.

To begin to save more, any overspending problem that gets in the way of saving needs to be eliminated. Budgeting is a popular tool to accomplish this, with the budget including a plan to pay off debt and increase emergency savings to stay out of debt in the future. This is a tough feat to accomplish in the face of marketers who tell us we MUST buy now. If you target these enemies, chances are you will be stronger to defeat them.

All of the above requires a plan of action, and that in itself can be a feat that makes many of us not even attempt any action to end the worries. Begin by spending time with some money-management books or consulting a financial planner.

Once the commitment is made, the plan will evolve step-by-step into a manageable plan that, like a good self-help book, will guide us to change the way we live - and end the money worries.

Dan Serra is a financial planner with Strategic Financial Planning Inc. in Plano, Texas.

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