Paying attention to money…

One of my favourite laws of money is that money is basically stupid or put another way, it has no intelligence of it's own. Money can only respond to my instructions to it, it can't act independently of me.

That means that it is not 'good' or 'bad' and cannot 'run out' or 'leak away'. It's only capable of doing what I do with it. However, as we use money both for storing value and as a unit of exchange, it pretty much affects every area of our lives and therefore demands attention.

In fact, it's been said that if you don't pay attention you will pay with pain and this is never so true as with money.

Here are two questions to see whether you are paying attention to the money in your life…

Do you know your current net worth, right now?

This is your personal balance sheet and if you are paying attention, you will know, at least monthly, what your net worth is.

If you don't then here is how to do it. First make a list of all your assets. These are things that make you money like your savings or investments. Don't include your house as an asset unless you take away from it the value of any outstanding loans. Then make a list of all your liabilities. These are regular commitments that take money away from you. When you take your liabilities away from your assets then you will be left with your net worth.

Do you know your monthly financial status?

This is your personal profit and loss and if you are paying attention, you will know, at least monthly, whether you are running a profit or a loss.

If you don't then simply make a list of everything you spend each month and subtract it from any monies that come in. The result will show you whether you are running a profit or a loss.

On the whole, rich people tend to save first and spend the rest while the poor tend to spend first and save if there is anything left. You'll have to test this in your own experience - which do you do, and are you getting richer or poorer as a result?

The thing that stops many people from paying attention to money are their core beliefs about what money is and what it can and cannot do. To have a look at your core beliefs about money then pay attention to a question of money and answer the questions - it might surprise you.

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