Charles Dickens wrote David Copperfield in 1850. In it, he introduced a character named Wilkins Micawber. Wilkins said something incredibly wise yet incredibly simple:
Income 20 pounds
Expenses 19 pounds
Result: Happiness
Income 20 pounds
Expenses 21 pounds
Result: Misery
That concept is fundamental to financial management. If your income does not cover your expenses, you will struggle in life whereas if your income does cover your expenses, even by a little bit, you will generally be happy financially.
When I apply that concept to my own life, I realize that I either have to earn more income or reduce my expenses when I am not in balance. The key is to make more or spend less.
Charles Dickens was right!
