Today’s episode is all about finances. What’s going wrong, how to help yourself get on track in 2018 and set yourself up in Dave Ramsey’s words to live like no one else now so you can live like no one else later. He meant, if you are able to make smarter decisions and become disciplined and aware NOW, you’ll have so much more money later on!
So here are some creepy stats to get us started
- Two-thirds of Americans would struggle to scrounge up $1,000 in an emergency, according The Associated Press-NORC Center for Public Affairs Research.
- Fact: About 77 million Americans, or 35 percent of adults with a credit file, have debt in collections reported in their credit files, according to the Urban Institute.
- Nearly one-third of Americans pay the minimum due on their credit card each month, according to FINRA's National Financial Capability Study.
- Paying just the minimum on your credit card balance means you'll pay more in interest. In fact, the average household with credit card debt pays a total of $1,292 in credit card interest per year, according to NerdWallet.
- Only 24 percent of millennials demonstrate basic financial literacy, according to a study from the National Endowment for Financial Education.
What happens when you spend…
- Buyers remorse
- Buy for kids when they already have SO much
- 10% of happiness comes from external world (this is the bit you were talking about with Oprah)
How to set yourself up for financial freedom
- Set a budget (I will go into detail about ours)
- Figure out how much your net each month, not gross but net
- Figure out your expenses
- Now that you’ve figured out how much you make each month and how much you have in expenses, you can subtract your fixed expenses which are typically non negotiable, think heat, water, cell phone bill not your us weekly magazine subscription but FIXED non-negotiables. Whatever is leftover you will now be able to allocate. The goal is to allocate EVERY DOLLAR to something. Even if that something is savings.
- Say that after you’ve subtracted your expenses you have $1500 leftover, you can then thinking about your gas, your food, your entertainment, savings etc and allocate accordingly
- The goal is to initially figure out and get comfortable with the budget and understanding where your money goes. The next step which is imperative if you want to get and keep your finances in order is to see where you could cut back or negotiate.. perhaps you can get a lower cell phone bill by threatening to leave I say this because I’m pretty sure we’ve done that when were questioning customer service over there. Maybe you could cut cable, or create more budget friendly meals.
How to stick together through this
- Be open to having a financial meeting each with to get on the same page
- Have a “no questions asked allowance”
- Dont be too strict or you will go hog wild after depriving yourself completely for so long
- Be willing to adjust frequently depending on the changing situations
“A budget is telling your money where to go instead of wondering where it went” Dave Ramsay
“Don’t Go Broke Trying To Act Rich, Act Your WAGE” - Anonymous
“We buy things we don’t need, with the money we don’t have, to impress people we don’t like.” - Fight Club