Levo League is a career site that provides readers with resources and advice for professional growth. To better connect with LevoLeague readers, local chapters have been created to help members in different cities connect with each other (I highly recommend researching to find out if there’s an active chapter in your city). Over the last year that I’ve been in Houston, I’ve attended a few Levo Local events and have met some really amazing, dynamic women. Last night’s event was in partnership with LearnVest, a financial planning company, and hosted at the Houston Zoo. Below are some of my notes from last night’s presentation:
Easy ways to kick start money mindfulness:
- Sync all billing and financial accounts in one place (like LearnVest.com) so that you can see all the comings and goings of your dollars
- Create a separate email account to be used just for bills (i.e. RaynasBills@Sucsass.com) *and only use auto-pay for amounts that never change, otherwise you could be over-drafting or paying more without proper preparation
- Set calendar reminders to ensure you never miss a payment deadline
- Take a daily money minute to review your accounts and ensure that you’re still on the right track (her example here was noticing that a waitress took out a few extra dollars for her tip. Not a big deal for that moment, but something that could be accumulating without you noticing)
The Big Three are: Credit Card Debt, Emergency Funds, and Retirement
- Credit card debt – is considered ‘bad debt’ unlike student loans (shocker) that are considered good debit, because it is an investment . Your credit score is most impacted by your: a) payment history (biggest factor), b) the amount of credit you use (you having a $9,000 limit but only using $3,000 maximum is better than using $8,999.50 because it shows the lender that you are a responsible borrower that just needs a little help; not someone who relies heavily on credit cards), and c) length of history (keep those old accounts open! Just the way you’d trust a plumber with 20 years experience over someone with 2 years experience, is the way banks want to trust you!)
- Emergency Fund – this amount should equal 6-9 months of your take-home pay. Seems like a lot but it’s better to put in a little bit every month to work toward this goal than to save $500 every month, only to end up taking $400 back out because you have an immediate need. To make this goal a little easier, start off by saving 1 month of your take-home salary (small victory) then work your way up from there.
- Retirement – ultimately this number should be 20-30x your current income. Do as much as you can, as early as you can. And consider retirement when job searching, some companies offer very generous retirement matching.
The “B” word: Budgeting.
- Set a weekly flexible spending number by using the following formula:
Take-home Pay – Fixed Costs – Financial Goal Contributions – Non-monthly Expenses = Flexible Spending Number (this is the amount of money that you have to spend freely). The key here is doing it weekly.
My favorite tidbits from the discussion:
- Ask yourself, “What does financial freedom (or progress) mean to me?”
- Savor what you spend by creating a “phrase to save”. Let’s say you have a goal set to travel to Greece next year, before making a random or unnecessary purchase you would use your “phrase to save” by asking yourself, “will this glass of wine taste better in Greece?” if the answer is ‘yes’, save the money, get to Greece, and enjoy the wine there instead.
Whew, I know. That was a lot. But these are some really, really great tips that I think are worth implementing. I’m sure we’ll thank ourselves for taking this advice later!