Most of us recognize the importance of caring for ourselves Physically, Mentally, Emotionally, and Spiritually in order for us to be at our best. Did you ever consider how your personal finances come into that equation? Think about it. Do you remember the time that your car died beside the road the same week that rent was due? How patient were you with your co-workers that week? Or the year that “vacation” consisted of spending a week with your mother-in-law because you didn’t have the money to take a real break? What impact did that have on your relationships?
We don’t notice it at first glance, and yet the state of your personal finances has a direct impact on your ability to show up as your best self. Let me be very clear here. This is NOT about the AMOUNT of money that you have. Rather, it is about your relationship with money. Are you managing it? Or, is it managing you?
Several years ago I had the privilege of learning T. Harv Eckers’ money management system. I started using his system immediately and found it to be simple and incredibly powerful. I want to share the basics of his system with you here as I also show you how each portion of your paycheck directly impacts your capacity to become a Conscious Leader.
Each time the Conscious Leader is paid, he or she immediately divides the check into separate accounts as follows:
10% Give: This account supports the spiritual aspect of the
Conscious Leader. For some, this money may go to a religious
institution. For others it may go to a charity. The criteria that
I like best is: to be given to any person or institution that
feeds you spiritually. You get to decide. Maybe it’s the extra
tip for the waitress who was so patient with your son tonight.
Maybe it’s a significant donation at the end of the year to the
local animal shelter. You choose. AND you don’t have to know whom you will give it to when you pull it from your check. Set it aside, look for the inspiration, give generously in gratitude when you see it.
10% Future security: Even though government employees have some remaining retirement benefits, those benefits alone are not likely sufficient to allow you to live the same lifestyle that you enjoyed
while working. This portion of your paycheck speaks to both the
physical and emotional aspects of the Conscious Leader. It ensures
that you have means to provide for your physical comfort in later
years as well as feeding the emotional aspect of enjoying your
freedom after formal retirement rather than feeling deprived.
10% Education (YOURS not your kid’s): Continuous education feeds
the mental aspect of the Conscious Leader. When was the last time
you paid to attend a class? Was it when you graduated college? It
doesn’t matter what you learn, nor does it matter if the topic
appears to be directly related to your work. Take dance lessons,
learn to trade stocks, hire a coach. The learning you gain from
continuous education extends far beyond the subject matter of the
topic at hand.
10% Savings for Spending: Otherwise known as the contingency
fund. This account may feed multiple aspects of the Conscious
Leader depending on how it ultimately gets used. If the money goes
to a new refrigerator because the old one died unexpectedly,
perhaps it is the physical aspect that is supported…you can eat
better because you can keep food fresh. Or, perhaps it is the
mental aspect that is supported…you can choose when you want to
replace your aging refrigerator and exactly what model you want to
replace it with because the available funds give you freedom.
***Note: You may find it helpful to sub-divide this category. For
example, 5% for new refrigerator, 5% for kids’ college fund.
5-10% Play: WHAT!?! Yes, PLAY! All work and no play makes Johnny
a very grumpy, narrow-minded, ineffective leader. Whether you
choose to place 5% or 10% of your paycheck in this account depends
on the category we will cover last. For now, the important thing
to realize is that not only must you segregate this money, you must
SPEND THIS MONEY! Spend it on whatever makes your heart
sing…whatever makes you feel rich, special, and ALIVE. It must
be something FUN. Whether you spend this money on a great
vacation, upgrading your plane ticket to business class, or a cup
of tea at the most expensive restaurant in town, take the money and
50-55 % Necessities: This is the portion of the paycheck that
covers all the necessary expenses of daily living: food,
rent/mortgage, transportation, clothes, personal hygiene, medical
expenses. Ideally all the expenses required for daily life should
be covered by 50% of each check. And, in the beginning it may be
necessary to allow the additional 5% to cover the gap while making
adjustments. Some of you are probably surprised that this category
comes last, especially since most of us instinctively think of this
category first. This category maintains all four aspects of the
Conscious Leader (physical, mental, emotional, and spiritual) AT
THEIR CURRENT LEVELS in the present moment. When we fund this
category first, there is usually little left for the other
categories. There is no capacity to give, to learn, to plan, to
react, or to grow.
I challenge you to try this system for 3 months. I think you’ll be
surprised at the results.