Around this time of year people are doing their taxes and many are getting refunds. They are all looking forward to getting money, but how will they effectively use that money? When you mismanage funds you are directing money towards the wrong things (and in essence you waste the money). For example, you can pretty much guarantee that some parent (or parents) on a low level income will take some of that money and buy their son some “really expensive” sneakers. Once the child gets them then often the family will “soon go back to struggling.” It doesn’t end with this family. I have known people who got retirement pensions with “huge amounts of money” only to be perfectly broke not too long afterwards. There are also stories of lottery winners who won massive amounts only to mismanage everything and become completely poor again. Willie Nelson made a lot of money but didn’t pay his taxes. Basketball star Allen Iverson made over $150 million dollars in his career and spent a lot of it on frivolous things including women, jewelry and friends and now it has been reported that he is destitute. Rapper MC Hammer amassed a huge fortune only to squander just about ALL of it away. Not paying taxes also managed to do in Lindsay Lohan. Mike Tyson, who made well over $200 million blew it all away by spending carelessly. Why did this happen to these once affluent people? Many people “think for the moment.” They figure that they will continue to do what they do forever and they also believe that money will continue to “come in.” They never take into account that smart investments will help you to maintain your lavish lifestyle. They get caught up in the power that comes from feeling rich and then they buy according to desire and “not” need. I do know that if I ever manage to “hit the lotto” the very “first thing I would do would be to “address my bills.” Once my bills are paid then I will actually make even “more” money through saving money on the payments that are no longer applicable. There is also the option of investing your money into something that you know will make you even more money down the road. I often wonder why people go get a business adviser when the concept is fairly simple: “Spend wisely…” If you pay off a bill that is $50 a month then that means you are now making “$50 a month more with your income. Take notice of things like “due dates” and “interest rates.” Of course, we all know that a lot of people will still “splurge without thinking once they get their monies and some will manage to make their situations “even worse.” It doesn’t “have” to be this way. If you know how much money you are going to get back, then take time to think about how far this money will take you. Make your own plan that will help you keep this money longer while improving your cash flow in the process. Stop being greedy… Some of us may never get the chance to make as much money as the people I mentioned above, but that doesn’t mean that we can’t effective manage the money we have. “Think!” Thank you for checking out my Daily Thought, and as always I wish you the very best that life has to offer.
Former Heavyweight champion Mike Tyson (tattoo on face) with Brett Jolly in background