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The Financial Forest and Trees - The Dollar Stretcher
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The Dollar Stretcher blog will explore people and money.

The Financial Forest and Trees

Most of us have probably been inspired by a distant view. Of the mountains, sea shore or a forested valley. The panarama can be awesome! Sometimes that perspective can help us see things that we couldn't see up close. At a distance we can't see individual trees so well, but we can see patterns that wouldn't be apparent up close.

That's probably true of life as well. Including our financial affairs. Sometimes when we're debating about buying a new car we're so close to the tree that we cannot see the forest. But, if we step back and look at the forest we may notice a pattern that can be helpful in making decisions today. Let's see if we can't discuss some examples.

We'll start with that car. It's easy to get caught up in the moment when the salesperson is talking about easy payments and your spouse is getting that new car fever look in their eyes (or maybe the look is really in your own eyes!).

Before you sign on the dotted line it might be wise to look at other cars you have bought. What do they have in common? For some of us the answer would be that we were tired of them after about two years and wish that we could trade for something different.

If that's the case you're better off looking at a used car. If you're financing a new car you'll still be upside down in two years. If you're careful buying a used car you probably can trade it for what you owe two years down the road.

It's not just the big ticket items like cars and houses. As you contemplate that new big-screen or the upgraded cable/internet package think about your history with similar items. What does the pattern look like? For some it will typically be a patient time with lots of shopping and research. Others will have an almost irresistable urge to buy it today!

Whatever pattern you see should give you some clues as to how to proceed the next time you're considering a similar purchase. Suppose that you're prone to make quick purchases and only later wish that you had waited until additional features are available. That should give you some help in deciding how to respond to the urge to buy today.

If you reflect a bit other patterns may emerge. Do your possessions reflect a need to have the best of everything? A lot of high end merchandise? You may want to consider why your decisions have that common theme.

The other side could be true, too. Do you notice a history of buying a little less than you need? It could be that you're confusing buying the least expensive item with frugality. It is possible to be too cheap for your own good.

Don't forget the little things in life. What daily spending habits have you picked up? And, what do they tell you about yourself? Look for tendencies. You may often pay for convenience. Or to calm a need for caffeine or sweets. Recongizing those habits could tell you much about your finances and yourself.

By stepping back you may also notice things about your emotional reactions to money. Look for emotions that tend to commonly occur before or after a purchase. Those patterns may help you understand why you buy.

You could discover patterns that shed light on how you relate to others and their money. Keeping up with the Joneses could be an emotional reaction that you need to understand if you want to change your purchasing habits.

Finally, don't just look for patterns that need to be fixed. There's a high likelihood that you'll see some areas where you typically do well. Celebrate those areas. Use them to encourage yourself to get better in areas that can use improvement. Hopefully each time you step back to get the scenic perspective you'll find an even pretty picture than the time before.

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About Gary

For more than 25 years, Gary Foreman has worked to manage money effectively. Prior to starting The Dollar Stretcher, he was a financial planner and purchasing manager. While helping clients manage their hard earned money as a financial planner, he applied commonsense, time-tested techniques during the turbulent 1980’s. The experience convinced him that you didn’t need to hit the lottery to accumulate significant wealth. Following that, Gary had an opportunity to learn more about how to get the best value for a dollar spent in the corporate world. As the Purchasing Manager for a computer manufacturer, he was responsible for supervising over $10 million in annual purchases. Gary began The Dollar Stretcher website <www.TheDollarStretcher.com> and newsletters in April 1996. Over 300,000 readers benefit from the time and money saving ideas presented in The Dollar Stretcher newsletters each week. His mission is to help people "Live Better for Less". He also provides private label newsletters for companies wishing to provide money saving information for their clients and/or prospects. Gary lives in Florida along with his wife of thirty years and their two children. Much of his time is spent working with the men's ministry of his church. One of their ongoing projects is the "Holy Smoke BBQ" which sells bbq on Friday nights with the profits going to support local foster kids and orphans. When he has a free moment you’ll find him restoring a Checker station wagon nicknamed “Two Ton” or cruising in a '65 Impala SS Convertible with doo-wops playing in the background.

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Gary is a former financial planner and purchasing manager who edits The Dollar Stretcher website <www.stretcher.com> and newsletters. You can follow Gary on Twitter.com/gary_foreman
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