I'm currently in the process of planning my 2015 , which has required me to ask myself some important personal finance questions. I ask these questions every year and would like to share these with you:
1. What is the cost of continuing with your current financial behavior?
2. What do you want your life to look like 5 years from now?
The first question helps us understand the impact of our current financial behavior on our future.
This question helps us get very clear on the life that we want to really create. Write this vision down and start taking action to make it a reality.
If your answer to question 2 is wildly different to your answer in number 1 then you should start asking yourself what you need to change in your current life in order to create the life you really want.
3. What is the one financial or behavioral change you can make to move yourself closer to the life you desire?
Change is scary.
Our subconscious mind is primitive and is engineered to keep us alive, so when we try something new it revolts, because it's not sure that this change won't kill us.
Financial change is very scary. The best way to approach any change in financial behavior is one step at a time.
When my finances were a mess I chose to spend the first year just focusing on improving my income, which meant going from making no money to making a decent salary every week.
That meant really changing my thinking about what people were willing to pay me and what I was worth.
I spent the first 6 months of 2011 doing nothing but questioning my thoughts about money and my earning ability. I did that for 8 hours a day everyday until I saw a difference in my income.
4. Do your salary or wages reflect the work you put in?
Divide your monthly/ weekly salary or wages by the number of hours you work. Include all your overtime.
Most of us think that we're earning a lot of money in our jobs but when we actually measure how much we earn, against the amount of time we spend at work and work related tasks, we get a different picture.
You have to decide how much your time is worth and if your salary adequately covers your time.
Also I've been in high paying jobs that cost me money - the job is so demanding and stressful that I end up spending a fortune on coaching, therapy, yogo, reiki etc. just to stay sane and stop myself from getting depressed.
This is money I wouldn't have spent if I was in a job I loved.
Sometimes it makes more sense to earn less money but work less hours, because the hourly wage is higher and you have free time to create extra streams of income.
5. How much do you need to earn annually to live the life you truly want?
How much is it going to cost you to live the life that you want in the next 5 years?
What other personal finance questions do you ask yourself?
I look forward to hearing your thoughts on the comments section below.