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Achieving Financial Freedom Through Budgeting

What is a Budget?

The Money Nerve Budget

Many people consider budgets as a negative part of your financial plan. Let’s take a second look! A budget is a marvelous tool for calculating the money flowing in and the redistribution of that money to live your life in the best way possible. A budget can help you with money choices today, decisions in 6 months and a plan for when you no longer work. Knowing where your money comes in and goes out will help you formulate a manageable budget that can accommodate several goals.

Best Practices

  1. underestimate your earnings ( be sure to jot down after tax dollars, not your salary)
  2. Overestimate annual expenses; because “things happen!”
    Of course, some parts of the country have a low cost of living, and other areas have a much higher cost of living. You will need to take into consideration as you formulate your budget.

First, determine how much you want to save. Pay yourself first. You may only save $25 a week, and that’s okay. If you set up an automatic draft, it is not as painful, because it goes straight to the savings account. Then when you get a raise, set up a second draft and route money to a long term savings account. This cash can be used to purchase property, save for retirement or other long term goals you have set.

Where does My Money Go?

It is easy to find the average wage and cost of living by each state on the Internet. Since I live in California, let’s use those numbers.

According to the MIT Living Wage calculator, an adult with no children in California needs a living wage of $30,392 before taxes. This salary covers the essentials of housing, food, utilities, transportation, and taxes. There are no luxuries at this salary without some creative methods of saving/spending.

Housing will take the most significant bite out of your income. As a general rule, you want to spend no more than 30 percent of your monthly gross income on housing. If you’re a renter, that 30 percent includes utilities, and if you’re an owner, it includes other home-ownership costs like mortgage interest, property taxes, and maintenance.

Food costs also vary, but a good rule of thumb is to delegate 12% of your salary toward food. Again food prices by state and even by city: New York, Chicago, Los Angeles, and Seattle will be higher. You may want to utilize supermarkets that specialize in overstock or day-old bread. Another option is to cherry-pick Costco or Sam’s for some of their brand name, big bulk items like coffee, nuts, frozen vegetables, and even gasoline. Include groceries, eating out, and liquor when calculating the total food bills.

Adding a small child can add $220-$250 per month to that %. The USDA has prepared numerous food plans based on a thrifty budget to the most expensive of budgets. With careful planning, you might be able to spend as little as 9% on food costs. But, if you prefer to eat out regularly or purchase high-quality meats and organic produce, you could triple your bill. Click HERE to see the graph for January 2019. It is all centered on what is important to you. You may prefer to live in a tiny home and dine like a king. Or you may live in a large house and eat tuna fish every night. We all have different wants and needs. Your budget should be a reflection of what is most important to you.

Budgets Create Financial Freedom

When you have set your budget – follow it. As you accumulate wealth, you will see how mindful money choices can create financial freedom. You no longer miss payments or pay numerous late fees which results in more money in your pocket. Take a chance on you! Create a path for your finances, check every year and invest in YOU! I invite you to download this easy budget and get started TODAY!

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3 Tips for Overcoming Emotional Roadblocks

Financial Roadblocks
Negative vs. Positive: How to create positive financial decisions when plagued by negative emotional experiences regarding money.

Negative actions, words, or lifestyles have a more significant impact on your brain than the same number of positive interactions. Why is this? Being criticized, rebuked, or corrected in a spiteful or consistent manner can demoralize us. And we often allow those old, but powerful words to autocorrect ourselves again and again – resulting in repetitious and unsuccessful outcomes.

Emotional baggage can derail our financial goals and visions too! Dealing with money is going to be part of your life tomorrow, next weekend, on your vacation, and even on your birthday. Facing your emotions regarding finances is the first step. There is no physical harm in facing your financial reality. No one yet – has ever been stabbed by a bank account!

Emotions can cause us to feel panicked, afraid to make decisions, to plan for the future, to ignore our problems, and take away the freedom of conscious choice. When we are worried about the heights to which we can ascend, it often feels more comfortable to lower our expectations quietly. So how can we change this emotionally charged way of thinking into a more rational and proactive method of moving forward?

