We live in a world fortunate to have some very selfless and generous individuals. Some of these people recognize the great needs of others and prioritize helping them over first taking care of themselves.
Certainly, if we all acted in this way, poverty and starvation would never be an issue, and we would all coexist in a utopian society. Unfortunately, all of us individually have limits on the capacity of our own generosity, and failing to stay within those limits will result in shortfalls of our ability to attain our own personal and financial goals.
Selfless individuals have a hard time prioritizing their own needs above others, but “paying yourself first” is an essential step in financial planning if someone truly desires to be able to support others over the long-term.
Another way of looking at this would be that failing to take care of your own financial needs will result in the end of that ongoing support for others. Therefore, if you truly wish to be able to support and assist others over the long-term, it is imperative that you make prudent financial decisions for yourself today.
Begin by identifying the mandatory expenses that you will have to personally incur. These would include everything but not limited to your mortgage or rent payments, food, taxes, transportation costs and utilities. Coming up short in any one of these areas will have nasty consequences that ultimately will prohibit your ability to earn an income and meet your own financial obligations.
Next, take time to understand your personal expenses that are not quite as urgent, but continuing to neglect these needs will eventually result in severely negative outcomes as well. For example, everybody needs to regularly visit their dentist for routine cleanings and X-rays. If your car has 175,000 miles on it, you need to start saving for its replacement.
You can occasionally procrastinate on these less urgent needs, but completely failing to acknowledge and prepare for these necessities can have devastating consequences in the long run.
A final essential step of taking care of your own needs before helping others pertains to effectively planning to meet your own financial goals. For example, if you would like to retire on time and with the lifestyle you envision, you will need to take incremental steps toward building an investment portfolio that will produce sufficient income for the remainder of your life.
If you wish to send your children to college or purchase a house or condominium, you will need to allocate some of your discretionary cash flow to those savings.
Only after all of these personal needs have been satisfied can you responsibly begin allocating some of your remaining dollars toward assisting others.
Consider the type of support you are thinking of providing. Will it alleviate or assist in a hardship, or will your support enable another’s continued irresponsible behavior? How long do you intend on providing this support to this group or individual? Are there groups or individuals that you would like to support other than those you were originally considering?
These are challenging questions to contemplate, but this process should yield the best of results for you and the groups or individuals you are considering supporting. You will have the certainty that you will still be on track to meet your financial goals and obligations, and you will have the confidence that providing this ongoing support is what you truly would like to do with your resources.
Without addressing your own needs first, you will not have the capacity to continue supporting others, and you may very well find yourself one day needing the support of others to meet your own basic needs.
Posted: Thursday, August 25, 2016 9:43 am
Mountain Mail Newspaper Salida Colorado