Transcript
WEBVTT
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Happy New Year everyone.
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Thanks for joining us.
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In today's episode, we are going to talk about five things you can do to start the new year off right.
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We're going to talk about setting financial goals, reviewing your budget, understanding what happened in 2024, creating a debt payoff plan if that's something you need to do, automating your savings and taking action.
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So if you are ready to kick off 2025 right and you want to be in a better place at the end of 2025 than you were financially in 2024, then this episode is for you.
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Hey podcast yo Learn how to make them pockets grow Financial freedom's where we go.
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Smart investments money flow.
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Hey babe, what are we talking about today?
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Happy New Year.
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We're talking about how to kick off your new year with intentionality and with a plan to make 2025 the best it can be.
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Are you excited?
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How are you feeling?
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I feel good.
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Yeah, I do feel good.
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Yeah, I do feel good.
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The idea of this today's episode is to make sure that you're starting the year off on the right foot, because we all know that the new year is a time to start anew.
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The new year is a time to start anew.
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Wow, guys.
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I'm full of you know, profound thoughts.
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It's my new year thing.
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Wow.
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We're going to have more of that to come.
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More of that to come, please.
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No, all right, well, let's get into it.
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We want to make sure that we are valuing people's time in 2025 and really sharing great episodes where you can walk away feeling empowered, ready to take action and take steps to improve your financial goals.
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Aside from today's episode, we also have some amazing guests coming on the show, so make sure, if you have not yet hit that subscribe button, that you do that, because we are dropping episodes every Wednesday and you don't want to miss out.
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I mean everything from a student loan attorney to entrepreneurs, stay-at-home moms maximizing their budget.
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I mean, we've got so many guest recordings that we're so excited to share with you.
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You just don't want to miss them.
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So hit subscribe, stay tuned and make sure you're also subscribed to our newsletter, because we have revamped that.
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It's been working tirelessly around the clock to make sure that things that are hitting your inbox are of value and, again, takeaways, links, partnerships, all sorts of great content there for you as well.
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You said it all Okay.
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Well, let's get into today's episode, then.
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How to start the new year off, right?
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We're going to give you five action steps, so what's the first one, babe?
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First one is to set financial goals.
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I mean, everything that starts with intentionality is determining what it is you actually want to accomplish, and we've said the time and time again that, unfortunately, a lot of people don't actually think through what their specific goals are.
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They tend to have maybe more generic goals and they also don't talk about them out loud and, more specifically, they don't talk about them with their partner.
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If you have one, that's going to be a whole nother episode, because we are working on something really exciting for couples to have conversations with their partners about money.
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But everything you just said is great.
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However, I think there's a reflection component right that we need.
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Well, there is a reflection component.
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So, you know, you do obviously need to think about, you know, some of the things that have happened in the previous year, but the idea is that new year starting, so you want to sit down and say, hey, what do I want to accomplish in the new year coming up?
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And you need to be specific and you also need to have measurable goals.
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Like I said, most people tend to have maybe generic goals and they aren't necessarily going to be the ones that move the needle when it comes to how you want to live your life.
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So, having those conversations out loud and really talking through it because I know for me personally, and I would say just as well is that sometimes you may have an idea of a goal, and talking out loud and talking through it helps you have a more clearly defined goal at the end of the conversation.
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Yeah, I mean definitely talking about it with your partner, because having that alignment, especially if your finances are combined which if you're in the same household, even if your accounts aren't combined, there's an element of combining the finances, so you definitely want to be on the same household.
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Even if your accounts aren't combined, there's an element of combining the finances, so you definitely want to be on the same page.
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Are you trying to reduce debt, increase your savings, start investing?
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You know, plan for that house, that baby, whatever it might be?
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You know, are you on the same page, I think, to writing them down or saying them out loud?
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You know, I think I don't know the statistic right off the top of my head, but I do know that the research has shown that when you talk about your goals out loud, that you are more likely to achieve them.
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So, as you're going out for brunch and lunch and dinner and meeting up with friends, that's a great opportunity to let your friends know what you're working on, because it's a way for them to not only be aware but also to help support you.
