The One Question You Absolutely MUST Ask Yourself About Your Finances…. Before You Spend One More Cent

How many times have you decided it was time to make a change for the better with the state of your finances? Perhaps you’ve sat down with pen and paper to draw up a new plan. Maybe you used the computer. Perhaps you called a ‘board meeting’ with your spouse. How many times did it feel good for a week or so and then the same old problems just came back to haunt you?”. So why does this happen?

Here is the reason and what to do about it…….

We all want to do the best that we can with our money, but “the best” that we achieve is often not as good as we’d like. I don’t know about you, but I’ve never met anyone who deliberately placed him/herself in financial difficulty, but even so, I have met many people who have had, (or are still having), financial difficulty of some kind. The question that arises from this fact is, “If nobody wants to have money difficulties but most people have them, then surely there must be something missing in our education or our up-bringing.” It can’t possibly be that we’re all stupid! If we can find what’s missing, then we can solve the problem!

So firstly we need to look at what most people consider to be the causes for cash-flow (money) problems and then we need to identify from this if there is one major cause that we can target (one that can make a real difference). It’s easy to solve a problem when you know what is causing it. e.g. I imagine that a scientist who knows why cancer begins to form in someone’s body has got a much better chance of finding out how to stop it from occurring than a scientist who does not. The same is true for “money cancer”.

Here is a list of perhaps the top 22 reasons why people have money problems. (in alphabetical order)

Accepting financial advice from a “friend”.
Acting on an impulse without getting all of the facts.
Bad habits – e.g. drug, cigarette and alcohol abuse.
Borrowing for things that lose value
Confusing “Short term pleasure” with “Long-Term satisfaction”
Consistently spending all, or more than you earn.
“Everyone else has got one” mentality
Failure to plan beyond today.
Failure to realise the best things in life are free
False justification. e.g. Buy a new car to save fuel when it might take 10 yrs to recover the cost. (by which time the car is a wreck anyway)
“I deserve it mentality” – Self centred living.
Image. (“Cool” and “Fool” rhyme for a reason.)
Lack of perseverance.
Making decisions based on emotions.
“Must have it now” mentality – can’t wait till it’s affordable.
Re-financing multiple Credit Card debts and then keep using the cards!
Spending on a “Promise” of income that never eventuates.>
Too busy to take the time to do what is necessary
Using income to buy “toys” rather than investments
>Victim of clever marketing campaigns.
Victim of “easy” finance arrangements.
“You only live once” mentality.
A comment relating to number 12 about Image – An Image is just that – an Image – It’s like a mirage. It looks wonderful but it’s got no substance! People spend lots of money trying to look like someone they will never become. But the reason they will never “become” is because they’ve spent the very money that could take them where they want to be in pretending they are there!

If you think about the Top 22 reasons above, you may see they probably fall into only three categories. They are:

Lack of Information.
Lack of Self Discipline
Lack of Time
Interestingly, if you were to ask a number of people what causes their money problems, it’s likely they would say it was the lack of income, i.e. their boss doesn’t pay them enough money for the work they do!

Without a doubt, maximising your earnings is an important part of reducing money troubles, but unfortunately it is easier to spend money than it is to earn it, so we also need to focus on how to make the most of what we do earn. Think about this. Surely there are people who earn less than you do! If you are struggling with money, how are they surviving? If you’re doing it tough, they must be going bankrupt! But many of these people are doing quite well! It’s also a sure thing that there are people out there who earn more than you do, but they are doing worse than you!

We’ve already identified lack of self-discipline as a factor that causes money problems. That is, spending money when you know you shouldn’t, but just doing it anyway! Of course this raises the question, “How do you know for sure when you should or shouldn’t spend money”? Do you rely on feelings? e.g. I feel like I’ve spent enough money for one day! Or, do you stop spending when your savings account is empty, or perhaps when your credit card is full? It probably seems like a silly question to ask at first glance. Isn’t it obvious? You would expect people would know when they should or shouldn’t spend money, but how do you know for sure when you can afford that little bargain you found at the supermarket? How do you know for sure you should pass it by?

This report is all about this very question and the answers that I present here should make so much sense I believe you’ll find a new confidence in managing your money. Not only that, you should find you can minimise the burden bills place on your income when you use the system I will reveal to you.

So – how do you know for sure when you can afford that little bargain you found? How do you know for sure you should pass it up? For that matter how do you know if or when you can afford the bigger bargains you find? Something like a new car for example.

If you have thought about it, you would have realised there is actually no simple answer to this question. Now you might be thinking “What’s the big deal about this question?” “Why is it so important anyway”? And if it’s so hard to answer, “Why should I be bothered about it”?

