Do you find it hard to stick to a budget despite working out your spending on paper?
Financial adviser Marc Bineham explains that we confuse mathematics with emotion when it comes to managing our finances. If it was simply about maths, most of us would be much better at staying on budget and planning our spending.
He argues money is emotional, not mathematical. We might feel anxious about how to pay bills and put food on the table. And spending money can also make us feel happy, at least for a while until the credit card has to be paid off. Our upbringing also affects how we view money.
Because money now is not about cash in your pocket or purse, it’s easier to lose track of spending when it’s as simple as waving your card, or your phone.
Money is also a taboo subject, how much you earn, or have in savings isn’t a conversation topic for most of us, even with those close to us.
Marc Bineham suggests thinking about the emotions you bring to your financial life. Educate yourself and realise how much psychology plays in your attitudes to money, budgeting and spending.
When you better understand how your emotions come into play in your finances, you’ll have a better handle on managing your money.