How to Stop Financial Avoidance and Start Adulting With Peace and Purpose | 431

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0:32Hey, besties. We're replaying one of our favorite chats from another podcast with our friend Marina from the Work Like a Mother podcast. It's a great time to just get a fresh start, clean slate. I think I just heard a recent statistic that like the average American has$3 ,000 saved. That's it. The first thing is to stop using it, which is scary all by itself, but you have to stop using it and putting money on the credit card in order to pay it off. Girl, I'm not playing this interest game. I'm playing how much money are you going to get back in your pocket by getting rid of that minimum payment?

1:02That's what I'm looking at. 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? Do 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?

1:31You're in the right place. We're Shana and Vanessa. We're best friends, business partners, and master financial coaches trained by Dave Ramsey. We'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.

2:03We 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 mortgages. And we're not going to shy away from the tough love. We'll tell you what you need to here and encourage you at the same time. This is the Financial Coaching for Women podcast. Thank you for having us. We're excited. We love you so much. We can't wait to talk about the B word girl, the new year. We're going to talk about some finances. Yes. And we want to like self-actualize us being in the new year because every year Marina, we're like, December is going to be great.

2:36We're going to do so good at December. And then we just fall forward through December, wake up and stumble through the next day, even though it's all for good. It's all good, but it's definitely January vibes. It's going to be great. January vibes are going to be so good. A thousand percent. And I really feel like women, especially in this mom life era, we're trying to figure that out. This is the new normal. And every year our kids get a little bit older and a little bit more expensive. Just keep evolving and changing as we do. We can't just have a set it and forget it program for the most part.

3:05We still have to pay attention to make it grow. So I would love to hear what is their new plan? What do we do? so right now it's going to be the same process it ever would would be let's start off by happy like getting it all on paper usually we would say take the last three months but maybe look at the last maybe look at september august and october like yeah those are like more normal months go through those bank statements see what you what your bills are what your spending is all of that kind of stuff so that we can set up a brand new budget yeah and you know what it's like shana said it's a great time to just get a fresh start clean slate because i think at the end of year.

3:40I was just talking to a client. She says, I just need to get through this month. Yeah. Yep. And preach. Yes. I feel like we all think that way. Shane has got two December birthdays. I have a December birthday. We have Christmas. We have a lot of festivals. There are Christmas events. There are school events. There's a lot of work parties. There's just community events, church events. There's just a lot happening. And so we're trying to scrape by the best we can. We, a lot of our clients are, maybe this is the first year they're paying for cash with all of this stuff. And maybe you're not there yet and that's okay.

4:05But what if next year that could be you? So the idea of planning ahead, sitting down, adulting for a minute, maybe a minute, just an afternoon, right? Let's just adult for an afternoon and plan ahead to go, what vacations do we have coming up? How much are my kids going to cost me in 2025? What do I think Christmas? What did I spend this year on Christmas? Therefore, what can I plan to spend next year? And just really getting a full picture of what you really, truly need to put in your budget instead of just going, I got gas and groceries covered. I'm good. No, there's way more to your budget than that.

4:35So we just want to plan for all of it. No, so true. And I think so often, even just thinking about vacation planning, do we have the money? It's just like a question, not let's plan ahead for the money. It's that we do have the money. Yeah. And it doesn't have, the main thing that we teach that makes us different than everybody else is to have separate bank accounts. And I'm thinking about, I just, before we recorded this, I just got off with a client. She's a lawyer. And sometimes we have clients, Marina, I don't know if you feel this. Did you do your homework? No, she did not do her homework, but it's okay.

5:02We're going to do it in the session. We're going to do it in the session, girl. We're going to get it done. And girl, she opened up because her checking, her spending account was in a different bank, which was really messing her up. And so she was just stealing from her bills account. She opened up her account for spending in Ally. We have a really easy banking, online making system that we recommend. She set up a spending account and she set up her automatic transfers based on the budget within five minutes. Like in the call. Yeah, in the call, super fast. So we said, okay, these are your paychecks, pay dates.

5:30This is when you're going to set up the transfer. Your monthly. So for her, she's single. her monthly personal spending amount is$500, right? So on her every other week on her payday, $250 comes from her bills account. And it goes over to her spending account. So every two weeks, she's got$250 to go do all of her fun single things. And what I told her is I said, and then you don't even have to look at the bills account, because your budget has set up all of the bills to get paid automatically. As long as you don't mess around in there, you're paying your bills on time, girl. And you always have spending money.

