Do you suffer from Debititis? It usually afflicts those who don’t watch their spending plans or take them seriously. It goes somewhat similar to this. Let’s say that you have $2000 in your bank account when you start your job. Every month, you receive, say $500 every two weeks. If your spending exceeds this amount, you will be in the red—and most people won’t even know it. Because when you check your account it may look like this.
-Your Bank Statement-
Beginning Balance: $3000
Income: 1000
Outgo: -1075
Ending Balance: $2925
Generally, this doesn’t raise a flag for most folks—they have “just $75” less than they did at the beginning of the month—and with the Challenges of Life most people are just “too busy” to worry about it—as long as they’re not in the red, or are close to it, they don’t really care. Now, what if we alter the stakes a bit: Instead of $3000, you have $150 in the bank?
-Your Bank Statement-
Beginning Balance: $150
Income: 1000
Outgo: -1075
Ending Balance: $75
A bit more noticeable, eh? It’s especially troublesome to see your three-digit income go down to two. This problem usually arises from those who only write a few checks and most of their spending comes from the debit card. Not to say the debit card is bad—its much better than using the credit card—but the problem is that people don’t think their minor everyday purchases “count” very much in the end. Month by month, the balance drops little by little.
The next thing you know, December is coming and you want to spend money on gifts and toys and an airline ticket to visit Mom and Dad for the Christmas weekend. So you splurge in December…and the Holiday Spirit is high! By the end of January you realize you’re in a negative cash position and you have to consult the Mafia to cover your “holiday hangover” losses.
If you have an established bank account, grab a few statements and look at your beginning and ending balances. If it’s incrementally smaller at the end of each month, you’ll either need to (a) develop more income or (b) plan your spending better, because at that rate, you may not be solvent for very long.
Look, at the end of each month its best to at least break even rather than operate at a loss. working in cash when making everyday purchases (the Starbucks, the cafeteria, the movies, the lotto ticket) and it will register in the mind quicker. Using cash for the DVD player, the Wii, and the DVR is the best way to make sure you're spending in a worthwhile way (unless of course, you're an online shopper and are getting cheaper rates.)
-Your Bank Statement-
Beginning Balance: $3000
Income: 1000
Outgo: -1075
Ending Balance: $2925
Generally, this doesn’t raise a flag for most folks—they have “just $75” less than they did at the beginning of the month—and with the Challenges of Life most people are just “too busy” to worry about it—as long as they’re not in the red, or are close to it, they don’t really care. Now, what if we alter the stakes a bit: Instead of $3000, you have $150 in the bank?
-Your Bank Statement-
Beginning Balance: $150
Income: 1000
Outgo: -1075
Ending Balance: $75
A bit more noticeable, eh? It’s especially troublesome to see your three-digit income go down to two. This problem usually arises from those who only write a few checks and most of their spending comes from the debit card. Not to say the debit card is bad—its much better than using the credit card—but the problem is that people don’t think their minor everyday purchases “count” very much in the end. Month by month, the balance drops little by little.
The next thing you know, December is coming and you want to spend money on gifts and toys and an airline ticket to visit Mom and Dad for the Christmas weekend. So you splurge in December…and the Holiday Spirit is high! By the end of January you realize you’re in a negative cash position and you have to consult the Mafia to cover your “holiday hangover” losses.
If you have an established bank account, grab a few statements and look at your beginning and ending balances. If it’s incrementally smaller at the end of each month, you’ll either need to (a) develop more income or (b) plan your spending better, because at that rate, you may not be solvent for very long.
Look, at the end of each month its best to at least break even rather than operate at a loss. working in cash when making everyday purchases (the Starbucks, the cafeteria, the movies, the lotto ticket) and it will register in the mind quicker. Using cash for the DVD player, the Wii, and the DVR is the best way to make sure you're spending in a worthwhile way (unless of course, you're an online shopper and are getting cheaper rates.)
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