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Get a Grip on Your Financial Situation

By: SFC (RET) Kelly McMurtrey

Published: 11 Jan 09

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Suze Orman is an internationally acclaimed personal finance expert—this is evident if you’ve ever seen her show on NBC. I like Suze Orman for a number of reasons, but especially for her no-nonsense, in-your-face, tell-it-like-it-is approach with which she gives her financial advice. People respond to that—they get it. It’s not surprising then that the “Can I afford it?” segment of her show has become quite popular. If you haven’t seen the program, here’s the gist: A guest calls into the show for advice on a major purchase. Suze will review a snapshot of the caller’s financial situation and make a determination as to weather he can actually afford it. If the numbers add up, Suze will whimsically approve the purchase, but if they don’t, it’s a gritty and candid denial in true Suze style.

I personally think the program is highly entertaining and in some ways rather humorous; however, on the flipside, especially in light of the country’s current economic state, it’s also somewhat sobering because it ultimately begs the question:

“How far removed, how detached, how blissfully ignorant does one have to be from his current financial situation to have to ask a third party whether or not he has the resources to afford a desired major purchase?”

I’m no financial guru by any means, but as a consumer I would think that one should be adequately aware of her current finances to know if spending X amount of dollars is compatible with her current income, net worth and financial goals. No further inquiry needed. Now I do suppose, however, that some people may call the show simply because they feel the need for validation i.e. someone to simply confirm what their gut it already telling them. But unfortunately I am also sure, that a lot of people call because they really don’t know the best course of action; they need someone to make this most basic of financial decisions for them.

And so this brings me to my point. In order to truly begin making a positive change in your finances you need to get a grip on your current financial situation. Getting a grip entails many simplistic fiscal steps that when taken collectively can have a huge impact on your finances. Some of the more important of these include:

  • Have a plan
  • Know how much income you have coming in
  • Know how much income you have going out
  • Know what is left over
  • Control discretionary spending by making a budget
  • Lower your debt–pay off high interest credit cards as soon as feasibly possible
  • Protect your credit rating by paying your bills on time
  • Pay yourself–build an emergency and retirement fund
  • Don't abuse your credit cards
  • Know what afford actually means
    • If this sounds familiar: "I'm going down to Car Toys to get that new $2,500 navigation system installed. The payments are only $75 bucks a month; I can afford that!" then you might want to rethink your financial methodology.
  • Know when it's time to seek professional financial help

I could continue for quite some time, but it really boils down to this: don't be blissfully ignorant about your finances. Whether you're in for a four year enlistment or plan to make the military a career, the Army provides secure, recession proof employment that in these tough times many Americans can only dream of. Don't waste the opportunity. Make a plan and start recognizing the true financial potential a job in the Army can provide. I don't know how many times I've seen fellow NCOs retire from the military with a mountain of debt, no savings, and a level of stress hazardous to their health. Retirement should be a time to relax and to celebrate your years of service to your country. We've all heard that money is not everything, and that may be true, but money does provide us with one thing that we in the military are all too familiar–freedom. Freedom to retire free of debt and without stress, freedom to provide for the education of our children, freedom to build a financial nest egg, freedom to not live month to month while fretting over mounting bills, and the freedom to live our lives in a manner in which we choose.

It is my hope that this article has simply motivated you to at least seriously begin thinking about your current financial state. In future articles, I will elaborate further on the simply fiscal steps that anyone can take to make a significant difference in his or her economic future. Here's to making more responsible fiscal choices in 2009.

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