“A wise man should have money in his head, but not in his heart.” — Jonathan Swift
Financial troubles can be devastating.
Whether you end up out of a job without any savings, or your retirement account has dried up, or you find yourself trading food for shelter, or trading healthcare for food, it’s a sharp reminder that you aren’t entitled to the basic needs.
That’s why knowing how to earn a living and solve basic needs, is such a big deal. And, what you don’t know can hurt you along the way.
Proven Practices for Personal Money Management
Worse, without a skilled financial mentor or good role models, you might never learn the best practices for managing your money that will see you through the storms.
Luckily, there are books that help shed light on proven practices for personal money management.
One such book is Give Yourself a Raise: How To Have More Money, Less Stress, and Financial Freedom by Gordon Bennett Bleil.
In Give Yourself a Raise, Bleil shows you how to find more money to reduce the stress in your life and achieve financial freedom.
Bleil is dedicated to helping those in financial distress work their way out of trouble and reach a permanently stable financial footing. Bleil draws from his extensive combination of experience as an adjunct professor of management, successful business owner, and bank executive. He holds an MBA in finance, and he’s hosted the radio talk show The Path to Financial Freedom. He has also taught training courses of the same title.
Without further ado, let’s dive into Give Yourself a Raise …
Chapters at a Glance
- Chapter 1 – The Financial Freedom Risk Assessment Quiz
- Chapter 2 – Objectives, Plans, Goals, and Budgets
- Chapter 3 – History and Forecasting
- Chapter 4 – Setting Goals
- Chapter 5 – More About Forecasting
- Chapter 6 – The Freedom Money Management System: Powered by On-Line Banking
- Chapter 7 – Debt Management
- Chapter 8 – Spending Strategies
- Chapter 9 – Credit Cards and Debit Cards
- Chapter 10 – Retirement and Investing
- Chapter 11 – Understanding Risk
- Chapter 12 – Government Programs
- Chapter 13 – Insurance
- Chapter 14 – Credit Scores and Identity Theft
- Chapter 15 – Emergency Preparedness
- Chapter 16 – The Secrets of Making Lots of Money
- Chapter 17 – Five Secrets of Success
Here is a sampling of some of the challenges that Give Yourself a Raise helps you with:
- How to control impulse spending
- How to eliminate family conflict
- How to get out of debt and stay out of debt
- How to practice spending strategies to stretch your income
- How to stop wasting money
Here are some of the key features of Give Yourself a Raise:
- No-nonsense, down-to-Earth, pragmatic advice. Bleil cuts to the chase and provides simple How-To advice to help you reduce debt, reduce your stress, make more money, and build your wealth to achieve financial freedom.
- The Financial Freedom Risk Assessment Quiz. The Financial Freedom Risk Assessment Quiz helps you answer questions such as What is financial freedom and just how risky is your present situation? And if your financial freedom is at risk, what steps can you take to reduce that risk?
- Goals made easy. The author helps you build a complete foundation for personal money management.
- The Freedom Money Management System. Bleil shows you how to use online banking to organize your personal finances.
Here is a sampling of some of my favorite nuggets from the book …
The Leaking Bucket
According to Bleil, here are some symptoms of a leaking bucket and you have the potential to give yourself a raise:
- You are in debt and the amount you owe is growing.
- You are making late payments.
- You are bouncing checks.
- Your credit score is low.
- You are not taking care of personal health matters because you are broke.
- You are playing only the minimum each month on your credit cards.
- You are facing increasing mortgage payments as a variable-rate loans rate increases.
- You do not have six months’ emergency living expenses in near-cash investments.
- Your personal relationships are stressed because of money issues.
- You worry a lot about tomorrow.
- You cannot afford the vacation you want to take.
- Your job is not secure.
- You do not have a realistic retirement plan.
- You are unhappy with the way you are managing money now.
The Freedom Money Management System
By splitting your funds up front and doing automatic transfers, you can make it easier to achieve financial freedom. Bleil writes:
“The Freedom Money Management system is designed to take advantage of on-line banking and to segregate funds into different ‘electronic envelopes’ using standard kinds of bank accounts.
- Primary Checking – Start with a checking account that offers free-on-line electronic banking. This checking account is the primary account into which all income is deposited (preferably by direct deposit) and from which the bulk of your bills and expenses are paid. Automatic transfers are made out of this account into the other accounts.
- A Pay-Yourself-First Retirement Accounts – Open a money market account (MMA) and use it to pay yourself first by automatically transferring predetermined amounts from the primary checking account into it every month.
- Personal Savings Account – Open a basic personal savings account with ATM card access to this account. Estimate how much you will need for expenses you pay with cash. This amount is your "allowance." Have this amount transferred automatically from your checking account into this savings account — probably to coincide with your paydays.”
The No-Goal Life
No goals can easily turn into no funds. Bleil writes:
“A cynic once observed, ‘Money does not buy you happiness, but it sure pays for a lot of things that make you forget you are unhappy.’ Are you using retail therapy (buying binges) to cover up some underlying discontent? Are you in debt because of it?
Look around and ask yourself what you have acquired that truly makes you happy. Are there a lot of things that, now that you have them, somehow are less satisfying than you expected? And how do you explain that feeling? ‘It seemed like a good idea at the time’ reflect the insight that perhaps given the opportunity to decide again, you might do things differently. Goal setting is a process to get rid of that regretful hindsight: ‘If I had only known then what I know now, maybe …’”
6 Step Goal-Setting Process
Setting goals is a simple way to help you prioritize and focus your financial efforts. Bleil shares a six step process for setting financial goals:
- What do I want?
