Category Archives: Life Lessons

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Money Cleanse: 8 Ways to Detox Your Finances

By | Financial Coaching, Life Lessons, Spending Plans | No Comments

Merry-making happens.  I ate, drank & spent more than I probably should have this past holiday season. Definitely more than I usually do.  So I know what to do about the eating & drinking; but what about the money?  What are the ways I can have healthier finances in the New Year? Here are tips gleaned from my experience as a money coach for almost two decades:

1.     First, the easy one – stop shopping.  Yep I said it.  Don’t be enticed by the sales and reductions in Jan and Feb.  Simply don’t go into stores. Give Amazon a rest.  Your accounts need to take a break from so many transactions and you need a month to pay off those balances and see where you truly are.

2.     De-clutter your media expenses: cell phone, data plan, home phone, cable, TV subscriptions, gaming & internet.  These costs are creepers.  Your carrier likes to bundle and make it easy to get the latest but are you really using what you are paying for?  After you determine you use it, then ask, does this add value to my life focus this year?  If not, cut it out.  The 30 minute phone call to change your service will feel like a breath of fresh air when you hang up the phone.

3.     Reduce restaurant purchases.  Notice I did not say stop.  I get it.  Sometimes buying convenience in the form of a hot meal brought to you with no clean-up is worth every penny. I’m just saying that taking a break from going out is a nice way to detox those reflexive habits we all get going  during the holiday rushes.

4.     Reduce alcohol costs by going to the liquor store and inviting your friend over for a drink and a chat.  2 – 10 buck cocktails plus tip downtown will buy a decent bottle of wine or liter of Tito’s.  And you don’t have to yell to hear each other.

5.     Declare a month of need-only purchases.  Each time you reach for your wallet, phone or computer to pay for something ask yourself…Do I need this now?  If the answer is not really then just say nope, I’m on a financial cleanse this month and I’m already seeing my balances go up.  It feels great!

6.     Okay this is a big one.  Complicated.  Will require research and really looking at your current situation while reminding yourself of your bigger picture.  Insurance.  All of them.  Take a week to examine.  I’d start with car, then renters or home insurance, then health.  These can be tricky because your agent will want to up-sell you, but keep an eagle-eye on what you need now.  Insurance is one of those things that the market bets on you not looking too often at the details and have adjustments in place to increase over time if you do nothing.

7.     Simplify how you’re using credit cards.  This takes some honesty and effort.  First look at how many active accounts you have.  Look at the statement for each one.  Now look at what their “deal” is; interest rate, annual fees, point systems.  Then pick 1.  Yes 1.  Stop using the others.  Get them out of your wallet & off your paypal or vemo account.  (Don’t close them)  Finally, only put on it what you can payoff in full each month, whatever your current balance is.  (If you have trouble knowing this is possible then start using your debit card instead of your credit card)

8.     Now that you have those credit card statements handy look them over for all memberships, dues & subscriptions.  I’m talking the gym, newspaper &  magazines, the skin care products that auto ship.  Here’s another honesty moment: if there is anything you pay for monthly that you didn’t actually use at least a handful of times, cancel it.  Its not about how big or small the monthly amount is, it is about the energy that goes to that each month that is a drain on your brain & your finances.  You’re stopping the leaks here.

Now that you are feeling lighter, clearer and more importantly have more cash-ola, I have a challenge for you.  Go ahead and gather a copy of each statement for ANY active accounts you are responsible for.  Don’t stress on this, just gather and let yourself see how many financial instruments you have going in your life.  Does it feel good to you?  If there are too many, or you are confused about how they work together you might be ready for  the next set of steps to improve the health of your financial life.  Let’s talk about it.  Give me a call.

ADDENDUMS

For Baby Boomer parents:  Stop paying for your grown kids’ costs.  Cellphone & Insurance after the age of 26 is just enabling. If they live with you, it’s time for rent.  Something.  Even $100 a month gets the flow going for you and for them.

For business owners:  If you haven’t already, completely separate your business and personal finances.  That means separate checking, savings & credit card for each.  Co-mingling is a no-no with the IRS, your year-end tax filing will be easier and your brain wont be so cluttered, turbo charging your creative powers.  Really.

5 Habits to Start Now to Improve Your Financial Health

By | Financial Coaching, Life Lessons, Personal Finance, Saving Plans, Spending Plans | No Comments

Would you like to achieve excellence in your finances? Here are 5 Habits you can start now to improve your financial health.

  1. Be the CFO of You, Inc. Set a date with yourself 1 x a week to handle the operations & details of your financial life such as: categorize your Mint.com, pay bills, check your balances, research that new investment or product, meet with your insurance agent etc. — all the money tasks that need your personal attention. Plan a reward after that date, a movie, an Amazon browse, bottle of whiskey, chocolate truffle, vacation planning. Something fun after you have a clear picture of where you are on your money map today.
  2. Give yourself a CASH allowance each week. Yep, good old fashioned cash. Feel the freedom of it. No financial footprint! It can make you feel a little giddy. Let it help you give your debit/credit card/digital spending a rest while containing those little treats that really add up: Starbucks, extra beer, convenience store snack, Burts Bees at the counter. This is a great way to execute the reward of #1.
  3. Start a savings-to-spend account. This helps soothe the spender in you, who, let’s be honest, is kinda tired anyway, by letting her know she will get to spend again. And maybe this time it can be for that bigger item or something truly desired that takes more moola than you allow to build up in your checking account. My suggestion is to open a savings account wherever you do most of your banking, and set up an auto-draft to go from each regular pay period.  Even just $50 can begin to add up. It’s forming the good habit and letting that feeling begin to lead you rather than the immediacy of a purchase for something you consume.
  4. Add to your “prudent reserve account” every month. Sounds simple, but most of us wait to see what’s left over to save. There are two problems with that: One, we don’t look at our finances often enough to see what’s real, and Two, our wants get immediate attention so there is rarely any left-over for the non-sexy “rainy day fund.” (Prudent reserve = cash funds to access when the unexpected happens. When change brings us new opportunity, now we can respond without hesitation or fear!)

As CFO of You, Inc, have a monthly meeting “how are we doing, where are going” meeting. If you have a partner or share bills, include the other person in your life. This is big picture stuff. Monthly review of income/expenses. Plus net worth or balance sheet. Once you have three months of good data, you can begin to create an accurate spending and action plan that give you a GPS position on your financial journey!

Get in touch if I can be of service to you.

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