If you’ve checked out the participant progress bars, you’ve noticed that collectively, they have saved almost $8,000 and reduced debt by almost the same amount in three months. Wow! That’s incredible…but how did they do that?
If you’re like many American’s you’re getting by, but not getting to where you’d like to be financially– not saving or reducing debt because you don’t have a plan to get there.
As Sheila would say “I just want some breathing room.” Each of our participants felt this pull, this guilt, over not doing more, this “I’m not sure where to turn or what to do next” feeling of frustration. Now, each participant is moving in a solid direction as the numbers show!
As coaches we looked at their entire financial picture to begin to piece together strategies that they could implement to change for the better.
When you want to accomplish something…what steps do you take? What processes do you put into place to ensure that it gets done?
Do you write that something on a post-it note? Put a note in your planner or set a phone reminder? Do you ask someone else to remind you to do it?
So many of us say we want to do that “something” but life gets in the way. That’s why commitment is key.
It’s been said that when you are held accountable and plan…you can accomplish anything.
So our participants set forth to save more money and reduce debt. They’ve set goals, planned and created a budget for savings and spending, they’ve created automatic transfers to savings account and set-up automatic bill payments. They have put their plan and budget into action.
So then what? Sit back and relax…figure the plan will work itself?
Not a chance.
You have to continue to put the work in…or life will stay the same.
It takes time to change habits, to rethink how you spend your money. It’s a daily challenge to and for yourself. Your challenge is to think differently, to question every purchase and ask yourself this question…
“Is this getting me closer or farther away from my goal?”
A key component to the advice Coach’s give is to set a goal and make it measurable.
All of our Project Money participants have set goals, have or are researching them and have a timeline attached to them.
As coaches, we can give advice and make recommendations. But ultimately, the person who wants to accomplish the goal is in charge and in control. It’s their decision and their effort in the work that needs to be done to claim the prize.
One of the biggest challenges our participants have faced is figuring out where their money is going and how much money they are spending in different areas such as eating out, groceries, and household expenses.
When you know where your money is going you know where you can make adjustments to spend less and save more.
As coaches, the biggest thing we can do to help someone figure it all out is to provide them with the tools, knowledge and encouragement to start tracking. Not everyone will use the same tracking tool – it needs to fit with your lifestyle and personality. Perhaps someone is a visual person and likes to color code or someone is an expert at Excel worksheets and that tool resonates with them because it’s familiar.
For the last two months our participants have been working to reduce debt and increase their savings.
They have been tracking expenses, evaluating their choices and re-examining what their wants and needs truly are. To help them, we’ve worked with them to identify goals, prioritize them and set plans to achieve them in a certain amount of time. We’ve re-structured their debt and opened savings accounts.
Each participant has made sacrifices. They have been more mindful of impulse and convenience purchases and have cut them out – using the money for savings or debt reduction.
Why? Because they have to. They are tired of the cycle they are in, they want change, they embrace it. They want to be in a better financial position. They don’t want to put emergencies on credit, they want to feel like if they need money for something – it’s there. And they will have the power to choose to use that money, and not be controlled by the situation they find themselves in – or the limited financial choices they have.
Project Money is about re-evaluating priorities, determining what you want and making the changes to get it. It’s life changing and affirming. In January, our participants want to be better off than they were 7 months ago. And they will be.
Many of us have the opportunity to get “Free Money” in the form of a matching contribution to our 401Ks from the companies that we work for.
When Coach Jenna was reviewing Dan & Sheila’s retirement progress, she noticed that Dan was not maximizing his 401K contributions. Coach Jenna challenged Dan & Sheila to find an extra $100 to add to Dan’s current contributions and benefit from the matching “free money”.
Many of us have the opportunity to get “Free Money” in the form of a matching contribution to our 401Ks from the companies that we work for.
When Coach Jenna was reviewing Dan & Sheila’s retirement progress, she noticed that Dan was not maximizing his 401K contributions. Coach Jenna challenged Dan & Sheila to find an extra $100 to add to Dan’s current contributions and benefit from the matching “free money”.
We wanted to share with you a strategy that we are using with Larry & Juli in July. Since there are three paychecks this month, the Brown's have some choices to make. What to do with the extra cash. Our recommendation is to look at future goals and allocate some of that money to saving for those things. Part of the third paycheck will be set aside for school supplies and activity fees for the twins so they don’t have to scramble when the expensive come up this fall.
When you have extra cash, review your finances and decide what to do with it instead of just spending it. Determine how much should go towards saving for the future or reducing your debt. And, remember use a little of it to have some fun.
In her blog this week, Jennifer talks about spending and how it might be helpful if she had an allowance to know exactly how much she could spend. Coach Emily seconded that idea and they drew up a plan to give Jennifer the structure she craved.
“When Emily and I met to create my budget, I suggested that it would be helpful for me to have a daily allowance. We created a bill checking account and a daily allowance account. We figured exactly what I pay each month in bills – give or take a little – and that amount from my paycheck is deposited directly into my bill account. The remainder of my income after paying my bills and putting money into my savings and Roth IRA will go into my daily allowance account.”
Coach Emily and Jennifer figured out a daily allowance spending limit taking all the other financial considerations she has, paying down debt, increase savings and other financial goals into consideration.
Then, Coach Emily set up automatic transfers to make everything organized. Certain amounts of money were automatically moving to accounts when they needed to be, leaving Jennifer feeling like this new plan is realistic and something she can commit to.
In her blog this week, Penny writes about her second meeting with Coach Mary…and how Mary found $450 to pay down her credit card.
“Mary had taken the bills and my paystubs and worked out an amazing budget for me. Where did she find all of that money? It was unbelievable. My first job was to write out a check to my credit card for $450. I've never paid them that much before.”
Coach Mary was able to review Penny’s entire financial picture and start making recommendations on how to tackle debt and increase savings. She reviewed Penny’s income, bills and then her spending habits. She created a budget that would be a challenge for Penny. But, in the end, give Penny the financial future she is looking for. Her first recommendation was to take a large chunk of money from “want” spending and use it to pay down her credit card. This reduces her interest payments and speeds up how fast that credit card would be paid off.
Penny’s situation is not unique, we recommend talking with a Summit Financial Coach to help you figure out your best options for your situation.
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