5 Important Reasons Why You Need a Budget

Aside from putting you in control of your money, there are 5 other important reasons why you need a budget. These include:

1. Creates a Savings Plan. A budget when done correctly, tells you how much money you can afford to save each month. It is important to take the time to learn how to budget, because you will be creating a solid foundation upon which you can build wealth.

2. Creates a spending plan.You are able to deduce from your income, how much money you have available to spend. Your budget is your guiding compass for how you should spend your money. Without which, you easily get lost financially.

3. Keeps track of how money is spent. Monitoring your budget and reviewing your spending regularly ensures that you are being mindful about the way your money is spent. If you determine that you are spending more money than you would like to, there are definitely things you can do to save some money.

4. Prevents impulsive spending. Budgeting prevents you from utilizing your money on unplanned expenses. Due to the fact that you have a plan for all the money that you have coming into your home, you are less likely to indulge in unplanned expenses.

5. Puts you in control of your money. The great thing about the budget is, you are in control of your money.This allows you to prioritize the things that are most important to you.

Your budget is flexible and is meant to guide you. It changes as your financial needs change.Schedule time to regularly review your budget and make adjustments as needed.

5 Ways to Improve Your Finances in 2023

The past few years have made people a conscious a their finances. So it is no surprise that more people are looking for ways to improve their finances in 2023

A readiness to improve your finances is the first step. To have lasting results, will require consistency and dedication.

Here are 5 easy steps that you can take to improve your finances in 2023.

1.Set financial goals and map out a plan.

Imagine you decide to meet your friends to hang out. You reach for the car keys, get in the car and start the car. The thing is you do not know how to drive and you do not have directions to where you are going.

 That is what not having a financial plan looks like. 

• Setting goals is important because it helps you map out a plan. A plan identifies where you are on your financial journey and what steps your need to take to get to the next level.

• A plan keeps you focused and fuels your ambition.

• Your financial plan to improve your finances will propel you forward. There are days when you will not feel like working on your goals, or your focus starts to shift. When you have a written plan, it acts as a visual reminder to keep you pushing forward and serve as motivation on those days.

• Your plan converts your dreams into reality.

2. Budget.

A budget is a foundation for building wealth.

• A budget helps you reach your financial goals. Helps your track your money and protects the money you already have saved up.

• A budget gives you a plan on how to spend your money . With a budget, you are able to tell your money what youwant it to do for you. YOU are in charge!

• It is important that your create a budget before you spend your money.

3. Pay down debt.

Paying down debt frees up money that: 

• Allows you to do the things you enjoy, love and want to do. Some of these might include; spending time with family, taking vacations, or just working fewer hours.

• Increases your earning potential. Paying off debt frees up your income allowing you more money to live on. 

• Reduces your stress. You will have less to worry about and more money to spend doing the things you love.

4. Have your fully-funded emergency fund in place .

An emergency fund puts a road block between you and a financial disaster. 

• It prevents you from going into debt. With an emergency fund in place, unforeseen disasters become glitches not a crisis.

• Consider putting this money into an online savings account  or money market account, where you can access it, without penalty, if and when you need it.

An emergency fund protects your financial plan.

5. Invest.

Before investing, get financially educated. At least know enough to ask the right questions about your investments. This can be done through reading personal finance books, magazines or blogs or by , taking personal finance courses like the Beyond Financial Reset Personal Finance Course. Personal Financial Education is a lifelong process and things are constantly changing so you want to stay in the know.

Lastly, plan to save at least 15% of your gross household income in retirement accounts.

Remember to keep your financial plan simple and easy.
Small, consistent changes, is all it will take for you to get to you where you want on your financial map.

You can do this !  

4 Easy but Effective Ways to Reduce Your Investment Risks

Each of us has different ideas of how we want to live our lives.

For you it may be wanting to spend time with family, travel the world and experience different cultures. For others, it may be wanting to relax with friends  and do nothing.

To be able to achieve the lifestyle you want, you need money, the knowledge to make informed financial decisions and the time to actually live that life.

Investing gives you and opportunity to be able to make money, so you can take off time to live your life the way you want.

All investments carry risks. One thing that should be at the forefront of your mind when you are planning to invest is how you can minimize the risk from your investments.

“All investments carry some amount of risks”

— BFR

To minimize your chances of making harmful financial mistake, you should consider doing these 4 things.

