Take a break from social and don’t keep up with the Joneses: Worry Free Money

Everyone, writes Canadian financial author Shannon Lee Simmons, is worried about money. But her excellent book, Worry Free Money, provides a roadmap to a life where you can enjoy your financial life – and Spend Happy — while living within your means.

She starts by citing a few examples from clients she’s worked with – “there is always something, and we can’t seem to move ahead,” says one. “I’m sick of being broke,” says another. “Why am I falling so far behind,” laments a third.

On paper, she notes, “these people are not actually, numerically `broke.’ But being broke and feeling broke are two different things.”

There’s a way out, she writes:

• Understand the underlying reasons for why you want to overspend.
• Understand what you truly can and cannot afford, without budgeting.
• Spend money on things that make you happy.
• Say no to overspending (and yes to saving).
• Stop comparing yourself to others.

She talks about the risk of the “F*ck-it Moment,” when “you feel as if there’s no point in trying to be financially responsible and you end up overspending.” Examples – “I can never actually afford a vacation, but I need one. F*ck it, life is too short. Swipe.”

In another example, a single mom who can’t afford to buy her son a PlayStation feels forced to do so when his friends come over and mock him for not having one.

Later,she talks about creating Life Checklists as a way of avoiding what she calls “the Inadequacy Influence” (keeping up with the Joneses) which in turn leads to “F*ck It Moment” rash spending. As an example, such a list might include your goals you are proud of – a job with a good pension, and owning property – and your own lifestyle expectation you yourself want to meet – a nice car, a job you like, running a marathon, travelling, getting married, etc.

You then look at the expectations on your checklist to identify goals “you’ve achieved… and where you may feel you are falling behind.” This process helps you to find “the non-negotiable goals, the ones that are truly important to you. Once you know what those goals are, you’ll also recognize the expectations that may not be financially realistic – the boxes that can sabotage your happiness.”

Further on, she talks about having a “Social Media Detox” to prevent yourself from being tempted to overspend on things you may not need. Her rules:

• Two weeks fully off social media. No cheating.
• Unsubscribing from all favourite retailers that currently send notifications to your inbox.
• Deleting credit card information from all apps and online stores.

“Ignorance is bliss when it comes to sales…. Unfollow any lifestyle brands or retailers that trigger you to overspend,” she recommends.

Interestingly, she is not a believer in traditional budgeting.

Budgets usually mean you “track your historical spending, categorize your expenses, forecast your monthly spending, set spending targets based on that historical data and then (you) try to live within those limits.” This approach is “totally unrealistic for modern life… (they) have too many rules and involve far too much work.”

She prefers the Hard Limit – four categories, including Fixed Expenses, Meaningful Savings, Short-Term Savings and Spending Money. There are charts and examples to show how you can move to this simplified, four-bucket approach. She also recommends that you consider putting your spending money in a separate bank account from any saving money, so there is less chance of overspending!

You need to be conscious about how you use your spending money, she adds.

“Your spending money is an investment in how much you enjoy your life. That’s why cutting back can feel so hard and frustrating… if you’re cutting back on the wrong expenses it can feel like you’re divesting from your happiness. It feels like none of the money you earn is for you,” she notes.

This is a great, insightful and well-written book this is thought-provoking and provides easy-to-follow self-help tips. By following the advice, you can be on the road to Happy Spending, she concludes, a place where “no one has to be ashamed about their financial choices.”

If you are saving for your long-term future – retirement – there’s a great resource open to any Canadian with available registered retirement savings plan room. The Saskatchewan Pension Plan has been helping to build secure retirements for Canadians for more than 35 years. Find out how SPP can be your retirement savings partner.

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