“Start by doing what’s necessary; then do what’s possible; and suddenly you are doing the impossible.” – Francis of Assissi
If I told you there was 1 thing you could do to become wealthy would you do it?
Of course you would.
Now what if I told you the 1 thing is not a trick, but a lifelong task, that takes hard work…
Would you still commit?
I hope the answer is still yes.
Cash Flow Tracking
Tracking your money is by far the biggest thing you can do to reach financial success. I am not saying to stop spending or even create a budget but I am saying–see where it all goes. Once you know that, a world of opportunity will open up for you.
You will have visual evidence of where you are overspending or underspending.
You will know how much extra you have every month, or how far behind you are. This knowledge is extremely powerful. Before you consider buying that new toy or even saving for your future you must know where you stand today!
There is a good chance there is much more you can do with the money you already have if you understand your spending habits, which can’t be done until you investigate your cash flow.
The funny thing about wealthy and successful people is that do not actually have to track their monthly cash flow because they earn more than enough money to cover their bills and save for their future. But yet they all understand the importance of knowing what’s coming in and going out.
They know when there is extra and when there is less.
This is the key to financial success. It’s very easy to put our head in the sand and live and spend as if everything will just work out. But more often than not, when we finally come up for air, our credit cards are maxed out or we are behind on our mortgage payment.
But there is a silver lining..
Once you put some time into this, you will have to track less and less because you will know the numbers so when something pops up, you will already know how that will affect the overall picture. And that’s huge.
To show you how this is not too difficult, I equate it to my step counter on my smartwatch. I bought it initially so I can understand how active or inactive I am on an average day. But after about a month I realized I am pretty consistent and checking my daily steps was not necessary, because it was about the same! And once I knew the “average” number, I knew if I had to get steppin! (and yes I was short of my goal) So….with new data I was knew I had to change my behavior
Your cash flow is the same –your salary and monthly fixed bills are the same every month and that’s the bulk of your flow!
I am always amazed when people can’t tell me to the penny what their net paycheck is! They get it every 2 weeks, the same amount! So there is no way that same person can maximize their cash flow. They are either way overspending or living a very frugal life. By tracking their cash flow they don’t have to live in either extreme world.
It just doesn’t have to be that way.
So, let’s change the habit. For the next 60 days track the flow!