6:02And so that's like the system. We want you to be able to set it up for the new year. And then, yes, we don't want you to be completely ignoring it, Marina, but it is actually a little set it and forget it. Well, yeah. And this idea of, I think, opening that separate checking account for specifically like just spending is mind blowing. And it's a concept that we're not really used to yet. Some people are still banking like they were when they opened up their first checking account in 18, right? So this idea of having one checking and when savings and that's where everything happens it gets really convoluted it gets really confusing there's a long list of transactions going on that month what got spent what didn't get spent what still needs to pull do i actually have this money for target like all those questions go through your mind when you go to the store to try to spend money and so if you allot a certain amount of money like shana's clients 500 a month if you allot a certain amount to go into a spending account that's completely separate than an account that's just paying your bills, you have the freedom of knowing, Hey, it doesn't really matter how I spend this money this month.

6:57I got 500 bucks and I'm good. There's no tracking. There's no accounting for any of it. You don't have to use an app to do any of it. No, it just makes it so much, so much more simple. That's so true. And I don't know why there is such a hurdle for people to open up multiple accounts. There's like some disbelief that, Oh, it's going to cost me more money. It's going to hurt my credit. I don't know what they think, but it's literally just like, they think it's going to be more confusing. I think that's really the one that we hear the most. And it's not. So So my client, and I know she said, I want to come on the podcast.

7:22So she's totally open to all of it. But she has ADHD, impulsive spending. That's why she came into coaching. And she's seeing a therapist for it. And I said, okay, one thing that does help is, sometimes when you look in your account, you have a thousand million transactions or you have a lot of money because there's a lot of different things going on. So if we can just at least tell your brain, look at the spending account. That is what I know. I have money to spend. And I told her, girl, we can increase your spending. I don't care however much you need to have. but you just look at that number.

7:51When your brain sees this big number of everything together, I think I have this or maybe I will, or I'll figure it out. I'll figure it out later if I actually have the money. But if you have a separate spending account, one, you exactly know, so there's no guesswork. And then also your bills are being paid, which is so much better. I had another client today. I wrote it down and of course I don't have it right in front of me, but she said, this is the first time all of my bills are paid on time. And I can't even believe this is me. And they're super sweet. They're a young couple, right? And they just get in their first mortgage and all that.

8:21But this is me. I'm paying all my bills on time. We're like winning. Yeah. I had my client this morning was like, she was crying on the call. And she said, I'm not used to having this much money in my account. Like she has to really settle with the idea of being the type of person that now has money because before it was all convoluted. She had her business and her personal in one account. Okay. Like, Oh no, that bright. And I was like, yes. So you'd want to talk about convoluted. And I said, first of all, your CPA is going to love me. And once we separate everything, she's just, it was coming in and going out as fast as you know, it was, and she just didn't know where any of it was.

8:56And so now she's very organized. We have multiple accounts to set everything up. And the idea of seeing, because I'm organized, because I set a certain amount of side just for spending and for bills and blah, blah, blah, all that, I can see it. And she had$1 ,300. She didn't believe me that she could put on debt, like literally legit in the call said, I don't trust it. And I was like, I promise it's them. We just have to realize and get used to the fact that we have this money is mine. Like I did this. And so it's just, it's really cool to watch them overcome that. Yeah, that's so good. I think I just heard a recent statistic that like the average American has$3 ,000 saved.

9:31That's it. 3 ,000. That doesn't get us to the next month. That's literally paycheck to paycheck. And so I think for so many Americans. It's just they're living out of survival. So how do we take them from that survival overwhelm state, taking the first step? Because the first thing you'd like to invest in coaching to work with you, what does that cost? Like, how do you get someone over that hurdle? First of all, I'm really happy that the numbers moved up to 3 ,000 because I was going to say, I thought it was lower. The staff did not use to bear that. So that's good. So how do we get them the first step from overwhelm?

9:59Okay. We, the first step we do is we're going to put the numbers on paper because one it's data. We do not have to add drama to the data. It's just numbers and facts. And typically what we told you to print out those three months, once we do that, I know it can be a little uncomfortable to see how much you're spending, but if you can just face the drama, that's what's overwhelming to me is like the not knowing and the shitting all over myself and giving myself shame and guilt. I'd rather just see what it actually is. And then I just told my kids this the other day, my daughter got a bad grade on a quiz.

10:28And I said, I'm not, she's afraid to tell me, I said, I want you to think when you get this? How can I solve this? That's all. What can I do to make this right to do better next time? That's all you need to focus on. There's no point in focusing on how you got that question wrong, and you can't believe it, whatever. It's the same thing with your numbers. There's no point in focusing on what I did wrong. What I want to do is put some fresh numbers that are actual math, actual data on a piece of paper and look at it, because that's less overwhelming. In fact, usually when we do it, it's not as bad as you think it's going to be.

