How to Lower Your Credit Card Payments and Free Up Cash Fast | 544

0:00I want my kids to be set in a better place than me. What does that mean? We talk about money because they have moms. Our kids have moms that are financial coaches. It's inevitable, right? We know that they're going to be very equipped by the time that they grow up, by the time they're in college, they get married, they have kids. We want them to be financially savvy. And like Shana said, financially illiterate. This is what you should want for your kids. Yeah. And I always push back because a lot of people will tell me how busy their kids are. And I understand that your kid is busy. They have to learn to manage their time and stuff costs money.

0:33Like it doesn't matter how busy you are. I don't know. Are you, once you're an adult, is somebody going to pay your bills so that you can continue to do all your favorite hobbies? No, that's probably not going to happen. So we have to learn now. And the cool thing I think, Vanessa, is there's so many opportunities, more entrepreneurial versions. Like Vanessa's son is able to mow grass for some people during the summers when he's less busy on purpose or whatever else he does. That way he can stock up money. And when he's in the middle of every single sport all year round, he doesn't have to necessarily worry about it as much.

1:04Obviously, my son edits the podcast, so he can make some money that way. He does tutoring on his schedule whenever he has time. Babysitting, dog sitting, all that kind of stuff, stuff that is not necessarily like every day, every weekend, like stuff that they can here and there build up money. You can, like Vanessa said, teach them to have a bills account, teach them to have spending, teach them to save some of it, teach them to give, whatever. Doing that opens those conversations on purpose for you to have with them so that you can – You know, it's not like you're even coming from, I know everything.

1:31It's just, let's talk about this. How would this work? What would I do? All of that kind of stuff. And it gives you a good basis, a foundation to start having this conversation. Today, we're bringing you real life stories and lessons from our private coaching sessions. If our clients are dealing with it, chances are you are too. So we're breaking it down to help you avoid the same mistakes, feel less alone, and walk away with some quick wins for your budget. Do you make good money but have nothing to show for it? Are you tired of living paycheck to paycheck? Do you have big dreams for your financial future?

1:58Do you want to get debt-free, but you don't want to live on beans and rice? Or you don't want to give up those pumpkin spice lattes? Hey, it's okay if you don't already know how to budget, or if you're using credit cards to get through the month. Hey, it's okay if you want to seem like you have your finances all together, or you're not on the same page with your spouse when it comes to finances. We know what you're doing probably isn't working, but guess what? You're in the right place. We're Shana and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey.

2:28We've been in business since 2019, helping hundreds of amazing people like you create budgets, get out of debt, stop living paycheck to paycheck, and know exactly what to do with their money. In this podcast, we'll share with you everything we know plus everything we're working on with our clients so that you have the best chance at reaching your financial goals. We want to help you take the guesswork out of your budget, improve your marriages, and even bring your kids in on the conversation. We can help you no matter where you're at, whether you're the single mom who's never had$500 in her savings account, or the millionaire who's paid off four real estate workers.

3:00And we're not going to shy away from the tough love. We'll tell you what you need to hear and encourage you at the same time. This is the Financial Coaching for Women podcast. I have a sweet single mom. I love her. She's a teacher. I believe she lives in California. And she also has some rental properties. She calls it a casita. She has a little house in the back where she gets some income, and then she also has a full rental property. I think it's long term right now and listen she came into coaching and she knew that she needed to change some stuff like she just knew things needed to change but she wasn't sure how to change them because she'd been looking at her numbers by herself for so long and sometimes you do that you get tunnel vision and you're not really sure something needs to change but you don't know what can change and how things can be different and sometimes getting a fresh set of eyes on it shana just helps it allows for that third person coming in giving suggestions we're not emotionally attached to your money.

3:52And so it just makes a big difference. I was looking at her monthly minimum debt payments and she, they were$1 ,517 a month. So$1 ,500 a month, she was paying in monthly minimum debt payments. And that was just credit cards and one small utility debt. They were, it's not, they won't, that's not mortgages. That's not anything that was literally credit card debt. And I tried when her first month of coaching editors and have conversations, we have our DIY debt relief workbook. And so I went through that and gave her the script and showed her how to do everything. But she didn't do it. And I don't know if it was just time or she just didn't want to make the phone calls.

