Jakarta, CNBC Indonesia – Income and expenditure are two aspects that are always present in our lives. However, believe it or not, strictly managing our expenses can actually make us more wasteful in the future.
A financial planner in the United States (US) stated that budgeting is often seen as a restrictive or restrictive action.
This restrictive approach can have negative long-term impacts. For example, when you receive a large amount of fortune, you may do “revenge spending” or excessive spending to compensate for desires that were previously limited by budgeting.
“Financial psychology deals with the human aspects of finance, such as how a person thinks, feels, and acts financially. It also regulates their relationship with money in the past, present, and future,” says Preston D. Cherry, a psychologist financial and certified financial planner (CFP) in Wisconsin, as quoted by CNBC Make It.
According to Cherry, psychologically, the term “shopping” or spending money is more positive than “budgeting”. Shopping gives a sense of freedom and flexibility in managing your money.
Cherry suggests using the more appropriate term “managing spending,” often called the “Reverse Budgeting” strategy. Control your money, don't let it control you!
This reverse budgeting strategy is similar to the “Pay Yourself First” concept that you may have heard about in financial content on social media.
In essence, you must spend money first for your future and financial security before using it for consumptive needs.
This way, you can use your money more freely for your daily needs after fulfilling your financial obligations.
Interested in trying it?
[Gambas:Video CNBC]
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