Hey Gang,
So, in light of the recent economic downturn, a few things have come to my mind. One is that it took so many people by surprise. I know that the nail in the coffin was the Covid19 virus, but even so, there was no escaping that the plummet was on its way, even overdue. It was all over every financial and regular news outlet for two maybe three years. Our market was overpriced. The economy goes in cycles of shrink and swell consistently. The biggest problem I see is that there are many people who were unnecessarily vulnerable. Financial injury is similar to the danger of the virus --the most vulnerable get hit hardest.
So how do you avoid being vulnerable next time? And when is sex coming into this discussion -- or was that just for clicks?
No, my friends, it was not just for clicks. Money and Sex have a lot of the same emotions and attributes in common. We're told it is inappropriate to talk about sex or money. We got shushed by our parents if we brought it up. We get our education from our equally ignorant peers. Both subjects are taboo, associated with shame, embarrassment, and self-worth. We get shushed our whole lives and then all of a sudden at the onset of adulthood we're supposed to be an expert in both. It is impossible.
You can't go from the dark ages to enlightenment without a little knowledge.
We managed to bring sex education into our world a while ago and diseases, unwanted pregnancies, shaming, and other struggles diminished a great deal. Even parents shushing kids and leaving questions unanswered became less of a trend. There were places to go to get your questions answered -- by real sources, not just your giggling peers.
Guilt, shame, and embarrassment -- those feelings are still associated with wealth and poverty and anything money-related. The reason is a lack of financial literacy. Financial literacy is important -- especially if you are working with a smaller number. It is absolutely possible to grow and cultivate personal wealth, but it must be learned.
Here's another myth busted --there is plenty for everybody. One rich person does not make another person poor. It is like air. If I breathe deeply I didn't take your air from you.
Another way of putting it is that the more prosperous people there are the more inexpensive a prosperous life is.
Remember when only the rich had, did, or went *fill in the blank* and now almost everybody has that rich person thing of yore. At one point in history that "rich person thing" was teeth, now it is smartphones. A plentiful life is getting more and more affordable the more prosperous people are out there. However, it is the financially literate who make it there. We can all be financially literate. And then once you are, educate your children, your community, and those who are truly vulnerable -- and as always, help the helpless.
Do make sure that the emotions are acknowledged and felt when you are passing on financial education. Financial literacy is more than the numbers. Are you worthy? Is your child worthy? Is your neighbor worthy of freeing themselves from financial vulnerability? Of course! But you must be kind to yourself if you want to have a healthy relationship with money. The more you know the better off you'll be.
Most Americans are in one of the following stages -- though, admittedly there are Americans who are poorer than this as well.
Stage 1. This is if you're deep in debt, living paycheck to paycheck, or even uncertain of being able to get things needed to survive (rent, food, electricity, etc.).
Stage 1, step 1 is to forgive yourself and acknowledge the emotions you associate with your financial situation. Then look at your numbers. No matter how big that debt is, you have got to stare it in the face if you're going to conquer it.
Stage 1, step 2 -- read read read! Start with Dave Ramsey. He has a course, several books, a podcast, and a budgeting app too. He's a tough-love type of teacher, but you will know your numbers and you will begin to chip away at the debt and find the tools needed to keep your lights on. Eventually, you'll have a rainy day fund (which will free you from being vulnerable when there is a pandemic or other crisis). *BTW, I have noticed a lot of churches in my area hosting his course for financial freedom. I do recommend doing this type of thing with others. A supportive community of people striving to solve the same problems is extremely empowering. Get a posse of people working toward financial freedom as your accountability partners.
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Stage 2. This is when you're lights are on, you may still have debt, but it is shrinking, not growing. In this stage your job is pretty secure and pays your bills -- maybe you even add to retirement.
Stage 2, step 1 is the same as Stage 1, step 1. Forgive yourself and acknowledge the emotions you associate with your financial situation. Feel a little pride in yourself. You are capable and doing fine.
Stage 2, step 2. read, read, read!! Check out Suze Orman. She is also a tough-love teacher. She has a lot of resources available (some for free) to get your financial life humming along to prosperity. Her stuff will help you get out of debt, build wealth, and do things like getting your will or other documents in order. You can also decide your give-back plan. What do you value? Here you'll know how much you can give to charities and causes you believe in.
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Stage 3. This is when you're doing pretty well but you want to have more autonomy in your life. You want to know that you'll still make more than enough money even if your place of business evaporates into thin air. Even better, here is where you'll learn how to have your money make more money.
Stage 3, step 1. Read, read, read!! As you probably already know, I recommend Phil Town and Danielle Town to learn to invest like Warren Buffett. (Some people call this value investing -- it is a broad term, but it'll do for now.)
Stage 3, step 2. Get a virtual money account (like think or swim -- a virtual money program associated with TD Ameritrade) and start putting your education into practice with virtual money, but real market activity. Write down all of your successes and failures and why you think things went the way they did. When you start with real money ease into it. Never stop learning. Continue finding books to read about money and mindset.
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You can really read any of these authors at any time. They offer some slightly different information and I think it is all useful. They have done the heavy lifting for you with the annoying stuff. For example, I hate official documents like taxes, insurance, wills and such. I just go to Suze Orman's website and download her checklist. I don't have to worry about missing something important because she has done the hard part for me. I also use Dave Ramsey's app and listen to his podcast. He keeps me on the straight and narrow so that I can be more relaxed. Phil Town has basically changed my life. I didn't have to go out and do any fieldwork or recon in finance. All of this is out there, available and either free or really inexpensive. Just study it once you get it. It is so much better than worrying about your future, or a potential crisis. You'll have the tools to survive -- thrive, actually.
For mindset books that set up littles for a life of peace and self-acceptance check out Daniella Bozzone's Books on Amazon, or click below:
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