First, examine which negative voices or memories are affecting your finances today. Determine how these negative fears or choices are affecting your personal life. Explore who might be a financial champion (coach or teacher) to assist you in making changes.

Second, write down a logical plan of action to follow. Assess where you are financially right now! You can’t get to your ultimate destination if you don’t know your starting point. Take a good, hard look at your income, expenses, budgeting, time, and hidden costs. See where your money flows into your life and then out. This action plan is not a time for self-judgment; it is just a tally of the financial “flow.”

Third, begin writing in a journal daily. Protect your dreams. Choose a short-term, mid-term, and one long-term goal. Life is full of extraordinary opportunities, and writing down your most profound thoughts, and goals can propel you more quickly into seeing those dreams become a reality.

These three tips can reroute your financial journey and create a healthier relationship with your money!

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Credit Card Debt can be Harmful to Your Health

Credit Card Debt

Credit Card Debt can be Harmful to Your Health

Did you know that credit card debt can be harmful to your health? While it’s difficult to imagine anyone creating harm for themselves when using their credit cards, this should give you pause if that next purchase adds to a severely overweight credit card balance. In that respect, knowing how to pay off Credit Card Debt is no different than going on a life-extending diet.

How to Pay Off Credit Card Debt Early

Interstate Mentality

Do you have an interstate mentality regarding your finances? On an actual freeway or interstate, you can see hundreds of cars ahead of you on the road. Your path is blocked, and your vehicle is moving slowly, if at all. Beware, the roadblocks you have set up in your mind tend to be less noticeable. Nobody is setting out an orange cone with blinking lights telling you to merge your credit card debt.

An interstate mentality takes place when you try to juggle payments on seven credit cards, transfer money from one bank account to another, free up expenses on one credit card so you can charge more on it while you make a payment for another card, and wait for a paycheck to cover checks you just wrote.

If you have a lot of different things going on financially, you have to stop to take a breath. Decide what is most important about paying down your debt. Credit card debt can be harmful to your health. Just like losing excess weight, you want to make your financial life sleek and slim.

Control Your Spending Habits

Slow down and make conscious choices. “I won’t charge my credit card, I’ll skip going out to dinner this week.” “Maybe I don’t need
three new outfits, and I should balance my checkbook.”  OR… “Take a breath and focus.” (It’s good to remind yourself to slow down.) Learn effective tactics for dropping debt effectively, controlling spending. Don’t let credit card debt be harmful to your health! In fact, when you pay off your debt early, you reap the reward of less financial stress while enjoying more financial freedom!

 

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Visualize Change

The Money Nerve

VISUALIZE CHANGE

Are you where you want to be financially? Visualize change! If you’re not open to change, then you want to stay exactly where you are. Truth is the truth. To change your path, visualize  change to seek motivation to begin the journey. As you update your mental map, you will start to see a difference in your actions. In fact, you will be better equipped to recognize the path you are on and begin to understand and enjoy it.

FIRST STEPS

The Money Nerve concept is a stepping-stone to understanding different aspects of your life. It is really about reprogramming your brain. The data you are using might have come to you when you were seven years old. You are not seven years old anymore; it is time to reassess the information you absorbed when you were young. Know that your mind is a powerful tool to initiate life changes. Mental fortitude will create new pathways for successful actions.

EARLY INFLUENCES

We have all unconsciously downloaded misinformation into our brains. We now have to consciously begin identifying our early money programming memories and work to change those beliefs. You may remember phrases or attitudes your Mom or Dad had about money. As a result, you may need to investigate whether that old information still works for you. Maybe you have already started the process of self-discovery. I am here to tell you that while the past may have influenced you, you are not doomed to repeat the same learned (and often useless) emotional reactions for the rest of your life. The more I’ve learned about myself, the more I’ve understood the impact that even the most seemingly insignificant events have had on my life. As a result, I’ve been able to push away old habits or thoughts and formulate new pathways to find financial freedom.

