Money, money, money… It seems like this topic is always front of mind.
Whether we talk about it positively or not, money is always going to be a huge part of our day-to-day conversations. Finances can be a sort of stress, especially for women and young girls, which is why it’s important to talk about this topic a lot more.
I have always had a rocky relationship with money. Growing up I felt like I never had enough and, when I did have it, it would disappear from my bank account way too fast.
Little did I know that managing money is a skill and as such it can be polished and even mastered. Although I am no millionaire, I have now come to grips with the concept of money and I have developed a series of hacks that completely transformed not only how I see my finances but how I handle them.
If only these hacks were available to women from a young age, the world would probably be a different place!
Shift your mindset around money:
Whether it’s society, the lack of tough conversations, or silly statements from family members, many women internalised the idea that managing and generating money is hard, complicated or something for later in life.
I want to tell you now, once and for all, that you CAN understand money and you CAN take control of your finances.
Money is not rocket science and honestly, as women, we understood some way more complex topics already (go explain menstruation to men!).
The trick here is to shift your mindset and educate yourself.
Why do you think you can’t understand finances? What beliefs do you hold about money and budgeting? Do you find complaining about money often and, if so, why?
Journaling about those tough questions was incredibly beneficial for me as I was able to uncover the real root of the issue, heal, and move forward (a story for another time!). I recommend sitting down with the above questions and reflecting on them.
On top of this, make it a habit to learn about finances regularly, whether it’s a book, a podcast or a course. The more you persist with this, the quicker you’ll understand there is nothing complicated about it — you just needed to familiarise yourself with the terminology! Countless resources can help you with this but the keyword is implementation: once you learn something, implement it right away and watch your mindset transform!
Some of my favourite money books:
- Geed good with money — The Budgetnista
- Black Girl Finance — Selina Flavious
- Get Rich Lucky Bitch — Denise Duffield-Thomas
- You are a badass at making money — Jen Sincero
- The Barefoot Investor — Scott Pape
Track your finances:
I don’t care if it’s on a money journal, on a spreadsheet, or using an app. Girl, you must track your finances!
There is no way you are going to learn how to manage your money if you don’t know how much you spend every single week.
If the word “tracking” is not resonating with you, you’re not alone. After reading “The Barefoot Investor” by Scott Pape, I decided to switch to “money date” and make it spicy! Feel free to try this too, and consider pouring yourself a drink or getting your favourite food.
The point is to create positive money habits so that your brain understands money is fun!
Find a system to track money that works for you and, at the very least, track your income, expenses and recurring expenses; making a clear distinction between essential and non-essential expenses.
Personally, I track my finances weekly in a (perfectly colour-coded) Google Spreadsheet. Anything extra is labelled as yellow so that I can see how much money I spent on non-essential items (mostly eating out!).
Have an emergency fund:
Also called safety net or money cushion, this is probably the one hack that changed my money game. If you can take anything from this blog post, let it be this.
An emergency fund is a separate saving account that, as the name suggests, serves to help in tough times only. Before you roll your eyes and move to the next hack, consider how many times you were flat broke (or close to) and something unexpected happened (hello, Covid). The purpose of this cushion is to give you enough time to get back on your feet, without spiralling down in desperation.
This is the hack that will make you feel confident in your money mindset and life, trust me.
To get started on this, pull up your money tracker and calculate how much money you need every single month to live comfortably. Then, make it your goal to fill your saving account with at least 3 - 6 months’ worth of expenses (for example, if you spend $5000 every month, you want your emergency fund to be between $15,000 and $30,000).
Yes, it will seem like a big number in the beginning, but remember why you’re doing it: you want to have your own back. It doesn’t matter how long it takes, you gotta have your safety net!
Remember to make your cushion hard to access: you don’t want to spend it on a spontaneous date night! It’s best to open a safety account with a high-interest rate, save money consistently (you could even schedule some recurring transfers) and forget about it.
Find your way to invest:
Investing, cryptocurrency, stocks… This is where most people get lost. I used to think being good with money meant knowing everything, but I couldn’t be more wrong.
The truth is: learn the basics of what you need and implement as you go.
Just like you don’t need to know everything about your car to be a good driver, you too can be good with money, knowing what you know now. Simplify your finances, and add more knowledge when you’re ready.
That being said, the most straightforward way to explain investing is this: buying assets that increase value over time. Basically, you can see your money grow on its own without too much maintenance.
Investing can still be daunting (it is for me!) and lots of research goes into it. If this is how you feel too, I recommend an app called Raiz. Raiz invests spare change and manages your investment portfolio on your behalf. For example, if your daily coffee is $4.80, Raiz will round up that expense to $5 and invest $0.20. You’ll be surprised at how much money you can set aside just with spare change!
It has a pretty high-interest rate and, because it takes so long to transfer money into my account, I also use it as my safety cushion.
Create better money habits:
Being good with money is a lifelong journey and the best way to master this skill is to start early. If you can establish healthy, productive and smart money habits now, you’ll find yourself in a much better position in 10 years’ time.
A mindset shift that helped me greatly was to spend what is left from saving, instead of saving what is left from spending. Now that you have a money tracker and your emergency fund, your next goal is to figure out how much you can save on a weekly or monthly basis so that your cushion can grow!
This is where you have to find a system that works for you: whether is setting up automated recurring transfers to your emergency fund or manually doing it on every money date, this is up to you. The important thing is that you save first, spend later.
Another money hack that changed my relationship with money is to live below your means and don’t buy what you can’t afford! For example, if you want to buy something that is advertised for $100, can you find a similar product for $80, and then invest those extra $20? And make sure you have those $80 in your bank account or wallet, so you can avoid any instalments or split payments
The secret is to get out of debt and to stay out of debt.
I hope these money hacks will help you as much as they helped me! A good way to stay on track with your new money goals is to find a money buddy and keep each other accountable. So share the love and start saving now!