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You know, if you're saying I want to pay off debt or I want to increase my savings, then they know, maybe I don't need to be asking you to go out.
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You know every other day to spend money.
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Maybe we can come up with ways to spend time together that's meaningful without spending additional money.
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So you want people to also know your goals so that they can help you achieve them.
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I mean that also leads into the whole.
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One of the purposes of this podcast is to have more open conversations about money, and that includes your goals, I mean.
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I feel as though that if you want to deepen the friendships and the relationships that you have in your life, talk about your goals.
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I mean you know having a shared, I mean you guys might even have shared goals when you start talking about it and you have new accountability partners.
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Yeah, absolutely so.
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Really setting those goals, getting clear on what it is that you're trying to accomplish and, you know, don't let this be an overwhelming part.
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Let it be something exciting.
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Maybe you won't be able to do everything this year, right, it's only 365 days.
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However, what are the most important things?
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If you don't have an emergency fund to start off the year, that's something we would definitely recommend you focus on.
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You know, putting aside X amount of dollars from every paycheck to make sure that you are getting that emergency fund up.
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If you, you know, didn't like I say keep the list concise.
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Yeah.
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I think too often people start to put too many things on their plate and then a few months in they feel overwhelmed and then they just let everything go.
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So maybe keep this list initially three to five items for the entire year.
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I mean the idea is to be focused and make sure you get them done and you know.
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If you are able to handle those five things this year, maybe you could add a few more to your list the following year.
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But the idea here is that you want to set goals that are actionable and that you can actually accomplish.
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Yeah, absolutely.
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Have you been listening to our podcast and wondering how am I really doing with my money?
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Am I doing the right things with my investments?
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Am I on track to reach my financial goals?
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What could I be doing better?
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If you answered yes to any of these questions, then it's time for you to reach out to Brandon to schedule your free yes, I said free 30-minute introduction conversation to see how his services could help make you the more confident moneymaker we know you could be.
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What are you waiting for?
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It's literally free and, at the very least, you'll walk away feeling more empowered and confident about your financial future.
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Link is in our show notes.
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Go schedule your call today.
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All right, let's move on to the really big thing.
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Which most of us need to consistently do, month over month, week over week, is review your budget.
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Yeah, so I always have to start out with a positive.
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What did you do in 2024?
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That was positive.
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You know what did you do right in that year when it comes to your budget.
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I mean, you could obviously, once you review some of the things that you're doing right, you want to continue doing those things correct.
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You continue doing those things.
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In the new year.
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Words Once again, are eluding me, but also, we do want to look at what do we need to improve upon?
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What are some of the things that you set out to do and maybe you didn't accomplish when it comes to your budget?
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And why?
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And why?
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Yes, the key is the why.
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The why.
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What hindered you from accomplishing those things, when it comes to your budget and then working on fixing that, moving forward.
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Now, obviously, there is some reflection here, and I don't want you to dwell on the negatives, because the reality is that it happened.
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You can't change it, but you can learn from it and apply what you've learned, moving forward so that it doesn't happen again.
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I think this is a good opportunity to to talk about how you want to budget, because there are people who are going to put a line item for everything.
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Right, they're going to put a line item for gas, for groceries, for iced coffee, all those things.
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And then there's people who are going to say I'm going to save, I'm going to invest, I'm going to save my money, pay my bills, and then anything else that's left is left, and so there's other ways to do it.
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You can track everything you know using software or an app, or if you are a paper to pen person and that helps you, then that's a great thing to do as well.
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But typically, what we hear is I don't know where my money goes, and we've felt that way as well.
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You look up at the end of the month and you're like where did all my money go?
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And if you're doing like a zero based budget, where you do what we do, which is you pay your bills, you save and invest, and then whatever's left is left, you know, maybe you aren't tracking and you're like, whoa, this was a really big Amazon month or whatever it might be.
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But decide how you want to actually track your budget and we've been honest on this podcast and we even talked about how, in one of our most recent money meetings, we sat down and it was the iced coffee.
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It was getting a little out of control and so we pushed back and and pulled back and said, all right, this is our budget for iced coffee, this is our budget for eating out.
