Weekend Challenge #05 (02/22/2020): A FINANCIAL REVIEW
HERE IS YOUR WEEKEND CHALLENGE: A FINANCIAL REVIEW
Listen to this weekend’s Weekend Challenge
The weekend is the perfect time to get do a FINANCIAL REVIEW.
The way I see it, as part of being a leader in your professional life, you must be a great leader in your personal life. The best way to be a great leader in your personal life is to keep your house in order. The less you can stress about your personal life, the less you stress with your professional life.
YES, they are a symbiotic. The two live and exist because of the other. Do NOT kid yourself and think otherwise. Simply break it down, if you cannot manage your own person finances, how are you expected to be a good steward at work?
While I am a complete and total advocate for keeping WORK at WORK and HOME at HOME. You are still one person and the events of one will impact how you act and react with the other. That is why you have to be aware and cognizant of both.
So, what does this have to do with finances?
Simple. You have to ensure that you know how much money you have, how much you need, where it is coming from and most importantly where it is going. Stress levels decrease when finances are in order. In just about anything and everything we do, when there is less ambiguity there is more confidence. Having more confidence means being less stressed. Being less stressed at home means being less stressed at work. All that confidence means a lot less anxiety. Doing what it takes to be less anxious is key to being an Authentic Leader.
I hope you can see how that works?
Don’t worry this WEEKEND CHALLENGE is relatively simple.
- Make a list of all your money holding accounts (Savings, Checking, Stocks, Mutual Funds, ETFs, etc.). If you only have a couple well then things just got a lot easier.
- Determine the amount of money you have in each account.
- Make a list of ALL outstanding debt (who you owe money to): Credit Cards, Loans, Mortgage, Car, Liens, etc. (again, if you have a couple of these debt items, CONGRATULATIONS things just got a lot easier).
- Determine and list ALL your sources of income (DO NOT INCLUDE ANY ITEM FROM #1)
- Here comes the cold hard truth: Determine how much money you have and how much you owe. This is the one thing most people refuse to see and admit. For most of us, this realization is going to sting. Let it sting.
- Now, here comes another difficult thing to do. Determine what you need to do to increase your income and decrease your debt and NOT paying on your debt is NOT the correct answer.
- Create a budget
- Pay yourself first (if you can, make $100 your monthly allowance)
- Save some $$$ (buy assets (saving it in the bank is not an asset (remember your money in the bank is an ASSET FOR THE BANK!))
- Buy Precious Metals (I.e., Gold, Silver, Platinum, Rhodium)
- Buy Financials such as Stocks, Funds, etc. (do your homework)
- Real Estate (Rental Property)
- Live off the budget
- Create a pay-off debt plan
- I recommend the SNOWBALL plan
- Pay on all your debt the minimum
- Select the one debt (DEBT#1) you owe the least and pay extra until all paid
- Once DEBT#1 is paid off, take the COMPLETE amount you were sending to DEBT#1 and ADD it to DEBT#2 and keeping doing that until it is also paid in full.
- Now take DEBT#1 and DEBT#2 amounts and apply them to DEBT#3 and repeat the process until you are completely debt free.
- DO NOT CREATE ANY NEW DEBT.
- If your only reason to create new debt is because you are buying CRAP to impress not the family, not the friends, but totally complete strangers then you are WRONG and nothing anyone, including me, can say or do will help you become a Great Leader.
- However, if you must CREATE new debt then make absolutely certain it is for the right reason (such as):
- Transportation (old one cost too much to fix or constantly breaking down)
- Housing (previous one was TOO expensive to live in)
- Appliances (only if the previous item no longer works, buy the bare minimum (a.k.a., Absolutely NO touchscreen refrigerator)
- Clothing (only if you shop at Thrift stores, 2nd Hand, Goodwill (lots of great stuff there)
- Food (STOP GOING OUT TO EAT! Buy and Cook Your Own Food)
- Entertainment. Going out is OUT OF THE QUESTION! Stay in and save a ton coin by subscribing to Netflix, Hulu, Disney+, Amazon Prime (this cost way far less than table service in the Velvet Room)
- STOP WASTING MONEY!
- LIVE LIKE A PAUPER until you are debt free, then you will be surprised how you will live like ROYALTY later.
- There is NO BAD TIME TO BEGIN on taking care of your finances. Well there is a bad time and that BAD TIME IS NEVER TAKING CARE OF YOUR FINANCES.
- I recommend the SNOWBALL plan
- Create a budget
Remember, just because the app on your fancy schmancy smartphone says you have money does NOT mean you have money to waste.
NOW, GET TO WORK!