4:29And I believe I got some of that from her, like that feeling I could tell, like she just didn't want to make those phone calls. Yeah, I don't blame her. I know. And I think I actually remember her saying something like, this is embarrassing. Just really, she just shamed herself for that. And I thought, listen, you're in a situation where you need some help. And the worst that they say is no and nothing changes. The best that they say is yes, and everything changes, right? So anyways, January happened. She didn't make the phone calls. February happened. She was doing some traveling. It didn't happen.

5:00Finally happened in month three earlier this month. And she was able to lower her debt payments from$1 ,500 a month to right under$1 ,100 a month. So$1 ,091 saving her$426 a month in her budget. Guys, that is not small. That is huge. And that was such a big win for her because guys, she needed that wiggle room in her budget. Yeah, and we've seen that over and over. So I'm gonna have a lesson coming up in the future about ripping the Band-Aid. But that is actually about setting up the automatic transfers because people don't like to do that. But this is the ripping the Band-Aid. We have seen so many times.

5:37There are like sometimes random companies that are just stubborn and they won't help you. So many times though, they already have a plan. They already know that you're – they already know that if she calls, this is what we're going to offer her. And it may be a reduced interest rate. It may be a lower payment. And a lot of times it may be payoff. Like they have something for you. You just have to call. And yeah, it's not the most fun conversation. But what is fun? Saving$426 a month. That sounds like a good time for me. is my hour on the phone max probably. Is it worth that? Do it while you're doing something else.

6:10Am I worth$426 an hour? I think so, girl. Yeah, it's gone. And that's like months, right? That's $426 a month for years because this wasn't just, oh, we'll put it in place for six months or what. No, this was permanent changes, like 100 % permanent changes to her credit card payments. I think three of them were down to 0 % interest from 29%. These were huge wins for her, saving her thousands and thousands of dollars over years of payments. I just want to say if you're teeter-tottering on whether or not these phone calls matter, they do matter. They are worth it. Shana said you are worth it. Your money is worth it.

6:44Take the time to sit down and have a conversation with your creditors because they could say yes and it could make all the difference. All right. I have a really small point that I want to make, which is every four weeks is not monthly. Say it, girl. Say it, girl. and that's annoying you know we were talking about vanessa we were talking about today how water and trash bills are there to sabotage you like they come up with this i'm gonna bill quarterly stupid idea like why just build me monthly stupid it's confusing yeah how does that help you so the pet food thing like the pet food i feel like is we're gonna we want in on this game we want in on this confusion so they're like every four weeks or every five weeks or whatever or i have some clients that get every four weeks to get this shipment and a different kind of shipment every six weeks.

7:28I'm like, oh my God. Okay. Anyway, the point is when you're trying to budget for that, you have to understand that four weeks does not mean monthly. You need to take that number. First of all, you take 52 divided by four, right? Because every four weeks is how often it's going to end up being 13, right? Like you're going to end up making 13 payments a month instead of 12. And you're probably putting it in your budget or thinking in your mind, basically that's once a month. No, it's actually 13 times a year. So it's more than once a month. Not that big a change, but we just want to make sure we're budgeting correctly.

7:59So this fun friend has a lot of animals. Okay. So it's really expensive. And, and so we, she has her whole separate pet fund and we are setting aside this money monthly and her pet bill, her pet food bill is actually coming out of her pet account because it's so much. But what the point is, if you have an expenses every four weeks, you need to do the math, and then you need to be saving the right amount. So let's say the four-week example, right? You're going to divide 52 by four, okay? Let's say it's$400. Then you're going to multiply four times 400. Then you're going to divide that number by 12 because you want a monthly payment, which it's actually 13 payments, not 12, which is, again, in this particular instance, isn't that big of a difference, but it is enough of a difference to do the math.

