A hearty welcome to “Grandma’s Wealth Wisdom” with your neighborly hosts, Brandon and Amanda Neely. This is the only podcast that helps you take charge of your cash flow and leverage your assets, simply and sustainably, the way Grandma used to.
Amanda: Hi, I'm Amanda, and welcome to Grandma’s Wealth Wisdom where we help you break through to a smart, stable financial future with the tried and true wisdom Grandma used.
Brandon: Hey, and I'm Brandon, and welcome to Episode 47 titled Paycheck To Paycheck: Grandma's Strategy to Break the Cycle.
Be sure you've listened to Episode 46 where we talked about “What is an independent financial future anyway?” In that episode we defined financial independence and looked at some of that crippling belief people have about money. [01:00.9]
Today, we're going to expound on that a bit and we're going to address one of the top crippling beliefs that people say to themselves all the time, and these are, “I'll never have enough.” Ever said that to yourself? “I'll never have enough,” or “I'll always be paycheck to paycheck.” Two crippling beliefs there.
Amanda: Yeah. Now, what we're going to share today are actually three different starting points on the journey to breaking paycheck-to-paycheck. You might be at any one of these three starting points. We're calling these points A, B and C, so that you can kind of think of it like this. You need all of your ABCs, right? Those ABCs, in order to move along through D through Z, right? If this is a journey, however many steps there are to complete that journey of no longer being paycheck to paycheck.
We're going to talk about A, B and C today, and give some hints at what might come D through Z or however many steps there are. [02:06.1]
Brandon: We might learn a little bit of the alphabet. That's what we're teaching our sons. So, that’s fun.
Amanda: Maybe that's where that came from.
Brandon: Yeah, there we go. So many people live paycheck to paycheck and for a lot of reasons. Maybe it's student debt. Maybe it's credit card debt. Maybe it's being underemployed. Maybe these kids seem to eat up everything. Literally and figuratively, anything extra, they eat.
Amanda: Right, and our son is only one and a half years old, and he seems to already be trying to eat us out of house and home. I can't imagine. I dread the day when he's a teenager and really tries to eat us out of house and home. He's already a bottomless pit.
Brandon: So many people run out of money before they run out of month, but it doesn't have to be you. How do you get out of that cycle? How can we avoid getting into that cycle as life changes, too? How can we make sure that our month isn't running out of … or our money isn’t running out of month … or that kind of whatever? [03:13.9]
Amanda: Yeah, let's get to the points, so here we go.
Point A is believing you can. Most people believe they will always be paycheck to paycheck because that's all they've ever known, and there seem to be too many things to do with the paycheck and not enough paycheck.
What's the alternative to those more crippling financial beliefs like “I'll always be paycheck-to-paycheck” or “I'll never have enough”?
What we come up with is an empowering belief that goes something like this: “I choose what I do with my money.” Let me repeat that again. “I choose what I do with my money.”
Brandon: I'm going to stop you there, Amanda. I don't choose to pay taxes, unfortunately and maybe fortunately, I don't know, whatever. I have to pay them or the IRS will lock me up in jail. [04:09.0]
I don't also choose to pay rent or have a mortgage. I have to put a roof over my head and your head, and our son's head and my mother-in-law's head. We’ve got to make sure we … I don't know. I don't know if I go all the way there with you.
Amanda: Yeah, sure. Okay. But consider this: you do choose where you live, which impacts both your taxes and your housing costs. When it comes to your money, you likely have more control than you give yourself credit for.
Brandon: I'll give you that.
Amanda: Okay. And just remember that we're talking about the long haul. You probably can't move overnight to reduce your income or property taxes, or reduce your housing costs, but there might be some immediate things that you could do to reinforce this idea of “I choose what I do with my money,” which I think is a good segue into Point B. [05:04.2]
Brandon: Or alphabet B? Alphabet B or Point B is knowing and being ready to question what your money is currently doing. How do you tell your money what to do if you don't know what it's doing now?
