Living Paycheck to Paycheck?

Living paycheck to paycheck is the way of many, yet it sets you up for potential financial disaster. Car breaks down, AC needs repaired, unexpected medical bill…are you just one unexpected expense away from disaster? What about a job loss? Here are some tips to begin correcting your situation and learning a better way to live with more money and less stress.

1. START BY DEFINING YOUR VALUES

Values are what you feel is important in life. They’re the guiding forces to your personal principles, standards and behaviors. Think: Honesty, Happiness, Family, Tradition, Resilience, Peace, Self-Awareness, Passion, Modesty, etc. Give this some serious consideration, write them down and keep the list nearby to refer back to. These values will be your compass, or baseline if you will, to guide you to your ultimate goals.

2. GET ON A BUDGET

Are you flying by the seat of your pants when your paycheck comes in, or do you have an actual WRITTEN plan for every dollar? Having a well-thought-out budget in writing illustrates a clear picture on where your dollars are going. You are more prepared to handle an unexpected bill or emergency because you know where money is going and where things can be changed to cover an emergency.

Do you spend more than you make? Are you spending much more on groceries than you thought? How about meals out? Now that you see in plain sight what you are spending in every category you might be surprised to see where your money is really going. And now we’re getting to the good stuff because we’re empowered to implement positive changes and if you ask me, that’s exciting!

3. PRIORITZE THINGS THAT ARE MOST IMPORTANT

Now that we’re all excited to make some changes, Step 1 is to prioritize expenses. The top 4 priorities should always be: Rent/mortgage, utilities, food & transportation. If it’s a struggle to pay for just these 4 things, then we have to make some crucial and immediate changes.

If you are not struggling with these top 4 priorities, but are still struggling, the following strategies are still important to consider. If it’s easy to financially cover these priorities that’s great! We still have some work to do though, and the following strategies are still important to consider.

4. WHERE TO CUT BACK (OR ELIMINATE)

Whether you are struggling with just covering the necessities or are unclear of where your money’s going, there are still things to consider changing or eliminating. You probably thought you were spending just a few bucks a month at your favorite coffee shop or deli, but now that you have a budget in writing you see you’re spending much more than you thought.

Unless you’re really in a horrible financial situation, it’s probably not necessary to eliminate those things altogether. Maybe consider limiting yourself to 1 coffee a week instead of 5. Or, instead of going through the fast-food line, pack your lunch and go sit by the water at lunch instead. It’s healthier, less expensive and a short, relaxing get away from work. My point is there are adjustments to be made that don’t feel like punishments.

How about those streaming apps? This conversation in our house that pops-up on the regular! We eliminated cable to save money and now we’re spending even more than before on this endless list of apps. Are you doing it too? If you have a budget to look back on, you will know for sure.

5. DITCH THE DEBT

Credit cards and loans with extraordinarily high interest rates are keeping you in debt. Period. And if you are only making the minimum payments you can count on including that in your monthly budget for months and months if not years (which is the more likely scenario).

Credit can be a fabulous tool for many reasons; Scoring points on other things like travel; To use as a crutch if you have a true emergency; When used responsibly it builds your credit and can improve your score, making you an attractive risk to people like mortgage and auto lenders. The problem is most people don’t use credit cards wisely; they can’t stand the temptation and if they listen close enough some swear, they can hear it saying, “USE ME! USE ME!” I promise you - it’s not but believe me when I tell you I have been there.

There are several strategies for paying down debt, for instance, paying off the smallest balance first. Or, paying off the one that has the highest interest first. If you would like to learn more about the options, determine which one would work best for you, and devise and implement them, let’s chat. (PUT A LINK HERE) (I caution you about settling your debt as it can have a negative impact on your credit score and tends to make things more difficult in the future.)

6. LIVE BELOW YOUR MEANS

If you’re reading this blog post, chances are you are not in a position to live below your means. BUT it surely does not mean that we can’t get you there. A fellow coach and friend of mine is working with a couple who earn a really nice living, but they have $350K of debt, not including their mortgages and car loans. You read that right.

My point is that everyone’s relationship with money is different. Someone who makes $15 an hour who is broke is no different than someone who makes $100K a year and is broke. BROKE IS BROKE. (IS BROKE.)