EXPLORING NEW OPTIONS

You will have many opportunities to visualize change in your future. You can reframe your own financial life. I believe that one of the most important ways to bring about change is through visualization. This technique involves envisioning your future as you want it to be (rather than as your current reality). You may see yourself with an abundance of money or paid up on all your credit card debt or driving a new car. If you can’t visualize how your future could be, it is difficult to believe you can take the necessary steps to get there!

Let go of negative judgments of yourself. Mentally picture the person you would like to be without worrying about how you might stop yourself from getting there. The point is not to fix yourself; the result is to embrace yourself.

STOP COMPARING

You may look at some people and think they live a charmed life. Those same people may, in turn, look at you and think you are the one who has it together. I work with some clients whom others consider to be extremely fortunate, and the truth is everyone had different challenges. Here’s the bottom line: they are not any different than you. In fact, you may be in a better place financially than they are. It doesn’t pay to compare. You are in charge of your life, you can visualize change, and you have the power to make a successful lifestyle change.

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Diversify Your Money by Joseph Hogue, CFA

Diversify Your Money The MoneyNerve Blog
Diversify Your Money

Diversify Your Money with

My Three Favorite Investments

Part of planning a sound investment plan is diversifying your money from simple stocks and bonds. Let’s look at how to diversify your money with my three favorite investments.

It’s nearly a decade from the last big crash in stocks and people are beginning to wonder if the stock market will just keep going up forever. It’s a nice thought but that always seems to be about the time that the market makes fools of us all.

Part of being ready to invest means understanding the terminology and creating a simple plan around your goals.

That long-term focus on investing will help you look beyond stock prices whether they’re rising or falling and reach your retirement goals. A slow and steady approach to personal finance and investing often leads to financial freedom.

There’s another important idea in investing though, one that will protect your money when stocks do tumble. It will also help you reach your long-term goals, but this idea will make it easier to put up with the short-term hiccups in the market.

It’s the idea of diversification and it’s one of the most critical pieces in any investing plan.

What is Diversification?

Diversification is the idea that investing in different assets will help smooth the ups-and-downs in your overall wealth, especially when stocks tumble. If stocks are 100% of your investments, then a stock crash can wipe out much of your hard-earned money.

Many investors try to balance out their stocks with some investments in bonds, which are loans to companies, but there’s a real problem here for most investors.

Bonds don’t make much money!

Most bonds earn less than 5% a year and that’s before inflation takes a 2% chunk out of the return. That’s not bad and I’m not saying to avoid bond investing but many investors don’t have the patience to stick some of their money in bonds and wait for them to protect their portfolio.

They end up getting tired of that lower return on a piece of their portfolio, especially while stocks are producing double-digit returns each year. They sell their bonds and stick it all back in stocks…then get hit with a market crash.

How Do I Diversify My Investments?

Even if you had the patience to keep some of your money in bonds, there is a better way to diversify your money(ie. your investment portfolio).

Looking for other assets, other broad types of investments, will do several things for your portfolio:

• Help you earn a higher return than bonds but not have all your money in volatile stocks
• Reduce the amount of money you need in bonds to protect your portfolio from a crash.
• Produce a higher level of cash flow to pay expenses when you start spending down your investments

Now that you have an idea of how diversification can help create wealth and keep you from freaking out over the next stock market crash, here are my three favorite investments to diversify your portfolio.

Real Estate is the Great Wealth Creator to Diversify your Money

Few assets have created as much wealth as real estate. Like the man said, “It’s the only thing they’re not making anymore.”

If you’ve only got few thousand dollars to invest, buying property is out of the question but there are other alternatives.