The fact is, it’s a most important question! You can’t mess-up your financial future by earning too much, but you can mess it up by spending too much! One of the strangest things about money – It’s so hard to earn, but so easy to spend!

At the moment, when you see something that catches your eye and you suddenly feel a rush of adrenalin that says to you, I’m excited about the possibility that I might buy this thing. I’d really like to buy it and I think I just might be able to have it now! Your emotions begin to take hold of you. What information do you have that you can use to help you make the decision to go through with the purchase? Shouldn’t you be rational? What information do you have that could possibly help you make the right decision?

Well, you currently have two pieces of information!

1.What is your per-pay income?

2.What is your current financial position? – i.e. Do you have enough money in your purse/wallet/savings account/credit card or could you borrow the money some way?

My experiences had shown me that this was not enough information, and considering it is the information millions of financially dissatisfied people use, (especially when their emotions are saying “DO IT – DO IT NOW!!!!”) I went in search of better things. What other information could possibly be available though? What other information would possibly make a financial decision any easier? I thought hard about this very issue and came to the conclusion that what I needed was a Crystal Ball. That would surely help me. What if I could tell the future! Then it would be easy to make smart financial decisions now.

How many people have you spoken to who have said things like, “If only I’d bought property here 20 years ago I’d be rich now” or “If I’d known the share market was going to do this or that I could have been a millionaire by now”.

Of course it’s easy to be wise about anything after it has happened. September the 11th would have been an entirely different day in history if someone could have seen into the future. Pearl Harbour would have been a different story. In fact, if you could look into the future and see any number of things before they happen you could make some really smart decisions.

So then, would it be of any benefit if you could see your bank statements into the future? Would it help if you could take a time trip into your perfect financial future, gather up all of your bank statements that recorded your journey through time, and then bring them back to the present? Would it help at all?

My bank sends me a statement at the end of every month telling me all of the transactions that have taken place in my account for the previous month and at the bottom it tells me how much money is in my account after everything has happened. Now, there is nothing I can do to change the past, so the statement is of little use to me as far as changing financial direction is concerned. Of course it doesn’t show the future, but wouldn’t it be great if it did! Wouldn’t it be great if it showed you exactly what you have to do each day to never have hassles with your cash flow ever again? You could just follow the numbers day by day to a brighter financial future.

But wait a minute, If you think about it, it actually does tell the future! It isn’t so obvious that it does, but the information is right there under our noses and can be used to predict the future. Think about it, so many transactions occur over and over again. Many of the transactions that appeared on the last year’s bank statements appeared on this year’s statements and will appear on the next year’s statements as well (and probably the year after that too)!

This simple fact opens up the secret to a much brighter financial future. One you can predict and plan with reasonable certainty, and one that you can measure your progress through every day of the journey.

So many of the transactions you will make during the next year are foreseeable. Think about how many payments you will make that you already know the details of by looking at your last year’s bank statements. E.g. you pay your electricity bill every three months. It’s next due on the 5th of whatever, and it is usually no more than a certain amount.

If you were to make a list of all of the transactions you can reasonably accurately predict that occur from at least once a year, right down to those that occur weekly you would be able to work out your perfect future bank statement in advance for those expenses!

We already came to the conclusion that being able to look into the future with our finances would have very real benefits. We realised that if we had our bank statement for the next year (and beyond) in advance we would be able to minimise the burden that bills place on our pay packet, freeing up more of our pay for us.

If you make a list of your predictable expenses (the ones you know will happen on a regular basis in your future) you will find there are heaps of them. If you would like to download for free a list I have put together for your use, go to www.simplybudgets.com/free-gifts.html. Filling out this list is the first step in constructing your financial stability plan (sometimes referred to as a budget) that will remove stress and give a sense of direction and security you may never have experienced before. In a moment I will show you how easy it is to use this list to work out your perfect future bank statement in advance.

I realised I was never going to get control of my expenses while I tried to deal with all of them in the same way. The frequency at which they would fall due varied dramatically. E.g. weekly, monthly, 3 monthly, half-yearly, yearly, car tyres every 2 years, car battery every 3 years, my driver’s license every 5 years, perhaps a new fridge every 10 years, etc, etc. so I saw the need to look for a way to group them according to their predictability.

Previously, for my budget, I had divided all of my expenses down so I knew how much each one cost me per pay. If you’ve ever done a budget for yourself you probably did it the same way I used to. At the top of a piece of paper I would write down what I earned each pay, and then I would jot down where the money was going per pay. I would subtract each expense from the income amount until at the bottom I had a magical number that was my spare money!

Here is an example of what this might look like.

