Guest post by licensed Right-Brain Business Plan® Facilitator Cass Mullane

If getting a grip on your money and your spending is something you’ve decided to focus on in 2013, here are two tips that can help you begin setting some quality money habits.

Skim 20% off of EVERY payment that you receive. Whether it’s a check, dividend, refund, credit card deposit, rebate, gift or anything else) put part of the 20% into a savings account to pay your taxes and the rest into savings that you cannot touch unless it’s a dire emergency. Do this before you pay a single bill.

I know this sounds challenging, but it here are some of the benefits:

a. You quickly accumulate a bucket of money that will minimize the stress that comes up every year at April 15th and the frantic “eeek-how-will-I-pay-my-taxes??!!” state of mind that many people get themselves into.

b. Over time, if you treat the money like it does not exist, it will give you a safety net in case you encounter a legitimate dire emergency. (P.S. shoes, bags and big screen TVs are not dire emergencies!)

c. You’ll start to pay closer attention to your money and to what’s coming in and what’s going out. It’s always good to know what your money’s up to.

d. You will look at your standard of living and probably make some changes for the better. After all, no one’s raising your debt ceiling! Learn to live below your means and teach your kids to do the same.

Give up the ATM. Yep, it’s convenient, but until you get a grip on your spending, the ATM is a giant black hole. Here are a few things to think about when you make a $100 withdrawal:

a. The ATM delivers your cash in small bills. Which are you more likely to spend: a crisp $100 bill or five $20s? Both are worth $100, but those $20 bills are going to slip through your fingers without giving them any thought.

b. You visit the ATM on Tuesday and you’re back at the ATM on Friday. Do you know where that cash went? If you’re like most people you don’t have a clue! Pay attention to what you spend your cash on.

c. You feel like you’re cash rich because there are five $20 bills just sitting there in your wallet smiling at you saying, “Spend me!” So what do you do? You spend them.

Make a point of going inside the bank to get your cash. This makes you more aware of the transaction and, therefore, more aware of your money. Then, when you withdraw cash, put most of it in a separate place and only leave one $20 in your wallet. You’ll soon be more sensitized to its value if one $20 bill is all you have readily available to spend.

A bonus: You get to interact with the personnel at your bank. A banker should be part of your professional team. Start building this relationship. It could come in handy if you need to straighten anything out at the bank or if you need to talk about financing.

Try both of these tips over the next four weeks and see what happens!
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Cass Mullane’s calm, comfortable approach consistently yields positive results for clients. Her business and personal coaching practice, www.ProsperCreatively.com, specializes in delivering solid left brain business skills to right brainers and creatives in a fun, visual way. Cass is is one of our licensed Right-Brain Business Plan® Facilitators.”