And? There’s no shame in any of it - on either side. There are plenty of folks driving around in beautiful fancy expensive cars that are secretly praying they can make the next payment. Lots of things happen to lots of people, for lots of reasons. And ya know what? IT’S OK.

Whether you make $15 an hour or $100K a year, there are tools and resources for us to put in place for you. The implementation and outcomes will look different for each of you but there is hope and I can help.

IN CLOSING

There are lots of tools, resources and strategies to improve your situation. The key is to start. Take the first step and let’s chat. 

Saving for something big?

Do you have your eye on something special? Maybe a new car, house or vacation? Or maybe you’re considering leaving a secure day job to work for yourself and want to build a nest egg first. Big expenses require big plans.

1. GET YOUR FINANCIAL HEALTH IN ORDER - FIRST AND FOREMOST

Having your financial health in order before a big purchase is a critical step to reaching your goals. If you have clear picture of where your dollars are going, you have a decent savings set aside and are not struggling with basic needs like food, utilities, clothing and shelter, then you’re probably prepared to start saving for your goal.

What if things are not in order and you have no savings, but you still WANT? I suggest reviewing the tips and techniques in my blogpost, “Living paycheck to paycheck?”. Even if that title doesn’t resonate with you, the article details some good strategies to prepare you for reaching your goal.

Once you know where your dollars are going, your bills are current and your emergency funds are in order, it’s time to see where expenses can be cut back on or re-direct to another bucket, like a special saving’s account. Opening a separate account to hold the funds until you need them is a great way to manage those funds and having them automatically deposited to that account takes the temptation out of spending!

2. WHAT IS THE GOAL AND HOW MUCH DO YOU NEED?

If you’re saving for a mortgage, downpayments on conventional loans are typically 20% but much like your financial situation is unique so is your lending profile. Not every situation requires a 20% downpayment but because it is the preferred method of lending (besides all cash, of course) we will assume that’s your goal. So, what does it look like?

All mortgages have fees. Closing costs, title fees, inspections, taxes, etc. Consulting with a lender ahead of time to see what you can expect is doing your due diligence and reinforces preparation for savings. In this example let’s say the purchase, including all of the aforementioned expenses, is $250,000. A conventional mortgage with 20% down means you need to save $50,000 to close on the loan. That’s equal to or even more than, the annual salary of many.

If you are in a position to set that money aside, first determine an end date. If you plan on buying in 2 years (or 24 months), that means you need to set aside $2,083 a month to achieve your goal. (Remember, there are other programs available that offer lower or no down payment at all, this is just an example.)

$50,000 / 24 months = $2,033

Cars are much different to finance and paying all cash for a vehicle should be your ultimate goal but in reality, the majority of people take out leases or loans. Credit scores drives the percentage of interest you’ll pay so the better your credit, the less the cost of the loan. Likewise, the opposite is true. CLICK HERE FOR MY MORTGAGE LENDERS

Remember that vehicles depreciate so any interest paid is not likely to be regained. In other words, it’s the bank’s cost of doing business and the only benefit to you is time to pay for the car but it most certainly is not savings. CLICK HERE FOR MY AUTO LOAN CALCULATOR AND AMORTIZATION CHART (Meaning the amount it will cost you over the total life of the loan.)

3. LONGING FOR A TROPICAL GETAWAY?

Many times, vacations can be paid in installments but unless those installments are interest free, I don’t recommend it. Why? Because a vacation is a want, not a need.

SIDE NOTE: Homes and cars can be wants too, but shelter and transportation are part of the top 4 budget priorities (Food, Shelter, Clothing & Utilities) so I don’t consider them wants unless it’s a second home or you have a house with more cars than drivers and don’t truly need them.

Similar to a Christmas Savings Club, many banks and credit unions offer Vacation Savings Clubs as well and work similarly. A pre-determined amount each pay period is automatically deposited into the special savings account. There’s a set date when the bank will release the funds and they may even be able to help you lock in a rate so costs don’t exceed what you have saved for by the time you are ready to travel.

Premature withdraws come with penalties so there is less temptation to take money out. Wouldn’t it make your vacation much more enjoyable and less stressful if it were already paid for?