8:43And then that's the amount that you set aside. It's not that, like I said, it's not that big a deal, but we just want to understand when it comes to your paychecks, when it comes to your bills, all of these things, if they're doing it every four weeks, your nails, your hair appointments, you need to understand that those are not monthly amounts. We're going to turn it into a monthly amount so that we can make your budget very predictable. Yeah, I think that's important too, because a lot of people will try to do the week thing and it's, or you can just do the math that Shana just did one time and then make, put it in your budget, put it in your savings buckets, however you're to do that, then that's on a monthly basis.

9:16And that's the number that you do. It's very easy. But to try to figure out how many weeks is this and how many weeks is that every single month. And then now your budget isn't consistent, but there's a way to make it consistent. It's just like when people say, I can't do a budget. I can't budget because I have inconsistent income. Like, well, actually you can make it consistent. Let me show you how. So there's a way to do it. We just have to back up, get out of the weeds and have a bird's eye view and not be, not have this victim mentality and say, no, I can't. I am in charge. I can do something about this.

9:42I can make a difference here. This is how I'm going to change it. So my next client came to us as a simplified budget system user for months. She's had it. She's loved it. She's been using it. Hold on. I'm going to take this time to ask our clients, ask our audience, do you think we should name it the Bougie on a budget system? Should it be the automatic budget system or should it stay the simplified budget system? Okay. I just want you to know, email us at hellobudgetbesties.com. I just want to know. Email us. Or DM us. Put it in a Facebook group. Tell us. Yes, we would love that. We were having – we're just trying to figure out how many more domains to buy, guys.

10:17Okay, that's where we're at in our life. For fun. Yes, for funsies. Okay. So she is – she's wonderful and she's really watched like all of our videos. She watched all the walkthrough videos inside the course, watched our filled out example, and wanted to make sure she was doing the budget the exact way that we teach it, which was great. The only thing was she was loving the idea of savings buckets, which everybody does. We hear it all the time. Love this idea of saving for unexpected expenses. She had a ton of them. Her and her husband are both teachers. They make great money. But she also has a very bougie budget, as she should.

10:51Why not? She can afford it, okay? But she had some debt on, I think, two cards still. And she really was trying to pay them off, but she was trying to also fund her savings buckets. So I told her, what if we just pay for in the moment things? So it was two months of, okay, what do you have coming up right now? What do we need to pay for in the month of January, in the month of February? We'll put those specific things in the budget, take out all your savings buckets just for two short months, and then we'll go back to funding them and you will have all of your debt paid off. She didn't believe me that it could be a thing because she just couldn't see the bigger picture.

11:26Again, that's why having somebody else come in and look at your budget, not emotionally attached to it, they can make better decisions. and she didn't have any big things coming up to where she needed to save in her savings buckets for them, right? So we did that and in two short months, she paid off all of her credit card debt. Everything was done. The balance was zero. And then so starting month three, we were able to put all of her savings buckets back in. And when we did that, we realized, she realized I'm$300 short. She said, my bougie was outliving my income. And so it was already really great, But she said, no, there's$300 in things that I know that I can knock down.

12:04She was budgeting like$1 ,000 clothing budget for her husband every year. And then she's, I know he's not going to use that. So there were some things in her savings buckets that were more dreamy versus reality. And so I told her, come to the next session. Think about, look at your savings bucket planner. Come to the next session. Let's talk about it and see where we can wiggle around$300. But now she can really focus on her savings buckets and her full budget, knowing she has no debt. yeah what i was gonna say is you know her their income is only going to go up their income is going to continue to go up and as you get raises as you do whatever maybe you can add some of that stuff that you were dreaming about but then what my mind went through vanessa is and i'm not looking forward to this but also when your kids move oh yeah they're i think she has two high schoolers so she's can you imagine what your budget is what you might be able to do with your budget at that point it's not like a forever thing is really what i'm trying to say you will make more money you could and then also your lifestyle will change.

12:57I remember when I didn't spend thousands of dollars on my kids every month. I remember that. That's a while ago. It's a while ago. But it will happen. It will go back to being that at some point and then I can take more vacations, I guess. I don't know. We'll see what I think I'm going to do with it. I don't know. I don't know. I can't even imagine. Maybe travel to go see them. Let's be honest. That's what's going to be. But anyway, so just it's not forever. Sometimes if you have to do that. I always think that people forget that their income is for the most part only going to go up. So that's exciting.