A Simplified Standard Budget

(Per-week amounts)

Income — $600

Groceries $150 ($450 left)
Rent $200 ($250 left)
Petrol $50 ($200 left)
Entertainment $30 ($170 left)
Telephone $25 ($145 left)
Electricity $10 ($135 left)
Car Repairs $20 ($115 left)
Insurances $35 ($80 left)
Clothing $20 ($60 left)
Spare $60 —

The problem was, doing it this way only proved to me that I should be able to pay all of the expenses that I had listed in my budget. It didn’t show me how to pay them. I could prove on paper over and over that I should be able to make ends meet, but when the bills arrived the money was rarely there to pay them.

By separating my expenses into three logical groups made up of expenses with similar characteristics, I realised it would be possible to make planning both simpler and more effective.

he list I offered for you to download a moment ago has the common budget expenses divided into these three groups. The groups are:-

1) Predictable expenses that fall within a yearly cycle – I call them ‘Regular’ expenses.

2) Predictable expenses falling on a much longer cycle – I call them ‘Long-Term’ expenses.

3) Unpredictable expenses that require ‘Savings’ to be put aside for if or when they occur.

For the purpose of simplifying the next section of this report, I’m only going to look at the bills and other expenses that fit into (1) above. That is, the ones that are predictable within a yearly cycle. (All three groups are used to develop a complete and thorough budgeting plan, but I want to keep this simple so I have only described the first group below in more detail.)

1) ‘Regular’ expenses fall within a repeating yearly cycle. You know how often they happen. You know how much they usually cost, and you know when they will occur next. Because of this predictability, it is possible to identify at any time where you are on the yearly cycle, and therefore your required savings balance can be predicted for any date. An example of one of these transactions might be the Electricity Bill. It may occur every 3 months, cost about $250, and might fall due on about the 20th of October. Another might be the Groceries, purchased weekly on a Thursday and costing about $180.

To be successful for ‘Regular’ expenses you need to go from the starting date, through a year and back to where you began without ‘crashing’ anywhere in between. If you end the year with more money in your account than when you began you have put in more money than you need to and you could have done something else with the surplus. If you ended up with less money, even if you had been lucky enough to make it through, you are going backwards and might not be so lucky the next year!

So how do you do the calculations? This is what I promised at the beginning, the “How to do something about it”. Well, there are two ways. When I began, I took a calendar and a calculator. These are the steps I developed.>

1. Take a calendar

2. On a separate piece of paper, add all of your year’s ‘regular expense’ type bills and divide by the number of pay days. (52 for weekly, 26 for fortnightly etc.) Let’s say you got $654 for your answer.

3. On the calendar mark all of your pay days with a +$654 (answer from 3 above with a plus sign

4. Mark all of your regular expenses on the calendar for the whole year with a minus sign.

e.g. Groceries -$150 every Saturday, Christmas Shopping on the 12th of December -$500, Telephone Bill -$120 on the 5th of each month, Electricity -$250 on the 21st of every third month starting next month, and so on.

5. Start from Zero and add all of the plus numbers and subtract all of the minus numbers, working your way through the year day by day. Write each day’s closing balance on the calendar in pencil. (Blank days have the same balance as the previous day) Don’t worry if you have any negative numbers at this stage.

6. After you’ve done the whole year, look for the largest negative number (e.g. -$500) and add that number (e.g. $500) to every day’s total for the year.

You now have the perfect bank statement in advance for the next year for your Regular Expenses. (The worst day of the year will have a Zero Bank Balance.) The only obstacle now is this, do you actually have the amount of money your plan shows for today’s ‘Opening Balance’ in a bank account somewhere? If not, you will need to work out a way to catch up on any shortfall that might be evident at the start. For me, this took a little while, but I knew the daily targets that would get me back on-track. Once I caught-up, I could just follow the numbers until something changed. Then it was out with a new calendar and start again. The same could be done over a ten year cycle for long-term expenses on a totally separate piece of paper, and then I could add in so-much a week for the unpredictable expenses.

I told you it was simple! (I just didn’t tell you it was tedious).

If you haven’t realised it, you have just been shown how to generate one of the most important things you were never taught at school. A personal budget that addresses the one issue that anything you might have tried in the past does not address, and that is the dimension of time when applied to money. You see, a standard old fashioned budget is only two dimensional. It balances the Income against the Spending. (It tells you “You can do it”) It is when you add the third dimension of timing that you suddenly have powerful information that can transform your finances. (It tells you “How to do it”)

The difference is astounding. Using this ‘Three Dimensional’ system, you find that your money starts to tell you when it is time to do things rather than events demanding money you don’t have saved up yet!

Imagine what it would be like if your bank manager sent you a cheque with a note attached saying:-

“Dear John, I noticed you car registration is due next week. Here is the money to pay it”.

“Dear John, I noticed it is your wife’s birthday next week. Here is the money to buy her gift”

Imagine if this happened every time a predictable expense fell due! Of course you know he won’t do it for you, but the method I outlined above will allow you to do it for yourself.

