This is part 2 of the “How to Afford Everything Series”
A quick note, if you are a new listener, please go back to Episode One so you are all caught up.
Watch this episode on YouTube HERE.
OK! Get ready to take notes and maybe even crack open a cold one as we continue this journey of financial enlightenment. As the great philosopher Jay-Z once said, “I’m not a businessman, I’m a business, man.” And you know what? So are you. Let’s get this money!
First, a quick shameless plug here: Don’t forget to pre-order my book which will guide you through all the things we are discussing here. The book comes out Dec 12th and you can preorder HERE.
Topic #1: Beliefs About Money
We explored the importance of budgeting, having financial goals, and some money Mantras. This time, we’re going to dive into the world of spending (the fund stuff), credit, and debt (the not-so-fun stuff).
Before we dive into your spending habits, let’s consider your personal feelings about money. Your life experiences shape your beliefs and behaviors about money. Financial experts call these “Money Scripts.”
Consider the following questions:
- What is your first memory of money?
- How did the adults in your life talk about money?
- Growing up, was money stable, unstable, or nonexistent?
- Did the adults in your life give you rules about money?
- Did you break or change those rules as you got older?
- When did you open your First Bank account?
- What was your first paying job or business?
- What did you do with the money you earned?
- What was your first experience investing?
Pay attention to how these questions, and your answers to them, make you feel. This will give you a big clue into how you view money and whether you have a positive or negative relationship with it.
Topic #2: Spending
Are your bills getting paid, but you still aren’t sure where all of your money is going? Are you living paycheck to paycheck but know you could do better? You are not alone.
What is your NUMBER?
I’m not talking about your FAVORITE number – but your Magic MONEY NUMBER.
Your Magic number is what it actually costs you to live, pay all your bills, have some fun, and put a little away for future you. This goes back to your BUDGET.
Don’t worry, my book helps you with this.
Let’s get real for a moment. How are you with impulse spending and cravings? It happens. Scrolling through social media enticed by clickbait is POWERFUL stuff. We’ve all been there.
When you find yourself pulled in the direction of an impulse purchase, repeat after me:
“That is not in my budget. That is not in my budget.”
And remind yourself of your goals – a vacation, a house, a new car, whatever it is. And then scroll or stroll right on by that thing you don’t need.
Topic #3: Other People’s Money (Debt)
Let’s break down debt and decode it so it doesn’t feel so daunting.
Debt is a liability in technical terms but can help you build your assets depending on how it’s managed and utilized. Achieving the right balance involves understanding the types of debt you carry, their purposes, and their impact on your overall financial health.
Not all debt is created equal, and understanding the distinction between good debt and bad debt is essential for making informed financial decisions.
Good debt is debt that has the potential to increase your net worth or improve your financial future. Some examples of good debt include Student loans, mortgages, or even business loans.
Bad debt is debt that does not contribute to your financial well-being and often leads to financial strain. Examples of bad debt include Credit card debt, Payday loans, and car title loans.
The first step to liberation is acknowledging its presence, writing down every dollar you owe to anybody (yes, even the $30 you borrowed from your cousin in 2008), and then pulling up your sleeves to make and follow a debt reduction plan.
Snowball vs. Avalanche: Unveiling the Art of paying off Debt like a pro
Listen to the episode for the key differences of each method.
Remember, love, you’re in control of your financial destiny. Let’s make sure your debt story has a happy ending that’s as amazing as you are.