1001431319Most of us live on limited resources, income, means or…in other words, money! But does it follow that we should also limit our goals and aspirations for the future? How do we manage our limited resources in order to save for our dreams, whatever these may be?
1. The first step is of course to determine how much we need for our dream. If this dream is a new car, or something tangible then it can be relatively easy. However, if it is a long term goal, like a particular retirement lifestyle set for 20 years down the road, then the services of a Certified Financial Planner are most definitely to be considered. Their guidance can be instrumental when calculating the “how much” and that very specific financial strategy to help you get there.
2. The next step that I like to use is something called conscious spending. This is about making explicit trade-offs for every purchase made with the resources at your disposal*. Practicing conscious spending means you have made a conscious decision to spend your hard-earned cash, with a focus on your goals. So how does this work? 
• Let’s say you drive to work every day; this costs money (gas,maintenance, insurance and ensuing depreciation). Make a conscious decision to walk, cycle or take transit to work. Using your car even one day less per week can add up to significant savings each year.
• Do you eat lunch out every day at work? Brown-bag it one or more days per week instead; the added monthly savings can range into the hundreds…
Not to mention that by walking or cycling to work and bringing your own lunch you are not only providing for a healthier financial future but a healthier lifestyle overall!
So, before you make a purchase ask yourself some questions: • Do I really need this/will it make my life better?
• Can I buy this used or can I rent or borrow it?
• Is there something I’d rather spend my money on?
• Will I actually use it and if so how often?
Personally, I have made conscious decisions on a number of things:
I no longer subscribe to cable (big savings); instead, for my TV viewing I subscribe to Netflix. I may not get the news or professional sports, but there are ways around that…watching a game at a friend’s house or simply catching the highlights on the internet
I no longer subscribe to cable (big savings); instead, for my TV viewing I subscribe to Netflix. I may not get the news or professional sports, but there are ways around that…watching a game at a friend’s house or simply catching the highlights on the internet
No more newspaper for me; here again, the internet can provide the latest news feeds.
I no longer have a home phone service, having replaced it with the Magic Jack which allows me to make calls anywhere in North America toll-free, for $35/year. Sure I have a cell phone, but my service costs less than $40/month and it includes toll-free calling in Canada, unlimited texting and voicemail.
With these 3 conscious decisions, at a bare minimum I am saving around $100/month…which is all going into the purchase of my retirement property in Belize… that is my dream!
J.D. Roth wrote an article on the subject: “Think before you spend” for Entrepreneur Magazine.
Wade Walters, CFP
Branch Manager, SISIP Financial, Esquimalt
