Don't tell me where your priorities are.

Show me where you spend your money and I'll tell you what they are.

-James W. Frick

Plan YOUR work! Work YOUR Plan!

Thursday, October 13, 2011

Guest Post: How to Live According to Your Needs?

Sanni Kruger, of Holistic Money Manager, is a finance coach helping people to become competent and confident money managers who live within their means without stressful money concerns. She assists her clients in reducing their debts whilst building up savings, as well as clarifying their desired long term vision and learning how to expand their resources to reach it. Her self-help book “Making Friends with Money – How to start feeling wealthy without waiting till you’re rich” is available from Sanni is also a motivational speaker with over 30 years experience of speaking to groups of any size on a variety of subjects.

In my last blog I quoted Imran Khan saying that he lives according to his needs, which he believes to be the secret of contentment. But how do you actually identify what your real needs are?

Oddly enough seeing what we actually spend our money on can give us the most important clues. Here are a couple of examples from my finance coaching work:

The first is a young student, who I’ll call Karen. We worked together during the summer before she went to university. Karen was in the habit of buying cans of soft drinks here and there when she was out and about. Like all my clients she was encouraged to start keeping a record of all the money coming in and going out. Instead of adding the amounts she paid for the soft drinks to her “grocery” category she created a separate one, because she was curious to find out how much she actually spent that way.

After 4 weeks we sat down together and added up the small amounts, varying between 40 and 60 pence. She called out the amounts and I added them up. When we were finished I said something like: “£46.80”. She burst out spontaneously: “WHAT?!?! – I’m not paying that!” In that instant Karen realized that she didn’t need those drinks to quench her thirst. Instead she started refilling a small plastic bottle with tap water and carried that around with her.

The other example involves a young couple, which I’ll call Jim and Natalie. At the time they had a 2-year-old and a new baby. Because of some health issues Natalie needed Jim’s support and they would do the weekly shop together as a family. Once they had loaded up their trolley after going through the checkout, they would stop in the café for a cup of tea and a scone before heading home.

Just as Karen did, Jim and Natalie recorded the money they spent in the café separately from their grocery shopping, and we added it up at the end of a month. This time it amounted to something just under £30. On hearing that, they both said: “Our sanity is worth it! We’ll find that money.” They had identified that they needed that time to recharge their batteries before bundling the kids back into the car, load the shopping, go home, unload the kids and shopping, and then stow everything away.

In the process they also discovered that our real needs are much more than a roof over our heads, food in our bellies and clothes on our back. That there are emotional and spiritual ones, too. And that almost all of them involve money at some point. That’s why I always encourage my clients not to change their spending habits when they start keeping a record of their money. That it is a fact finding mission, and that nobody, but themselves, will make any judgments on their spending habits.

You can find detailed instructions about creating and keeping records in my self-help book “Making Friends with Money – How to start feeling wealthy without waiting till you’re rich”, which is available from

Thanks Sanni!

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