It’s only an occasional drip, but that leaky faucet is costing you a lot more money than you might think.
A couple of years ago, I noticed that the faucet in our kitchen sink was dripping. I’m not much of a handyman, and I have a bad habit of being lazy about home maintenance, so I didn’t pay it much attention. But a month or two later, I saw that our water bill was about $30 higher than normal. Needless to say, I called the plumber to come fix that leaky faucet right away.
There are a lot of things in our lives that are leaky faucets, seemingly innocuous issues that are actually causing bigger problems that we realize. If we’re lazy about the way that we maintain our financial lives, it can cost us a lot of money in the long run.
In much the same way that you can fritter an entire day away and then wonder where the time went, a lazy approach to financial management will lead you to wonder what happened to all of your money at the end of a month. Even if you have a good income and don’t think that you’re living a luxurious lifestyle, financial laziness can affect you more than you realize.
Here are five ways that financial laziness is costing you money:
1) Your budget doesn’t balance.
The number one key to success in personal finance is to build a budget and then stick to it. Unfortunately, most people don’t ever create an actual plan for their spending. And some people that do create one eventually get lazy and stop living according to it.
When you don’t have a budget (or you disregard the one that you do have) you really have no control of where your money is going. You have no way to monitor what you’ve spent in a given month, or to know what you can afford to spend in most circumstances. This turns your personal finances into a big guessing game.
If you lose that game, you’ll find yourself overdrawn on your checking account, which can cost you a lot of money in fees. Using a credit card can get you around these basic limits of arithmetic for a while, but it does so at a price….
2) Your debt grows.
Debt is terrible for you in so many ways. It costs you tons of money in interest payments and traps you in a spiritual and financial slavery. The more debt you carry during the course of your life, the more restricted you are and the less you can do other things with your money.
Unfortunately, if your budget doesn’t balance, you’re likely to find yourself borrowing money in order to support the kind of lifestyle you want. Credit cards, car payments and other debt instruments can keep you comfortable for a while, but as your debts grow, the amount of money that you will pay in interest over the course of your life skyrockets.
The goal of good financial management is to get out of debt, and then never to get back in again. But if you’re lazy about your money, you’re likely to be in debt your whole life.
3) You don’t have enough savings.
Saving money is hard — it requires a lot of discipline to sock money away in a bank account instead of spending it on something that you want right now. But saving is one of the best ways to buy big-ticket items like cars and houses. And having some savings is critical to help bail you out of financial emergencies.
If you’re financially lazy, though, you’re not likely to be very successful with savings. This might not seem altogether bad, since it’s easy enough to get loans for things like cars, college, and emergency home repairs. But as we’ve already discussed, borrowing money for those things will cost you thousands of extra dollars in interest payments over the course of your life.
Having money saved gives you a lot of buying power and financial peace. But you’ll never get there without diligence and discipline.
4) You’re not investing or building wealth.
Working and earning money is a fine way to support yourself through life. But if you want to get ahead and build wealth, you’ll need more than just your income — you’ll need to have some money to invest.
Like savings, investing well requires a high level of discipline. Your retirement plan at work probably requires you to have some money withheld from your paycheck, which can sting a little bit. And if you want to be really successful in investing and building wealth, you’ll have to invest some money on your own, too, outside of your employer-sponsored plan.
This kind of investing will make you a millionaire by the time you retire if you do it right. But it takes discipline to find this kind of money in your budget every month and set it aside for investing. If you’re financially lazy, you’ll probably never invest like you should, which could cost you millions of dollars in lost opportunity.
5) You’re not giving enough.
Though we are in charge of handling the money that comes into our lives, our money isn’t our own. In the end, it all belongs to God, and one of the things that He wants us to do is to give that money to help people in need. If you’re financially lazy, though, you’re probably not giving as much as you should.
Like any other worthwhile financial goal, giving money on a regular basis requires having extra money to give. Since financial laziness usually leaves you with less money than you need (instead of more), giving is often the first thing that people forego. This is tragic, because giving is one of the most important things that we can do with our money.
If you fail to give like you should, you’re also going to miss out on the blessing that come along with giving. We reap what we sow. And if you’re sowing nothing, nothing is exactly what you can expect to reap in return.
As you can see, the dripping faucet of your financial laziness might not seem like a big deal right now, but it’s going to cost you a lot of money in the long run. So, what’s it going to take for you to get your act together and fix it?
Photo by Cali4beach. Used under Creative Commons License.