• Real Estate Investment Trusts (REITs) are real estate funds that trade like stocks. These are special companies created to hold commercial real estate. They get a special tax break for paying out most of their income to investors which means these investments pay out massive dividends.
• Real Estate Crowdfunding is a newer way to invest in real estate. Developers offer their projects on crowdfunding websites for investors. You can invest as little as $1,000 in a debt or equity investment in each property.

Peer to Peer Lending isn’t Just for Borrowers

I learned about peer-to-peer loan investing from my cousin several years ago. Platforms like Lending Club allow borrowers to apply for personal loans for up to $35,000 and investors can invest as little as $25 in loans that meet their criteria.

Actually, the idea of investing in loans is nothing new. Banks traditionally package and sell their loans to investment firms which then sell the packages to anyone that needs consistent cash flow. That means pension funds, insurance companies and college endowment funds are some of the biggest investors…and that you probably already have money invested in loans and may not know it.

Returns on Lending Club generally range from 5% to 14% depending on the types of loans in which you invest. I invest relatively conservatively in borrowers with a lower risk of defaulting and have earned a return close to 10% for several years.

The best part about Lending Club is that you can automate your investments to tell the website to invest your money in any loans that meet certain criteria. Since you receive money monthly from your loans, in principal and interest, it’s important to reinvest this money quickly to keep earning a return.

Go West for Diversification, Way West

This last investment isn’t necessarily a different asset class but it’s one that most investors avoid. Investing in stocks of foreign-based companies, will help protect your portfolio from the ups-and-downs in the American economy.

It’s true that the largest U.S. companies sell products overseas and that can help immunize your portfolio from trouble here at home but that doesn’t quite cut it. Investing directly in foreign stocks can help you diversify even further by investing in companies with most of their business outside the United States.

Many foreign stocks trade on the U.S. exchanges as American Depository Receipts (ADRs) so you can buy them just as you do shares of a U.S. company. You can also buy funds that hold shares in hundreds of foreign companies like the Vanguard FTSE Developed Markets ETF (NYSE: VEA).

These aren’t the only alternative investments that will help you diversify your money but they’re three of my favorite. All three pay consistent cash flow that is regularly well above that of stocks. Putting it all together in a portfolio with stocks and bonds will smooth out any stock market troubles while still providing a return you can count on.

Joseph Hogue, CFA
Guest Blog by Joseph Hogue, CFA |  The Money Nerve

 

Joseph Hogue worked as an equity analyst and an economist before realizing being rich is no substitute for being happy. He now runs five websites in the personal finance and crowdfunding niche, makes more money than he ever did at a 9-to-5 job and loves building his work from home business. He holds the Chartered Financial Analyst (CFA) designation and has appeared on CNBC and Bloomberg. To learn more, visit: https://mystockmarketbasics.com

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Emotions Around Money

The Money Nerve
Emotions around Money

EMOTIONS around MONEY

“Emotions Around Money” – how does your money get sidetracked by your emotions? Some people say they don’t have any emotions surrounding money. And then they start talking about money and the floodgates open. I developed the Money Nerve concept by working as an accountant, financial advisor, and business consultant for over twenty-five years. I am thankful to the many people and businesses that I’ve helped who have, in turn, helped me.

I have spent decades sitting across from my clients—most of the time feeling more like a therapist than an accountant. I realize now that many people have money issues because emotions and money are tied together hand-in-hand, Many think they are supposed to know how to handle finances intuitively and can’t –but they are ashamed to ask for help. I see business owners, other CPAs, lawyers, therapists, doctors, and others in major financial crises. I am no longer surprised when clients come in, start talking, become emotional and break down crying. There is a lot of fear and shame surrounding “emotions and money.”

Define Your Emotions aka your “Money Nerve”

It’s time to start admitting, without shame or embarrassment, that we weren’t taught how to handle money (or that we don’t know all the answers). We need to bring our money issues out in the open and start changing our belief system to set ourselves up for success. What pinches your Money Nerve? If you have more month than money, it is time to explore a new pathway toward financial freedom.

