How many times have you heard that?  Bottom line is that you need income to live.  The manner of living is different for everyone but bottom line, it still takes money to fiance eating, housing, clothing, and other basic needs.

Let’s first find out if you presently are making enough money to fund a reasonable lifestyle.  Again, we get into questions as to what is a reasonable life style?  Studies have shown us that $75,000 a year presently can provide a suitable life style in today’s world that will provide security and less worry.  I’m not sure if that is for only one person or covers a family.  Kids in college and having a  retirement plan doesn’t seem likely to be available  with only $6,250 before taxes a month to spend. Do you buy the $75,000 idea? It doesn’t really matter for our analysis as we are going to be looking at you as an individual with certain needs.

So let’s go about this a old fashioned way.  Get out your friendly bank statements (personal and business) and take a look at your expenditures.  Look to the basics first.  How much is the mortgage? How much for food? Day care? etc.  Be brutal and honest about how much you spent on those items and more in the last 6 months.  Now add how much debt you have and what the monthly payments are. Are you saving any money each month? Then using this information come up with a monthly budget of what you need to sustain your present lifestyle.


If the answer is yes, then go on to next hurdle and find out exactly how much income you are getting each month.  And then the major question:  ARE YOU MAKING ENOUGH INCOME TO COVER YOUR MONTHLY EXPENSES?  If your debt ratio to income is more than 15% then something is wrong(unless big items like cars and houses are involved).

By this time, you should be seeing some interesting developments.

  • If you are not satisfied  because you want your lifestyle to be different, then in what ways would you change it?
  • If you are not satisfied because you don’t have enough income, then the only way to change it is to earn more money.

Seems like a no brainer?  You can’t imagine how many people get hung up here!  Even Attorneys!

NOW YOUR TASK THIS WEEK IS TO TAKE A HARD LOOK AT THESE QUESTIONS AND ANALYZE EXACTLY WHAT IS GOING ON WITH YOUR “MONEY LIFE”.  If you need some help, call me.  Next week we will get into increasing your earning and what might be holding you back if that is what you need to do.