PROACTIVE is defined as acting in anticipation of future problems, needs, or changes
REACTIVE is defined as tending to be responsive or to react to a stimulus
Which one are you currently living?
Do you take charge of your financial life or do you just let it happen? Individuals who live financially reactive lives do not have a contingency plan in place when a financial disaster strikes. They do not know where their money was spent each month. When the financial markets are crashing their looking to hide. They always seem to be a step behind and never seem to get ahead.
On the other hand, individuals living a proactive financial life are not stressed when a financial disaster strikes because they have several contingency plans in place. When the financial markets are crashing they are looking for opportunities. They prepare budgets so they know where their money is going even before they receive their weekly or bi-weekly pay check. They are always a step or two ahead.
Living a proactive financial life allows you to be in control of your finances while living a reactive financial life you just hope things will work out for the best. So you decide what financial lifestyle you want to lead the proactive or reactive one? If you are ready for things to change for the better you must decide you want to improve your current financial ways and become proactive because if you won’t do this for yourself no one else will do it for you.
The best way to begin to live a proactive financial life is by simplifying your personal finances. Here are some action steps to take to begin simplifying:
- Access your current financial situation. Do you have more debt than you can handle? Is your financial net worth positive or negative?
- Create a budget. Know how much money is coming in and how much is going out. Know where the money going out is allocated to essential or non-essential items.
- Automate your financial life. Set up auto-deposit and auto-payment as well as automated financial reminders such as your checking account is low or your rent or mortgage payment is due.