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Tag Archives: The Millionaire Next Door

Money: 10 things every woman should know

imageRecently a new college grad asked me if I had any advice on “getting rich”.

First thought, getting rich, seriously?  What does “rich” even mean anymore?

Second thought, getting rich has never been a goal of mine.  My goal has been to be financially secure enough that I can make life choices based on my values.

Then I thought, there are many things wise women have shared with me that changed my view of money and forever changed my life for the better.  So I will change the question and answer…

What should every woman know about money:

1. Money is a tool (it is not inherently good or bad).

2. Know yourself and make choices based on your values.

3. Every loan or credit card purchase has to be paid back, ensure you only borrow for investments in your future (useful degree, affordable house, etc. not  clothing-vacations-cars).

4. Live below your means (starting out this might even mean roommates, a bike instead of car, used furniture, learning to cook cheaply).

5. Let others pay the retail price (ebay, consignment, craigslist are your friends, even today my designer wardrobe is mostly ebay.  I will not pay $500 for my DVF dresses when I can buy them with no sign of wear on Ebay for $100).

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6. Save first.  From my first paycheck out of school I maxed my 401k contribution.  I also set up direct deposit for my savings (which is how I bought my first house at 22).  The trick is, if you never see the money, you can’t spend it.  My budget (house payment, car choice, entertainment budget) is based on the post-savings income.

7. Don’t waste money on taxes.  Max your401k, look into a Roth IRA, Flex Spending Account (FSA), donate items and keep the receipt.

8. Read the fine print. If something seems too good to be true, it probably is, always read the fine print before signing something with a financial component.

9. Don’t procrastinate.  Too often procrastination costs us money.  Read the fine print, know the deadlines and take action well ahead of time (to allow for errors and delays).  Keeping one calendar and to-do list helps.

10. Don’t rely on someone else to meet your financial goals.  You need to know your financial picture whether on your own, married, or with billionaire parents.   There is no knight in shining armor to rush in and save you financially.        Knowing what is happening with your finances and making decisions puts you in position to use money as tool and not be caught surprised down the road.

So none of my advice is flashy or ground-breaking.  It doesn’t have to be, money is in reality pretty simple and I love simple.

 

Money, a tool for dream manifestion.

 

manifestboardI grew up confused about money.  It was bad right?  Wait, it was good.  We need money.  Yet it has become one of the four-letter words. 

Toward the end of college I read a book that opened my eyes.  “The Millionaire Next Door” by Thomas J. Stanley.  It is a popular book, many people have read it.  If you are a math nerd such as myself you may even enjoy all of the statistics.  The main idea I walked away with is this, money is simply a tool.  If you do the hard work of clarifying what is truly important to you, money is simply a tool to help you get there. 

I integrated another tool in clarifying what matters to me in life, Feng Shui terms it a manifestation board.  Simply take that pile of old magazines and cataloges and pull out images that speak to you in terms of what you want your life to be composed of.  For me it is family, health, love, freedom to live where we want, in beautiful surroundings with rich life experiences.  I used the manifestation board to create a list of concrete goals.  My husband and I decided the big ones together.  Whenever I passed a department store sale or turned down an expensive dinner out with the girls, I could envision my manifestation board and knew what I was saving for meant more to me.  Having a picture in mind of what you are moving towards makes it easy to say no to the daily barrage of consumeritis.

Money Manifestation Board

  • start with a pile of magazines, catalogs
  • rip out any images that speak to your life dreams
  • paste them onto a poster board
  • write a list of your life dreams
  • write a list of concrete goals to fullfill those dreams
  • take a photo on your phone of the board and the list of goals to remind you whenever tempted to impulse spend
  • update the manifestation board as needed for it to remain inspiring
  • bonus clutter reduction: recycle the magazines and catalogs you have gone through

Check out the 4 Step Life Imagined Budget for the next step.

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