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Here's the money that you know, quote unquote I get to spend when I go out with friends, and so it just puts boundaries and parameters on the things that we value, and then we pull back in other areas where we didn't find value.
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So think about how you want to budget, but, most importantly, how are you going to track it?
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Because if you can't see in black and white where your money is going, you don't have a budget and you don't know.
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I also want you to have a mind shift, because I think when most people hear the word budget, they think of restrictions.
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Right.
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And that's not what we're focused on.
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We're focused on using our money with intentionality as far as focusing on where our money is going and is it going towards enriching our lives, because I think often we get too caught up in just spending money on things that, in all honesty, if you just stopped and thought about it, don't necessarily need and it really isn't adding to your life.
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So don't think about budgeting as restriction.
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Think about it as really focusing on knowing where your money is going, so that you can create a plan for where you want to be in the future.
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Yeah, and I've actually one thing that I've seen online several times and I just started kind of implementing is I put things in my cart and I just leave them there for a day or two and you give it 48 hours and then you decide do I really need this, Do the kids really need this?
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What am I going to use it for?
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How long is this going to last?
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And you know, I'm not talking about the laundry detergent and the kids vitamins, but you know, that extra sweater or that cute pair of shoes that was on sale, you know, is this something that was already on your list or is it something that you're buying because it was on sale?
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You know, we just kind of came off of that black Friday, gray Thursday, cyber Monday, I mean like gray Thursday is that a?
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thing?
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Yes, it's a.
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Thing.
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I mean you know it's all the excuses to shop, and so why are we buying things?
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Are we buying things just because it's there and it's on sale, or is it because we actually wanted it?
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And I know, for us, one of the things that we're being very intentional about is our travel.
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Right, we spend most of our money on travel.
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We've got a big trip coming up for my 40th.
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We're already planning on going out of the country again for Christmas 2025.
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We don't have any plans yet for our summer beach trip.
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We need to do that, you know, but what we really value is travel together, travel with our children, and so that's where the bulk of our money goes.
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But again, intentionality.
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And that ties into you know, when you're reviewing your budget, that you are taking into account the goals that you want to accomplish for 2025 and incorporating that into your new budget.
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You know any major expenses you may be having.
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So, for example, like we were talking about some of the trips that we're taking, we're booting that into our budget for the year.
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So that's the idea of doing the review.
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Absolutely All right.
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Moving on from budgeting, most of us, in some capacity, need to also look at our debts.
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So you know for anybody new that's listening we are not debt free.
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That's not something we've ever claimed.
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It's also not something that is a goal of ours.
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We have a mortgage.
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We don't plan on paying it off.
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We have a car payment, and you know we're talking about those consumer debts.
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We're talking about, you know, getting our student loans down, things like that personal loans.
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More specifically, you know if you have credit card debt payoff plan for, but it's something that you need to look at.
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So it's a great time at the start of the year to look at all of your debts, write them out when are they, what are the amounts, and then what are the interest rates.
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And there's a couple of schools of thought about how to pay off debt.
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Some people will say write out all of your debts the amounts and then the interest rates and start with the highest interest rate first.
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But there's other people who want those small wins along the way.
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So maybe you pay off a credit card that has a smaller balance with a smaller interest rate, but you get that endorphin boost because you've paid it off much quicker and then you roll that payment that you were making onto the smaller card into the larger cards.
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Yeah, that's the difference between the two strategies known as, like the avalanche versus the snowball or the avalanche.
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You are focusing on the avalanche.
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There we go.
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That's what I said, but with avalanche you have, you're focusing on paying off the debt that has the highest interest rate first.
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So you're obviously paying the minimums on all the debts that you have, but then any excess money that you have after you reviewed your budget would be going towards your high interest the card or whatever debt has the highest interest.
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As compared to what?
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The snowball method is that?
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Any extra money that you have to put towards debt payments?
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Now you're going to put that towards your lowest balance instead of the one with the highest interest rate, and the idea behind that, like she said, is some people need to get those small wins in order to continue on it's a mental shift, yeah and there's no wrong or right way now mathematically paying the higher interest, putting the additional money towards that one would make more sense mathematically.
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But as you know, here we're not all about just the math, because everyone has an emotional attachment to their money.
