Money Freedom Fridays - Lies That Keep People in Debt

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Lies That Keep People in Debt

Debt - everyone seems to have it. It's just normal, right? We have to be in debt to make it, right?

Debt keeps our money bound up. It causes us to get into more debt to pay for our basic needs like food. It keeps us from being in control of where our money goes.

Here are a few Lies that keep us in debt that we don't have to believe anymore (ramseysolutions.com.).They are just that, lies. 

• Debt is normal (or even beneficial)
• There are good debts - and tax benefits (no, there really aren't)
• 1 in 4 Americans who have debt are in collections for at least one of their debts.
• Having a budget limits freedom
• Many don't even know how much debt they are in because they don't track it
• If you are watching where every dollar goes, you will understand how much you are throwing away on debt.
• Out of 80% of Americans currently using a budget, 88% say they keeping a budget helped them stay out of debt.
• Not using debt is a scary lifestyle change
• Debt seems comfortable. You have always had it. But it's just as easy to buy things without debt. If you don't have the money, you don't buy it.
• Millions of people are living without debt. You can do it.
• Getting out of debt isn't a priority
• Debt sneaks up on you. You may not realize just how much you have. You just keep making the monthly payments. 
• If you are only paying the minimum payments, it keeps getting bigger even if you don't get into any more debt. Interest accumulates and compounds.
• What could you be doing with those minimum payments or those car payments instead? What would your retirement fund look like if you invested in that instead of debt?

Make no mistake, creditors are making a lot of money on our debt. We are causing others to be wealthy when we pay them thousands of dollars in interest and fees as we remain poor.

"Debt is normal, choose to be weird."

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Freedom Friday - Millionaire

Millionaire 

Only 15% of millionaires had a career in which they held a senior leadership role like a vice president or CEO of a company.

According to Dave Ramsey, the top 5 careers of millionaires are:

• Engineer
• Accountant (CPA)
• Teacher
• Management
• Attorney

To become a millionaire, you've got to start investing wisely. If you are debt-free with an emergency fund in place of 3-6 months expenses, it's time to start investing 15% of your income for retirement. 

If you have a 401k plan, it's a great place to start. If not, you don't have to go it alone. Get in touch with an investment advisor who can walk with you and teach you about the options that are right for you. If you don't have anyone, I can refer you to some amazing advisors.

Where are you on your journey? Are you ready to start amping up your investments? 

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money & Marriage Mondays - Effects of Money Fights

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Effects of Money Fights

I recently saw this list of some negative effects on marriage when we fight over money. It was in an article by Rachel Cruze. Do any of these things resonate with you?

• A lack of shared dreams
• Financial infidelity (hidden purchases)
• Poor health 
• A lack of trust
• Divorce

One way we can stop fighting each other over marriage is to recognize that you each may have differences in how you approach money and to realize that neither of you is "wrong". Many couples have different money personalities. For example, often one is a saver and one is a spender. But that's a good thing! Now you can combine your differences and help each other with your strengths. 

But if you don't communicate your perspective on money, you will never know what your differences are. So come together and discuss your perspectives on money. Be sure to come with an open heart and open ears. Really listen to each other. 

Now that you understand each other better, the next step is to make a plan that incorporates both of your money perspectives. For instance, have a "slush" fund budget for the spender in your marriage where they can use a set amount of money for whatever they want, like going out to lunch or buying tools, with no questions asked. Then there is no argument because you already budgeted for the spending. 

Money fights can lead to a lot of negative effects, however, we can move in a positive direction to reduce and ultimately stop the money fights.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - It Takes Work

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It Takes Work

Getting healthy takes work: exercise, changing eating habits, etc. And it can be hard. Even when you are healthy, it takes work to stay healthy. Getting healthy is not a destination, it's a journey. It takes changing your lifestyle and the way you look at what you eat, everyday! 

It's the same with getting and staying financially healthy. It's a lifestyle change and often takes a change of mindset. We must intentionally work on not getting back into debt. We must intentionally not buy things that we don't need, especially when trying to get out of debt. We must intentionally save: have an emergency savings fund and savings for those things we know we are going to need in the future.

Don't miss your opportunity to stay healthy just because it looks like work. Taking the path of least resistance, the least amount of work, will keep you from becoming healthy or will end you back to where you used to be. It does get easier to maintain the health after you get there, but it is still work.

