Читать книгу Sort Your Money Out - Glen James - Страница 21

For as long as I can remember (probably since I was 16 years old) I have read and listened to personal finance resources and motivational speakers from all around the world. Personal finance speakers often use the analogy of ‘You Incorporated’ as a way to get people to step back and see themselves as a company or corporate entity with ‘you’ being the boss. If this is a new concept to you, effectively you are the CEO of ‘You Inc.’. Would you expect a company that has a good, stable income and expenses to have zero systems in place to manage its cash flow? Of course not, so that's why you must have a cashflow system in place for yourself.

Since you have decided that you are done with debt and never looking back, your focus should now shift to setting up a good cashflow management system. Your cashflow system should be automated and remove you from the process as much as possible.

While you are doing this, I would suggest that you place all your consumer debts on minimum monthly repayments only and forget about them for the next few pay cycles as we need to get some good habits and behaviours flowing around spending and managing your money.

I want you to not worry about doing a million things at once. I want you to trust me and try my way — with respect, your way of handling money has not worked so far if you are currently stuck in consumer debt.

So you are paying only minimum payments on your consumer debt and focusing only on setting up your cashflow system (see ‘Setting up your spending plan’ in chapter 4). I want you to not only see the light at the end of the tunnel, but also to feel it! You see, if you conducted a financial autopsy on the average person's consumer debt, you would probably find that there is a car loan, a credit card that they can't shake or a buy-now-pay-later (BNPL) program that goes round and round and maybe even a personal loan from something another life ago. Generally, personal loans and credit card debt mean that there is no financial asset linked to them and the debt/money has been spent at the discretion of the purchaser. Lending money which is not secured against an asset is risky business because there is no guarantee that the lender can recoup the loan amount should the borrower fail to repay it (also known as ‘defaulting’). In turn, this is why credit cards generally have higher interest rates: the bank can't rock up and sell the nice holiday that you enjoyed or the shopping trips you went on to recoup their money and pay off the debt. Most consumer debt (such as credit cards, cars, personal loans and BNPL) is not usually from one big item purchase (with the exception of a car purchase, which decreases in value anyway) but rather lots of different things here and there without any real system in place to manage money.

In short, you may have suffered a death by a thousand cuts and you have been systematically overspending. Don't you just love consumerism?

If you are in this situation, I want you to pretend that the new CEO of You Inc. has a mess on their hands. The business needs to run as usual, which is why you can't simply stop paying rent, mortgage or grocery bills to throw 100 per cent of the available money onto the debt — if you do, the business will stop functioning. The first thing the new CEO must do is put a working system in place, even if this means that the balance sheet (the financial statement of a company — in this case, You Inc.) has some debt that needs to be cleared. It takes time to fix a mess. It's understandable that it will take at least a few pay cycles for the new strategy to be installed and to take effect.

Think about this: you're on a boat and there's a slow leak. What's more important? To start bailing water out because you're worried that your feet might get wet or to stop the leak? If you spend time stopping the leak and fixing what caused it, it's okay to have a bit of water on your feet. I understand that some of you might be up to your neck in water, but it's still more important to stop the leak and put a system in place to ensure the cause of the leak can never happen again.

My point is that there's no sense simply paying down debt until you first decide that you're not going into any more debt (as we saw in step 1) and now you are going to work on yourself and the systems in place. I'll show you how to get a money system in place in chapter 4, but I want you to know that dealing with habits and behaviours takes time and that's totally fine because this time you are now serious about getting out of debt.