IN CLOSING

Regardless of what you’re saving for, the action is the same; Decide how much is needed, set an end date, divide the amount needed by the number of pay periods remaining between the time you start and the end date. Now you have the amount to set aside with each check and will be well prepared to make that big purchase!

I recommend researching and consulting with lenders ahead of time, so you know what to expect as you prepare to reach your saving’s goal.

Bill Collectors Got You Down?

How to Deal with Debt Collectors When You Can’t Pay All Your Bills

If the phone is ringing off the hook and letters keep showing up in your mailbox, you're likely feeling the pressure of debt collectors closing in—on top of the stress of bills you already can’t afford. It’s a tough spot to be in, but you’re not powerless. You have rights, options, and steps you can take to protect your peace of mind while working toward a better financial future.

Let’s break it down.

1. DON’T IGNORE THEIR CALLS, BUT DON’T PANIC EITHER

It’s tempting to avoid the calls, delete the voicemails, and pretend the problem doesn’t exist. Ignoring debt collectors won’t make them go away and in some cases, it can make things worse…they can garnish your wages. The last thing you need right now is to find out your check had a big chunk taken out of it before you even got it!

So - answer the phone when you can—remain your composure - be polite, calm and confident—and take control of the conversation.

2. KNOW YOUR RIGHTS

Debt collectors have rules they must follow under the Fair Debt Collection Practices Act (FDCPA).

By law, debt collectors may not:

• Harass or threaten you

• Call you at unreasonable hours (before 8 a.m. or after 9 p.m.)

• Call you at work if you ask them not to

• Talk to anyone else about your debt (unless you have listed someone as your alternate contact)

You have the right to:

• Request written verification of the debt

• Dispute it if it’s incorrect

• Ask them to stop contacting you in writing

Knowing your rights makes it easier to respond from a place of POWER - NOT FEAR.

3. ASK FOR EVERYTHING IN WRITING

Before agreeing to anything over the phone, ask the collector to send you a debt validation letter. This letter should confirm:

• Who the original creditor was

• The amount owed

• That the debt is legally yours

Once you have it in writing, you can review the details and make informed decisions.

4. DON’T MAKE PROMISES YOU CAN’T (OR WON’T) KEEP

Collectors are trained to get you to commit to a payment. But if you agree to pay money you don’t have, you may dig yourself into a deeper hole or miss critical bills like rent or utilities.

It’s okay to say:

“I’m not in a position to make a payment right now, but I’m working on a plan and will be back in touch when I’m ready.”

Stay respectful, but don’t let them pressure you into panic decisions.

5. PRIORITIZE YOUR ESSENTIALS FIRST

When you have more bills than money, not all payments are equal. Keep the lights on, food on the table, and a roof over your head first. Medical needs, transportation, and basic survival expenses must come before credit card or collection payments.

Debt collectors can wait. Your mental health and wellbeing cannot.

6. KEEP A LOG OF ALL CALLS AND DOCUMENTS

Every call should be written down; the day, time and name of person you spoke with, and be sure to ask for a reference number. This information could come in handy if you need to file a complaint or defend yourself in the future. And if you let them know you’re recording the call, it’s ok to do so to keep for your files.

7. NEED HELP?

You don’t have to figure this out alone! We can work together to:

• Create a plan to prioritize debts

• Negotiate with creditors

• Explore settlement or repayment options

• Avoid bankruptcy when possible

Final Thought: You’re Not a Bad Person for Being in Debt

Life happens. Illness, job loss, divorce, or just a stretch of tough luck can knock even the most responsible person off track. What matters now is how you respond—and step by step, you can rebuild.

Debt collectors may be loud, but your comeback story will be louder.

Blog Post Title Four

It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.

Don’t worry about sounding professional. Sound like you. There are over 1.5 billion websites out there, but your story is what’s going to separate this one from the rest. If you read the words back and don’t hear your own voice in your head, that’s a good sign you still have more work to do.

Be clear, be confident and don’t overthink it. The beauty of your story is that it’s going to continue to evolve and your site can evolve with it. Your goal should be to make it feel right for right now. Later will take care of itself. It always does.