UNITED STATES—It’s time to chat yet again about the world of money, finances and how to better manage. I recently completed a survey where it had me thinking about my finances, what I want to accomplish, how much I want to have in my savings account and more importantly: retirement. So it brought me to a very important question: why is it we save more when it’s something we really WANT or NEED?! Yeah, it sounds crazy, but it is very true.

I recall vividly during my freshman year in college that I had to pay a boatload of money to ensure my tuition would be paid off for the semester. It was hell, brutal hell because I was working 40 hour work weeks for close to four months straight, all the while taking a full load (16 credits) and I felt I had no social life as I headed into my sophomore and junior year. People complained about what I was doing, but in the end it was my decision and I was well aware this is what I NEEDED to do to take my life in the direction that I wanted. I don’t regret that decision at all till this day.

The thing that shocked me the most was realizing that I was able to save nearly $2000 in four months and cut my expenses down to the pure basics. When I say basics I mean that: just eating, transportation, going to work and pretty much nothing else. You sacrifice when needed, and with that being said, we aren’t we more disciplined with our finances when we are well aware we have very important matters that have to be completed?

It goes back to my column from last week where we discussed issues pertaining to NEEDS vs. WANTS. We are a culture driven by the need to always want things that we may not necessarily needs. However, it is all about knowing what your weekly or monthly income is. Once you know that, than you can start to divvy up how that money is spent. Of course, a top priority is dispensing your income on all of your expenses first. After that has been determined, see what is left over.

Most would argue you should take 50 percent of what is left and put into savings. However, for many people that is not feasible. So in that case, I’d give yourself a bit of cushion and say take 30 percent of what is left over and put into savings. Whatever you have left, it’s free for you to spend. Should you blow every single penny of it? I would argue against doing that, but I know plenty of people do that.

The reason for that is if you find yourself in a dicey situation you have a ‘secret stash’ beyond your savings account that you can tap into if need be. This is something I advocate so strongly because as the money guy in my family, it annoys me to the core that every time I think I have some extra money stashed away, someone is contacting me needing a loan or some extra help. Its frustrates the hell out of me because I work hard for my money, and I hate constantly having to tap into it and preventing myself from doing something perhaps I want to do because others don’t know how to properly manage their finances.

I think when people are placed in situations where they are broke, and I mean truly broke, going weeks, months, maybe even a year with no money to spend, you start to appreciate it a lot more. That transpired to me in college and I warned myself I would NEVER allow that to happen to me again, and it hasn’t. With that being said, it brings up a very important question as well. What do you do when you receive a lump sum of money?

This could be from a bonus from work, a tax refund, overtime from work, a gift from someone, gambling winnings, etc. Yeah, it doesn’t happen often for many of us, but it does happen on occasion. The biggest thing that pops into everyone’s mind is: I can do this, I can do that, and before you know it, all that extra income is gone.

So here are some very important tips: 1) Know what you have 2) See what debt you have 3) Save some money 4) Decide what debt you can pay off or significantly knock down 5) Purchase something for yourself 6) Put the rest in a secret stash.

It may not be easy to do all the following, but think before you react. I know so many people who would prefer to have $3k in their pocket, yet they have $2k in debt. Guess what, pay off that debt and you still have $1k. You can spend $100-$200 on yourself and save the rest. I’d rather be broke and debt free, then have a ton of money in my pocket and loads of debt. It’s okay to be broke for a few days or a week if all your debt is paid off. Why? Well if you work, you’ll get paid in a week or two so the income is still flowing in. I don’t expect anyone to be disciplined with his or her money overnight; this is something that takes time to sharpen your skills. The more you treat money with respect the better things become over time. Money is a great thing, but it can also be a bad thing if you’re not smart with managing it.