I recently heard of an experiment where a dog was in a cage. The researchers gave the dog a shock and, not having a way out, the dog sat there and took the pain. The scientists then opened the cage door and gave the dog a shock again. Again, the dog was shocked, but this time with an escape route. The poor canines suffered what sociologists call ‘learned helplessness.’ It wasn’t until the scientists physically dragged the dogs out that they could see the way out. Every time there after, the dogs removed themselves from the painful situation. The dog was free. And sometimes, all we need is someone to help and show us the way, and maybe with a strong nudge.
I am passionate about this subject. If I was any brighter (and if I could go back and change my major), I would absolutely love to help people get their finances in order. To be free financially is to have a huge burden lifted. To be free financially is actually a relatively simple subject. What is difficult is the practical aspect. I am grateful to Dave Ramsey’s work in the financial field of helping every day folks like you and me get our finances in shape.
The following is just some things that has helped my family of four live off of $1300/month*.
Budget, Budget, Budget. I once helped a 50 year old woman with her finances. She kept on saying, “We make so much money every month and before we know it, it’s gone!” The money was indeed going somewhere. With her, we looked at her purchases over the past month. We found out that going out-to-eat was costing her almost $400/month alone! Her grocery bill was tipping towards $1000/month. She realized she was being charged for a service she wasn’t using. This all adds up and when money is not allocated, it goes out the window with the birds. By allocating where your money is going, you are in control. So take control in order to be financially free.
One question that has saved me literally thousands of dollars is: “Do I really need this?” When going through the store, it is so easy to take something off the shelf and stick it in the cart. Imagine you have $50 for your food budget. All of a sudden, cookies are flying out of the cart. A $5 movie on sale suddenly does not become a necessity. Could you believe that by not spending an extra $8/week on things that aren’t necessities can save you $19,200 in 50 years? That is a brand new car!
That leads me to the final quick point: For younger people, did you see how much money you can save over the next 50 years? That is just $8/week. Check this out: by buying a $150,000 house with a 15 year mortgage versus a 30 year mortgage can save you $56,685.
Whereas we should not obsess over money, we should be good stewards of what God has given us. We should be wise with our spending. I love Dave Ramsey’s book Total Money Makeover. It is a quick and easy read jam packed with helpful tidbits on how to be sagacious with your finances. Get out of the cage and don’t be stuck. Be free from the shackles of financial stress.
*Our family is on a skeleton budget currently; cutting out all non-necessities.
For Further Discussion:
20 Quick Tips From People Who are Winning with Money