A Simple Way to Feel Wealthy on a Middle Class Income
This post is about simple things that a not so rich person can do to feel wealthy.
Part of my learning process has included small steps that can improve your financial mental health. More specifically, I have an initial suggestion that may help some folks feel wealthy even if their income is definitely middle class.
Pay All of Your Bills at the Beginning of the Month
Please don’t laugh and leave after reading that heading. Take a few seconds and push on. There is real value to be derived from that simple statement.
I read about a very interesting psychological research study a few years ago. The research showed that crossing something off your personal to-do list each day was more effective than anti-depressant medication in elevating the moods of the study participants.
Can that really be true? The research says yes.
I know that it works for me. When I complete a task I have been dreading, I feel great. It sets me up on a positive wave for the rest of the day. I’ll bet many of you have had similar feelings.
In our world of money, worrying about paying bills is a constant downer. Many of us dread confronting the reality of our obligations. The payment process can be drudgery. We don’t like seeing money slowly draining from our bank account. We are concerned about cash flow, as in running out of money before the next paycheck. We end up putting off the bill-paying as long as possible.
All of these negative thoughts are exhausting. They make us feel poor. Feeling poor only compounds the bad mood that creeps in our mind and lingers.
So why not put an end to those feelings by taking the bills off your to-do list as soon as possible?
How to Pay all of Your Bills at the Beginning of the Month
The bean counters out there are already protesting this concept. They say that we should keep our money working as long as possible, surrendering it to our creditors only at the last possible minute.
There is financial truth to that argument. But I think the good feelings that come from putting the bills behind us can outweigh the financial benefit of waiting. Plus there is a way to accomplish both.
The biggest obstacle that most people will have to paying bills all at once is cash flow. These folks are living paycheck to paycheck. Getting off that treadmill is the first step. That means frugally sucking it up for a month or two, to accumulate enough free cash at the beginning of the month. It can be done and it will be worth it. Do it.
Of course, you don’t have to start at the beginning of the month. But there is both calendar and mental logic to doing it then. The arrival of a new month brings a new paycheck and signals the time to pay up and be done with it.
The second step is to gather all of your paper and electronic bills – every one. If necessary, contact your creditors and get them to adjust your billing cycle. Alternatively, learn how to access your creditor accounts online so that you know what you owe before the bill arrives. That is easier to do than you might think. Most creditors love sending electronic statements.
The third step is to cut the checks or issue the electronic payment instructions. This means sending what you owe now, not later. Everyone gets paid until there is no one else to pay. You want the bills off your back – right now.
If you hate the idea of sending money to a creditor ahead of schedule, there is a plan B. Use a separate bill-paying account. Schedule all of your electronic payments from that account at the beginning of the month, with payments staggered in accordance with the actual due dates. This is important: Transfer all of the money needed to fund those payments into that bill-paying account at the beginning of the month. This allows you to completely forget about cash-flowing your obligations for the entire rest of month. That is very relaxing, believe me.
Now live the rest of your month in financial peace, feeling like a wealthy person.
The Payoff – Feeling Wealthy
Here are the reasons why I feel better – and wealthier – after having paid all of our bills at the beginning of the month.
1. All the money that remains in your daily operating account is yours – to save or spend in accordance with your own plans. No one else has a claim to it. For most of each month you experience a high level of financial freedom, similar to being completely debt free. That feels good.
2. You can make daily spending decisions without having to worry about whether an unpaid bill will leave you short. That’s how wealthy people make spending decisions. If your budget allows for a splurge now and then, your splurging becomes blissfully stress-free.
3. Within a few days after you pay your bills, your account balance becomes reliably real. You have no worries about staggered bills and payments floating around. What you see on your ATM receipt or online bank balance is what you get. Refreshing.
I predict that you will have similar feelings. The money “high” you will experience after paying that last bill can sustain you. That wealthy feeling will probably energize you toward a debt-free life, the ultimate payoff.