Let's put in the work.  What habits do you need to give up? What habits do you need to put in place?

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Back to School Spending

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Back to School Spending

I just came across this message from Rachel Cruze and it's perfect timing. Before my kids became young adults and almost fully independent, it was so tempting to spend on them (even now, to be honest). You want the best for them. You want better for them than what you had. And the reasons go on and on. Check out her article below.

We tend to spend more when it’s for our kids. (That’s not just me, right?) From the moment they’re born, we justify spending more because it’s for their safety, education or general well-being. After all, they’ll only be this little once! But here’s the truth: The best thing you can do for your kids’ future is set the whole family up for success. If you’re living paycheck to paycheck, burdened by debt, and spending more than you have just so your kids can have the trendiest shoes or enroll in the most prestigious sports, that’s not helping anyone. So, try not to get caught up in the back-to-school hype. Write down your list of needs, make a budget, and stick to it. It sounds simple, but it’s the small acts of intentionality that lead to a solid financial foundation and a legacy you can be proud of. Love, Rachel Cruze

Write it down. Make a budget. It really does make a big difference in how you spend your money when you plan it out and see it in front of you. And it's a lesson for your kids as well. They may not get it now, but they will remember when they are making their own way. 

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Long-Term Thinking

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Long-Term Thinking 

I love the statement above: "Almost all long-term thinking has short-term pain. Almost all short-term thinking has long-term pain and short-term relief."

Sometimes we make quick decisions about spending or we make quick financial commitments (debt). How many times did you go to the store or the car lot just to "look". Before you know it, you have signed papers for a new car loan or charged $500 to your credit card. You may have short-term relief or short-term joy, but now you may also have long-term pain of getting out of debt. You have traded your living expenses or other opportunities to spend your money (like giving) for a long-term debt payment without consulting your long-term plan.

But if we were to wait and think ahead and plan out the long-term, we would then have a plan to tell our money where to go and not allow ourselves to get caught up in more debt. We can see when we will actually need that car and put a plan in place to save for it. We can stay on track to get out of debt before purchasing those "wants" and obtaining those things which only give short-term relief or joy.

It really brings home that quote by Benjamin Franklin, “If you fail to plan, you are planning to fail!”

If you haven't already done it, put a monthly budget together. Then look forward and plan out your year. Then look forward again and see where you want to be financially in 5 years, 10 years, and even to retirement. It's just a plan. It could change, but having it written out will help you stay on track. Having it broken out into these chunks of time will make it more achievable. Then make sure you monitor and make adjustments as necessary. It might be painful at first to stick with the plan, but in the long-term, it will bring lasting financial relief.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money & Marriage Mondays - Money Baggage

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Money Baggage

Let's face it, money is not generally the first thing you think about with respect to compatibility when you meet your spouse. 

But... it cannot be avoided. Ultimately, money questions will have to be faced if you have any type of long-term relationship. You bring your money baggage and your spouse brings theirs. 

Money baggage comes in many forms. Some bags are heavier than others. Perception of money baggage differs too. What may seem "heavy" to you, may not be "heavy" to the one bringing it. 

The key is not to avoid it. Open up all the bags and unpack them, preferably before you get married. Be honest in your feelings. If you are not open and honest from the beginning, it will put a strain on the relationship later. Come to an agreement of what to do about past money baggage and how to handle money going forward, together. Get on the same page. Re-visit as necessary to make sure your plan to go forward is on track.

Although, it may be scary, unexpected, or maybe even easy, when you know what to expect going forward, then do the work needed to get rid of the baggage.  That way, money doesn't have to be the main focus because of pressure. It can be put to the side and just work through as you planned so you can concentrate on each other and the things that made you truly fall in love. 

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Emergency Fund Spending

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Emergency Fund Spending

You worked hard to save up for an emergency. Even though you know these funds are for emergencies, there are sitting there in savings and tempting you to spend them. 

Make sure you ask these 3 questions before spending your emergency funds: 

1) Is the thing you want to spend your money on UNEXPECTED? For instance, do you need to pay your rent or mortgage because you lost your income due to downsizing or health? Or did you just forget about a big bill that comes up annually? 

