Don't Let Perfectionism Stop You

I have a tendency toward perfectionism, but one area I have been able to let this tendency go is in managing our finances. For example, as I discussed last week, our family budget is a constant work in progress. Here's another example:

In the last few weeks, I have been doing some mid- and long-range financial planning involving Alex's education and our own retirement. The further in the future I plan, the more I have to estimate the numbers I use in my calculations. But that doesn't stop me, and it shouldn't stop you. This is truly a situation where some planning is better than no planning at all. In five, ten or twenty years, Marc and I may realize that we have too much or too little money to accomplish what we set out to do, but we will definitely have more money than if we hadn't planned in the first place.

Another thing to keep in mind is that you don't have to do everything at once. In fact, you're much more likely to create a complete plan if you do it in stages. Gather information on how to achieve your goals over a week or two (read articles, bookmark online calculators, etc.). Then spend a day or two or three putting all of your financial information in one place. Once you have all the materials you need, you can do the math.

One last word about the math: don't let the final figure scare you. Sure, you might realize that you truly cannot afford to take a Carribean vacation this year or next year, but it's better to make that decision because you're in control of your finances than to blindly pay for the vacation with a credit card and spend the next 10 years paying it off. Or you might enter numbers into an online retirement calculator and have the program tell you (as it did me) that you need to be saving 47% of your gross salary in order to retire at the level you inputted. Not surprisingly, 47% is completely unrealistic for our current budget, but I was conservative with the numbers I put in because (as I mentioned earlier) I don't know what our exact situation will be in 20 or 30 years. The important thing that came of this exercise was a renewed commitment to increase our retirement savings.

The bottom line: Let go of your perfectionism and take control of your finances. Even without perfection, you'll be ahead of the game.