We all have our financial stories and beliefs and these invoke various feelings and emotions.
Believe it or not, money is very strongly correlated with our mental health. Lord knows when my money ain’t right, my mind ain’t right. When the cash is flowing, my feelings are growing (in a positive direction)!
Tonight, I’ll be premiering an interview with Dr. Lakeisha Gatling, discussing money and mental health. You can catch it at 7pm CST in the Beyond the Busyness Spring into Self-Care Facebook Group.
Many of us have used this time for reflection, rediscovering ourselves and gaining clarity in various areas of our lives. As we begin to acclimate to our “new normal” ask yourself, are you happy with your current financial situation, sis? If you answered, yes, congratulations on making smart money moves. If you answered no or kind of, I encourage you to consider these six steps to financial independence.
Now more than ever, we actually have time to reflect and really be honest with ourselves. As we go through the six steps, take out your financial journal and document your answers to the reflection questions.
Step 1: Cash Flow
The first step in financial awareness is understanding your income and expenses. Be sure that you are using a free app such as Every Dollar or Mint to track every expense and all of your income so you have a realistic perspective on where you are financially. You cannot account for anything you do not track.
Reflection: Are you happy with your current income?
Step 2: Debt Management
What would you and your family be able to do if you were 100% debt free? If debt is something that is holding you back from reaching other goals, reach out to me on your options to relieve this burden. Holding on to debt for long periods of time, is not allowing your money to work for you due to the high interest rates and it can delay you from realizing your life long dreams and goals. I know this first hand as it took me over a decade to buy my first home due to debt.
Reflection: Do you have a plan in place to eliminate your debt, if applicable?
Step 3: Emergency Fund
What is the first thing we turn to if we don’t have an emergency fund and we have an emergency? Most of you probably mentioned Auntie Visa and Uncle Master Card. This then sets up back financially and we sink deeper into debt. By having an emergency fund, our minds can rest in peace a bit, if our car breaks down, we need to replace a refrigerator or take an emergency trip.
Reflection: Do you have at least three months of expenses saved in case of an emergency?
Step 4: Proper Protection
Many people do not care to discuss insurance because death is a sensitive topic. However, there are new types of insurance that have living benefits, such a long term care coverage and a cash savings plan that grows TAX FREE. Yes, tax free. When you withdraw the money it is tax and penalty free. Sounds like a win, win to me. Also, if you have anyone dependent on your income, you never want your family in a predicament where their lifestyle has to change so drastically because your income is no longer coming.
Reflection: Do you have the best type of life insurance to protect your income and assets?
Step 5: Build Wealth
How would you feel if you could ensure that your money was growing tax free and outpacing inflation? If you were like me, it would make me feel a little more at ease about being closer to meeting my financial needs when I’m no longer working for income. Wouldn’t it be great to have a work optional lifestyle?
Reflection: Have you decided on your retirement age? How much money do you need in retirement to maintain your lifestyle?
Step 6: Preserve Wealth
Many of you already have assets or are working towards them and you have a purpose and plan for them. The key is to ensure that everything you’ve worked so hard to secure is passed down to the people or charity of your choice. It is crucial to ensure that your legacy is properly protected.
Reflection: Do you have a will and trust in place to protect your legacy and understand why this is necessary?
If you are interested in anyone of these six areas, please schedule a free financial self-care discovery call with me by going to calendly.com/beyondthebusyness
I look forward to connecting with you and helping you build a strong financial future.