Many people are in denial because they don’t want to deal with their financial situation. I had a conversation with a client that went something like this:

Client: I was more upset about coming to see you today than I was about finding out whether or not I had terminal cancer yesterday.

Me: Your priorities are messed up. It’s just money.

Client: I didn’t want to come to see you. My finances are a mess! I almost canceled. Now I’m glad I’m here—you always make me feel better. I know you’re still going to help me and get my mess all straightened out. I’m not sure why I was afraid.

Me: This is only about money. Do you hear what you’re saying?

Client: I know, I know.

Illusion of Money or Vision for the Future

Huge companies like Fannie May, Freddie Mac, or Lehman Brothers built their empires on the illusion of wealth. When the time came to pay up, however, their house of cards came tumbling down. It should come as no surprise that many individuals who make up these companies have the same problems. Many people’s lives are also a house of cards, an illusion.

If major corporations are having problems, you shouldn’t be embarrassed about your personal financial problems. It’s epidemic! FYI, there is no 700-billion-dollar bailout for you. You have to help yourself. Start today by creating your vision for the future. Define Your Money Nerve.

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BUDGET: What does this mean to you?

financial freedom with budgets
The Money Nerve Budget

BUDGET: What does this mean

to you?

Budget: an estimate of income and expenditure for a set period of time. Or “keeping within the household budget.” Many people cringe when they hear the word budget, and instantly assume it is a gloomy, painful process of giving up all the joy in their lives!

Since the word budget has such a bad rap, let’s make a change and call it “proactive money management” or a forecast. A forecast is a general vision of what’s to come; it allows us to make decisions for the next few days. We all know that the weatherman isn’t always exactly right, often changing the outlook as the clouds roll in faster or the sun bumps up the temperature.

When you forecast how you want to spend and save your money, you are pushing out your projection for the next week, month, 1-year plan and beyond. Just like a weather forecaster evaluates new information to share with viewers, you may have to adjust your financial timetable as “life” happens.

Be Honest and Accurate

To accurately predict the weather, you must set the destination. Knowing the temperature in Seattle has no meaning if you live in Miami. With your finances, you need to know where you are; how much you bring home and what your monthly expenses are. Creating an estimate of how you want to direct or point your extra money into different funnels establishes a roadmap for the plans or goals you set for the future.

If you are like 90% of Americans, you tend to inflate your salary and round down your bills. Try to flip that assessment around. By underestimating your take-home pay and then basing your monthly bills at the highest projected amount, you have now given yourself a cushion of cash reserves. That’s refreshing!

Inflow and Outflow

A budget doesn’t always mean cutting costs; it is merely a plan for how your money will flow into your life and then dispersed to others for the benefits you want. Most people apply their money to three main priorities: food, housing, and transportation. These are essential components for a higher quality of life, and once you have these taken care of, you can begin to set aside money for other important goals or dreams.

Write down every expense, good or bad. Don’t pretend that you always spend money wisely. We all have habits and plenty of opportunities to be wasteful with our dollars.

One of my colleagues Kelli, (aka the Freebie Finding Mom) has developed a handy budget sheet to track your cash easily. Take a moment to download this helpful resource HERE.

Finding Balance

If you discover there is not enough money for the three essentials of housing, food and transportation, then you must explore your options to find a reasonable balance. You could cut down on one of these components, (smaller apartment or using coupons for groceries) or you could ask for a raise, look for another job or add a second job on the weekends. Creating a forecast (or budget) of what bills need to be paid each month, along with one time expenses that come up each year –– gives you a good guesstimate of where your cash flows in and out. A lot of people arrange to get monthly insurance bills instead of one massive bill annually, and this makes it easier to stay on track and “In-Budget.”

Financial Freedom

Work your desires into your budget. Save for special events and big purchases. Once you have identified where your money comes in and how you want to spend it, you have the power to change your plans. You have opened a new door of opportunity with intentional, proactive choices. The benefits of forecasting your money flow include less financial stress, a new sense of understanding of what’s important and the freedom to choose how you spend your money!