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But the idea is that you discuss a payoff strategy and you implement it, whatever it may be.
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Right, and you know.
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What's really nice is if you're looking at your credit card statements, which you should be doing on a monthly basis, even if you're paying off your cards every month, even if you have things automated, you should still be looking at your statements just to make sure everything's correct, that all of the charges are actually your charges.
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But what's really nice is that most of the statements now will actually give you almost like a schedule of if it takes you this long.
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You know this is how much you're actually going to pay on this bill.
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It'll also tell you how much extra you're going to be spending, you know, in interest payments, and so that could be pretty motivating to look at, because obviously, the higher the interest rate, the longer it's going to take you to pay it off and the more you're going to pay an interest if you're only making those minimum payments.
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So that's something to take a look at.
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They've done the math for you and we want to get that consumer debt paid off as quickly as possible.
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Yeah, I always use a debt calculator with my clients I'm working with Because it shows them, with the current method that they're using and how much they're putting towards that debt, how long it will take for the pay it off, and then say we add an additional $50 a month to that payment and it shows them how much quicker they could take it off, pay it off, and a lot of people are really surprised at how much a little bit of money actually goes a long way when it comes to debt payments, as far as how quickly you know a debt that maybe was going to take you 24 months you had another $50 a month to the payment could end up reducing it by six or eight months and you pay it off sooner.
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We can also definitely link I can link the one on the show notes that I often use with clients because it's a really easy one to use.
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Perfect, we'll link that in the show notes.
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Next, we want to talk about going from your debt reduction to your savings, because we not only want to have that emergency fund, but we also want to, you know, save for our future selves, for retirement.
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What's your suggestion there?
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So, first and foremost, you need to look at how much are you currently saving?
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The idea is to get an eye.
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The idea is to figure out what your current savings rate is.
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How much are you saving on a monthly slash, annual basis?
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And that can include how much is going to a high yield savings account, how much you're putting towards your retirement accounts whatever it may be, but how much of your income are you saving?
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Now, once you know that amount, maybe you can look at hey, can I increase that amount?
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So, let's say, hypothetically, your savings rate is 10%, which is great.
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If you're already doing that, pat yourself on the back, but we always want to work towards improvement.
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So maybe you can do 12%, 13% and see what that looks like.
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Now, once you've determined what your savings rate is and what you want it to be for 2025, automate it, automate it.
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Automate it.
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Automate it.
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Make it much easier for yourself rather than having to do all this stuff manually, and it's also been shown statistically that those who automate their savings are much better savers than those who try to do it on a monthly basis manually.
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Well, because let's be serious If you're not automating it, the likelihood is you're going to pay your bills, you're going to spend your money and then you're going to be like oh, I need to save.
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And you're going to spend your money and then you're going to be like, Ooh, I need to save.
00:18:20.471 --> 00:18:21.434
And you're going to say, oh, I don't have enough.
00:18:21.454 --> 00:18:26.092
And the thing is, too is for those individuals that may be working jobs where your monthly income fluctuates and you're a little bit worried about, you know, choosing an amount to automate.
00:18:26.092 --> 00:18:29.865
Automate a lower amount so that it's automatically happening.
00:18:29.865 --> 00:18:40.136
You know, base it off of your lowest month, of what you brought in, choose that amount and automate that, and then you can always add that additional amount manually on top of that.
00:18:40.136 --> 00:18:42.653
The idea is that we want to make sure something is going in.
00:18:42.953 --> 00:18:58.848
Yeah, and one nice thing that you could also look into, especially if you are working you know, a corporate nine to five type job a lot of times your payroll will allow you to add additional bank accounts so you have your direct deposit into your checking.
00:18:58.848 --> 00:19:09.048
But then you could also in some cases you'll have to do your research, but in some cases you can also automate that a portion of your paycheck goes directly into savings.
00:19:09.048 --> 00:19:12.674
I know for me, if I don't see it, I don't miss it.
00:19:12.674 --> 00:19:25.518
So even if it's $25, $50, $100, getting taken out immediately from that paycheck, just like your health insurance and your 401k and your taxes and all the things, if you don't see it, you don't miss it.
