Financial Fitness in a Container?

dollar bills in mason jar

By:Jeff Morgan

Well it’s been a bit over 90 days since we all made New Year’s resolutions. And, I know the statistics show that we have all pretty much given up on our “get into shape” plans. There are a few of us “average Joe’s,” and “average Jane’s” for that matter, that have stuck it out, and are seeing the benefits of a healthy lifestyle. A few that are loving the new energy they have found throughout the day. A few that are a bit stronger, a bit more confident, and definitely a bit less flabby.
I am not one of those people. I did well for about a week. One solid week. Then I just started eating Lucky Charms cereal again. Those marshmallows have one heck of a grip on me. It all went downhill for me. Then came the girl scout cookies. I bought 400 boxes. I am not lying or exaggerating. What do you do?
The one thing I have stuck with is my financial plan. Do you remember the financial plan you made? How are you doing? How close are you to your goals? Did you actually set a plan? There is always time, if you didn’t. You don’t need to wait for next New Year to start.
My beautiful wife (I do want to point out that it is possible for fat guys like me to have a smokin’ hot wife, though I can’t see what she sees in me) is doing a 21 day fit challenge-food sorting-diet-workout-coaching-extraordinaire-plan. I really don’t know what company is providing her with the tools, and materials to complete this challenge. There are a million of them out there. But, I am fascinated by the psychology behind this challenge.
This company is providing small containers for a person to prepare, and pack their daily meals in. Let me just tell you that many of the containers would not even come close to holding my mandatory amount of Lucky Charms in them. Not even close. But, I digress. These containers provide two psychological advantages for the person completing this challenge. First, the meals are already prepared. There is no wondering, “hmm what am I going to eat right now?” Second, because the containers break out the food groups you need, it appears as if you are going to eat a lot. There are many individual containers that total your daily intake.
So, let’s take this into account for our finances. If we had the ability to create a budget that included many “containers” with a prepared plan, wouldn’t we be able to save more money every day. There is a true science behind this. Follow me for second.
The average American spends $94 per day. The American who makes less than $90,000 annually spends $75 per day. If you make more than $90,000 per year you spend $190 per day. (Please see polling from the Gallup group http://www.gallup.com/poll/174278/consumer-spending-increases-slightly-july.aspx) Now, these numbers don’t include regular bills, cars, or your new home. This is discretionary spending. This is what we WASTE!!!!
I am known as a “numbers nerd.” So, let me quantify this for you. Here we go:
If you make $90,000 per year or less, and you spend on average $75 per day, you spent $2,250 per month. That is $27,000 per year. $27,000!!!!!
Are you ready for the $90,000+ income winners. $190 per day, you spend $5,700 per month, and $68,400 per year. Whew!!!!
Have you ever wondered where all your money goes? Holy cow. (Holy cow is trademarked Utah term, also known as Utahonics). Now, you might not be a statistic. Utahans are fairly conservative. But, could you cut this discretionary spending in half?
I am going to use the average of $94 per day in discretionary spending for illustration purposes. You might not fit in this scenario perfectly. I encourage you do look back at your spending for the last month or so. See how you compare.
Here are the real numbers. $94 per day is $2,820 per month. If you decreased your wasteful spending by 50% to $1410 per month, and then took the rest of your hard earned money and put it in a savings account, by the end of the year you would have saved $16,920. Now, obviously, there is interest that you can earn on your savings account. I am not calculating any potential interest. I just want to illustrate how cutting out wasteful spending will create a massive amount of money, in a short period of time.
So, how do we do this? How do we cut our spending by 50%, when we might not even know where our money is going? Here is my thought; prepackaged containers. Just like my wife’s fitness challenge. Break down everything we love to spend money on, and “prepackage” how much we are going to spend. Think of all the things we love; clothing, music, books, movies, restaurants, drinks (Diet coke for me), auto parts, snacks, itunes apps, toys for the kids, camping gear, RV’s, gym memberships, vacations, date night, make-up, sports activities, and any other expensive-awesome hobby.
This is America, the greatest country in the world. If you work hard, you deserve to play hard. Just play with a bit of restraint and control. Here are the 4 “containers” I came up with:
Food and entertainment—Restaurants, date night, drinks, and movies.
Clothing—shoes, make up, and appearance.
Physical activities—Such as gym memberships, yoga, and cycling classes.
Kids and “kid stuff.”—way too much to list.
Determine what your priorities are inside of these four “containers” and create a budget for them. If you are planning on budgeting $1410 per month for your discretionary spending, you might have to spend more on “Container #4,” your kids at the expense of “Container #1,” food and entertainment. It’s all about a healthy balance. Taking the time to plan for your expenses, and creating a budget that allows you to enjoy your hard earned money will relieve financial stress, and have you on your way to being financially fit.
There is always next New Year’s, where we can start “working out” again. You have my permission to wait until then to go to the gym. But, start or get back on your financial plan today. You will be glad you did.

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