Posted by Nancy Hecht, CFP®, AIF® 

I recently recalled a conversation I had with a young client about 20 years ago.  The client said to me, “If I only had XX $$’s in income, everything would be perfect.”  My client felt that if they made “a lot” of income, and then could have a pile of money, everything would be fine.  My client was missing the point.  The income is not the issue.

No matter how much income you make, and are able to save, how you spend that income and savings is the real point.  No one likes to put together a budget as it is time consuming and can often be a slap of reality that many do not want to face.  A budget is a good thing.  Knowing what you are spending on a required and discretionary expense and being able to control the spending is the real issue.

The advice is simple but not always easy to follow:

Pay yourself first through emergency fund and 401k savings.

Start a slush fund for big ticket purchases

Live below your means

 

~Being a good spender is really the issue.

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