You can control your money!
Using 3 R’s will help you experience money management success.
When dealing with money, it can sometimes feel like money is controlling us. Using the 3 R’s from the National Endowment for Financial Education High School Financial Planning Program to control cash flow, you can be the one in charge of your finances!
- Reality- Face the reality of your current and actual situation.
- Jobs can change. Prices for services always increase. You might get sick or injured and can’t work temporarily. An emergency situation such as a broken laptop, fractured bone, fender bender or lost cell phone can easily happen. As an adult, the emergencies could relate to leaky plumbing or replacing a broken furnace or old fridge.
- To face your current reality, create an emergency fund that can help you be better prepared when an unexpected event takes place. Have a spending plan or budget using your actual income. Plan on the reality that phone or internet costs (for instance) will go up, so it does not feel like a financial stress when it happens.
- Michigan State University Extension offers 4-H Youth Money Management and Adult Financial Education tools to help you create an emergency fund and a spending plan.
Responsibility- Accept responsibility for your own spending and saving actions.
- As you look at your cash flow, are you changing your behaviors to adjust how you use your money?
- Many times there are cash flow “leaks” in our plan. Finding those leaks and then addressing them by changing your behavior is the way to take responsibility for your money.
Restraint- Show restraint when there is temptation to stray from either your financial values or your spending plan.
- You have a plan so stick to it. If your plan is to only eat out once a week, use self-control to follow that plan.
- Using the 3 R’s, you can build your sense of control over your finances instead of feeling like it controls you.