The good news is that YOU can do it much easier if you don’t mind paying a small amount to purchase a simple piece of software I have had developed called Simply Budgets. It is reasonably priced and suddenly becomes very good value when you consider what it can do for your finances!! If you don’t want to pay the money, no problem, you can do it the way I described above. That is exactly how I did it when I was discovering the power of planning in this logical and common-sense way.

Believe me; the difference it makes to your life, knowing where you need to be up to financially every step of the way is amazing. You don’t actually need to check every day. You can check on payday, or once a month if you are getting good. It’s as simple as – What is the date? What does my budget tell me I need to have in my account today? Am I behind, or am I in front? If I am in front I could probably go and spend the surplus without having to worry, and if I’m behind I can do something about it before I get into trouble! It certainly takes away a lot of the stress, having your own financial road map and it removes the third reason why people have difficulty with money and that is their lack of time. This method requires very little time, but delivers exceptional results.

Here is a little tip I discovered that makes it even a better reason to do it this way. Make sure you include some of the things you previously have been missing-out on. (Let’s face it, you don’t just want to pay your bills!) Put in some sweeteners. Follow the numbers, and on the chosen date, have the week-end away or the night out on the town, or whatever it is that you have planned for. No need to feel guilty or worry if you can or can’t afford it. If you’ve followed the numbers and you’re on target, do it guilt free and without hassle?

I often liken using this system to children playing ‘Pin the Tail on the Donkey’. Without the blind-fold it’s a whole lot easier to hit your targets! Achieving your goals suddenly becomes a whole lot easier when you can see where you are going before you start.

That’s it! How simple, yet how powerful?

Here is what some of my customers have said about my software once they have used it.

David,

I have been using Simply Budgets now since last year when I bought it and love it, best investment I ever made….

Lee, Hillbank S.A.

Hi David,

I received my copy of your wonderful program just over a week ago. Since then I have been working on it and refining my budget.

WOW ! What a timesaver this is proving to be. For years I have worked everything out on a spreadsheet but this leaves everything else for dead. But what am I going to do with all the extra time?

Spend the extra money I now have I suppose.

It’s really great thanks so much.

Norm Gibson.

David,

Just a quick message to say that I have finally sorted out my finances. There was no way of doing this without the help of Simply Budgets. My husband and I went from a double income no kids scenario to a one income plus two children reality!

We were convinced that I would have to go back to work just so we could make ends meet. I didn’t want to put my children in day care especially my new baby but we couldn’t see another way around it. My husband and I saw your Simply Budgets software program on one of the current affairs programs, and thought, why not give it a go! Well I am pleased to say that working out our finances with your software I now have the luxury of staying home to raise our two children, for at least the next ten years if I wish to!!!

Just seeing our finances clearly in black and white made us sit up and really take notice of the things we wanted out of life.

I just thought I would e-mail our gratitude to you because you have now afforded me the luxury of raising my two children (with a stay at home mother by choice) and not someone else by putting them into ten hour a day day care.

Sincerely Thank you,
Cindy Durnan

I thank you so very much for your software…it certainly saved my financial life. It is by far the best budgeting program out there, and it has paid for itself many many times over.

Yours

Paul, Hurstbridge, Vic.

Hi David,

Congratulations on an excellent product. I can only imagine how many hours of design, modification and error trapping you have had to put in.

Len, Hawthorn Vic.

There are stacks more like these but I think you have probably gotten the idea by now.

The only other thing I can do for you now is to make it as easy as I can for you to take advantage of what I have discovered and described above. Hopefully it is obvious that I am really excited about the power of what I have discovered. The potential to change the lives of thousands of people around the world is obvious to me. There are already over 19,000 Simply Budgets users, and this number is growing steadily every day.

What have you possibly got to lose? I even back up my claims with a 365 day 100% money back guarantee. Can you just imagine how good it will be to allow the financial stress and worry just melt into financial confidence? How good will it be to know you are on track and that everything is under control. I expect that not too far down the track you will be able to spend some money on yourself without feeling guilt or worry, perhaps for the first time in a long time.

In a few short weeks I will be looking for an e-mail from you that says, you were right. This does work! Please tell your prospective customers my story!

There is more information at http://www.simplybudgets.com/index-redirect.html. You will also find a Power Point slideshow that outlines the content I have presented in this Special Report as well at http://www.simplybudgets.com/slideshow.html.

Thank you for taking the time to read this information. Feel free to invite your friends to also view this Special Report.

By the way, if you would like to receive a regular ‘Money Hints and Tips’ newsletter from me justgo to the the Simply Budgets Home Page to enter your name and e-mail address so I can send these to you for FREE on a regular basis.

David Wright

Simply Budgets.