Phones ringing off the hook all day, a whirlwind of clients, staff meetings, and needing to run errands at the end of the day. Sure (we say sarcastically), sitting down to look over your personal finances sounds like the first thing you want to do when you get home, right? But sweeping things under the rug can lead to larger issues down the road. Financial consultant Gary Glassman, CPA, a Veterinary Economics Editorial Advisory Board member, and financial therapist Denise Kautzer, MA, CPA, detail the obstacles that keep veterinary team members from making smarter financial decisions.
Obstacle 1: Disagreeing with your spouse or partner
We all know that lack of agreement between partners on goals—especially money—can cause tension, says Kautzer. Then we all have a tendency to “hide” our disagreements. Perhaps it’s a spouse who’s overspent and then hides the credit cards or bills from their spouse out of guilt. Communication and compromising can be one of the best ways to move the financial issue forward. No shame in asking for help from a third party, like a therapist, if you need it.
Obstacle 2: Confusing “wants” and “needs”
Where do your values about what’s important in your life and how you spend money come from? How do those values play into your financial decisions? Do you spend your money in a way that reflects your values and goals? It’s important to sit down and think about what’s important to you and what goals you have, Kautzer says. Then you have a base to build your planning on.
Obstacle 3: Overspending
People tend to overspend and then feel guilty about it, or they aren’t good planners or aren’t organized enough to keep a working budget. Kautzer suggests making a plan for a difficult situation. For example, what will you say when your friend comes—again—to you to borrow money and you can’t afford it this time? Have a response ready to use before it comes up, rather than being on the spot and spending money you really shouldn’t. Others live paycheck to paycheck even when they don’t have to; they spend all their money as it comes in instead of saving or paying off debt. Check out the sample budget posted at dvm360.com/moneymatters if you need ideas to get started building a budget.
Obstacle 4: Living a life you can’t afford
Adjusting to change can be difficult when you’re used to a certain lifestyle and then lose your job or experience some other money-crunching hardship. And sometimes you keep spending at the same level to maintain the lifestyle you had. Other times, you may consciously or subconsciously want to project a certain image of yourself to others, and you’ll spend too much to get that image even thought you can’t afford it, says Kautzer. So, how do you tackle these habits? It takes a lot of introspection, sit down and question how you spend your money, and how you’re managing your savings. It may even take a session with a third party to view things from the outside and see where you can make cuts.
Obstacle 5: Failing to follow through
Sometimes the fear of not accomplishing a financial goal can keep you from starting it in the first place, Glassman says. Or one small setback (the car broke down again?) and you quit. It’s important that you continue to see your long-term financial goals as achievable—that you still see the path ahead. A lack of follow-through will cause failure. Fear of financial failure and a sense that you’ll never get where you need to be can lead to under-insuring or under-saving for. Glassman tells clients that the way to overcome this fear is to face it head on. The first step is to get organized. Understand what you have, what you owe and what you want to accomplish. “Many folks just don’t know where to start. We have them make a list of what they own, what debts they have, what their plan to pay down debt is, and begin a savings program. I think once many see this information on a piece of paper they feel more organized and can focus on what’s important. This is the point where we can point them in the right direction and see the vision of what can be accomplished,” he says.
You made it! You’ve conquered—or started conquering—those financial fears and bad habits that are leading to overspending and undersaving. Now, it’s time to become even more financially literate—or reach out for advice from a professional finance planner, investment expert, accountant or financial therapist. And for more on veterinary personal finances, head to dvm360.com/moneymatters.