What that means is, first, getting a handle on what's coming in, and what's going out. You have to know what you have and what it needs to be doing. It's like you get the lay of the land before charting your journey. You’ve got to kind of have that map to know where you're going to go.
Practically, that means recording every dollar that enters your life and what it does for a period of time, maybe a month, maybe two, maybe a little longer. It just is tracking and keeping a journal, if you will, of your money.
Amanda: Yeah, and it just so happens that there's a great tool to help you do this, to get the lay of the land with your money, so that you can see how you might take steps to break the paycheck to paycheck cycle. It's actually a budgeting app. [06:09.9]
Amanda: Right, budgeting is a four letter word, not really, but kind of, but they have this tagline: “You've never budgeted like this before.” It actually sounds like a guarantee. “You've never budgeted like this before.” They use that “never,” and kind of as a challenge like, Try us out. See if you've ever seen a budget like this.
And this idea of knowing what your money is doing, they actually call it “Give every dollar a job.” It's rule number one of their four rules for how to budget. Give every dollar a job.
We're huge fans of YNAB or You Need a Budget is what it's called, and we invite you to check them out, see if they can help you with seeing what your money is doing for you, so that you can begin to question what your money is currently doing. [07:01.2]
We're actually going to provide a link in the show notes, so you can go and see their website, get the free trial that they offer. And with our link, if you choose to sign up after the free trial, you'll get a free month on us basically at no extra cost to you. Full disclosure, we get a free month, too, but we'll use them even if we don't get that free month. We love them so much. Again, check out the show notes for that link, so you can get the free month as well.
Grandma always said, “Eat your vegetables. Look both ways before crossing the road. And never risk your financial future on elements of the market you can’t control.” That Grandma, always good for some tried-and-true advice. And although some of her wisdom seems to have skipped a generation, you don't have to be left behind.
Download “Grandma's Top Tips for an Independent Financial Future” absolutely free, when you visit Grandma’sWealthWisdom.com. Don't wait. Get Grandma's best tips today.
Brandon: Let's assume you know what your money is doing. You've got this snapshot. Now you can start asking the big questions and these questions are like this: Is this what I really want these dollars to do for me? Could I find a way to make these dollars work smarter? What if I tried _________ instead? What if I tried doing this with my money instead? And what is that _________ for you?
As you ask those questions, you start to see ways to break that paycheck-to-paycheck cycle by taking charge of your cash flow, which is Point C: taking charge.
Amanda: Yep, Point C: taking charge of your cash flow. When you begin to believe “I choose what I do with my money” and you know and question what your money is currently doing, the natural order is often that you take charge of your cash flow. Simply put, taking charge of your cash flow is all about telling your money, the money that comes into your hands, what to do. [09:08.1]
It's often the first step to getting off the hamster wheel of paycheck to paycheck. Telling your money what to do leads to all sorts of benefits and really gives you Points D and E and F and G. All of those are probably going to be ways that you take more control, take more charge of your cash flow, and give your dollars better, smarter things to do for you.
We give you some ideas of what those things could be in a past episode of the Grandma's Wealth Wisdom podcast. You’ve got to go way back to Episode 4 entitled A Hen That Lays Eggs and Hatches None. It's one of the first episodes that we released and we had that cliché, a hen that lays eggs and hatches none, going through the cycle over and over again, never seem like you're making progress.
We gave four ideas for how to get off the hamster wheel, how to break the paycheck-to-paycheck cycle in that episode. I'll recap those ideas really quick here, but if you want the details, go listen to that episode. [10:12.9]
The four ideas we shared were restructuring your debt, changing how you save for retirement, rethinking your taxes and considering how your spending aligns with your values. Again, those were all outlined in Episode 4, A Hen That Lays Eggs and Hatches None.
Brandon: Those are some really good ways there. So, which of the ABCs is your next step?
