Run your personal finances like a corporation
Wouldn’t it be nice if your life and personal finances were run as orderly and efficiently as a major corporation? Follow these 5 steps and you’ll be well on your way to running your personal finances as smoothly as a well-oiled corporate machine.
1. Get approval for major purchases.
Even if you have a corporate card with no credit limit you’re eventually going to have to answer to the bean counters. Adopt this attitude toward your personal credit card and ask your significant other to review your purchases and do the same for him or her. No significant other? Draft a close friend or family member to audit your credit card statement and in turn offer to do the same for them. This way your purchases will be as transparent as any corporate financial report and you’ll probably be a lot less likely to make impulse buys.
2. Make decisions by committee.
Proverbs 15:22 says “Plans fail for lack of counsel, but with many advisers they succeed.” Take this to heart the next time you have a major decision to make, whether it’s for a major purchase, an investment, refinancing, credit card offer, etc. Even if I could I wouldn’t attempt to start a project or make a major decision at work on my own, I always try to get buy in from everyone involved. This (usually) saves me a lot of headaches later on. If you don’t have anyone in your immediate life to help you with these things recruit somebody, or take your questions and problems to the blogosphere. You’ll find there are a lot of people out there who have had similar experiences and are willing to share their knowledge.
3. Back up your files to servers.
All of my work files are saved to a corporate server which is backed up on a daily basis so I don’t have to worry about losing any important files. If my laptop refuses to power up one day I can simply log on to any other networked machine and access all my work files.
At home, however, it’s a completely different story for most of us. My Norton anti-virus subscription allows me to back up my important files to Norton’s servers but that still leaves gigs of data at risk. You can manually burn your files to CD or DVD, invest in an external hard drive (you can get a terabyte drive for less than $120), or you can automatically back them up to a server of your own using carbonite.com ($54.95/year for unlimited backup), LiveDrive.com (100 GB of online storage for 39.95 British Pounds per year, or $5.38/month American), Mozy.com (2 GB of free online storage or $4.95/month for unlimited storage), and ElephantDrive.com (1 GB of free online storage or $4.95/month for unlimited storage – they also offer 256 bit encryption), to name a few.
4. Document everything
I’ve been known to say “If it wasn’t documented it never happened”, and not in an attempt to make something go away but to drive home the importance of capturing things on paper. Ever play the telephone game? Line up a group of people, give the first person in line a message to pass on to those behind him or her, and then ask the person at the end of the line to tell everyone what the message was. The message always ends up coming out completely different than what it started out as, and usually doesn’t even make sense by the time it reaches the end of the line.
This is one of the reasons why you have to fill out so many forms and reports at work to get anything done, but the chances are you’re not nearly as conscientious about documenting things at home as you are at work.
Here are a few ways to put this into practice in your personal life:
- Keep track of your purchases, or at least have a file where you can store receipts. I’ve found accordion style coupon folders are pretty handy for receipts, and get a cheap day planner for documenting your purchases.
- Take notes the next time you speak to a customer service person, that way if there are any issues later on or if you have to call back you’ll have all the pertinent information at your fingertips.
- Keep a journal, or better yet buy a Franklin Planner. Nobody’s memory is perfect and this is an easy way to help you keep track of those little details you’re not likely to remember. I forgot to ask for refill pages for my planner at work and I’ve been lost for the last few weeks. I prefer the Franklin Planner because it has a system for prioritizing tasks and creating an index for your notes so you can easily retrieve important information later.
5. Digitize important documents.
Everyplace I’ve worked for the last 15 years has been trying to go paperless, although it seems like we use more paper now than ever. The real value in having everything available electronically is I can access pretty much any information I need in a matter of seconds, where years ago I would have to track down hard copies.
Meanwhile at home I’ve got paper coming out my ears, and I’ve just recently started scanning documents to help reduce the mess. A lot of my bills are already available electronically which also simplifies things, especially around tax time.
While you’re digitizing your documents consider taking digital pictures of your valuables as well so you have a record of your property and its condition. If you ever need to make an insurance claim this should help expedite the process.