Follow me @themoneynerve on Facebook, Twitter, Instagram and Google+ To receive our monthly newsletter with financial tips and tools, visit https://business.facebook.com/TheMoneyNerve/app/100265896690345/

 

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Build A Road To Financial Freedom

Road to Financial Freedom

Build A Road To Financial Freedom

Wish you were living on Easy Street, USA, with an incredible amount of money just earning interest? Here are some simple steps for you to build a road to financial freedom. Many of us long for enough money to pay the bills and then some! Unfortunately, a majority of us have more month than money and feel helpless when trying to manage our bills.

Embrace Your Story

To arrive at a new destination, you need to determine where you are today. No guilt, no accusations or remorse – just figure out where you are financially and use that as the basis for a new direction. Decide to make adjustments, making new or different choices that will empower you.

Set Simple Goals

Explore what things are most important to you. Use that information to begin building your road to financial success. Taking time to set priorities gives you the power to make smarter decisions with your money. If laziness, bad habits or emotional reactions currently drive your budget, you will be amazed how quickly proactive choices can boost your bank account!

Be Accountable

Write down your financial goals and give yourself a deadline. There are many paths to achieve your desires, and by mapping out a plan, you give yourself a higher percentage of hitting your target. When you know what bad habits or destructive emotions have sabotaged your efforts before – you can choose to try an alternate course of action. One of the benefits of having written goals is that they help you stay the course over time. This accountability is a key component for creating financial freedom.

Change Your Mindset

Using positive and powerful words to impact your actions. Stop telling yourself that you just can’t do it or that it’s too hard. Create new mental pathways with positive intentions such as, “I want to save money with each paycheck to purchase a home (car, vacation, etc.) and apply one action to that wish. You can set up an automatic deduction that routes $25 to your savings account.

Small Steps = Big Change

Making one little decision each day that leads you closer to one of your primary goals will reap enormous benefits over the course of one year! Saving $25 a week will earn you more than $1,000 within the year. And that will grow to $6,500 in just five years. One tiny step practiced consistently, can create lasting effects in your life. Check out the first chapter of The Money Nerve book ~ Make time to make a change TODAY!

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Teaching Yourself to Say NO to Debt

Today’s Guest Blogger is Matthew Woodley, creditexpertrepair.com.

Be sure to implement some of his insightful tips for dropping debt!

Teaching Yourself to Say No to Debt

If you are struggling with debt then you have to make a commitment to change the way you spend your money. There are many places you can turn for help, such as financial advisors, and there are many ways to help turn your finances around with programs involving debt management, refinancing, or even debt consolidation. Tapping into professional assistance and teaching yourself to say no to debt can pave a new path to financial freedom.

With that said, no matter what options you choose you need to commit to saying no to any more debt. No matter how tempting it may be to spend, if you want to get out debt you have to stop adding to it.

It is true that it can be hard not to take on new debt, especially if you are used to using your credit cards and are living pay-check to pay-check. To get started here are a few suggestions for teaching yourself to say NO to debt and changing your habits.

Avoid New Loans

When you are having trouble paying bills, it can be very tempting to seek out a new loan in order to cushion yourself and have a sense of security. However, you are much better off reducing your expenses in other ways and creating a monthly budget. This can show you how easy it can be to save money and allow you to learn how to live within your means.

Begin teaching yourself to say no to debt by using cash for all of your expenses. You will begin to realize just how much of a crutch your credit card and loans have been. If you have a lot of debt and cannot afford to buy something in full using cash, then you should not be allowing yourself to buy it.

Breaking Bad Habits

It is very important to allow yourself to put paying off debt before anything else. By avoiding loans and only spending the money that you have in your account you will be able to break away from your spending habits and stand up to your finances.

