Get Good with Money | Tiffany Aliche

Summary of: Get Good with Money: Ten Simple Steps to Becoming Financially Whole
By: Tiffany Aliche

Introduction

Welcome to a journey that will help you transform your financial life through the book summary of ‘Get Good with Money: Ten Simple Steps to Becoming Financially Whole’ by Tiffany Aliche. Discover the importance of a healthy money mindset, learn to create a solid budget, become a master saver, and tackle debts effectively. You’ll also learn to focus on increasing your income, investing, getting proper insurance, boosting your net worth, and building a strong money team. By the end of this summary, you’ll gain invaluable knowledge to help you lead a financially stable, worry-free, and abundant life, no matter your starting point.

Embrace Financial Wholeness

Achieving financial wholeness means having a healthy mindset around money, recognizing your financial influences, and making your money work for you. Cultivate gratitude and surround yourself with positivity to nurture your growth and pave the way toward financial abundance.

Financial wholeness is when each aspect of your financial life works harmoniously, granting you peace of mind and security no matter what challenges arise. Attaining this state is possible regardless of your current living situation, and the first step lies in examining your mindset about money.

Money often brings anxiety and shame, but through simple exercises, you can overcome these triggers and foster a healthy money mindset. Begin by recognizing your financial habits and understanding their origins, as well as how they affect your overall financial goals. Remember, your attitude toward money is a product of your upbringing and societal influences. By identifying and addressing these patterns, you can break free from any negative financial behaviors.

Taking charge of your financial life requires establishing a strong financial voice. Imagine a version of yourself who excels at handling money and focus on making your money work for you instead of the other way around. Adopting this perspective will lead you to make decisions that further your financial wellness.

Gratitude and joy play a significant role in achieving financial wholeness. While money can make life easier, it only contributes to happiness up to a certain point. Embrace the discomfort experienced as you change your financial habits, and recognize it as a testament to your growth. Develop a gratitude list, updating it consistently, to maintain a positive outlook on your financial journey.

Surrounding yourself with a supportive and encouraging network is crucial for success. Evaluate the influences in your life and replace those who drain your energy with individuals who uplift and motivate you. Keep in mind that you possess the power to pursue financial abundance, and your present circumstances are merely the beginning of this journey.

Master Your Budget, Unlock Dreams

A robust budget is the foundation for achieving your financial dreams, whether it’s a dream vacation or higher education. To start, list your income and expenses, categorize them, and reduce unnecessary spending. Establish separate checking and savings accounts, and automate transactions to eliminate human error, leading to a ‘say yes’ budget that supports your aspirations.

Embarking on your financial journey begins with crafting and managing a budget that embraces your dreams, such as exotic vacations or returning to school. The budgeting process calls for a proactive approach, wherein you monitor your monthly earnings and distinguish between fixed and variable expenditures. Aim for specificity throughout the process.

Begin by examining your finances. Enumerate all sources of income, both significant and trivial. Next, make a list of your expenditures, envisioning an ordinary day and identifying where and when you spend. Jot down every expense without judgment and compute your total monthly spendings.

Prepare yourself for an emotional moment as you calculate your initial monthly savings by subtraction—your income minus your spending. The figure may startle you, but remember, no judgment! It’s time to reassess your financial situation. Revisit your expenses, categorizing them as bills (B), utility bills (UB), or cash expenses (C). Cash expenditures account for non-contractual costs like groceries or salon visits. If you find yourself primarily spending on B and UB, you likely need to increase your income. However, if C expenses dominate, you have a spending problem.

To address this issue, cut back on your expenses, beginning with the easier-to-control cash expenses. Refrain from online shopping and cancel any unnecessary subscriptions. Simultaneously, devise a plan to boost your income, which we’ll discuss further later on.

Next, allocate your funds into distinct accounts. Establish two checking accounts—one for cash expenses and one for bills, in addition to two savings accounts for emergency funds and long-term objectives. Automation is crucial to successful budgeting. Set up automatic deposits and payments, thereby saving time, energy, and eliminating human error.

With these steps in place, you’ll create a budget that supports your goals and empowers you to say yes to your dreams.

Save Like a Squirrel

Squirrels are experts at saving and investing for the future, which humans can learn from to achieve financial wholeness. By shifting your habits from spending to saving, you create a financial cushion for emergencies and personal goals. By practicing mindful spending, asking yourself crucial questions before buying something, you can prioritize needs and loves over wants and likes. Regularly deposit money into dedicated emergency and personal savings accounts, ideally in high-interest online accounts to help curb impulse purchases and ensure security.

