A Simple System to Attract Wealth
Transcript:
Wealth is attracted to good management. No matter how good you are at making it if you don’t manage your personal and business finances well, you’ll never be wealthy. I’m not talking some hocus pocus law of attraction concept either. It’s more concrete than that. You see, many of us think we need more money when we actually need to take better care of the money we have. And our lack of taking care of the money we have is often rooted in a lack of emotional intelligence. True wealth is built upon the foundation of solid emotional intelligence. And that increased emotional intelligence translates into recognizing more opportunities and developing more relationships that equal increased income.
Let me ask a few questions
Do you have a written budget that you actually use for both your personal and business finances? Why not? Have it all in your head? I did, too, until I realized that wasn’t working $50k plus in credit card debt later. Or what about savings. Do you have a savings account of at least $1000 for unexpected expenses? You don’t? Why not? Can’t afford it? My question would be, “How can you not afford it?” Or maybe (and let’s be frank) it’s just not fun to save. If you have a working budget and a savings account, you probably don’t need to read the rest of this blog.
Those excuses used to be mine. For years, my husband and I never had a working budget much less tangible and S.M.A.R.T. financial goals. I confidently stated that I knew our budget up here as I’d point to my head, which to me was how much we could spend not actual details like how much was coming in, how much we were paying in bills each month, spending on entertainment, etc. And what’s even crazier is that I kept lying to myself in spite of growing credit card debt. The idea of sitting down and figuring all of that out was like getting a root canal. Then when we were approaching bankruptcy, I was too scared to look at everything.
All of my responses were tied to lack of emotional intelligence. I emotionally didn’t want to do a budget. Instead of adjusting myself by choice, I was forced to, which is a big sign of a lack of emotional intelligence not to mention my refusal to change for years! The first obstacle I had to overcome was understanding the emotional aspect of financial management. Once I started looking at the why behind my decisions, I was able to make better ones. I got a clear picture of where we were at financially, created a budget, stopped impulse buying, and worked on our emergency fund.
After I looked at all our numbers, I went through the painful process of whittling down our expenses to bare minimum. However, I wasn’t willing to not have any fun at all. Instead of cable, we switched to Hulu and saved a ton of money. Instead of SiriusXM, I listened to podcasts and the radio. No more eating out so found great snacks and treats I liked and could eat at home. I knew that all of the stuff we eliminated would return but for now, I had to get us out of debt. Bankruptcy wasn’t an option for us. We believed we needed to keep our word and pay our bills. No judgment for those that have filed bankruptcy! That was our own personal decision. Today I have Sirius XM again, and we eat out occasionally. That one is still mainly off limits until completely debt free.
All of these decisions required emotional intelligence. All of a sudden I had more money, my business started making money, and I got a part-time job. Even though I don’t believe in the law of attraction, I do believe that doing what’s right and doing things well produces success and increase. You know what else happened. Murphy moved. You know Murphey, the guy that shows up out of nowhere to sabotage your best intentions to get ahead.
The second obstacle was to shift my mindset and view my budget as a road map to keep me on course and my savings as paying me first.
Paying off debt and being under budget suits my goal-oriented personality perfectly! Now I love looking at numbers and saving money. But I had to deal with the emotional intelligence aspects first. Then I had to develop a system for keeping track of everything. It has worked really well for me, and I’m sharing it with you in the hopes it helps you, too. You can tweak it or throw it out but have some type of system. I do have to let you know that when I first created this system after I created my budget, I dreaded doing it every month. I still had some of those old mindsets trying to sabotage me. So I decided to do it weekly! That solved that problem. Now I look forward to my weekly money dates, which is amazing! If you only knew how jacked up I was!
So before I tell you my simple system to attract wealth, you must know, again, that you will “attract” wealth more when you’re managing your finances well using sound emotional intelligence. Work through your junk. Recognize that money may be neutral, but our relationship to it isn’t.
My Simple System
Based on my budget for groceries, miscellaneous, entertainment, etc., I make my purchases during the week and place every receipt in an envelope, including any online purchases. If it’s not in my budget, I don’t buy it. I do not create a monthly budget. To me, my budget doesn’t change enough to do monthly. I do mine yearly (with a goal of revisiting my budget every six months) and am usually under budget in all areas because I faithfully follow my system. If you’re not the most disciplined, you might need to visit your budget monthly.
Every Saturday, I grab my envelope and my wealth notebook to carefully record all of my transactions on my Abundance Worksheet and also record them in my check register. This not only makes sure I’m within budget, it also lets me know how much more I have for spending that month and that no purchase falls through the cracks. I also record my income in my Abundance Worksheet. I use one worksheet for both personal and business expenses but designate them as such when I write them down. I then put my business financials into my spreadsheet. It might seem repetitive, but it’s very thorough and only takes minutes.
To make sure I caught all my expenses, I compare my checkbook register with my online activity. This is a good idea if you have auto payments and subscriptions.
That’s it! Since I started this, I’ve doubled my income, paid off a lot of debt, and created new mental habits that have brought me peace and joy in managing my finances.
Will This Work for Businesses with Fluctuating Income?
It sure will. Here’s what I do. I average out my net income monthly. You can add up six months of net income or one year or even three months and then divide that number by the number of months.
$20,000 divided by 6 (months) = $3,333.
Next look at your current expenses. How much do you have to have to pay your bills? Let’s say it’s $2,000. Make sure you always have at least $2,000 in your account and use the rest to pay off debt, buy groceries, pay bills, save, or whatever you have budgeted. I always have at least $1300 in my account and budget the rest out normally. It’s my cushion for the “just in case” times, and I don’t spend it. It’s covered me many times. If I have to use some of it for a slow month, I quickly get it back up once business picks up.
In Summary
You know what’s better than the financial blessings? The peace. Not having the “I should do this or I should do that” hanging over my head is well worth overcoming the initial fear of looking at how bad things were. On top of peace was the feeling of taking control of my future. It was very empowering. I’ll admit. It wasn’t easy, but I’d not change a thing, including the debt because it forced me to learn how wealth works. Even so, wisdom is doing what you need to do before you need to do it. That’s the more excellent way.