|
|
|
|
|
|
|
|
|
So what you're not going to see here is a running tab on my personal net worth. All you need to know is that it's high enough that my advice has worked for at least one person, me. The other good thing for me is that you're not going to see a running total of my emergency fund. Suffice it to say that I've been fortunate enough that it is well funded.
I'm a big fan of numbers, don't get me wrong but I think that sometimes there can be too much emphasis on numbers and not enough on life. I've written about this before in a post on my feelings about credit scores. But I want to expand on that a bit more and say the same thing about all the numbers in your life.
You aren't doing youself any favors by tracking the amount of debt on your credit cards if you continue spending money like you have it. You can keep track of your emergency fund but if you aren't saving enough money each month then there really isn't a point to keeping track of it is there? You can follow the ups and downs (hopefully more ups than downs) of your net worth but if you aren't getting the other numbers under control then it doesn't mean as much.
I come home from work every evening and the first thing I do is update my stock values in Quicken. I used to stare at those numbers for hours hoping that they would continue rising. Now I update the numbers and more often than not I'm dissapointed when they go up. (Why is that? Well that's a post for another day - check back for that soon.) for now let's just say that the daily, weekly, monthly and even yearly fluctuations aren't as important as the overall trend. As someone who has many years ahead of him before retirement, the short term just isn't that important.
The same holds true for your emergency fund. Imagine the scenerio of someone putting money into an emergency fund with a goal of say $5,000. When they're half way there their car breaks down wiping out $1,000 but that's ok. Sure they've taken a step backwards but they're still on the path and besides, that's exactly why they had the emergency fund.
I see and hear a lot of people talking about becoming more financially secure, focusing on numbers some financial advisor, blogger or magazine told them is important while continuing to make the same mistakes over and over. It's important to know the facts and these numbers, the emergency fund, credit card balances, net worth and others are important facts but now you have to use those to make better decisions. So instead of concentrating on the amounts of money in your emergency fund, start saving a little more. Instead of focusing on the often large number that represents your credit card debt, concentrate on the number you write in the amount box on the check each month. If you do that then the other number, the debt amount, will take care of itself. Instead of obsessing over your net worth number, do something to increase you're income and that number will begin growing beyond your best expectation.
Subscribe to Rich E. Obscure