- How much will it cost?
- How much time will it take?
- When do I want to reach the goal?
- What steps do I Have to take to get what I want?
- How will I know when I have reached the goal?
The “60 Percent Solution”
According to Bleil, successful money management requires a plan, otherwise, the money flows in and flows you and you wonder at the end of the year, “Where did it go.” One of the plans that Bleil shares to get started is from Richard Jenkins, editor-in-chief of MSN Money. The plan consists of five parts:
- 10 percent investment/retirement – really long term.
- 10 percent long-term savings – money needed in 5-plus years (e.g. college fund.)
- 10 percent short-term savings – irregular and emergency expenses (escrow expenses)
- 10 percent fun – dining out, movies, toys, vacations, and sanity essentials.
- 60 percent – everything else, including taxes
Escrowing to Pay for the Big Stuff
Don’t just save for a rainy day. Save for the big stuff you know you will have to pay for throughout the year. Bleil writes:
“I am a firm believer in escrowing — that is, regularly setting aside money to accumulate to pay for big expenses that will be coming up at irregular intervals throughout the year. … In terms of a spending plan, therefore, your next priority after ‘paying yourself first’ is to set aside money in an escrow account to be prepared for predictable big items that you know will be coming up. Discretionary items like vacations need to be accumulated for in this same way. If you cannot accumulate the funds in advance, do not incur the expenses.”
3 Steps for Getting Out of Debt
According to Bleil, you can follow three key steps to get out of debt:
- Step 1. Live within your means, starting right now. If the total money coming in is less than the money going out, something has to change — NOW!
- Step 2. Do not charge anything. To get out of debt, you first have to stop getting into debt. If you are in the debt ‘hole,’ stop digging.
- Step 3. Set up a debt retirement and monitoring system to keep track of, control, and report on the success of your ‘get-out-of-debt-program.
Don’t try to keep up with the Jones. Bleil writes:
“In 1908, Thorstein Veblen published The Theory of the Leisure Class, the classic work in which the term ‘conspicuous consumption’ first appeared. Among the premises he set forth was the idea that certain people simply need some kind of certificate of status.
… Today, some people mistakenly equate their personal significance or worth with the material trappings around them. An automobile can get you there or show that you have gotten there. How important is the brand name to you? … Why are you in debt? Are you an addict of conspicuous consumption or is there some other excuse?
There are many excuses as there are people in debt. The simple answer is that you have spent money that you did not have.”
Destroying Your Credit Cards Isn’t the Answer
Blaming your credit cards won’t fix the underlying problem. Bleil writes:
“The underlying problem is self-control and accountability. Destroying your credit cards won’t fix that.
Destroying your credit cards to get out of debt is like blaming the pots and pans and dishes in your kitchen for causing you to get fat. Have you heard of a ‘break-all-the-dishes’ diet plan? Of course not, because it is obviously silly.”
Controlling Impulse Spending
You can control impulse spending by breaking it down into a two-part process. Bleil writes:
“Controlling impulse spending is a two-part process:
Set goals. Vow never to buy anything significant unless you have money set aside to pay cash for it right now and it is on your goals list. (The exception is that you can use your ‘walking around money’ to buy what you want if you want to have enough walking around money to cover the purchase.) If something you want to buy is not on the list, why isn’t it? What suddenly made the purchase important? What do you want to take off of the list and replace with your new must-have purchase?
Even with your discretionary money, ask yourself these questions at the point of purchase: Have I planned to buy this? Is it on my list of goals? Will buying this use money I have planned for something else? Have I shopped for the best value? Do I have the cash to pay for it? What will happen if I wait?”
If you come into a windfall … do nothing. Bleil writes:
“The very first thing you should do with sudden wealth is — nothing. Store it safely. Let the thrill subside so that you rational persona can take over from your emotional persona. Do not indulge yourself with a spending spree. Store the money for at least six months, or preferably one year, while you develp a plan. Bank CDs are safe and will earn money while you are planning. If your winners are more than the FDC will insure at one bank, divide the money among multiple banks to be sure your deposit is fully covered by FDIC insurance. The money market accounts of stock brokerage firms are similarly safe. Spending your money will not be any less satisfying because you waited before spending.”
The Secrets of Making More Money
To make more money, you have to do what people would pay more money for. Bleil writes:
“Difficulty is only one dimension of making lots of money. The second dimension is ‘economic value.’ The task that is difficult must have economic value to someone else who is willing to pay for the skill. Engraving the Gettysburg Address on a grain of rice is certainly difficult to do. It is unlikely that there are many people who can do this. What is even more rare would be finding someone who is willing to pay for the grain of rice bearing the Gettysburg Address.”
Increase Your Chances of Promotion a Thousandfold
Comfortable mediocrity wins over stressful excellence. Bleil writes:
“Don’t be a pain in the a**! The sad truth is that many highly competent and well-qualified employees are passed over for promotion or more responsibility simply because they are hard to get along with. The single most powerful driving force in every decision anyone makes is comfort. Given an array of choices on anything the decision-maker always favors the choice that is most comfortable (or least stressful or uncomfortable). Comfortable mediocrity wins out over stressful excellence. We avoid people we do not like. If you can be excellent in what you do and a pleasure to be around, you have increased your chances of promotion a thousand fold.”
Overall, it’s a pragmatic and effective guide filled with proven practices for personal money management.
Get the Book
Give Yourself a Raise: How To Have More Money, Less Stress, and Financial Freedom, by Gordon Bennett Bleil is available on Amazon:
Give Yourself a Raise: How To Have More Money, Less Stress, and Financial Freedom, by Gordon Bennett Bleil