The CEO and COO of Women & Co., a fabulous Citigroup-owned website all about personal finance for women, recently wrote a list of solutions to help you separate your money and emotions, and forge a healthier way to relate to your finances.
To get started, first assess how you feel about money. Begin by asking yourself these questions that may determine the psychological factors driving your financial behavior:
- Is money a sign of power or control in your relationships?
- Do you regularly put off budgeting? Saving? Investing?
- Do you use money to boost your self-esteem?
- Does the “rush” of making a purchase drive your spending?
- When growing up, did the subject of money or budgeting start arguments?
If you answered “yes” to any of these questions, it may be time to re-evaluate your attitude toward money and budgeting. A healthy attitude is one that enables you to indulge now and then, but also helps you prepare for unanticipated expenses that inevitably arise.
Here are some key ways from Women & Co. to get on a healthier track with your personal finances and stay in control of the relationship:
- COMMIT to your budget. Commitment is a key element when it comes to successful budgeting. Be realistic about your spending habits, and set a realistic spending limit for yourself. Monitor your budget and spending habits closely and regularly, and be prepared to change your budget to adjust to any lifestyle changes that may occur, whether these changes are for the better or worse.
- COMMUNICATE. It is critical that you discuss your financial situation with your spouse/partner, financial advisor, and most importantly, yourself. Share any feelings or experiences that may shape your attitude towards financial activity. Communicating your financial flaws and past mistakes will help you determine what will be the most effective way for you to save, spend and budget from this moment on.
- BE INVOLVED. It is important that you are involved in your finances, and if you have a spouse/partner, you both should be on the same page with creating and maintaining a financial game plan. Being involved not only means you have a plan, but that you’re also checking in with yourself and each other to monitor how it’s going, and making any adjustments along the way, as needed. Remember, knowledge is power, and by knowing all the financial facts of your life, you will have a much better sense of control.
- HONESTY is the best policy. Be honest and realistic about your goals, as well as the sacrifices you’ll need to make in order to meet them. Maintaining a budget and financial plan will be extremely difficult if there’s any denial or disagreement with your loved one about money. It is possible that what you consider a “want,” your other half considers a “need.” Be honest about what you want, need and expect from your budget, and understand what meeting those wants, needs and expectations will require from you.