The Secret to Making (and keeping) Your Money Goals
Growing up, it was a universal fact that discussing politics or religion was off-limits. Politics and religion were an “off-limits” duo because they both were highly sensitive subjects that in many ways were how someone might define themselves. Within the family of impolite dinner conversations, there is a forgotten middle child: money.
I mean, honestly, I’m much more inclined to ask someone what religion they practice or who they voted for before I ask them how much money they have in their bank account. It just feels dirty.
But here’s the thing, if we don’t talk about it, it’s easy to sweep money under the rug and live our lives chasing “get rich quick” schemes. So, with that said, let’s talk about money!
I don’t know a single person who doesn’t desire wealth in some way. Maybe your financial goals are not to be a millionaire, but you would at least enjoy the ability to buy the fancy bottle of wine at dinner and also still pay your mortgage that month.
But how?
That’s the question.
You see, I come from a performance background where being moody and broke are almost idolized in a way that makes you feel like in order to be a successful artist you’ve got to be living paycheck to paycheck and on the perpetual brink of an emotional meltdown.
Sis, that ain’t it.
I’m here to break it down into some simple actionable steps that you can take today in order to make money goals that you can actually keep. Today is the day that you will stop building up debt and start building wealth. Are you ready? Buckle up!
What’s in Your Wallet?
The first step to making a financial goal is to know what you’re working with. I want you to literally open up your wallet and list out everything that’s in there. Cash? Credit Cards? Debit Card? Coffee punch cards? Gum? A paper clip?
Literally, I’m asking you to make a list of exactly what is inside of your wallet. Then, you need to pull up your bank statements and credit card bills and really assess your situation.
Make two columns: wealth and debt.
In a healthy wallet, it’s not a bad thing to have a bit of debt, but (and here’s the kicker) your debt should not be anywhere close to the amount in your wealth column.
If you’re a Millennial, you most likely have columns that are really out of balance because of things like student loans and credit card debt. Don’t panic yet, it’s going to be okay.
Make a Wallet Dream Card
I’m a huge fan of visuals to help keep me on track. I also love writing things down to remind myself of my goals.
So this next step is fun! Grab a piece of paper, a pen, and maybe some glitter if you’re feeling fancy.
Make two columns: wealth and debt.
Now I want you to take a deep breath and imagine where you’d like to be financially in 1 year. Base this off of your current salary so you know the goals are realistic. I personally make my savings goals first and then the pay-off plan next.
Financial advisors have varying opinions on this, but my personal philosophy is this: if you have money in savings, you are less likely to fall back into debt and you can even pay off debt more quickly in bulk if you have a nice savings account.
Of course, if your monthly interest is really high it might be best to pay off more than you are saving. Only you can make that decision for yourself. Using basic (but hopefully realistic) numbers for easy math, below is the basic breakdown.
Monthly income = $4,000
— Rent = $1,000
— Monthly Expenses (groceries, etc…) = $500
— Savings Goal = $1,000
— Debt Pay Off = $1,500
If you take that example and do the math, by the end of one year you’d have $12,000 saved and paid down $18,000 towards debt! Do you see what I’m getting at here?
(Of course, the more money you make the more you can save and pay off. Be on the lookout for an upcoming post with ways to increase your income!)
Whatever your numbers look like, write them down on your wallet dream card. Put that dream card in front of your most used card in your wallet. This way, every time that you go to pay for something, you’ll be reminded of your financial goals.
This is very important because this next step is where it gets dicey.
Deny Yourself
I’m sure you’ve heard the coffee rule when it comes to spending. The concept is pretty simple: a cup of coffee averaging $3 per day for an entire year results in a coffee budget of $1,095.
I personally have nothing against coffee, but the truth behind the principle is 100% true. In order to meet your financial goals, you’re going to have to give up a few “luxury” items.
I want you to list out your top vices. Whether it’s coffee or happy hour or something entirely different, what would you save if you cut that out (or at least cut back) over the course of a year?
I recently cut out alcohol for an entire month just to see how much I saved. I realized that my husband and I were spending nearly $40 each week on alcohol (including going out and my nightly glass of wine and his whisky). That’s $2,080 over the course of a year!
Since doing that experiment, we decided to cut back on our alcohol consumption at home and when we go out we would implement a 1 drink maximum. Now instead of $40 a week, we’ve cut it almost in half to roughly $20 each week on alcohol.
What are you spending too much money on? Maybe it’s as simple as ordering one less Seamless dinner each week or only buying a new pair of shoes every other month. Whatever it is, do the math and recognize how much money you will save by adjusting your habits and denying yourself.
Eventually, it will become easier to deny yourself and it’s also entirely okay to “treat yourself” from time to time — within reason. Self-denial is the hard part, but this is where the changes are made, and this is where your journey from debt to wealth begins.
So there you have it! Now, I’m going to challenge you to share this with one person you think could benefit from these steps, too. Let’s give money a spot at our dinner table and stop brushing it under the rug. Change starts now.
If you’d like to further assess your relationship with money, check out my Finances Check-In Worksheet.
Love ya!
