Issue #2: Thriving financially while the economic vibes are off

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Surprising stats & facts

• 72% of households do not have a written financial plan (source: Charles Schwab)

• 100 million Americans have outstanding auto loans and collectively owe around $1.5 trillion—a record high (source: Consumer Financial Protection Bureau)

• 49 years old is the age in which the average millionaire hits the $1 million mark (source: Ramsey Solutions)

DEEP DISH 🍕
Thriving financially in uncertain times:
8 Essential steps to economic empowerment

Let the government and finance pundits decide whether we’re entering a recession or already in one. But what we can all agree on is that the economic vibes are off.

So in these uncertain times, having a solid plan for your money isn't just smart; it's essential. This isn't about complex formulas or Wall Street jargon. It's about making wise choices with the resources we have. Let’s make financial empowerment a priority with these eight essential steps.

1. Assess Your Financial Landscape

It's crucial to cast an honest and detailed look at your existing financial scenario. Question yourself about your spending habits - are they pushing your budget boundaries? Reflect on your savings - are they just a concept or an active part of your financial strategy? A clear-eyed look at your current situation is the first step towards empowerment.

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2. Craft Your Financial Blueprint

Budgeting isn't about restrictions; it's your roadmap to freedom. The 50/30/20 rule is a popular method. It suggests spending 50% of your income on needs, 30% on wants, and 20% on savings or debt repayment. However, this is not one-size-fits-all. Feel free to adjust the percentages to suit your lifestyle and financial goals.

3. Track and Tweak Your Spending 

Awareness is the key. By tracking expenses, you gain insight into your spending habits. This isn't just about cutting costs; it’s aligning spending with goals.

Tools: We searched for a curated list of the best budgeting apps to simplify this process. Check out the sweet links below.

4. Designate Funds Wisely 

Divide your money into accounts for specific purposes – bills, emergencies, or leisure. It simplifies finances and ensures intentionality with every dollar.

5. Establish Good Credit Habits 

Your credit score is a reflection of your financial health. Maintain it with timely payments and sensible credit use. A strong score opens doors to better financial opportunities.

Real talk: Poor credit can make it harder to get car and home loans. Even if you are offered a loan, chances are it will be at a higher interest rate. Those with lower credit scores also pay more for auto and homeowners insurance. Lastly, employers may run a credit check before offering you a job, especially if you're applying for a position that involves handling money.

6. Embrace the Future by Investing Today 

Investing is key to long-term wealth. Whether through retirement accounts or other vehicles, starting now can lead to significant rewards.

📚️ Book it: Refer three friends to Money Menu and we’ll share three of our favorite books on this topic.

In the meantime, compounding interest allows even small investments to grow significantly over long periods, as it accumulates on both the original amount and the accumulated interest. Translation: Let your money make money!

7. Master the Art of Saving 

Saving secures your future comfort. An emergency fund isn't just prudent; it's a necessary buffer. By regularly setting aside money, you build a safety net and can handle life's unexpected twists and turns, ensuring peace of mind and financial stability.

3 step strategy for an emergency fund:

1. Start by setting a clear target, typically six months' worth of living expenses, to cover unforeseen events.

2. Automate your savings by setting up a monthly transfer from your checking to a dedicated emergency savings account, ensuring consistent growth without needing to think about it.

3. Review and adjust your budget to cut unnecessary expenses, allowing you to increase the amount saved each month and reach your goal faster.

8. Practice the Power of Persistence 

Financial mastery is a marathon. Setbacks are normal, but persistence is crucial. Reflect on your journey, set long-term goals, and adapt as needed.

You got this: Every step forward, no matter how small, is progress. Embrace the challenges as opportunities to learn and grow, and trust that your consistent effort will lead to your rich life.

Use these eight steps as a foundation to build a robust and resilient financial plan that can weather any economic storm. Along the way, we’ll be here to help you stay informed and committed to your financial aspirations.

SWEET LINKS 🍰
Digital bites we think you’ll like

• Ballin’ on a budget — These 6 budgeting apps recently received the highest ratings. Choose your favorite and refer to numbers 2-4above.

• Make money moves — Get a visual understanding of the impact your initial investment, contribution frequency, and risk tolerance have on your wealth potential.

• Trillion-dollar daycare — Imagine if Brian could work with the Federal Reserve Board through these uncertain times…the economic vibes would be immaculate!

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📈 Two referrals = financial tracker and tutorial
📚️ Three referrals = three best-selling personal finance books

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