Financial savviness
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Financial savviness
A few different ways to approach your finances.
People have the uncanny tendency to over-complicate things. I always thought that managing one’s finances was one of these things. People are scared to talk about it and so we continue to not only breed but encourage incessant consumerism and bad decisions.
Dave Ramsey does a great job of getting people to understand the fundamentals: create a budget (be intentional), don’t spend out of your means, and prepare for potential fallout. But if you’re anything like many people, you might have bought Total Money Makeover™ and didn’t take the time to read it.
Even recently in Florida, it was announced that they’re requiring financial literacy classes before graduating high school. I think this is a step in the right direction, but I don’t have any faith in the execution of it. If people are more broadly going to get better with their finances, then we need to stop complicating it.
I can truly only imagine what that curriculum will look like.
A few ways to think about money:
Don’t spend out of your means. If it’s optional and you don’t have enough for ~2-3x it, don’t buy it. However, do enjoy life.
Don’t listen to the Latte haters, coffee freaking rocks and a coffeeshop is my most productive space. I also enjoy a night out at the bar with friends from time to time. I generally don’t say no to a concert I want to see or an opportunity to see family. Build a life that you enjoy, responsibly.
For some time, I was making $37K/yr, going to college, paying rent for two people, and over-indexing on partying. I had to borrow money and was regularly flipping belongings on craigslist. I mostly ate the all too regular Little Caesars. This is no way to live life. Understand that building a great life involves a reasonable amount of sacrifice.
Find ways to increase your income. If you’re spending a majority of your time trying to save a few bucks as opposed to making a few, you’re wrong.
If you’re a freelancer/1099, raise your prices. If you can’t justify raising your prices yet, improve your quality and then raise your prices.
If you’re an employee, figure out how you can make more money. If you’re capped at your current job, find a different job. If you can’t get a different job, focus on up-leveling your skills and then get a different job.
Lastly, get creative. Find ways to make a buck or two in the open market. I picked up freelance project management while I was working at my last job. I freelanced computer repair for some time in college.
If you don’t have the discipline to check your bank/card statements regularly, install an app that will. Turn alerts on.
You should be intimately familiar with what’s coming and going. Increased sensitivity will give you the necessary pause on wasteful spending and more confidence in your current state.
Not only that, you’ll no longer be the person that says “I paid for HBO Max for four more months than I had anticipated!”
Once you have these set, and only then, start getting a little creative. Play around in the stock market, buy crypto, and look for investment opportunities.
But until you make enough and have saved enough, this is a waste of time. Devote all of your energy to building a solid foundation.
This is controversial, but I feel the same way about messing with a 401K/IRA. For some time, those contributions were better serving me by eating well, investing in self-education, getting promoted, and enjoying my life. This isn’t the case anymore but it was for some time.
That’s really it. There are a lot of nuances in-between all of that. Stuff you can spend hours and hours reading about on Google. Or you can look to monitor your spending, look to make more money, and only then, get a little creative.
The rest is noise until then.
Cullin
PS – Just returned back to GR from Mexico. What a time. I have so many thoughts but I will say this: the work ethic of nearly anyone in Mexico is unparalleled to the US.
Some photos:
