Client Interview #1

When I decided to write a blog, I knew I wanted to include client interviews. I started Richer Than You Think LLC over 10 years ago knowing that I wanted to help individuals and families succeed with their everyday money. This meant helping them achieve what I call financial stability. I felt I had the education, experience and mechanics in place to provide a necessary and valuable service FOR my clients. And to a large extent, I did. But the insight I’ve received FROM my clients has added perspective, richness and education that has made me better as an advisor, coach, and business person, and is simply priceless. I am so excited to share my client interviews with you.

Here is Client Interview #1, with Jayki.

RTYT: How long have you been a client?

Jayki: 3 years.

RTYT: What made you choose to seek budget help, and why did you choose Richer Than You Think?

Jayki: My financial life felt unmanageable. I didn’t have the tools to rein it in. I needed a professional’s opinion on what to do. I found RTYT from a trusted referral.

RTYT: Had you tried budget help before?

Jayki: I had taken a course from another personal finance company, but no professional help or coaching.

RTYT: You were a RTYT client for about a year, took a break, and then came back. How did your experience differ between the two segments of service/coaching?

Jayki: When I became a client the first time, I wasn’t ready to take it seriously. I knew the service was essential, but I wasn’t ready to be accountable. I wasn’t ready to scale back my lifestyle to get my finances in order, which meant attacking my student loans. I came back when I reached the point of really being ready to focus on financial stability, which meant putting an end to avoiding the loans. Once I made that decision, adjusting lifestyle was easy because the financial stability was more important.

RTYT: What makes this service work for you?

Jayki: Accountability, coaching, tools and personal service. My annual budget and weekly implementation plans provide reference, spending boundaries, and dollar assignments. This helps prevent drifting off into the gray. I feel like our work together is a partnership; we celebrate victories together. The personal nature of the service speaks to me; your firm genuinely cares about my progress. This personal aspect is really helpful; I’m not alone.

RTYT: We focus on helping clients achieve what we call Financial Stability (No debt outside of mortgage; Fully funded emergency fund; Meaningful, regular savings into retirement). How important is Financial Stability to you, and how different does it feel from building wealth?

Jayki: Financial Stability comes first. It’s like learning to crawl before learning to walk. You can’t build wealth if you can’t manage your day to day finances. Financial Stability is real and now vs. a far-off dream. It’s an action step toward wealth. But it’s also necessary if you don’t want to build wealth. It stabilizes you financially so you can make your own choices going forward. The beauty of your service is it’s fundamental for everyone: financial stability strategy, budget, implementation, celebration of achievements.

RTYT: What goal are you currently working on?

Jayki: It was originally paying off my student loans, and we made some important progress on the smaller ones. But since the rest are large, it will take several years. So I’m building my emergency fund to feel more protected. Then all of my surplus will go to the remaining loans. I’m doing this while not feeling deprived in my life. I was terrified of this originally which is why it took long for me to seek help. You have shown me that I can have both. That’s rewarding and freeing.

RTYT: How necessary is the coaching to you?

Jayki: It’s invaluable to have a coach to reach out to. You’re not a far off spreadsheet or entity I’ve never met.  As I said earlier, you care about my progress. In fact, you were the first person I wanted to tell when I paid off one of my loans! Not everyone needs coaching, but I do. For me it’s really useful.

RTYT: What’s next for you, after you reach financial stability?

Jayki: To start learning about investing.

RTYT: Sometimes it can seem hard to spend money on budgeting/financial help if you feel your finances are out of control. Can you speak to the value of the service relative to the price?

Jayki: Personally, I think it’s a steal for the value I get. Can’t put a price on peace of mind, and that’s what this service provides to me.

RTYT: What else would you like to share with readers?

Jayki: Whatever your fear is in terms of getting your finances in order and moving to financial stability, just reach out and have a conversation. RTYT is so open, warm and inviting. It’s worth looking into vs. staying silent and in fear. Plus, they are willing to go the extra mile with any situation. Also, I would like to meet other clients. I thrive on community, and having a community around this subject, where we are all pursuing Financial Stability together, would be really helpful and positive.
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I hope you’ve enjoyed reading Jayki’s perspective about the value and importance of fixing your finances, and seeking help to do so. Even if all you need is help putting a budget together. Or you need help prioritizing what to do first. A financial coach can get you on track efficiently. Don’t be afraid or intimidated. I always say, take a step. Maybe getting help is the best next step for you.

