Nobody inherently possesses superior money management skills, which everyone must learn, preferably sooner rather than later.
Even after becoming familiar with financial terminology and techniques, starting the journey toward financial well-being can still seem daunting. Even if you have ample resources, you might struggle knowing how to manage them, leading to stress and other negative emotions that do not typically improve the situation.
Tiffany Aliche, a financial educator known as The Budgetnista, emphasizes the importance of releasing any feelings of shame associated with financial situations as the initial step towards achieving financial goals. Aliche experienced her financial challenges before finding her way to economic well-being and sharing her journey in a book to assist others.
Whether you are facing significant debt or simply unsure where to begin building wealth, Aliche outlines the first three steps to start your journey toward financial wellness:
1. Let Go of That Shame
Everyone begins at a different point. Some are fortunate to learn financial skills early, while others reach adulthood without a solid understanding of essential money management. Feeling embarrassed about lacking financial knowledge will not help improve your situation.
Many believe they must be flawless with money to reach their financial objectives. However, financial experts note that striving to adhere rigidly to a strict budget or debt repayment plan often fails because humans are prone to mistakes.
To overcome shame about your financial situation, Aliche suggests opening up about it. She advises confiding in a trusted friend or family member when you feel stressed or uncertain about money. Often, you will discover they share similar feelings. Realizing you are not alone can boost your confidence to move forward in your financial journey.
2. Ask for Specific Money Goals Help
Personal finance revolves around your circumstances, so seeking personalized assistance is essential to determine your next financial steps. Aliche advises identifying your specific challenges so you can ask for targeted assistance.
Specific individuals feel anxious due to debt, others worry about their inadequate savings, and many strive to break free from the paycheck-to-paycheck cycle.
Aliche tells a story about a friend who received a $2.5 million settlement and did not know what to do. He wanted to ensure financial security for his son, pay bills, and feel comfortable. Aliche advised him to hire a certified financial planner to manage the newfound wealth.
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3. Focus on What You Can Control
After devising your plan to achieve your goals, the next crucial step is to implement it. This can feel overwhelming, particularly when experimenting with new methods or grasping financial concepts. Aliche advises focusing on the aspects within your control as the key to staying committed to the plan.
Aliche explains that there are different levels of control over expenses. Discretionary expenses offer the most control, allowing for immediate adjustments. On the other hand, bills such as those for housing and utilities may require more significant lifestyle changes to modify.
Starting smaller than desired might be necessary. Achieving big financial goals, such as retirement savings or business launching, is lengthy. However, every journey must commence somewhere. Aliche emphasizes the importance of starting to initiate progress. Even if your major goal feels distant, breaking it into smaller, actionable steps is essential.
