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The Do-Over – Creating a New Relationship with Money (Part 1)

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair…” (A Tale of Two Cities, Charles Dickens)

When times are tumultuous and uncertain, they can and should be real catalysts for change. 

When a friend suffers a heart attack, they always talk about how life will change, and how valuable the wake-up call was. 

This is happening today in the area of work and money. 

Hopefully, you are one of those people who are saying, “thank goodness I took care of this or that financially. It’s helping so much in this situation.” 

If you are not, you might be having your own wake-up call in the midst of this transformational time we are in. 

That’s often when we feel a big enough push to make changes. So, if you have financial moves that you have wanted to make, now is the time to organize and act.

When the Woolsey fires hit Malibu, many people were caught off guard with inadequate insurance coverage. That was a wake-up call for them and for those of us watching.

Financial preparedness is smart. Although we like the idea, it’s often a “get to it later” ideal. 

I’m going to challenge you (and myself) to change that paradigm. 

In this self-isolation period we are in, we have time to contemplate our finances and see what we should do to feel more secure, protected and abundant. 

This is something to work on now, whether it helps immediately or later. There is significant benefit either way.

Consider your income or business revenue. 

  1. Know your numbers. How much do you earn from a job or business? Many people do not know exactly what they earn. Whether you receive a paycheck or have fluctuating business income, it’s critical to know and track what you make on a regular basis. 
    • Do you have multiple revenue streams?
    • What do they amount to in total each month?
    • Do they fluctuate? Are there patterns, like seasonal income?
    • Do you have household income that others contribute to?
    • If you are a business owner, do you pay yourself a salary? 
    • When is the last time you had a raise?

2.  We will look at expenses, however even without knowing your expense numbers, how are you living with the income you currently earn? Are you paycheck to paycheck, or the opposite, with money left at the end of each month?

  • Are you able to pay your bills as they come in?
  • Do you have money for savings in various forms?
  • Can your regular income take care of unexpected emergencies that come along?
  • Has your income increased over the years due to raíses, price or fee increases, or job changes?

3. What would you consider an income challenge right now?

4.  How much more income do you need or want to live the lifestyle you desire?

That last question requires that you sketch out what you want your life to look like and put numbers to the elements that make up the lifestyle you want, so you can determine the amount that you need or want to earn. 

I’ve found that people don’t actually know how much they need to live their dream life. 

The gold right now is in the knowing, and in calculating real numbers to guide you toward your goals. 

There’s more to know.

I’ll get back to you in another email with more to consider, but spend some time with this income side for now. 

I understand that, depending on your situation, this may be future-oriented, but it’s still important. Manage whatever survival mode actions you need to take, but remember there is a future ahead and we can tend to that as well, at least strategically. 

I want to help you come out of this uncertainty with a plan for more security and abundance that can ease your mind in the next event, and help you reach your dreams in normal times. 

This is a powerful time to build a better relationship with your family and your money. Get to know them both on a deeper level.