We all have a financial weakness. That one area where we struggle to do the right thing. We might even struggle with deciding what the right thing is. If we remain unaware of our financial weakness, it can wreak havoc throughout our financial life, as my weakness did mine.
However, knowing your financial weakness, your financial Achilles’ Heel, so to speak, can help you become a better manager of your finances.
My Financial Achilles’ Heel
Me? I like to squirrel things away for the proverbial rainy day, but when the rainy day comes, I don’t like to dip into my stash.
My husband and I have an emergency fund. True, it’s smaller than we’d like, but we do have one in place. Considering 28% of Americans don’t have any emergency fund (CNN Money), we’re glad to have our small one.
There are other ways I squirrel away things. We buy produce in season at lower cost by doing creative things like renting an apple tree. Then we store it away for the cold winter months. (It makes me feel a bit like a pioneer. A pampered pioneer, but a pioneer, nonetheless.) Right now we have a deep freezer in our basement that is filled with plums, grapes, blueberries, strawberries, and applesauce. If we didn’t have money for groceries, we have enough fruit to easily last us for two to three months.
Having an emergency fund as well as a stocked pantry doesn’t sound like a problem, right?
Right. I’m being financially responsible and preparing for a time when money will be tight.
Here’s the problem.
I don’t like to dig into my stash.
If I have a financially lean month and I’m faced with a large expense like a car repair, I don’t do what would be logical–dip into my emergency fund. Instead, my first inclination is to put the repair on my credit card and leave the emergency fund intact.
If I have a month where I don’t have as much grocery money, I’m more likely to put groceries on my credit card than make a significant dent in our food stash.
My behavior makes.no.sense. No sense.
And yet it took me years to figure out that I do this and to realize that I have to fight the natural inclination to go in debt rather than dip into my reserves. Part of why my family struggled with credit card debt is because of this irrational behavior. Now the credit card debt is paid off, and I have a chance to start anew, well aware of my weakness.
What’s Your Financial Weakness
So, what’s your financial weakness? What completely irrational behavior do you exhibit? Are you even aware of what it may be?
Honestly, finding the chink in your armor, so to speak, may take years. I think it took me nearly 15 years to figure out mine, and I made a lot of financial mistakes during that time. I’m not sure why I exhibit this behavior except that perhaps growing up, I always saw my parents struggle with money. They never had money to create an emergency fund. Credit cards were their emergency fund, and they had to use them frequently.
I’m guessing for most of us, the experience is the same. Financial behaviors we saw in childhood and learned as normal become the basis for some of our adult decision making.
What is your financial Achilles’ Heel?
My financial weakness is focusing on the minutia rather than the big items that make the most impact. For example, I track all my income and outflows fanatically in quicken, but I delay opening a DRiP investing account or a peer to peer lending account due to lack of time / energy.
My goal for this year is to not stop but at least reduce my procrastination and make sure the big needle-moving events happen, despite work, despite baby, whatever it takes.
My financial weakness is my credit card. It is too tempting.
When we have an unplanned expense/repair my temptation is always to delay taking care of it rather than spend. I could easily slip into living permanently in a home where you have to tell guests to jiggle the handle… If something is dangerous or going to be a bigger expense if we delay on the repair then it gets done, but the other stuff that can wait indefinitely, well it’s hard to force myself to spend money on that stuff just because we probably should.
On a totally different scale, we spend what some people would say is a stupid amount on our annual family trip. We have cut virtually every nonessential from our budget but we consciously left the trip in because it’s important to us. We also acknowledge that if we didn’t take that trip we could move our early retirement up by 3 yrs. But we’ve decided that traveling now with our kids is worth those three years and I if I’m not careful I find myself justifying unnecessary spending on the trip just because “we don’t spend on anything else”.
My financial weakness is unplanned expenses and my credit card too.
You know I do the same thing. I hate dipping into our savings for something like new tires or whatever. Not sure why but your right..it makes no sense!