2) Is this something that is absolutely NECESSARY? Sometimes things seem "necessary" because it looks like a really good deal that you may never see again and you were thinking about getting it anyway. But at the end of the day, it is still just a want.

3) Is this URGENT? If you decide it is a need, is it something you have to have today or can you wait and save up to buy it later? If your water heater is making some pinging and knocking noises but it isn't broken, you can save up over the next few months for it so you won't have to dip into the emergency funds.

And if you decide it meets all 3 criteria above and you have to dip into the emergency funds, make sure you build that fund up again as soon as possible, you know, in case of another ergency.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Freedom Friday - Be Free

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Be Free

This weekend, we celebrate our freedom. We celebrate America's declaration of independence from things that kept us from being free to make our our decisions.

This weekend, I encourage you to make a declaration of independence from being in debt. "I am FREE to be independent of what others say I should have and do that causes me to be in debt. I am FREE to be independent from "but that's just the way life is" debt. I am FREE to make my own decisions on what is best for me and my family.:"

Do not accept debt as normal. Do not accept debt as necessary. See finances in a new light. See money as just a tool. See yourself directing your money instead of it directing you. Make the hard choices now so you can see FREEDOM from debt, not just in your imagination, but in actuality. 

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money & Marriage Monday - Why Talk About Money?

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Why Talk About Money?

I love this article from Dave Ramsey. And my favorite part is: "... [it] doesn't mean you'll never have hard conversations..." 

Money can be difficult to talk about and work through, but it is critical to a healthy marriage. Money problems don't go away and are the second leading cause of divorce.

"Getting on the same page now doesn’t mean you’ll never have hard conversations in the future—but it will help you avoid fighting about money because you’ll be going in the same direction. Talking about money helps you lay the groundwork for a healthy marriage that stands the test of time.

Remember, when you get married, you become a we. It's a big shift. And talking about money forces the two of you to discuss really important issues-like goals, dreams, how you want to retire, and what legacy you hope to leave. 

These conversations build a shared vision in your marriage-which makes you more financial secure and stronger in your relationship." 

Get the conversation started today.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

 

Money Freedom Friday - It's Time To Make a Change

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It's Time To Make a Change

Do you work hard? Are you tired of working and working and working and still feeling broke? You work too hard to be broke. It's time to make a change. As Dave Ramsey says:

"Don't borrow another dollar. Your future is too valuable to continue to give it away to monthly payments. Make a decision to turn things around. It's not going to be easy, but it's worth it. You CAN do it."

What do you need to change? Do you have a monthly budget? Do you know where ALL your money is going? Start tracking it. You might be surprised to see where it is going. Once you identified where all your money is going each week, you can see where you could cut back and begin paying down debt faster.

Most importantly, the best way to pay off debt is to stop entering into debt. It's very tempting. A new car with seemingly "easy payments". A home renovation project. After all, you "deserve it." The easiest debt to get into is credit card debt.  It's sneaky. "Oh, it's just a few dollars on the credit card." But it adds up. Stop using the credit card. 

It's TIME to make a change. 

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Post-Pandemic Spending

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Post-Pandemic Spending

This is real. We have been under so many restrictions and have had to sacrifice so many things that it feels like we need a reward, we deserve to do something for ourselves. But think carefully about what you decide to reward yourself and your family with. You don't want to blow your budget or your financial goals. Make a plan and see how spending on the things you want will impact your financial goals. Will there be a significant delay in reaching your goals? Is it worth it?  This way, whatever you decide, you will go in with eyes open and not out of emotion or impulse.

Per Dave Ramsey's website, here are some common areas we want to "splurge" on:

• Expensive meals
• Salon treatments
• Home repairs or remodels
• Traveling
• Cars
• Clothing
• Furniture

If you already gave in to these temptations, it's ok. Just re-map your goals and start fresh.  We fall but we just get back up again. 

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Save Money... Cook at Home

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Save Money... Cook at Home 

We can spend a lot of money going out. But, although it may be convenient, it can be way more expensive that cooking at home. For example, we once went to a restaurant and someone ordered a side salad to go with the pizza everyone was sharing. The salad came in a tiny bowl with some lettuce, a little bit of cucumber and a couple grape tomatoes. They charged $6.00. I make salad a lot and I know how much lettuce cucumber and tomato cost. I estimate it would be about 20 cents, if that, to make this particular salad at home. 

