It’s #MoneyMonday!! So this week I’ve been listening to The Ash Cash Show Podcast. Which is AWESOME by the way. Please check him and Tashima Jones out on SoundCloud, the podcast is designed for Millennials seeking financial motivation!
On this episode (37) Erin Lowry author of Broke Millennial (IG: @BrokeMillennial) is giving tips to get our financial life TOGETHER. Erin Lowry has written a step-by-step guide to go from being broke to in full control of your finances. Visit her website https://brokemillennial.com to get a free worksheet to begin your journey to financial freedom! You can get the book on any website or any bookstore that sells books.
Tips I grabbed:
Reoccurring Advice: Understand how you feel about money. AGAIN! We internalize everything, especially as kids. Figure out what negative or positive connotations you have about money. We have to understand our thoughts about money in order to move forward. We have to find out what things we need to UNlearn and replace with financial literacy. What’s your money mentality?
Think short term, for long term goals. We can’t say “I’m going to be a millionaire” without millionaire habits. Erin talks about how personal finance doesn’t come cookie cutter, one size fits all. Her and Ash Cash talk about how personal finance is indeed that, PERSONAL. So how your friends manage their money, may not work for you. Your first budget may not work the first time you try. Don’t give up on your financial breakthrough, keep working to be better. Develop good habits that work FOR YOU.
Ash asks Erin why does she think millennials manage money so differently compared to generations before us. She makes a great point saying that everything is so digital for us. We rarely ever have to use paper currency or coins. We’ve isolated ourselves so far that we barely even see actual money. She also mentions how student debt also affects we feel about accumulating more debt or being attentive to debt.
Erin gives tips to help cash more on the forefront. CASH DIET. A cash diet is essentially only using cash for a month. Okay so when you get whatever form of income you’re pulling in, to help keep tabs on how much you’re spending, only use cash. Besides your bills. The cash that you use for entertainment, grocery shopping, going out to eat, buying shoes, going to the movies, whatever… allocate a specific amount that you can afford to spend weekly. Keep all your play money in cash. Having the cash is more of an eye opener because you can actually SEE your money vanishing. Another tip?
Track every penny. For two weeks let’s start writing down all of our transactions. Every cent spent, write it down. Keep track of when and and what you spend money on. After the two weeks period, we’re going to sit down and figure where our money is going. After seeing where we are spending our money, no guessing. We’ll be able to see where we can cut costs.
Do you have bank alerts sent to your phone? For people who are thriving in this digital age, that may work for you too! Keep the alerts coming and keep up with WHAT you’re spending money on.
Get an accountability partner. This can be a coach or someone whose in a similar financial situation. It’s someone to help you stay on task. You should share the things that work for you, the things you conquer and the things that knock you down. You’re more likely to keep working towards your goal, with someone there to encourage you.
Paying back debt
So when Ash and Erin were talking about paying back debt there were two different kind of approaches they discussed. Debt Avalanche and Debt Snowball. So with Debt Avalanche you basically list your current debt from highest amount of interest to the lowest. Mathematically this will save you money. In doing this you still have to make sure you’re paying the minimum due balances on all open accounts. Debt Snowball is more of a feel good approach. You rank your debt from the highest amount due to the lowest, they described this one as the feel good approach because seeing the debt be eliminated will most likely motivate you to keep paying. Whereas with Debt Avalanche your highest interest may not be your lowest amount, which would take longer to clear. BUT again, you save money. So ultimately, IT’S UP TO YOU. Whatever works for you, makes you more at ease. That’s the route to take.
Track your spending for two weeks
Try out the Cash Diet
Sign up for bank notifications via text
Owe money? Find out how you want to tackle it? Debt Avalanche or Debt Snowball method?