“Follow the money” is a catch phrase about how to solve a “who done it”—it’s a way to put the puzzle pieces together. What I’m wanting to do is talk a bit more about how that idea relates to our own money. If we follow our own money what will it tell us?
Let me start by talking about how money works in a company. Money tells us what’s working and what’s not. Following the money shows us where the system is asking for help, and where it’s smoothly running. It’s one of the delights of financial statements. A company’s financials tell you what’s working well, and where the problems are. If customers aren’t paying invoices, it shows up in the Accounts Receivable and it points to a problem. Somehow, the customers aren’t happy. Now we know where to look to help the company.
It’s exactly the same thing with your money. What does your money tell you? Okay, your first response to that question is probably, “There’s not enough of it!” Let’s look a little deeper than that. That “not enough” answer has some emotion (yours) around it, while money is just trying to be neutral and show you what’s going on. Where is there not enough? Where is the money going? Do you know? The money will tell you, if you pay attention to it, if you listen to it. Listening to it may look like using Quicken or creating a spreadsheet to allocate expenses. It may look like hiring a bookkeeper. It may look like paying attention to what you’re spending money on when you spend it. It may look like something more creative than linear, like using my GOSH model. Regardless, if you follow it, it will tell you.
For most of us, the “leakage” problem spending comes through the credit card. It’s money that gets spent easily, quickly, and without much noticing. So take a look. Again, what’s money telling you there?
Here’s a way to look at this: It’s like dieting. To lose weight you have to eat less and exercise more. You can find out what you are doing by noticing what you eat and how much you exercise. We know that if you don’t change those habits, then you will not lose weight.
It’s the same process for food or money!
If “not enough” is the issue, you need to spend less or make more. Money can actually tell you which. And if you choose not to look at where money is being spent and how you earn it, it cannot and will not change.
So what would it be like to actually follow your money and find out what it has to say to you? What might the information it gives you—without emotion—help you to see?
Shell Tain, The Untangler
Want to explore this idea and get some support in deciphering what your money it saying? Give me a call at 503-258-1630 or check out my website: www.sensiblecoaching.com