Here are some tips to make cooking at home a little easier and to reduce the temptation of going out to eat.

1) Stock your shelves with the staples of many meals such as flour, rice, beans, chicken stock, tomato paste, oil, spices, etc. Then you will have them on hand when you are preparing your meals at home.

2)  Make a  menu for meals you plan to make in the next week or so and list out the ingredients that you need that may not be on your staples list or might be perishables, like veggies. Stick to the list so you won't have to throw out unused items.

3) If something you use a lot is on a really big sale and is not perishable or you can freeze it, like hamburger meat, consider stocking up on it for future meals.

4) Make extra on your day off. Then you can have leftovers for dinner or lunch throughout the week.

These are just a few tips to help you reduce your money outgo so you can reach your money goals faster. What are some of your tips?

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Summer Savings

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Summer Savings

Now that there are fewer restrictions due to the pandemic, we are just itching to go where we haven't been able to go for quite some time. It's also almost summer and the weather is warm and inviting.

But, be careful. The normal summer spots have many opportunities to blow your budget. But you can still have fun without over-spending and staying on track with your budget.

Here are a couple savings tips:

• Skip the amusement parks and go to a National or State Park instead! Don't lose that extra family time you enjoyed while under restriction. As a bonus, you will get some fresh air and exercise. 
• Have a garage sale. You probably noticed several things in your home or garage that you don't use anymore. Sell that stuff and earn some extra cash to pay off debt.
• Going back to work in the office? Save hundreds monthly and pack your lunch.
• Put a pause on gym memberships and exercise in your home or outside. The nice thing about the prior restrictions, people got really creative and made free classes available on you tube. And it's always been free to run around the block or at the park. 

There are many other ideas on how to save money. What are some of your ideas?

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Secret Stash

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Secret Stash

Well, it's not really a secret. But you may want to pretend it is. It's your Emergency Fund. Stash that money away and don't even look at it as available money to spend.

What is an emergency fund and how much should I set a side? Start with the beginner amount. This is $1,000. If you have debt you are paying off, except your mortgage, get this beginner amount of $1,000 set aside before making additional debt payoff payments. This $1,000 is JUST for emergencies such as a water heater that goes out or an unexpected car repair or medical deductible. This is definitely not for the new pair of shoe,s that just went on sale at a price you "cannot" pass up but need some of this money or you can't buy it without borrowing, emergency.

If you are debt-free, except your mortgage, your emergency fund now must jump to the next level. Before paying down your mortgage with extra principle amounts, beef up that emergency fund. How much should you increase your emergency fund by? The best way to calculate how much you need is to first determine how much money you need to live on each month. Then multiple this amount by a minimum of 3 months, but 6 months is best. 

This beefed up emergency fund is for unexpected loss of income, such as a lay off from work or a medical issue that would prevent you from working. Then you have at least 3 months of emergency funds available until you can regain that income. 

And don't forget, if you use any of your emergency funds, you need to replenish them soon as possible.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Freedom Fridays - Easy Payment

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Easy Payment

Have you ever been at the store or online and you linger looking at something that might be a big ticket item? You don't need it but you wouldn't mind owning it. So you stop and inspect it a little closer. You picture it where you would use it. You are not seriously thinking about actually buying it, but you are definitely interested.

The next thing you know, there is a salesman right beside you telling you about an "easy payment plan" or a pop up on the screen telling you how easy it will be to finance and with super easy payments.

Don't fall for it! It's a trap to get you into debt. Debt will keep you for reaching your goals. Even non-financial goals. You want to get out of debt as soon as possible, and not take more on. 

Begin to change your habits from asking "how much per month" to "how much". Then asking yourself if you need it. If not, and you are still in debt, delay that purchase. Walk away. But if you really want it, save up for it to pay for it outright. Say "NO" to more debt.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money & Marriage Mondays - Cheap Date?

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Cheap Date?

When it comes to paying off debt faster, saving for an emergency fund, saving for a down payment on a house or saving for retirement, there are some changes in how we spend money that can help us to stay on track. 