Once you have your important documents in an electronic format revisit Number 3, back up your files to servers. That way you’ll never have to worry about hard drive crashes, theft, fire, flood, etc.
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Number 3 I need to work on badly, especially with my writing and ideas. I haven't been backing up often and know it's going to bite me in the butt one day… I know this, yet I'm not doing it, not very rational huh?
I always carry around a notebook and pen wherever I go, or at least some scrap paper, because my best ideas always seem to come when I'm out and about. Great inventors like Leonardo Da Vinci would always carry around paper and incessantly take notes about their ideas.
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Number one sounds much like having an accountability partner, we all need one, a good one who we can trust to tell us the truth no matter what. Number two is very similar. I agree on both of these points. Number 3, well I have had hard drive crashes at least twice and lost everything. I did learn tons about computers this way, lesson learned for me was to store every important document on a flash drive (have tons of them). May be a cheaper way for followers to store important information and a plus is you can easily carry your info with you anywhere. Four and five, live by them. I love it when I have spoken to a representative and I can repeat the exact conversation as well as the main points that were made. I also like to date and time my notes for even more exact information. I talked to you Friday afternoon at 12:17, remember you wife called and asked you to stop at the store. You get the picture. Also date and time stamp document you have to sign. If there are questions later, you know when you read the document (that has saved me in the past also). Great article and great points to utilize.
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You're not the only one, Ryan. The only reason why I started backing up any files is because Norton nagged me into it. The Norton 360 icon in the task bar shows a red x until you select files to back up. I'm too cheap to pay the $5/month for unlimited backup so I'm going to use the free 2 GB at Mozy and Elephant Drive and see how that works.
I've carried around a Franklin Planner for about 15 years and I haven't found anything else that can replace it. I've used Palm devices for 10 years and currently have a Treo 680 where I store all my personal information but I haven't found an electronic device yet that works better than my paper planner (not even Franklin Covey's own software).
You're going to need to be better organized when you become a Waikik business mogul
It's great to hear from you, Jeff. I've got a bunch of flash drives too but I'm paranoid about losing them and I'm not disciplined about backing stuff up, so I'm going to try the free online backup and see how that works. I'm going to try Mozy and Elephant Drive's free 2 GB back up and hope the three programs don't conflict with each other.
Keep plugging away at the blog, it's a lot of work but therapeutic
The wife just got the terabyte master maximus something something drive to back all her stuff up. i may have to join in on the fun!
Don't forget to have the backup blugin for your blog. Back it up at least once a week if not more just in case things go *poof*. never know!
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Good point Sam. With as cheap as it is anymore to back up data there's no excuse not to. I think I might have to outsource that task though:D
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Few of us do a good enough job backing up data. Personally I have an aversion to anything that comes with a monthly fee so I have two external harddrives, one at home and one at the office. Not often enough, but I will make a back-up and take it to work then do the same there and bring that one home. This way if there is a catastrophe in one place I always have a back-up elsewhere.
#4 I'm learning more and more is really important. Not only has it never happened if it was never documented, but if it's not documented, processes and procedures are random. This is not a very intelligent way to run a business!
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I'm still debating paying for the online backup and am going to try the free plan first. Norton gives me 2 Gigs, Mozy offers 2 Gigs, and Elephant Drive gives you 1 Gig, although I'm not sure if I can use all three at the same time.
I literally say that at work at least once a week because we keep running into situations where past inspections and maintenance records weren't documented properly or turn up missing, yet they still want to take credit for them. This is another thing I'm bad about, if I don't have my planner with me I tend to not write things down. I guess I could use my smartphone but I usually don't. Something for me to work on I guess.
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Enjoyed the post David. Taking business practices and applying them to our personal lives may sound "boring", but businesses are successful & PROFITABLE because they implement these into their daily routines.
By the way, everyone talks about automating your bills so you don't have to continually do it by hand….the same goes for backing up files. Depending on your media, you most likely can set up a recurring backup.
I have read all the articles. Very useful information was written. Thanks
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