Sometime ago I wrote about needs versus wants. Along those lines I’d like to talk about priorities. It’s pretty common that we heard our friends or family say “I don’t have the time” or “I don’t have the money” (of course, we’ve never said these words). And periodically, I’ll hear these words uttered by my students (no time to study), generally after a not-so-good exam score. But what these folks are really saying is “It’s not a priority right now.”
For many of us, it’s not about having more time or more money. It’s really about prioritizing the time and money we have. When we reprioritize what’s important to us, it’s amazing the things we can accomplish and the money we can save. Here are some tips to prioritize your time and money. In fact, for many folks time is money.
Prioritize your savings. This can be done by paying yourself first through automatic payroll deduction to your 401(k) or other employer sponsored. Do the same thing with automatic deposits into your IRA from your bank account.
Determine needs from wants. This is tough for some folks, but doable. Make a list of everything you spend money on monthly and force yourself to eliminate unnecessary things (wants) from necessary expenditures such as retirement savings, emergency funds or mortgage payment (needs). One you’ve made the list, allocate your money accordingly and stick with it.
Don’t procrastinate. This is easier said than done. But I would argue that eliminating certain wants (such as cable TV or your smartphone) can free up more time to do things that “you never have time for” such as going back to school, reading or writing a great book, or spending time with family.
Another neat trick to get more time I learned in college was to set my alarm 1 minute earlier each day than the day before. By doing do, I was able to free up an extra 30 minutes in my day over a month without shocking my body. Eventually, this led to 60 minutes. Now, I have almost two hours to get work done, exercise, and study before my day starts with my wife and kids.
Set goals. Write down specific goals you’d like to achieve and give them a timeline for accomplishment. For example, you could set baby steps for retirement amounts. This can be done by coming up with an annual savings goal say, $5,500 into an IRA. Give yourself a year (or tax deadline) to accomplish this goal. From there, you can simply divide $5,500 by 12 to get a monthly amount of $458.33. Use the $458.33 as a “mini-goal” and try to free up that money from the needs and wants step mentioned above. Once the money’s freed up, put it on autopilot as recommended in the first step.
Try it, and let me know how it works for you.