Mimicking the smart saving habits of squirrels, you can embark on a journey toward financial wholeness. Squirrels store acorns during abundant times and comfortably survive during scarcity, teaching you to save for tougher times rather than splurging when cash is plentiful. Start shifting your habits from saving to spend money to saving to make money, meaning both investing and building a financial cushion.

When planning savings, divide goals into two categories: emergency and personal. Aim to save enough money that covers at least three months’ worth of household expenses for emergencies. Allocate a portion of your monthly income for individual goals, including investment opportunities. To make room for saving, you can establish a noodle budget—identify the minimum amount needed for survival per month and see where to cut back. Adjustments can include cooking at home, managing hair care personally, and enjoying free entertainment sources.

Mindful spending is another useful approach. Before purchasing anything, ask four questions: Do I need it? Do I love it? Do I like it? Do I want it? Redirect spending from likes and wants toward needs and loves for better savings. Incorporate your emergency and personal savings goals as new recurring expenses, creating monthly transfers for each. Search for the best savings account that earns high interest, restricts instant withdrawals, and protects your funds. Online accounts are an ideal option, as they discourage impulsive spending while offering competitive interest rates compared to traditional banks.

Conquering Debt and Uplifting Credit

To break free from debt and enhance your financial well-being, change your mindset about it and choose a simple repayment strategy that works for you. Also, focus on boosting your credit score by understanding the factors influencing it and making timely payments.

Debt can feel intimidating, but it doesn’t have to define you. In fact, learning how to effectively manage and banish debt is a crucial aspect of achieving financial stability. To change your relationship with debt, adjust your mindset – instead of thinking, “I’m in debt,” consider it as, “I have a debt to pay.” This simple shift in perspective can make all the difference in empowering you to tackle your financial obligations.

To become debt-free and improve your credit score, start by gaining a thorough understanding of your debts. List them all – including the outstanding balances, interest rates, and due dates. Then choose a repayment strategy that suits you. Two popular approaches are the snowball method (paying off debts from smallest to largest) and the avalanche method (paying off debts with the highest interest rate first). Consider combining these methods, allowing you to experience both small and large successes. But always remember: becoming debt-free is just one milestone in your financial journey.

In addition to addressing your debt, it’s essential to work on improving your credit score. This computer-generated number estimates the likelihood that you will repay a debt. A good credit score can significantly impact your financial well-being, as it opens up the possibilities of favorable interest rates and savings on credit-dependent purchases, such as houses or cars. In the US, strive for a score of 740 or above.

If your credit score seems less than ideal, don’t fret. Instead, normalize financial missteps and focus on your improvement strategy. Familiarize yourself with the factors affecting your score, including payment history and credit utilization. Payment history, or your ability to consistently pay bills on time, is crucial. Analyze your past two years of payment records and address any discrepancies.

Next, assess your credit utilization – the percentage of your credit limit that you’re using. Aim to keep it below 30% to demonstrate responsible credit use, and be sure to clear the balance each month. By understanding these factors and implementing positive changes, you’ll be well on your way to boosting your credit score and achieving lasting financial stability.

Boost Your Income & Self-Worth

To enhance your financial well-being, assess your value, expand your skills, and embrace side hustles. Confidently negotiate your salary, consider multiple job offers, and create revenue streams outside your main job using your talents.

Picture yourself as the goose that laid golden eggs. You possess the ability to increase your income, which is a crucial aspect of achieving financial wholeness. Two strategies to boost your earning potential include upgrading your current earnings and cultivating a successful side hustle.

Begin by asking for a raise. To effectively negotiate, prepare a brag book that displays how your work positively impacts your organization. Enhance your skills to make an even stronger case for higher pay. If your employer is not willing to recognize your worth, proactively seek new job opportunities. Attend multiple interviews to hone your confidence and bargaining skills, and evaluate every job offer that comes your way. Don’t hesitate to apply for positions even if you aren’t the perfect candidate; a 50-percent match can still signal great potential.

When increasing income from your primary job isn’t feasible, strategize a side hustle that aligns with your skills and interests. Analyze your abilities and consult friends and family for advice on which of your talents can be monetized. Set a target for your side hustle to make it tangible, like aiming to earn an additional $500 per month. This goal translates to $125 a week, or just over $16 a day.

Take inspiration from Tiffany Aliche, also known as “The Budgetnista”. As a teacher, she supplemented her income through babysitting and tutoring, earning an extra $6,000 annually. Encouraged by the success of her informal financial coaching for friends, she turned this side job into a blossoming career.

With a strategic approach to enhance your income and embrace self-worth, you’re now better prepared to grow and preserve your wealth. Soon, you’ll be ready to delve into investing, a powerful tool for securing your financial future and providing for your future self.

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