When we move towards a goal we are saying yes to life. When we dare to dream we are adding our own unique gift to the world. I want this for you! Seeing clients outline their goals and move in that direction is what All the Colors is about.
Of course, it’s not linear. There’s as many turn-arounds and roadblocks with money as there are in life. Yet, you have agency. You can create a life you love now even without accomplishing all your goals. There is joy and pleasure in the striving and being fully present for yourself.
As counter intuitive as it can seem, saving can actually make spending more pleasurable because there won’t be any guilt around the spending. It’s like limiting your desserts to high quality, mouth watering, gelato that makes you moan as you eat it – no guilt, just joy…
The life blood of your money is cash flow. It’s how you circulate what you earn. When you are aware and deliberate with cash flow you have taken charge of the building blocks of your financial life. The first step is to set up a spending plan: check out True North with Cash Flow and Five Tips to Enjoy your Bougette for my favorite system.
So what do you save for?
The first thing is a “life happens” fund. This is also known as RISK MANAGEMENT.
Unexpected expenses like health issues, car problems, and job loss are part of life. By having a money buffer you’ll be better able to weather these storms. How much do you need? At least $1,000 to start. From there consider what emergencies could come your way…
- Medical? Have enough for your maximum out of pocket deductible
- Car problems? Have enough for the insurance deductible and regular maintenance
- Job loss? Consider that unemployment will give you about half of what you make. Do you have enough to offset that income loss?
- One-off expenses? This is things like insurance, car registration, school fees, anything that’s periodic. Have money set aside to cover this.
Then there’s savings for OPPORTUNITIES! And this is such a sweet spot to be in. Every dollar you put towards manifesting your opportunities makes them that much more real.
- Home ownership? Have the money for a down payment, closing costs, and maintenance issues
- Ready to start your business? Capital reserves will make that launch easier.
- Did you toddler say she wants to be a neurosurgeon? It’s never too early to start saving for education.
- Dreaming of a sabbatical? You can do it with money!
- Retirement? Definitely! And for this you can go beyond saving to investing!
What if I get the benefits of saving, but it just doesn’t work for me??
As a natural saver I weird out people with how much I like putting money in the bank – it helps me feels secure and grounded. Even so, I haven’t always been able to save. There’s been times when I’ve been between job, when there were emergencies bigger than my savings account, and I am currently not saving as a new entrepreneur.
Consider your money history and how that affects your comfort with saving. For example, a good friend of mine grew up with her parents taking her money gifts and deciding how the money would be used for her. So she does NOT save, at least not naturally, although things have changed as she’s evolved that money memory.
Past money experiences need to be unpacked with so much compassion and a gentle sense of experimentation. If growing up, one day there was enough and then there wasn’t, saving could be as unnatural as walking around on your hands. In situations like this, it doesn’t make sense to save for later because you don’t know whether there will be enough later.
Past money experiences need to be unpacked with so much compassion and a gentle sense of experimentation.
Although it can take time to develop a saving muscle – it can be done! Bring curiosity to your money practices. This is my specialty. Want to talk? You can set up a free Discovery call using this link.
When do I graduate to investing?
So what do you do with all this mullah? If you’ll need the money within the next 2-5 years keep it in cash. I know cash isn’t sexy, especially now that interest rates are so low, but it’s STABLE and AVAILABLE.
If the money will be for a goal that’s more than 5 years out then invest to have it GROW faster! In separate articles I’ve outlined investing 101 as well as what to keep in mind regarding taxes. Feel free to reach out with questions.
Say it with me – Yay for Saving!
Saving is saying yes to a bigger life by saying no to random expenses today. So how can you enjoy this denial? Is there a masochistic trick? Maybe…? Postponing pleasure does enhance it – remember that gelato example I opened with?
So what gets me saying yay for saving? The anticipation of what I’m saving for, the pride of being able to manage my own emergencies without debt, being able to spend worry free, getting my hair done, and being a BOSS with my balanced check book.
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