Another great way to learn new habits is to start paying yourself before you turn to other expenses. You can do this by setting up a deposit into your savings account on the first of the month. When you start to see this money disappearing each month you will begin to treat it like any other payment, and even forget that you are actually saving money. This is one of the best habits to get into and is a great way to save for an emergency or start to build up a nest egg.

Even if you set up a withdrawal that puts $50 a month into your savings – you will have at least $600 in an emergency fund at the end of the year. While that may not seem worth it right now, it can be the difference between bankruptcy and making it through any difficult times. Something as simple as avoiding buying a cup of coffee each day can allow you to pay yourself first, and is more than worth it in the long run.

Reducing Toxic Debt

Aside from putting away a bit of money, you should always do your best to target toxic debt with any extra money you have from your budget. Toxic debt refers to the high interest payments that you have in terms of credit card balances or pay advance loans. You should always being focusing on paying off this kind of debt first before upping your payments on things such as student loans or car payments. Tackle the worst debts first and then you will be in better shape to slowly pay off other debt such as your mortgage.

The fact is that most of us have more money than we think we do, we are just guilty of impulse buys and not having our priorities straight. By teaching yourself to spend in cash, avoid loans, pay yourself first, and attacking toxic debt, you can form all new habits and in many instances find out just how much extra cash you will eventually have lying around at the end of each month.

Be smart, stick to your guns, and that dream retirement or debt-free future could be closer than you think.

Matthew Woodley is the founder of CreditRepairExpert.org which provides users with free and unbiased information on how to repair and improve their credit score. Make sure to follow him on Twitter for the latest on credit repair and debt management.

For more info, please visit CreditRepairExpert.org

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Easy Hacks For A New Financial Habit

The Money Nerve

Easy Hacks For A New Financial Habit

Today is the best day for starting a new habit. Try these easy hacks for a new financial habit. You may have decided that it is time to do “things” differently, but the thought of making lots of significant changes at the same time can be overwhelming. Let’s break it down to make it easier to stick with a new mindset.

Keep It Simple

Let’s say you have decided to start an emergency fund and your long-term goal is to save three months of salary. When thinking about such a big hairy goal, it would be so easy to admit defeat before you ever started. So, take $50 and open that savings account. Tell all your friends that you are working on saving more money. When you talk about your goals, you plant the idea more firmly in your head.

Now automate a small amount of money, how about $25, to be directed into this new account with every paycheck. You will be surprised at how quickly your account will grow, and how little you miss that small amount you may have been spending on “junk.”

Starting with small steps makes a change of financial habits easier.
One glass of water a day. One extra vegetable. Three pushups. One sentence of writing a day. Two minutes of meditation. Voila! You now have a habit that lasts.

Keep Your Focus Positive

We all know a friend or colleague that seems to be “practically perfect!” They work out every day, eat healthy, volunteer at the local shelter and blog about their good deeds. It’s easy to compare yourself to others and begin to tear apart all the good work YOU are doing.

Keep your positive attitude; you are making one small step toward a more positive outcome.
Only you can make a personal change. When seeds of doubt begin to grow, you need to squash those negative voices that pop into your head; demanding you to quit, taunting you with past failures or demoralizing you with doubt and fear. Shove those thoughts into a box and mentally throw the box out! Embrace your new habit and nurture your small wins.

Keep It Real

Every week or two, hold yourself accountable and move forward a few steps. If you didn’t do as well as you wanted, jot that down and try again with a slightly different approach. Did you spend your “emergency fund” money on a movie and popcorn? Next week, add fifty percent more, you will still be ahead.

Did a great job of saving each paycheck for the past month? Tell yourself what an awesome job you are doing. Acknowledge your good work, reward yourself, and enjoy the success. Share your success with others, it may motivate them to start a new habit too. It often takes less time to create one simple habit than it does to make excuses for your inability to change.

For insight and motivational tips to create a healthy relationship with your money, AND for easy hacks to develop a new financial habit – sign up for the monthly Money Nerve newsletter.

You can do anything for one month!