10:58And just by putting on the numbers there. You start to feel more empowered. You start to feel more, okay, I can actually do this. And like you want to do something. It's the avoiding of it that makes you feel overwhelmed. All right, budget besties, it's time for some real talk. You don't need another budget. You need a budget system. Our simplified budget system is what you've been looking for. It's going to allow you to be bougie on a budget. You'll be able to easily set up a system that runs automatically and shows you exactly where your money is going. And it's going to give you permission to spend.

11:31Everybody loves that. Yeah. It's straightforward, pretty, and packed with walkthrough videos that break down the exact methods we use with our clients to get out of debt, set up a bills account, separate spending, build savings buckets, and end the paycheck to paycheck feel. If you're new to budgeting, this is the perfect way to jump in. And if you're already a budget nerd like us, you're about to meet your new obsession. This is the upgrade to your finances that you need right now. Yeah. So head on over to budgetbesties.com forward slash budget and grab yours. Now back to today's show. How many times, Shana, do we show a client their budget and we're like, hey, you got$3 ,000 left over.

12:09And they're like, no, because they really don't believe that there's that there's extra. But when we put it on paper, it's nine times out of 10, not as bad. I had a lady that was texting us at nine o 'clock last night going, thank you for helping me work through talking to my husband about this because she had for so long bared all of the responsibility and all of the stress about the finance. She didn't want to bother him. Well, that turned into racking up a bunch of debt to make it work, quote unquote, make it work. So he didn't, he couldn't feel it. Right. Cause she was trying to, in her eyes, what is it?

12:40Safeguard him. And then she messaged, I finally talked to him and he is so on board. He's so excited to work through this. I had no idea he was going to react like that. So it's the same concept of putting it on paper, guarantee it's not that bad. Have that conversation. Guarantee if you show up with the data to talk about it, it's not going to be that bad of a conversation because it's you guys coming together as a team trying to work through it. Yeah. Take the emotion out of it. Just look at the facts. I think that's a big hurdle. I feel like so long in the beginning of our marriage, it was so emotional about every money conversation, like a personal attack.

13:11The thing that's changed about that, I was thinking about that the other day, is let's be honest, we make more money now. Okay. So it really was almost survival, like a lot more emotion in the beginning. Of course it is because are we going to have gas or groceries? Which one do you want? But now we have more money and we know that we do and we probably should be a little better steward of it and have more than$3 ,000 in the bank possibly because we know we have, we know we spend that a month probably could be able to save that. And truly by putting it on paper, we do see people feel that it's just the natural next step to be a better steward of your money.

13:44Especially like Vanessa, once you see what's possible. So like this client that I have, who is using credit cards, she's single, makes good money. She was using credit cards. And now she, this month, is going to put$500 in her emergency fund, pay off one credit card. And we still, like I said, she still has her$500 to spend each month. That's usually the case. If you just, and then, and you're willing to do, that is hard, right? To not spend 5 ,000 or however much her credit card is, but actually paid off. That is hard, but it's worth it once you see it and you see what's possible. And we call that being bougie on a budget.

14:16So like the idea of being able to have spending money, go to Target, go to Starbucks, go wherever you want to go and have fun, Nordstrom or wherever. And then also, hey, you're paying off debt or also, hey, you're saving for vacation or for Christmas next year or for annual bills or for birthday gifts, like being able to do all of that at one time and budgeting for what's important to you is really exciting. And we, like I said, we call that being bougie on a budget because it's what's important to you. Not everyone's budget is the same as it shouldn't be. Like Shana's budget is very different than mine.

14:45And what's important to her is budgeted in and vice versa. So we just want you to know that you can have it both ways. You can have fun spending and you also can build wealth and you also can pay off debt. Yeah, totally. Okay. So going back full circle, it's January. We're like resetting budgets and everything. Talk to me about credit card attack. What is the strategy to get down our debt? How do you? Okay. The first thing is to stop using it, which is scary, right? All by itself. but you have to stop using it and putting money on the credit card in order to pay it off, which is a strategy all by itself.

15:17So let's, that's why you have to do the budget, which I know is annoying. We've been saying that B word like so many times, but don't worry, you don't need another budget. You need a budget system. We'll get to that. That's what we're going to, we're going to make it easy, but you need to see on paper to make sure that you know, you can afford your life. So a lot of times what you're doing is swiping because you don't know, right? So if you can make sure, okay, I have money for savings. I have enough for groceries, whatever. Then I can put that credit card aside. That does not necessarily, unfortunately, mean that you can pay it off immediately.

