One of our users coined this term to me the other day and honestly, I’ve been thinking about it a lot lately. What is Chronic Vagueness, and how does that apply to personal finance? The answer is certainly much more clear than the term.
I guess if we apply the definitions of these two words, it makes more sense. ”Chronic” means, constant, habitual, continuing a long time or recurring frequently. ”Vagueness” means, not established, determined, confirmed, or known. Putting both together, “Chronic Vagueness” could be a constant, habitual thought or set of actions that are done without an established, determined, or known set of facts. Does that describe how you feel about your personal finances?
One of the things I love the most about what I do is talking with people that are clearing the chronic vagueness from managing their personal finances. Just recently, I spoke with a BudgetSketch user that was struck by the fact that her and her husband were understanding clearly their financial position for the first time, and BudgetSketch was working to help them create new habits and patterns of thinking about their finances. Since she could see her budget plan in one view, she manages it daily by tracking her actual spending against her plan. She said they have eliminated several hundred dollars of wasted money per month, and have already planned the payoff of their second vehicle over the next 3 months. All of this is happening because they’ve changed their habits, and have a clear well-defined plan for moving forward. I hear a lot of stories like this, and it’s music to my ears.
Many people “manage” their personal finances in a state of chronic vagueness. Spending behavior is habitual, with no plan for how their money will be spent or even knowing if they can afford the constant spending patterns they’ve established every month. Once a person tries to get a handle on this, it seems daunting, as it could be really hard to get their arms around.
BudgetSketch is as much a tool to remove the “chronic” spending behaviors, as it is medicine for removing the “vagueness” out of establishing a plan or even knowing your true financial situation. It does this by first showing you a clear picture of your financial situation, and then it works to change chronic spending behaviors. In BudgetSketch you’ll plan to spend, not just spend.
If you’ve made a plan to only spend $50 this week for work lunches, and by using BudgetSketch, you know you’ve already spent $50 by Wednesday of the week, you have a decision to make for the 2 remaining workdays. In the past, you may have just continued to buy your lunch for Thursday and Friday, spending $70, but since you now know you’ve already spent your plan for the week, you can make some modifications. Maybe you bring your lunch the next two days, or perhaps you reduce $20 from some other budget item. Regardless, when you know, the vagueness is removed, and the chronic behavior of spending an extra $20 for the week on lunch is now a decision to make, not just a chronic behavior.
This is working for my family, and for many BudgetSketch users all over the world. I would love to hear about your successes or best practices to remove the “chronic vagueness” from your personal finance management. You can do it!