Are You Living On Financial Edge? Why?
There are so many people who like the idea of living on the edge.
They constantly run late, leave things to the last minute and scrape through deadlines, all for the adrenaline rush. It makes it easy to feel like we lead an exciting life, when there are constantly things that need to be done urgently or our whole world will fall apart.
So why are we living on the financial edge? Is it because we like the adrenaline of not knowing if we can make our mortgage repayments? Or is it one of the following reasons?
Too much debt
Lots of debt is an easy way to get yourself living on the financial edge. If too much of your income is heading towards interest, then you might need to think about ways to reduce your debt or increase your income to pay it off.
Too much house
One look at Glenmore Park is all you need to remind you of the dangers of McMansions. Even without falling into that trap, mortgages can still spiral out of our control. If more than 30% of your income is headed that way, you’re swinging your legs off an edge.
Too much car
Buying a new car is a huge expense and can demand a rather annoying debt to buy them. Used cars are often still functioning and effective, and can be half the price. Pull back from the edge, and be sensible about whether the shiny new toy is really all that worthwhile.
Private school
This is suggested by The Wisdom Journal as a pitfall. If you’ve already paid for schooling through your taxes, you might consider it paying it twice should you put your children into private education. This one is totally up to you.
Too much insurance
Being properly insured is paramount to financial security. But being over-insured can have an equally damaging effect on your finances. Paying a higher premium than is necessary will detract from your savings, and leave you on a financial edge.
Too much entertainment
Discipline and a bit of restraint will keep you from the edge, especially when it comes to entertainment. If you’re feeling like you’re exceeding your budget, think about stripping back on your entertainment costs.
Too much food
Shopping impulses can send you over the edge, like a death from a thousand cuts. Creating a shopping list, and sticking to it, will make your life much more financially secure.
Too much clothing
We really don’t need all that much; it’s all about what we want. If we can acknowledge that difference, then we can pull ourselves back from the financial edge.
Too many hobbyhorses
Hobbies are wonderful things, but they can also be costly. Collections, massive amounts of money invested in paints, or in seeing the Masters once a year- the costs can add up. If you are feeling financially insecure, reevaluate how much money you are spending on your leisure time.
Too much laziness
Laziness is my major sin, so I feel this one keenly. You might be pulling yourself over the financial edge by missing deadlines, deferring needed maintenance, or just generally not taking care of things.
For instance, if you don’t service your car, eventually it breaks down and needs major repairs. Laziness can have you shackled to the financial edge, don’t let it drag you down.
What factors are keeping you on the financial edge?
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