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Lesson 1a: Why We Avoid Financial Planning

Objective: To help you find out what has blocked you from taking control of your finances. 


Commitment = Energy - Resistance
"Only 36% of households often or always plan and set goals for their financial future."
- Survey of Consumers, November and December 2001

Financial planning may seem like a large insurmountable task.  Many find it difficult to take the first step.  So, I applaud you for starting this educational series.  To maintain your commitment towards prosperity you can either increase your energy or reduce your resistance.  However, if it was as easy as increasing energy, then why do many of us drop our New Year's resolutions before the end of January?  It is because as you increase your energy, so does your ego  increase its resistance to change.  Your ego wants to maintain status quo.  It is important to understand the reasons why you have avoided financial planning in the past (resistance) because these reasons will come up again as you proceed through this educational series and stop you from creating the prosperity you desire.

There are millions of reasons why people have avoided or neglected their financial plans.  These reasons are really beliefs about yourself and money.   Beliefs are how you see the world which will be discussed more later.   The key to beliefs is that they can be changed by changing your thoughts (e.g., see a new reality).  Some popular reasons /beliefs used by others are:

Reality/New Thought
I will start a financial plan when I have some money. I need to plan to have money.
The working class can not get ahead in today's world. Financial planning is about working with what I have instead of focusing on what I do not have.
Financial planning is too confusing. Financial planning is less confusing when taken one step at a time.
I do not have time. I need to have money work hard for me in order to have more time.
I do not have knowledge. There are plenty of books and websites that can help me gain this knowledge.
Unforeseen emergencies take the money that I have, so why plan? Not planning for unforeseen surprises results in my lack of money.
I get discouraged when looking at my finances. It is not money but my feelings about money that causes my discouragement. That is why this website is here, to show me how to deal with these feelings.
I have tried it before and it does not work. It will work this time for me.
I will start my financial plan later. And when will later come?  I will stop avoiding in order to make things better.

In reading the above section, some emotions may have come up.  A friend who helped me review this site, felt shame when reading a previous version of this page.  This is normal.  Shame, anger, sadness and other feelings can be closely tied to money and what it represents.   Realize that these feelings can stop you from taking charge of your finances.  For now, feel these feelings (they will be addressed later) and do not let them stop you from starting your financial plan.  

The next step is to uncover any hidden reasons for avoiding your financial plan.  The first reason/beliefs that comes to mind may not be the most important issue to address.  To find the answer, you may need to dig deep.  One trick to uncover these reasons is to ask "why" 5 times, because the initial answer may not be the most important reason. 

Here is a sample dialog.

Why don't you have a financial plan?

Because I do not have time.

Why don't you have time?

Because I have more important things to do.

Why is financial planning less important?

Because I do not believe I am able to save money.

Why don't you believe that you can save money?

Because I will never amount to anything.

Why do you believe that you will never amount to anything?

I have always been told that I will never amount to anything.

Remember, this is just an example.  This exercise is like peeling an onion; you keep peeling until you get to the core issue.  The core issue is usually a belief about yourself or the world.  For example, not having time or not being able to save are not beliefs about yourself.  In this example, the reason for not creating a financial plan resolved around the person's belief that he is not entitled to have money and "will never amount to anything."  If feelings come up like shame or sadness, explore the reasons for the feelings.

Exercise: Ask yourself "why" 5 times to figure out why you might be avoiding financial planning.  Distinguish between superficial reasons and core issues.
Exercise: On a piece of paper write down all the reasons (beliefs) that you have used to avoid financial planning.  Realize that these excuses hinder you and your prosperity.  When you are done, either throw the piece of paper away or have a burning ceremony while saying "I am taking my financial future into my own hands and rid myself of these excuses." 

The key here is to understand that in the past you have chosen to use excuses to limit your financial freedom.  This exercise is about making new choices to regain your power and financial independence.

Personal Topic : How to get started
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