If you ask Gail Vaz-Oxlade about managing money, she makes it seem extremely simple. Speaking to a room full of young alumni and students, the financial writer and TV personality preached her brand of financial prudence with her trademark vigour and enthusiasm. When the McGill Young Alumni group invited Alumni Career Services to partner with them and bring Gail to McGill as part of Backpack to Briefcase 2013, we knew it would be an entertaining talk. What we didn’t know was just how educational it would be.
Manage your bottom line
If there was one lesson to take away from Gail’s talk, it was this: Manage your bottom line. We spend a large portion of our lives making money, and even larger portion of our lives spending it. So why don’t we take an hour or two to manage our money? The only person you can rely on to give you sound financial advice is yourself. According to Gail, “85% of what you need to know to manage your money is very simple”. It is our responsibility to educate ourselves on these simple financial matters. We need to take the time to learn about what it takes to manage our money. If we cannot understand the simple principles that it take to manage the bottom line, we only have ourselves to blame.
Differentiate your wants from your needs
Gail has a simple rule regarding wants and needs: if you buy something strictly for enjoyment, it’s a want, not a need. People have a way of convincing themselves that they “need” to buy the newest cell phone or an LCD TV. The reality is that these items are simply for our enjoyment. Once the excitement of a new purchase wears off, they become just another thing we own. Gail tells us to pick and choose, and to differentiate what we want from what we need. Unfortunately, we can’t have it all at the same time. When we buy something for the sake of buying it, we shortchange our future for immediate, short term satisfaction.
Don’t let “décor porn” rule your lives.
Catalogues and commercials for products have a way of making our stuff look dreary in comparison. We look at these shiny new things and discount what we already have. The truth is, we should not question our lives and our belongings based on what appeals to us. While we may envy someone for the new car that they bought, we do not know the debt they incurred in order to buy it. Like the golden apple that is rotting from the inside, we don’t know the long term financial sacrifice that is being made while making these purchases.
Always save something
Regardless of how much debt you have or how much you are spending, it would be foolish not to save even a little bit every month. According to Gail, people need to break through the psychological barrier that prevents them from saving. In fact, we should celebrate the fact that we save regularly! We celebrate our cars and our house, why not our savings accounts? Gail has a very simple motto when it comes to saving: “when you make a lot of money, don’t spend it all!”
Learn to anticipate
People have forgotten the excitement that can be received by anticipating something. With easy access to credit, we can buy what we want the moment we want it. According to Gail, we need to go back to saving and hence, savouring, a purchase. Why enjoy a weekend trip to Disney World for 2 days, when you can enjoy that same experience for the entire time it takes to save up for it? By anticipating an expense and saving towards it, we can enjoy our money for that much longer!
In the end, the most important thing I took away from Gail’s talk on money management is just how simple and common sense it is. Modern society has a habit of wanting immediate gratification; we want what we want, and we want it now. According to Gail, we can’t afford to do that. We can certainly have the life we desire; we just have to pace ourselves. After all, “there’s a reason we have 70 odd years to live”.
To learn more or register for Backpack to Briefcase, visit the schedule of activities.
This event was initiated and organized by the Montreal Young Alumni Branch.
To learn more about Gail, visit her website at www.gailvazoxlade.com.