13:26Yeah. We like to say you're making the least amount you're ever going to make because you always want to increase your income over time, right? You always want to go, not follow the money. That's not what we're talking about. We're talking about knowing your worth, knowing if you're in a career where you get raises and you're naturally, your income is going to go up. You have a business, you're naturally going to increase income in your business because every year after year, how to be a better business owner. Yep. It's time to enter your coaching era because making good money should feel. like making good money.

13:54Yeah. Imagine six months of private coaching where we'll tell you exactly what to do. No guesswork, no confusion, and absolutely no judgment. It's a done for you system that actually works. You don't know what you don't know, and that's not your fault. And that's why we're here. Financial coaching with us looks like two coaching sessions a month, personalized recaps, and after hour support, you can text and email. So you're never stuck wondering what to do next. Together, we're going to build your budget, set up your system, and tackle any challenges that come up along the way, which, by the way, they always do.

14:28If what you're doing isn't working and you're tired of trying to figure it out on your own, sign up for financial coaching at budgetbesties.com forward slash coaching before all of our spots fill up, and we will help you go further faster. Six months from now, you'll wish you started today. Okay, this client has a business. Guys, a lot of clients have businesses. Yes, if you feel like, oh budgeting is hard add a business like just double the hard and so that's why a lot of our clients happen to be business owners but this has nothing to do with our having a business this has to do with your kids and a comment that i was the like witch the wicked witch or something of the west i don't know what i think that's a first shana yeah i was like all right that's fine whatever you need me to be i don't know why it's my fault but anyway so here's the deal this client had a college kid living with her.

15:15And I was telling Vanessa, we believe that kids should pay some of their share. Whatever version of that looks like for you guys, really the most important reason is so that they have some skin in the game, that they start to learn how to pay bills, how to be financially responsible, and they learn some financial literacy. The version of that is different for everybody. In this client's case, they needed the money. It was like I said earlier, their mortgage is one full paycheck. That's hard. That makes you have to live the rest of your life on the other paycheck. And there's a lot more life to live besides just your mortgage.

15:49So they needed a contribution from their college age son who was living with them. So I told them to do the math and decide on a number that they felt was fair. And at that point, they did they I think they took all of their like regular house bills divided them by five or something and came up with a number for him to contribute. Okay, so now he's moving out. So he's been contributing that sometimes. So it's fine. Oh, okay. Not consistently. Not consistently. Not being held responsible. Because he, quote unquote, doesn't have time to earn money. And I was like, because he's a collegiate athlete.

16:20And I understand they're busy. But something has to give. Like, life is still life. You still have to live your actual life and pay your bills. So whatever. That's not really my point. Now he's moving out. So he's moving out of his parents' house. And he's not going to owe them rent anymore. But I said, that's fine. But you're also paying his phone bill. You're paying his health insurance. and you're paying his car insurance. And he's an adult. He's 20, 21. What part of that is he going to be responsible for? And they're not cheap. So this client has three kids on insurance right now or on drivers, three teenage young drivers on their insurance.

16:53So they paid$1 ,200 a month for that. They pay$400 a month for the five cell phones. And then they pay$900 for health insurance. And I said, you need to think about how, what he is probably going to be similar to what he's already been paying you because you really went light on him before. Anyway, and so that's when I was, she was like joking that they he's not gonna be happy to hear that or whatever because you're already the witch of the family or whatever for making him pay or something i don't even remember i know they were joking i don't i really truly don't take it personally but yeah i was just like okay but the point is again it doesn't matter if you make if you have way more money than you need or not we want some version of this in place especially younger but especially as an adult child living with you or you're paying their bills for reasons they need to learn and that is more important than them feeling financially safe or financially like less stress.

