That’s a great question!
While I can’t speak for other financial planners, I can share with you what this financial planner and her husband are doing with their finances right now. On a day-to-day basis, I handle the money management but my husband and I make our long-term, strategic financial decisions together. We’re not living in fear. We’re not hoarding cash.
What We’re Doing Right Now
We’re being intentional, using systems and automations with online banking, focusing on our goals and practicing gratitude and generosity.
Acting with Intention
My husband and I both have variable monthly incomes and we’re paid just once a month so we need to make the money last. We track our spending and know how much we need each month to maintain our lifestyle. We choose to live on less than we have coming in. Also, we don’t carry credit card balances and we pay cash for big-ticket purchases like vacations and vehicles.
Over the eight years that we’ve been married, we have found that frequent, judgement-free conversations about our finances serve us well. On a regular basis we set time aside for “finance committee” meetings where we look at our account balances, discuss upcoming expenses and work with a spending plan.
Another way we are intentional with our money is when it comes to cutting expenses. Years ago, we cut the cord to cable and redirected the monthly savings into our investment account. Same with our health insurance premiums and wine club membership. When we find a savings opportunity, we don’t keep the money in our bank account. We redirect it to another purpose that supports our goals.
Using Systems and Automations
You know the importance of having an emergency fund, or rainy day fund, and we do too! Years ago, I set up several bank accounts and gave them each a nickname. Using online banking, I set up monthly automatic transfers from our “main” checking into various other bank and investment accounts that I refer to as our “rainy day” and “sunny day funds.” Our “Rainy Day” fund is for unexpected, emergency expenses. “Sunny Day” funds are for known and expected expenses.
Rainy Day Fund (Unexpected Expenses)
- Medical Bills
- Appliance Repair or Replacement
Sunny Day Funds (Expected Expenses)
- Property taxes and insurance
- Vehicle expenses-replacement, maintenance and repairs and insurance
- His/Her spending
- Vacation
- College expenses – In just four years our son, Brock, will be going to college!
- Pre-retirement goals
- Retirement
- Gifts
- Clothing
- Personal care
These dedicated accounts are essentially electronic “envelopes” that make it easy to save in a systematic, disciplined manner and enable us to have the money available when we need it.
Regarding investments, we invest systematically into good quality investments. We don’t try to time the market because it’s time in the market, not market timing that leads to successful, long-term performance returns.
Staying Focused On Our Goals
We’ve decided to focus on a couple of major goals over the next few years.
- Pay off mortgage (UPDATE: Paid off Mortgage Spring 2022!)
- Boat the Great Loop-circumnavigate the eastern half of the US, starting in Michigan, through the Great Lakes, down the east coast, around Florida and up the Mississippi
To make those goals a reality, we maintain a laser focus on what we truly value in life.
Is your money aligned with your values and priorities?
Practicing Gratitude and Generosity
Giving back through charitable giving and supporting local businesses is another way we show our gratitude and support of the local economy, even if take-out is only a couple times a month. I love to cook!
We want to be a blessing to others and like to show our appreciation for excellent service verbally, with a kind note on the bill and of course in the gratuity!
Serving Others
If you feel like you need a financial reset or guidance as to what steps you should be taking now, let’s have a conversation. Book your Complimentary Welcome Call Now!