1.   Determine what your goal for investing is.

To meet your investing needs, you will have to figure out;

• What kind of lifestyle you want to live

• How much you need to fund that lifestyle

If you are planning on retiring, you will factor in;

• Where you plan to retire

• How you will continue to take care of your expenses when you stop working

• The healthcare costs you might incur

For example, your reason for investing may be to retire in 10 years so you can and travel the world. Knowing where you will travel to, how much it will cost to travel to those places and how much you will need to have if you do not want to keep working, will help you develop a plan.   

2.   Have an Investment plan

With an investment goal in place, you can move forward with crafting an investment plan. An investment plan helps you make informed investment decisions and is not based on how you are feeling at any given moment.

Your investment plan should take into consideration what your investment goals are, how much risk you can tolerate, and your current financial situation.

To determine how much income you have available to invest, you should start by making a budget. Your budget will guide you as to how much disposable income you have available to invest.

Should you find yourself in a situation where you do not have any money left over after taking care of your expenses to invest, it may be time for a lifestyle change. Find ways to reduce your spending and bring in more money.

• Switch the cable for something cheaper like Roku or SlingTV.

• Buy Generic instead of brand name products.

• Use coupons by searching on sites like Honey to get the lowest price on your purchases.

• Take your lunch to work.

Then redirect the money you save towards your investing goal. Every dollar adds up.

3.   Make use of tax-favored accounts

Tax-favored means that you do not to pay taxes on the profits you make in some cases up to a certain amount. How cool is that?

So taking advantage of this opportunity that the government has given is a great way to jump start your investment.

While there are other types of Individual retirement accounts, the 2 accounts you should consider looking are a 401K and a ROTH IRA.

A 401K is a retirement plan that is offered by your employer, and gives employees an opportunity to contribute a portion of their paycheck in that account. In most cases, the employers match the employees contributions up to a certain percentage 4-6%  sometimes.

So basically it is free money that is being given to you by your employer.  Not taking the match is walking away from free money.

“Not taking your 401K match is walking away from free money”

— BFR

Another retirement savings plan to consider is the Roth IRA. The Roth IRA is a Retirement Savings Account that allows your money to grow Tax-free. So you pay taxes on the money before you put the money, but whatever you make on the after that is yours.

There is a limit to how much you can contribute to your Roth IRA…. Usually, $6000 to $7000 depending on your age, so please consult with your tax advisor.

4.   Diversify your investments

Diversification simply means putting money into different types of investments.

Spreading out investments to reduce risk is putting your money across many companies minimizing your risk should one company be affected by the downturn of the market.

If you have a mutual fund and one company suffer a major decline or loss, some others may not go down as much or may even increase. As such your overall losses may not be as bad minimizing your risk.

On the other hand, if you bought just one stock and it when down 50%, you lost 50% of that 1 stock.

 You can safely invest and live the life that you desire. You just have to take the necessary precautions, do your research and make smart financial decisions. Gaining knowledge is the first and most important step when preparing to invest.

Whatever you decide to do, please consult a financial advisor you trust before making any investment decisions.

How to stop spending: 8 ways to save money

It is very tempting to spend when you are trying to work on your financial goals. With the advent of online shopping, all it takes is a click of the mouse or a swipe of a finger and your purchase is on the way. Many shopping sites are making it very easy to save your credit card information and are using adverts to make their products harder to resist.

The good news is, there are things you can do to remove the temptation and stay focused on your goal.

1. Make a budget before the month ends and before you receive your income and make sure you stick to it.

2. Cancel subscriptions you are not using. The cable that you barely watch or the gym you have been planning to go to are all recurring expenses that steal your income.

3. Unsubscribe from newsletters and emails. Those deals that are delivered in your email are a trigger for you to spend. So why not remove the trigger. If you do not know there is a deal, you will not go looking to buy. A good app to use to unsubscribe is unrolled.me app

4. Use coupons, discount codes and cash back apps to shop. Make sure you are shopping for things that are on your budget. Honey will show you coupons and search other sites for cheaper deals for you. Another site, Rakuten gives you cash back on purchases you make.

5. Use cash. When you use cash, you feel the weight of your spending. Remove your credit and debit card information that is saved online. When you have to input that information every time, it gives you a few extra seconds to rethink your decision.

6. Use a shopping list when you go out grocery shopping and never go shopping when you are hungry.

7. Negotiate your bills with your service providers.Most service providers have loyalty programs for longterm customers or discount programs to keep customers. So before you commit to your next billing cycle, make sure you are asking for a deal. What is the worse that can happen?

8. Plan meals. Planning meals helps you with your grocery shopping and also reduces impulsive shopping. The random trips to the fast food restaurants because you cannot figure out what to cook is $30 extra dollars you have saved. Plus, you can get the family involved and make it a fun, family bonding activity.

