I remember an old comic in which a boy said to his sister, "Hey, we're rich! My mom received a box in the mail with full checks." We can laugh about it, but I really do it for adults who believe the same thing. As long as there are Check Balance: Bank Account Balance Check in the checkbook, they act as if they have money to spend. I knew that many people make all their spending decisions based on their current bank account balance.
This is a natural mistake. In the form of invoices, expenses and wishes, if there is enough in our bank account, we spend it. If we get extra income, that's great! We are considering rewarding something new. The true principle of the second myth is this: Your bank account balance cannot predict what you were not prepared for.
In particular, there are three types of things that your bank account cannot anticipate.
First, you can't calculate the income difference in your bank account. Many people who are self-employed or receive commissions have incomes that vary greatly from month to month. In my first year as a tax accountant, I earned all my annual income in the first four months of this year. I had to manage my money well for the remaining eight months of the year, otherwise November and December would have been very short months.
Second, your bank account balance can't provide for recurring charges. Many regular expenses do not come every month. Expenses that occur once a year or once every six months are among our biggest personal expenses. Only a bank account does a bad job of preparing us for this type of spending.
Third, your bank account balance cannot be determined when Murphy strikes. You are probably familiar with Murphy's Law: the worst that can happen - and the worst of times. When Murphy strikes, you may have to replace the furnace, repair a large car, pay an unforeseen hospital bill, or deal with other similar financial difficulties. Those who rely on Check Balance: Bank Account Balance Check as the only wealth management tool often believe that the only solution they have to deal with in these crises is to sink into debt.
During my first year of college, I lived about 45 minutes from campus. I worked on campus, and when I went to campus in the morning, I was tempted to stay there until 8:00 or 9:00 at night. So I went to a student union or to a fast food restaurant surrounded by a campus to buy two meals a day. The cost was a little expensive, but I earned enough money to spend two meals, and it saved me a lot of time.
Then, in the middle of the first semester, I received a notice in the mail reminding me to pay fees for the second semester. I completely forgot the deadline and did not make any special plans to pay the tuition. I started packing lunch bags and Finnish dinners every day, and I was able to get tuition almost on time. Only by using my bank account balance to manage my money did I lose the opportunity to continue my education.
More importantly, managing money with your bank account Check Balance: Bank Account Balance Check may not help build your financial well-being. Creating prosperity requires two stages. First, you should have an income that comes regardless of whether you are able to work or not. Second, you have to cancel the loan.
You can easily do both. There are no specific requirements regarding income level, occupation or degree. But these two actions require constant discipline and concentration. Managing money with your bank account balance alone will not give you the tools you need to exercise that discipline and focus. A bank account is an important money management tool. But that alone is not enough. The full set of money management tools includes tools such as financial planning, expense planning, and reporting tools. Together, these tools can create an image of your financial well-being.