There is an old saying that goes: good fences make good neighbors.
When boundaries are clearly defined, you and your neighbors eliminate uncertainty and bad feelings.
You know which area of land you need to maintain and which area is the responsibility of someone else. You know who rakes which leaves, who shovels which mound of snow and who pays which tax bill. The fence also defines where you’re allowed to walk freely and where you’re trespassing.
You respect each other and get on with life – on your side of the fence.
And that is precisely how it works with money, when you know how to set financial boundaries.
Creating boundaries around your money works exactly the same way. Good financial fences means you know how much money you can spend, save, invest and give each month and every year. You also know which kinds of purchases can be made, who can make them, how and when.
How to set financial boundaries – 5 Benefits when you set the boundaries
With strong money boundaries, you ultimately eliminate uncertainty and lift money fog. In the process, you’ll end up feeling more confident and in control of your life and the decisions you’re making.
Here’s a rundown of five key benefits you can enjoy when you know how to set financial boundaries.
1. You make empowered money decisions
In order to know how to set financial boundaries, you first need knowledge, and knowledge is power. You become more aware of your income, expenses, personal values, and goals in life. When you’re able to make informed money decisions that support you and your best life, you feel a greater sense of control.
2. You increase your sense of financial security
When there is a clear financial road map, one of the first things that happens is that you ditch haphazard spending. You also know how to successfully ride out a financial emergency during uncertain times. As a result, you feel more safe and secure.
3. You get out of debt
…and stay out. You don’t just blindly rely on debt to cover every unexpected expense. Instead, you learn how to plan for the unexpected, while simultaneously saving money and building wealth.
4. You can better plan for the future
When you set good financial boundaries it helps you think about your future financial needs. You learn how to smartly split your income and invest a portion of it to meet your short-term, mid-term and long-term money goals.
5. You become a better you.
How you spend your money is an extension of what you value most in life. Making financial choices that are aligned with your values and setting responsible limits will help you to be stronger and more confidant. You’ll feel a sense of clarity and purpose. You’ll take care of your needs, while you enjoy the calm, tranquility and peace of mind that comes with knowing you’re making the most of what you have been given in life.
By setting limits, you end up creating a powerful and profound sense of freedom.
And that brings me to my client, Barbara (not her real name). I’m happy to share with you her Success Story.
I began working with Barbara and her husband in January, when their credit card debt had ballooned to a staggering amount.
Over the last few years, they’ve been using debt to cover the dry spells in income from their small business. But this year Barbara and her husband made a commitment to turn their financial situation around. They put up some strong financial fences to clearly define which purchases where in… and which were out. One such fence involved the amount of money their teenage daughters could spend on clothes and other personal items.
You can watch the short video below to see how it played out:
I’m so excited that Barbara and her family are building good financial fences and writing a new money story.
So does this inspire you know more about how to set financial boundaries? Reach out for a free Get Acquainted Call. I would love to help you write your new money story.