Jayki, thank you for being so generous with your time, and for your willingness to be interviewed for my blog.

Your Budget is Your Financial Best Friend

Whenever you are trying to fix or change what’s happening with our money, the most important thing you can do is to create a budget. It tells you exactly what you need and can do with your money month to month. It’s honest. I call it the boss to spending; and to me, it’s my best financial friend.

The budget tells you where you are starting from. It answers important questions that enable you to make decisions about your day to day handling of money. Questions like, “Am I living within my means?”, or “Are my expenses higher than my income?” or “Do I have subscriptions/recurring expenses I’m not using?” or “Do I have room for savings or a special purchase?”

When you create your budget, you suddenly have information. You have knowledge. And as the saying goes, “Knowledge is power.” You now have the power to make decisions with your money that will resolve issues, improve your financial condition, and allow your financial dreams to start becoming goals. Here’s the key: doing a budget is not difficult, should not be intimidating, and requires no special technology.

A pen and paper is all you need to write out your budget. It’s the simplest, most un-intimidating way to do a budget in my opinion. But there are seemingly infinite (free) resources available on our computers (spreadsheets and templates) or online (budgeting tools) to help. If you have access to and are comfortable with technology, it can be an efficient approach, depending on the technology you choose.

I find the most efficient technology approach to be a spreadsheet due to use of mathematical formulas for totaling, and the ease of modifying, adding or deleting line items. Online tools and templates can be helpful; however, I find most to be too detailed, causing the process to take too long and the resulting budget to be filled with far more line items than necessary. I know from my own experience and that of my clients, that the simpler the budget, the easier it is to follow. For example, you only need one line item for food/grocery, and it should include non-food grocery items like paper products, toiletries and cleaning supplies. And it should include eating out/ordering in. One line item for food/grocery is easy to track and gives you spending flexibility within that category.

Whatever method you choose to create your budget, the important thing is to start. I can assure you, you will feel a sense of increased control over your money with every line item you document.

As you put your budget together, remember that every budget has these three sections: Money In (Income), Money Out (expenses and savings), Balance (profit or loss). You are living within your means if your Money In is greater than your Money Out, meaning your budget is balanced with a Profit. You are overspending if your Money In is less than your Money Out, meaning you have a Loss. Your job every month is to plan your budget so that you are living within your means. The resulting Profit is what you put towards your financial goals. It’s that basic.

The bigger your monthly profit, the faster you achieve whatever financial goal you are working on. The more you spend, the less profit you will have, and the longer it will take to reach your financial goal.

But what if your budget shows a Loss? What if Money In is less than Money Out? You are living BEYOND your means, and your budget is not balanced. You are falling backwards financially.

There are two options to turn the Loss into a Profit: reduce expenses or increase income. Start with reducing expenses. How? First, if you have debt, bring all of your debt payments down to minimum payments only. Don’t pay extra on debt just yet. Next, in my experience, we as a society tend to spend more money than necessary on food, shopping and subscriptions. Reduce your spending here. Go as low as you think you can. Then, look at luxuries like lawn service, cleaning service, etc.

If you are still showing a Loss, look to increase your income by reducing the number of deductions coming from your paycheck or getting a second job (my least favorite way of making your budget balance). But focus on expense reduction first; it is usually the answer you need. In extreme cases, you might need to cancel things like the cable bill, or delay paying unsecured credit cards.

Once Money In is equal to or greater than Money Out, you have a balanced budget. Congratulations! Hopefully, you have a little profit (my first budget had a profit of just $5). Take a look at your work. Doesn’t it feel good to know your bills can get paid, and that you know exactly what your spending can be in order to live within your means? I found this knowledge really empowering when I did my first budget. And I still feel it today. I hope you do, too.

In a future post, I will talk about how to build key components into your budget that move you to what I call financial stability. But for now, you are in control under the guide of your budget. Trust it. Let it be the boss to your spending. In return, it will also be your financial best friend.

WELCOME!

I am glad you’re here. This is a blog about personal finance, and how fixing your money enables you to enjoy your life. Let me just list some of the reasons…