Do you need more of A to believe you can break the paycheck-to-paycheck cycle? It all starts with belief, right? So, do you need more of that?
Do you need a little bit more of B to know what your money is doing for you and be able to question everything with what it's doing for you?
Or are you ready for C to take more control of what your money is doing, so that you can break through to an independent financial future? [11:12.3]
Amanda: Now, let's say you've got your ABCs down and you're ready for D through Z. I mean, lots of people that listen to those podcasts, you are super smart with your money. You've been tracking it for years. You've been giving it better jobs to do. You've nailed your ABCs. You're already in kindergarten or first grade, or whatever, on that journey toward financial independence.
Our encouragement for you today is to remember that it's a journey. Remember, it's a journey. You are going as far as you can see. You're making those changes to improve how your money is working for you. You're getting around that bend in the journey.
But then, guess what? Then you see farther. You see what the next leg of the journey is like, and as long as you're looking for it, you're not closing your eyes or standing still, you'll kind of see what comes next. [12:05.8]
The important thing here for all of us, no matter for A or Z, or anywhere in between, is to remember that it's all about taking action. The worst thing that you can do is to feel overly comfortable, wherever you are in your journey, and we're all in this on some journey of some sort. We hope this episode has given you some confidence to keep going on that journey toward an independent financial future and, wherever you are in your journey, to help you build that confidence and go further along that journey.
We decided we wanted to start giving you some extra guidance. We can only do so much in these podcasts. We want to just start helping you take what we share here and implement it in your life.
So, we're launching a new service for you. We've decided, not every episode, but some episodes, we're going to start creating these wealth journals for you to download. The idea is that these wealth journals are one-page exercises that can help you take what we share in the episode and figure out how to implement it into your life. [13:07.9]
We fundamentally believe that knowledge without action often leads to cynicism and jadedness. You've got all this knowledge, but you don't know what to do with it or you've not putting it into action you can get. It can get really frustrating. So, we want to empower you to take action.
The first action to take is to go download your wealth journal to go along with this episode. We’ve tried to make it really easy. It's just Grandma’sWealthWisdom.com/47, the number of the episode, the number 4 and the number 7, where you can get your wealth journal, go through the activity that's in there and think through how you can implement some of what we've talked about today.
Brandon: And I want to add that this service that we're providing is free to you.
Amanda: Oh yeah.
Brandon: All you're doing is putting in your email, getting that little document, that journal, and it's a wealth journal, so there's going to be more pieces that are going to come. Maybe you put it in a binder and start putting those wealth journals in place as we create them, and it's going to be your journey. It's going to be your journal. [14:16.8]
Again, it's free. So, why not do it? Even downloading the PDF. It’s just going to be helpful. So Grandma’sWealthWisdom.com/47. You'll see a little image or the way to download right there.
One final reminder. You are the driver along your financial journey. You are the driver along your financial journey. Don't be the passenger in this. Don't take this as a passive role. Be the driver. It's up to you to take charge and take control of your future.
Now, we're here to help as guides along the way. We want to be there for you. But, again, we're just guides. You're the driver, and we are never too busy to chat. [15:02.8]
So, if you want to get to a call with us—and I would strongly recommend, it's great—go to Grandma’sWealthWisdom.com/call.
Amanda: And then, be sure to subscribe to this podcast, so that you don't miss the next episode that comes out on Valentine's Day. We hope you'll be our Valentine and join us to discuss a common topic this time of year, taxes.
Brandon: Oh, I hate that.
Amanda: We'll be asking the question, When do you want to pay your taxes?
Brandon: Er … never.
Amanda: And as a little teaser, the answer isn't necessarily April 15th, and we'll share why.
Brandon: Until next time, keep building your wealth simply and sustainably, so you can break through to a smart, stable financial future.
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The topics presented in this podcast are for general information only and not for the purposes of providing legal, accounting or investment advice. On such matters, please consult a professional who knows your specific situation.
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