One idea is to change where you go on your date nights with your spouse in order to pay less or nothing at all when you go out.  Here are some ideas for a "cheap date":

• Go out for breakfast instead of dinner. It's often a lot less than dinner.
• Watch the sunrise or the sunset. Bring some snacks and beverage to enjoy while taking in the view. (Make sure you hold hands or cuddle on a blanket.) 
• If you love books, browse at a bookstore. Maybe pick up a coffee while you are there.
• Volunteer together. Check your church, the city website, social media, or meet ups to find something you can serve together in. This will help others and likely bring you closer together.
• Take a hike (or a walk or a bike ride) together. Possibly bring a picnic and plan on stopping somewhere along the way. Make a day of it.
• In the summer, sometimes you can find a free outdoor movie screening. Bring your own popcorn!
• Cook dinner together instead of going out. You can save so much money and make sure you take time to kiss the "cook".

Changing money habits takes work and inspiration. Try some of these ideas and let us know some of your ideas.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Freedom Fridays - Payoff Student Loans Faster

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Payoff Student Loans Faster

Here is a great student loan calculator from Dave Ramsey's website and some great tips on how to use this calculator and to inspire you to get this debt paid off faster so you don't live with this debt for 20+ years.

https://www.ramseysolutions.com/debt/student-loan-payoff-calculator?fbclid=IwAR0pw2px87ktaB31s0RF4Xu3RIb9HAle3AxkL0j32Wm3FCjHWsSBM7bkmuw 

This calculator shows you how quickly you can pay off your student loans. By calculating the impact of extra payments, you can learn how to save money on the total amount of interest you'll pay over time.

Want to Pay Off Your Student Loans Early?

Use the Extra Payments functionality to find out how to shorten your loan term and save money on interest by paying extra toward your loan's principal each month.

Understanding Your Student Loan Payment

Your student loan payment is defined as your principal and interest payment. When you pay extra on your principal balance, you reduce the amount of your loan and save money on interest.

Making Additional Student Loan Payments

Get creative and find more ways to make additional payments on your student loans. Making extra payments on the principal balance will help you pay off your student loan debt faster and save on interest. Use our free budgeting tool, EveryDollar, to see how extra payments fit into your budget.

Calculate Different Scenarios

See how early you’ll pay off your student loans and how much interest you’ll save. Let's say you have $35,000 in student loan debt with monthly payments of $360 at 4.5% interest on a 10-year repayment plan. By making an additional $325 payment toward the principal every month, you'll save over $4,688 in interest and pay off your student loans 5.4 years sooner!

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - It's Time To Break Up

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It's Time To Break Up

Want more control over your money? It's time to break up with these 5 bad habits.

1. Spending without a Plan
2. Paying for convenience
3. Spending without keeping ctrack
4. Making impulse purchases
5. Spending to feel better

These bad habits will cause you to overspend on everything. Over time, this overspending can really add up. 

And what does that mean? You will have less money to pay off your debt, to build your emergency fund, to save for a house and for retirement and to give generously.

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.

Money Wellness Wednesday - Are the Kids Running the Show?

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Are the Kids Running the Show? 

In many ways, our kids do determine what we do. They have needs and they are not able to provide for themselves. However, do we cater to their every desire? Do we give them all the toys, video games, the latest technology? 

Maybe you didn't have much of anything growing up or didn't have the latest trends that your friends seemed to have and you don't want your kids to grow up like that.  Or possibly, you think giving them all these things equals love or will make up for time away from home at your job.

Whatever the reason, they do not have to be the driver of your money. In fact, there are important lessons to be learned by saying no or by saying not now or by setting goals for them to achieve to obtain what they want. There are even lessons learned from them saving their own money for those things.

Get the kid's involved in the budget. They don't have to know everything, but let them know generally where the money goes every month. Let them know that needs come first and everything else after. 

I heard of one couple that budgets a certain amount of money for going out to eat. And when it comes time to choose, they ask the kids: "Do you want to eat fast food 4 times this month or 1 time at a nice restaurant and 2 times at fast food?" That gives them choices. Make an envelope for your budgeted family outings with the budgeted cash in it. Let them see it or even count it. Then as it gets used, they will see where it's going. This is a great way to have them feel involved. 

Have a savings goal for the things they want the most and track the savings on paper or on a savings app. Then there is a visual for watching their savings grow.

You get the idea. The kids can have a say, but make sure the parent is the one running the money "show".

You can master your money... and I can help!  

Contact Michelle Serna by filling out the Contact Me form.