Admittedly, change is uncomfortable.
I was thinking of this while harvesting my tomatoes last week. Have you ever heard the quote, “for everything there is a season?” It applies to life, relationships, gardening, finances, and a lot more. Actually, if you give it some thought, you’ll see how it applies to your life.
Let me give you an example of what happened to me recently. And it will have a financial twist to it too. I had a fantastic tomato-growing season in the fall. As you can see, my tomatoes weren’t the biggest. But I had a lot of them. Regretfully, the season ended with this latest cold snap. And as with many things, including my garden, “For everything there is a season.”
My gardening results seem like a simple analogy, but it’s more complicated than it appears. In reality, I didn’t trust the seasons this year. If I did, my tomato harvest would have been much better.
Here’s what I mean. Remember back in August when it was so hot? The more experienced gardeners said that despite the 100-degree days, it was time to plant fall tomatoes at the beginning of August. Some niche nurseries were selling tomato seedlings, and I thought they were crazy. I thought this year it was way too hot. I resisted and waited until August 31st. There was even an article from Texas A&M saying that early August is the time to plant fall tomatoes. I even ignored that too. Consequently, by the end of October, when my tomatoes should have been ready to harvest, they were the size of marbles.
I should have listened.
So now I look back and realize I should have listened and trusted that “For everything there is a season.” But I didn’t pay attention, so I paid the price. Now, in December, I have green tomatoes. When the big freeze came, I had to harvest what I had or lose them.
As you might expect, my story has a common thread related to your finances. And here it is. Sometimes I am just as stubborn as anyone else. Change is uncomfortable!
But I am not OK with that. In reality, I was wrong. If I want things to be different, I have to be open to altering what my assumptions tell me. I need to look at the facts and make a plan. As a result, I’ve already marked my calendar for the coming year: plant tomatoes on August 1st!
The Wisdom of Solomon
But my tomato growing story also applies to many other areas of life. I think that is how King Solomon thought 3,000 years ago when he wrote in Ecclesiastes 3, “For everything there is a season.” Similarly, as we come to the end of a calendar year, there are some things that you should put on your calendar so you don’t have financial regrets. And here it is. Within the next week or so, here’s what you should do.
- Look at where you are financially.
- Look at where you’ve been.
- Determine where you want to go.
- Most importantly, take action.
It doesn’t matter if you’re rich, poor, or in between. If you want to be in control of your finances, do these four things, and you will have a better 2023. It is important to make this point. I am not suggesting that you create a resolution or a one-time goal. Last week, I wrote last week about how I had my biggest resolution success: losing weight.
I had a goal. I accomplished that goal. Now I am focusing on my system of nutrition, so I don’t gain that weight back. You can go back here and read that post if you want. If you want to get control of your finances forever, create a process.
I’ve been listening to a podcast conversation between James Clear, the author of Atomic Habits, and Dr. Peter Attia. James puts the idea of making change this way.
“Goals are for people that care about winning one time. Systems are for people that care about winning again and again.”James Clear
Here’s how I go about this process. When I say, “look at where you are financially,” here’s what I mean. Take inventory of what you have accomplished financially. Some people would do this by creating a personal balance sheet. I use Quicken. When I help clients create a balance sheet, I use a software called MoneyGuidePro. Or you can use a simple worksheet like the download below. It doesn’t matter how you take inventory of your finances as long as you do it.
Next, look at where you’ve been. In other words, how did you spend your income in 2022? And how did your savings and investments perform? I make a point of downloading my monthly bank and credit union statements at the end of the year. Also, if you use a program like Quicken, be sure to update it in the first week or so of January. I learned the hard way that you need to download bank statements to Quicken after several months into the New Year, or else you will lose access to those statements.
As far as investments go, I use a more involved system to analyze my investments. But in short, I am looking at how my investments compare to indices or benchmarks. I’m looking for the long term and understand that there will be years when some investments don’t perform well.
Now time for the big question. Be honest with yourself. Where did you spend too much money, and what do you want to change? Winston Churchill once said, “Those that fail to learn from history are doomed to repeat it.” If you don’t look at where you are spending your money, you are doomed to waste it again and again. The process I am suggesting can create a lasting change to improve your life.
And I don’t just say that willy-nilly! I have made the mistake of not tracking my spending and paid the price for it. So please don’t make my mistake.
Third, determine where you want to go. Remember what James Clear said about goals, “goals are for people that care about winning one time.” With this in mind, I encourage you to do more than set one-time goals. Ask yourself what you want to be! Do you want to be a successful business owner, a financially stable retiree, or a charitable giver? Look at who you want to be, different from what you want to do. Accordingly, look at your budget and plan how you can accomplish those personas.
I’m a big fan of writing things down. Now is a good time to start if you’ve never tried writing down what you want to do. It works. To sum up my thoughts, here is the fourth and final step. Take action. It doesn’t matter if you want to grow better tomatoes or be a financially stable retiree. You have to take action, or history will repeat itself. “For everything there is a season, a time for every activity under heaven.” It may be your time to make changes that will lead to you having a better life. And since I am getting older, I will add, age matters not.
And as always, remember that this information is for educational purposes only. This information is not investment, accounting, or tax advice. For those things, you need to find yourself a good fiduciary advisor. 😉
Happy New Year,
PS, here are some other great topics from my blog that may interest you.
The Easiest Retirement Plan Budget Plan
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