If you have money - please spend it!
Why it's so important to keep money flowing as the lifeblood of our communities.
We are in a time of uncertainty, share prices are falling, businesses are closing, there is talk of economic collapse and recessions. All of these things breed fear. Someone described it today saying ‘it feels like someone pulled the plug and all the money is disappearing down a plug hole’
Take a really deep breath…………………
And another…………………
Breathe for a moment.
The money hasn’t all vanished overnight down a big plughole!
Okay so let me start by saying the money isn’t going down a plug hole, money doesn’t all just vanish, there is still money.
There’s a block in the flow
What’s happening is that the flow of money is being stemmed. When people are fearful, when there is uncertainty about the future they stop spending, they hold onto what they have and it’s like turning off the tap.
(I’m no master economist by the way and there’s probably some super clever people out there figuring all this out - check out the FT if you want that kind of analysis - this is my take, my thoughts and it feels right for me to share them)
If we looked at the bank balances of everyone in your community, whether that’s your physical community or your online communities, we’d probably find that there’s still quite a bit of money around. The question is, is it flowing? And if it is, where is it flowing to?
When the money circulates locally it’s like lifeblood, it brings together the people that need things with the people able to provide those things, whether they are goods or services. Without this flow things grind to a halt.
The Money Multiplier Effect
There is a theory behind this and it’s called the money multiplier effect. (I’ve simplified this as it gets quite complex)
I do some money mentoring work with a client - they pay me £500. If I put that in my bank account it will stay as £500, it stagnates. What happens if I spend it though?
Lets see how that could circulate:
Me:
I spend £100 having the local plumber fix my leaking old toilet (total spending £100)
I spend £100 on groceries at the local shops (total spending £200)
I spend £100 with a local business that helps me promote my services (total spending £300)
I save £200 into my bank account (total spending £300)
So we started with £500 and £200 has leaked out (well it's sitting stagnant in my bank account no longer in the flow)
The plumber:
Spends £100 on a large grocery shop for the family (total spending - including mine - £400)
The local shopkeeper:
Spends £100 on replenishing supplies (total spending £500)
Pays the shop assistant £100 in wages (total spending £600)
The shop assistant:
Spends £60 on groceries (total spending £660)
This is a simple example but you can see that the £500 injected into the community actually generates a lot more spending than £500 and circulates through creating energy and flow.
Leakages
When we spend money with large multinationals not as much of that money stays in our communities - it goes to their suppliers and also they are aiming to make profits which get paid out in dividends to their shareholders. This money ‘leaks’ from our communities
How do we keep up the flow
So how can we keep the money circulating and the energy flowing?
If you can afford to spend - please do
If you do have money to spend - choose carefully how and when you spend it - make sure that it aligns with your values - your money is literally giving energy and lifeblood to people and businesses. Do those people and businesses align with how you want life to look?
Get clear on your values, what is it that's really important to you right now? It can be as simple as taking the time to write a list. I’ve also written a blog about values that you can read here.
How can you support the businesses that are struggling - maybe you can pay in advance for something - maybe you can buy a voucher for a meal to be used later in the year!
I love this Facebook post by Denise Duffield Thomas she bought 64 online courses costing under $100 spending $6,195.32 from people in her community and then gave them feedback about their sales pages!
If you don’t have much money - take the time to figure out what you have - where can you cut back - be responsible with your money, where can you cut back, do you have an emergency fund, what changes can you make now so that you can keep your money flowing for as long as possible?
If you notice that you are in fear - well done for noticing, there’s a lot of it around and that's okay. Fear is not a great place to make decisions from though - we make irrational decisions when we are afraid. Look for ways to slow down your brain from overthinking, meditation, yoga, listening to music, dancing, colouring, knitting, something that involves moving.
If you have something to give, to offer your community, don’t fall into the trap of thinking you have to do it for free - you need to keep your money flowing too - charge what your goods and services are worth. Consider a pay as you can structure. Don’t get stuck in thinking there is no money. SOME people have no money SOME people still have lot of it - who are your customers?
If you would like some support during this time:
Follow me on Facebook - look out for my free Voxer sessions.
Download my free money awareness resources.
Join my upcoming training - The Beginners Guide To The Money Pots System
Book in a Power Hour for one to one strategy for your personal or business finances.
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Hi there I’m Gail Bainbridge. I have taken my 20 years of experience as a Chartered Accountant working with small businesses and their owners and become a money mentor.
I am on a mission to transform your relationship to money. I can teach you how to find money that you didn’t know you had so you can spend it on living a life you love.
Need some help with your money take a look at how you can work with me.