00:19:25.518 --> 00:19:34.114
So get that out of there as quickly as possible and, you know, flow it into one of your other accounts A high yield savings account would be great by the way yes.
00:19:39.724 --> 00:19:40.967
If you have not opened up your high yield savings account.
00:19:40.987 --> 00:19:41.488
please go ahead and do it.
00:19:41.488 --> 00:19:42.150
It literally takes a few minutes.
00:19:42.150 --> 00:19:42.470
That is it, yes.
00:19:42.490 --> 00:19:51.894
We've made over a thousand dollars last year off of one of our savings accounts, and that is, I mean, the definition of free money.
00:19:52.576 --> 00:19:56.424
And the thing is too is in America people have a hard time saving.
00:19:56.424 --> 00:20:01.406
In comparison to other first world countries we are, you know, kind of statistically the worst at saving.
00:20:01.406 --> 00:20:09.332
So it is a habit that you have to work on, and once you've established that good habit of savings, everything else is so much easier.
00:20:09.332 --> 00:20:17.836
Whenever I meet with a new potential client and I can see they already have that habit of savings, I'm like thank you, lord, because this person is going to be so much easier to work with.
00:20:18.538 --> 00:20:21.090
Yeah, Because it really is like a muscle that you have to train.
00:20:21.090 --> 00:20:33.652
You know, to hey, every month or every paycheck, or however many times you get paid, X amount of dollars goes here, you know and also stress that any amount saved is better than nothing.
00:20:34.073 --> 00:20:34.914
So, like you don't.
00:20:34.914 --> 00:20:36.786
If you can't save a hundred dollars, that's fine.
00:20:36.786 --> 00:20:40.814
Save 75, save 50, save 25, save five.
00:20:40.814 --> 00:20:43.358
I would rather see you saving five than zero.
00:20:43.358 --> 00:20:46.953
So don't get caught up on the amount being a large number.
00:20:46.953 --> 00:20:48.096
Just save something.
00:20:48.605 --> 00:20:49.469
Yeah, even.
00:20:49.469 --> 00:21:01.315
I mean and that goes for investing as well right, build the muscle, build the habit of investing $10 every month, you know, if you don't have 500, if you don't have 1000, if you don't have 5000, that's okay.
00:21:01.315 --> 00:21:07.115
But because of compound interest, the time is the most important part, not the amount.
00:21:07.115 --> 00:21:15.478
So, if you're starting with $5, and you're, you know, listening to this and you're in your late teens, early 20s, that's great, you know.
00:21:15.478 --> 00:21:22.605
Start building that muscle and then, as your salary increases early 20s, that's great, you know start building that muscle and then, as your salary increases, your savings rate can increase, and then your investments will continue to go up.
00:21:22.605 --> 00:21:29.131
Because I know, if I was investing the way I do now in my early 20s, you know I started teaching when I was 22.
00:21:29.131 --> 00:21:33.556
And, yeah, I had the 403B, but I wasn't doing anything with it.
00:21:33.556 --> 00:21:35.874
I didn't, you know, have the knowledge that I have now.
00:21:35.874 --> 00:21:37.949
And, man, am I kicking myself?
00:21:37.949 --> 00:21:43.759
Yeah, all right, what is the last thing you want people to do?
00:21:44.766 --> 00:21:56.134
schedule a meeting with me or or some other financial advisor I'll settle for that, but I think you should reach out to me first, obviously yeah, yeah, oh go ahead, no go ahead.
00:21:56.776 --> 00:22:03.553
Well, I was gonna say I think what we've talked about consistently throughout 2024 is people are well intentioned, right?
00:22:03.553 --> 00:22:09.613
We know, if you're listening to this podcast, you are trying to improve something about your finances.
00:22:09.613 --> 00:22:17.288
You're trying to learn something new, gain a new perspective, do something better, different, faster, more efficient, whatever it is.
00:22:17.288 --> 00:22:21.586
You're not just listening to us because you like our voices, you're trying to get something out of it.
00:22:21.586 --> 00:22:29.233
And so, with that intentionality, that's great, but that's only one portion, right, you have to take action.