15:41But what we want to do is set the budget up. And I'll let Vanessa speak to this in such a way that we know exactly at the end of the budget, how much we can pay each month to get the credit cards finished and taken care of. And this may be the first time that you're having to actually pay that minimum payment on your card. Like this may be the first time that you're not just paying it off. Because if you think about it, and I've had a lot of credit card conversation lately with my clients of trying to play this game that this point game with the credit card companies, trust me, you're not winning.

16:07I know you think you are, but you're not. But anyways, if you think about paying the minimum payment versus paying it off, that's really hard, especially when you're used to racking it up, paying it off, racking it up, paying it off. You're a whole month behind when you do that. Okay. So what we really want you to do is set up your budget in a way that it's got five columns. It's super easy. All right. So you're going to list your income. Then you're going to list all your debt payments. And you're only going to list your minimum payments. So if you set a credit card to just pay$500 every month on it, we're going to change all that.

16:34Change everything to only pay minimum payments. and eventually we're going to put some extra on debt, but we want to see actually what you, what do you have to budget for? What are you required to pay? And then after your debts comes your, your bills, like you want to list everything that you have to pay in your bills. Yeah. And so then you're going to do your spending and that's where, so that's why, so usually you're using the credit card and then you're paying it off, like Vanessa said, but now we're going to spend the money that we earned on the things that we want and need. And then we're also going to set aside some for savings.

17:03So that means we probably won't have enough leftover to pay off the credit card, but that's okay. Once we've allotted, like I said, income minus debt minimums, minus bills, minus spending, minus savings, there's usually something left over, right? We're not in college anymore. We kind of making a little bit more money, girl. Yes, girl. And so we might have a little bit extra. That's when we're going to use that amount to attack our debt, right? So it might take you a couple months to get the thing paid off and be done with it for good. But the first step truly is like transitioning to using cash instead of using and being okay and getting the budget system set up and seeing it work.

17:35And then you can pay off your credit cards. There are different strategies that we use with our clients. It depends on where they're at, their income level. Dave Ramsey is going to tell you minimum balance first, and then you go all the way to the higher balance. With our clients, a lot of times they have a lot more money, so they might be able to attack a bigger one with a higher interest rate all in one fell swoop. And if we can do that in all in one fell swoop, we want to, because obviously we want to save that interest, especially right around now. Bonuses, tax returns, raises, like there might be a good chunk of money.

18:06So you want to be very discerning about which ones you pay off first. And it doesn't, it's like Vanessa said, it's not cookie cutter. It's up to you what's important, what makes sense financially. And if you have two cards that have like comparable balances, but one has a way higher interest rate, you pay that. Or a higher minimum. Yeah, higher minimum. Yeah. And really quick, one of my clients this morning was talking about, oh, why do I want to pay all that card off? Because the interest rate is lower. And I say, girl, I'm not playing this interest game. I'm playing how much money are you going to get back in your pocket by getting rid of that minimum payment?

18:35That's what I'm looking at. Yeah. So sometimes depending on like a furniture loan or even a car loan, you might have a higher payment, lower interest or whatever. So it might feel like it's a different game. But if you can get$500 back into your budget that you can use to pay off the next stuff, that's better than 197. Right. So there's just strategies there. But yeah. Yeah, totally. Okay. So then Christmas is going to come around 2025. How are we budgeting for it? And are we just like going through our base statement of December to be like, this is how much I actually spent to then budget for the next year?

19:06Or how do we take that approach? It's not about being perfect. Okay. So it's not about getting every single dollar that you're going to spend on Christmas. It's about getting a general idea of what did I spend around? What did I spend this year. If you can take that number and then divide it by 12 in January and go, okay, if I set aside$500 a month or whatever that number is for you, I set aside this amount of money for 12 months, I'm going to have enough money saved to be able to spend money on Christmas. Cause it's not a matter of if I spend the money, no, you're going to spend it. You know, you're going to spend it.

19:38So you might as well just start preparing now in a very smart way, in an affordable way to be able to save over 12 months, instead of having to cram it like October and going, oh, Black Friday's coming. And then you're having to do that in two months. And this will keep you from going into debt again, right? So we can stop the cycle once and for all. We want you to think about, we have so many. I put it on our Facebook, I think like last week or whenever, how many of you are paying cash for Christmas for the first time? And just like scroll, scroll, yes, me, me. And they're so excited. We're so excited for them.

20:06That's golden. That feels so good. But the thing we want you to do is, don't just look at December, right? Let's look at all of the different spending that we've done for Christmas, whether it's for decorations, for parties, maybe for your ugly sweater that you have to get a new one every year or else everybody will know that you rewore it or whatever. Who knows? We don't care. We're not discriminating that. We just want you to think about all of it. It's not just the presents, right? If you do cards or family pictures or whatever, let's put it all in there. Like Vanessa said, divide that by 12.