Our Reset. Our WHY

In 2017, we did a total financial reset and decided to work towards building the life we have always dreamt of. We were over $300,000 in debt with no house and had two kids we were struggling to feed. Both of us had graduated from school. Jay from pharmacy school and Sylvie from nursing school. We were stressed out, frustrated at the financial mess we had on our hands, and disheartened by the toll it was taking on our marriage.

Where did we go wrong?

As immigrants in pursuit of the American dream, we had worked hard, gone to school, gotten good jobs, yet the American dream was nowhere in sight. What we had instead was a pile of debt; student loans, medical bills, car loans, lots of credit cards and a long list of financial mistakes. What was more, the financial commitments, expectations from our community and the needs of our extended family was getting us deeper in debt. We were barely trying to make ends meet. Struggling to stay afloat, we resorted to shuffling funds from one credit card to another and applying for even higher limits.

And when we thought we were at breaking point; Jay’s income was cut in half while Sylvie was in school amassing more debt through her master’s program.

How were we going to take care of our kids? Put a roof over their heads?

We went into survival mode. We did a total reset. Instead of trying to keep the house from falling by shifting funds from one credit card to another, we decided to start rebuilding from the ground up. This time with a better foundation. We needed a solid plan. Plagued with questions such as; how do we climb out of the financial pit hole we are in? How do we prevent this financial distress from happening? We got to work. Our financial journey had begun. A journey, though challenging at times, has become the turning point of our lives in the US.

When we were $300,000 debt, we were in so much distress and felt frustrated at our circumstance. Sometimes we were angry at each other for not being able to provide for kids or felt disappointed at ourselves for struggling to meet the needs of the family. Many times, on our financial journey, we felt like reverting to our old ways. But in your moment of despair, that is when God sows His seed. And so, it was for us. He reminded us WHY we were on this journey and of the experiences that had led us down this path.We were able to reset our thinking, and with the help of Dave Ramsey we began seeing results.

Though we were able to reset our lives and dig our way out of debt, if God had not ordained it so and poured out His blessing on our lives, we would not have been able to budget and execute our plan.Now, when faced with challenges, our faith in God, believe in our dream and each other keep us moving forward. We have learnt through all of this that no experience is wasted. Whatever you go through, there are lessons to be learned. Do not let your past experiences define you. Use your failures, mistakes, and setbacks as building blocks for the dreams you want to create.

Don’t give up. Set your financial goals, develop a plan, put in the required work and soon you will see results.

You’ve👏🏻 got👏🏼 this!👏🏽 

How to talk to your spouse about money

Talking to your spouse about money can be very challenging. This is in part because each spouse has a different relationship with money. The value they give to money, how they feel about money, the way they manage money, or their financial upbringing. 

Due to these differences, It is no surprise that talking to your spouse about money can awaken feelings of anxiety, fear, resentment, and distrust.

 These money talks even though stressful, are necessary for a healthy marriage.

 𝐓𝐡𝐞 𝐠𝐫𝐞𝐚𝐭 𝐧𝐞𝐰𝐬 𝐢𝐬....... Some things can be done to make these conversations less stressful.

In our quest to build a stronger, and more solid financial foundation for our marriage, we realized that 5 things are needed for a couple to talk about money without fighting. 

 1- Be open and honest with each other.  Avoid playing the blame game. It is hard for ANYONE to admit that they are wrong. 

“HERE ARE MY STRENGTHS, HERE ARE MY WEAKNESSES. SINCE WE ARE A TEAM, HOW CAN WE SUPPORT EACH OTHER?”

2- Be aware of your emotions, and keep them in check. Taking emotions out of these discussions is a hard task. So talk to your spouse about the feelings you have about your current financial situation and how your feel thinking about the future. Lead the conversation with love, and focus on creating a financial plan to tackle any money problems. 

3- Schedule financial discussions and make them fun (why not make it a date night too? ) Try not to talk to your spouse about money when you have had a long tiring day at work, or when emotions are running high. Give your partner an added reason to show up. Make room in your budget for fun activities to keep each other motivated to keep working toward your goals.

 4- Be consistent. Be intentional and make these discussions recurring events on your schedule. Block out specific dates in the month and set reminders. Those small consistent changes add up to the big wins.

 5- Both parties should be involved. No spouse should dominate the conversation. Be sure to seek each other’s opinions. Ask open-ended questions that allow your partner to contribute more than a “Yes/No” to the discussion. If you have a difficult time controlling the conversation, get a timer and take turns talking uninterrupted. 

Talking to your spouse about money keeps you accountable to each other. It also facilitates you reaching the financial goals your set for your marriage sooner. 

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