17:41It's more important for them to learn in a small, safe way that they are responsible for their own life, their own money, all of that, than it is for you to help them feel less stressed or whatever about money. That is the most important lesson. Whether you have a lot of money or a little money, this is something that you need to make sure that you're doing for your kids so that they can be financially literate. Yeah. And I think it's not about the money. Like it has nothing to do with the money at this point. It doesn't, like Shanna said, whether you can afford it or not, it is the financial literacy part.

18:11Imagine you having these conversations with your parents when you were younger. Okay. Just imagine if they had with you in how much more prepared would you be as an adult in like right now in the day of age that you're in, we want you to take this information that you're learning. You're listening to this podcast for a reason. We want you to use this information as a tool and as education to teach your kids because we want them to be better than us. For kids, I remember my mom just wanted me to be better than her. That's just, that was the natural thing. And for me, I want my kids to be set in a better place than me.

18:44What does that mean? That means having, I love my mom. She barely had any types of conversations with me ever when I was younger. My dad did. He was super level-headed. We had so many conversations. My dad I bought me my first razor, okay, when I was like 12 or whatever. My mom did not. But I saw money being handled, but we really didn't talk about it. But my kids, my gosh, like they, we talk about money because they have moms. Our kids have moms that are financial coaches. It's inevitable, right? We know that they're going to be very equipped by the time that they grow up, by the time they're in college, they get married, they have kids.

19:15We want them to be financially savvy. And like Shana said, financially illiterate. This is what you should want for your kids. Yeah. And I always push back because a lot of people will tell me how busy their kids are. And I understand that your kid is busy. They have to learn to manage their time and stuff costs money. Like it doesn't matter how busy you are. I don't know. Are you, once you're an adult, is somebody going to pay your bills so that you can continue to do all your favorite hobbies? No, that's probably not going to happen. So we have to learn now. And the cool thing I think, Vanessa, is there's so many opportunities, more entrepreneurial, versions like vanessa's son is able to mow grass for some people during the summers when he's less busy on purpose or whatever else he does that way he can stock up money and when he's in the middle of every single sport all year round he doesn't have to necessarily worry about it as much obviously my son edits the podcast so he can make some money that way he does tutoring on his schedule whenever he has time babysitting dog sitting all that kind of stuff stuff that is not necessarily like every day every weekend like stuff that they can here and there build up money You can, like Vanessa said, teach them to have a bills account.

20:21Teach them to have spending. Teach them to save some of it. Teach them to give. Whatever. Doing that opens those conversations on purpose for you to have with them so that you can, you know, it's not like you're even coming from I know everything. It's just let's talk about this. How would this work? What would I do? All of that kind of stuff. And it gives you a good basis, a foundation to start having those conversations. If there is one thing that you take away from all of this to teach your kids, it's for them to separate their spending from their bills. Like it is so important for them to learn that concept because if they have one account, one convoluted account, eventually as they get younger, what they may have one or two bills, we get it.

20:56It's not, it may not seem as important for you to have them separated at that time, but it really truly is important. So if you can teach them at a young age to do that, they're always going to know that they're going to have a set amount of money that they're responsible for spending, whatever guard rules they decide that is for them. And then they're going to have an account that they know that always pays bills. And that is going to be, it's a very mature thing to have for an 18, 19, 20 year old. right? Going into their life that way. So just know that you're going to set them up for success.

21:20Yep. And so we hope that these lessons have helped you, that you maybe can see yourself in some of these different situations and maybe it is encouraging you or helping you or giving you ideas on how to handle your own fun financial lessons that you're learning. And we'll see you next time. And listen, if there's some things that you want to chat about, and maybe private coaching is for you, sign up for budgetbesties.com forward slash free call. And you know, we can chat about what you have going on and see if having somebody else coming in, looking at it in a different perspective, we'll help you out.

21:52If you're tired of feeling like your finances are all over the place and you're ready for a simple set it and forget it way to budget, we have something special for you. Watch our automate your budget masterclass at budgetbesties.com forward slash automate. We'll show you step-by-step how to finally organize your money, how to set up your accounts and put your budget on autopilot. So your bills, saving and spending around my clockwork. Imagine less stress, more savings, and the freedom to spend money without having to track every dollar or babysit your bank account. Go to budgetbesties.com forward slash automate to start today.