Desire was wealth but state of mind was broke. I didn’t know what wealth, savings, or healthy spending looked like. My comfort zone was just getting by. I wasn’t satisfied until I was all spent out and praying for my next pay day. Overdrawn accounts, payday loans (the devil), and irresponsible spending. Finances and good credit, a topic rarely discussed growing up for me and for most. Parents want to make sure you’re equipped with what you need for adulthood but forget one key component, financial intelligence. 401k, IRA, investments, budgeting, credit score. Imagine if this was a class taught in schools around the country, especially inner cities.
Parents will spend $200 on a pair of Jordan’s but won’t spend $12 on a book about money management, or take $100 to open an account and teach them how to earn, manage their own money, and buy their own shoes.
How much do you know about credit? Do you know what a healthy credit score looks like? I didn’t for a very long time. I divorced with over $60K of debt. Why? Because of financial ignorance. A credit score of 700 and above is considered good. I didn’t know how to manage my money. Even 13 years later it’s still a struggle. The “come from nothing” mentality can be hard to break. You feel like I never have nothing so once you get something (taxes, bonuses, etc…), you end up right back in the broke boat weeks later.
Managing your money. I’ve always been an emotional spender. Get mad, spend. Sad, spend. Over life, spend. Yes folks, even spending money I don’t have. What did it get me? Bad credit and overdrawn accounts. Overdraft fees will have you messed all the way up! $34 for every charge that doesn’t go through. I want y’all to think about that. Account balance $5.77, charge $6.98 plus $34 because you failed to manage properly. Dipping into my savings to cover what I messed up. Borrowing money from family members. Robbing Peter to pay Paul. Buying scratchers hoping for 20xs what I spent! (Real life y’all) You get the point.
Did you know that once a year you can get a free copy of your credit report from all three major credit bureaus? From where you ask? annualcreditreport.com It’s important to check your credit regularly. Checking my credit report regularly, I discovered several things that weren’t mine. I was able to contact them and have those things removed. Another thing that majorly affects your credit score, late payments! Call these creditors if you know you’re going to miss your due date. Arrange for a later time. So many creditors have to option to extend the due date without penalties. Lawd, credit is nice, but should be used for emergencies, or to establish credit. If you can’t pay cash, you can’t afford it, truth serum.
Budgeting…create one. I don’t care if you make minimum wage, create a budget. Compare your input vs your output, if it’s off, start trimming. Write things down, review bank statements. If the majority of your money is spent on eating out (guilty), buy groceries. Make lunches and meal prep, thank me later. On average, one can spend up to $20 per day on eating out. Multiply that times 5 (days in the week), then times 4 (weeks in the month), then times 12 (months in the year). Even the dollar menu adds up!
This isn’t for those who have mastered their finances. This is for real folks like me who struggle to change the narrative.
A few sites I love that may be useful to you:
• thebudgetnista.com
• mint.com
• retailmenot.com (if you’re going to spend, save a coin or two)
Until next time…❤️