In Today’s episode, we are talking about financial planning for your business and your family.

I don’t know about you, but I love reflecting on my past year and setting goals for the new year ahead.

Now for me, this past few weeks, I have worked a little, to be honest, not a whole lot, but I have given myself space to reflect and plan for what’s coming up next for me and a little bit of Netflix binging with my family.

Now, for those of you who do not know me, I am a big financial planning geek.

Now, I have not always been like this. Actually, I used to suck and I mean suck at money management when we had to declare bankruptcy back in 2018 because our real estate business went belly up.

Episode Highlights:

00:01:08 My #1 lesson from losing millions of dollars.
00:02:09 Fixing my toxic relationship with money.
00:03:48 You have a dysfunctional relationship with money.
00:03:56 Covid pounds and money.
00:05:46 Shift your mindset around money.
00:07:54 Start a budget!
00:08:24 On Friday’s we finance.
00:09:02 Dave Ramsey’s Every Dollar
00:10:00 3 Steps you need to get on track.
Follow us @kara.charron

Episode Quote
“If you do not tell your money where to go, it seems to magically evaporate.”

Kara Charron

Read The Full Episode:

 

Happy New Year, my friends!

I don’t know about you, but I love reflecting on my past year and setting goals for the new year ahead. Now for me, this past few weeks, I have worked a little, to be honest, not a whole lot, but I have given myself space to reflect and plan for what’s coming up next for me and a little bit of Netflix binging with my family.

Now, for those of you who do not know me, I am a big financial planning geek.

Now, I have not always been like this. Actually, I used to suck and I mean suck at money management when we had to declare bankruptcy back in 2018 because our real estate business went belly up.

I used that time to learn everything I could about money management and digital marketing. And I read so many books, took so many courses about paying off debt and financial planning.

My head was spinning, but what I realized was that I was doing it all wrong.

My #1 Lesson from Losing Millions of Dollars

So my number one lesson from losing millions of dollars in real estate was that I over-leveraged and when the market tanked, I totally went belly up. I spread myself too thin. I ignored my gut feelings – that intuition is so priceless and it cost me a whole lot of pain.

Now, I wouldn’t change it for anything in the world because I learned so many lessons all about money. And it led me to where I am today.

You know, I once read, if you can’t manage your money when you don’t have much, you will never be able to manage it when you get more. I never used to believe that, but it is so true. People think I just need more money and well, I think that might be part of it. But if you don’t know how to manage it properly, adding more money to the mix is just like pouring gasoline on a fire.

And that is so true. Now, I knew I needed to fix my relationship with money.

I had such a toxic relationship with money and now running a successful multi six-figure business. I have figured and fixed that relationship with money. Now, like any relationship, I’m always growing with it, but I feel finally at peace with it now, even when there are moments when the money isn’t flowing in and it’s not necessarily what I expected, I am seriously amazed at how calm I am, which allows me to adjust and just go with the flow and not freak out.

Now, funny enough, it always works out. I think most people starting off this New Year, they’re thinking about goals and looking at credit card statements coming in.

And I encourage you to think about your relationship with money.

Are you always worried about money or do you feel like you can never get ahead? Are you letting money control your thoughts? Listen, I used to do all of those things. And trust me, I still face financial freakouts, but I handle them so differently. Now, I know what it’s like to have massive and I mean MASSIVE financial pressure, but I’ve also found a way to not let that pressure consume me. I think people think they’re having money problems, but in reality, you’re having mindset problems.

And I’m sorry, I’m going to call the elephant in the room.

You have a dysfunctional relationship with money, and that’s OK. I’ve been there too.

Listen, I was listening to a podcast about weight loss recently, and I don’t know about you, but I know I have definitely put on some Covid pounds and it does not feel good. So I am surrounding myself with people who will help me get back on track. And I loved this analogy he used.

The speaker said (and I wrote this down) “Diets were created for people who like shortcuts because they think it’s too hard to do it the old fashioned way.” He said, “The reality is simple. Your body has so many calories it can burn and you must consume less than that and you will lose weight. That’s it. But the problem is people think it’s so hard to log your food and even weigh it. So they look for an easy solution. But the truth is, calories in needs to be less than calories out.”

I was listening to that, and that concept is so simple, but for someone like me who has recently started consuming so many extra calories, that is so much easier said than done. And it’s the same with money. You know how much you are currently making. You need to be living on less than that. If they’re more than that, you need to cut the fat, my friends and I know it’s so much easier said than done.

I mean, I’ve been there, but you need to start somewhere. So if your income is not enough to support your expenses, trim that fat.

So it’s time for you to take a stand and shift your mindset around money.

Yes, you might need to make some short term sacrifices along the way, but you can handle this. Listen, I remember years ago before we had kids and we were just starting out in life and my husband said to me he didn’t feel like he could come to me with any money issues, which totally offended me. But he said he couldn’t come to me with any money issues because I would freak out. And the reality is, he was right.

Any time the car broke down or we had an unexpected expense, I was like, “oh, great, what’s next?” Or “damn, like I just paid this thing off.” Or “we never seem to get ahead.”

And I look back now and chuckle, seriously chuckle at how silly I was back then. Listen, we still have unexpected expenses. Trust me, they pop up, but now they are not so much of a big deal. We figure out a plan and we move on because that’s what we’ve always done. And once I fixed my relationship with money and started a budget so I knew exactly what was coming in and going out, everything changed for me. Now, I still do this today.

I control my money and I always have a plan for it. If you do not tell your money where to go, it seems to magically evaporate.

You will never be perfect with your finances. Perfection is an illusion. You may still make some stupid decisions. I know I have, but they are not nearly as common and I give myself grace when they actually do happen.

Your relationship with money

Before you can start to plan your financial goals, you need to get real with yourself and check in on your relationship with money. If it needs some TLC, then start fixing it right then. Also seriously start a budget, track your finances.

I admit I am not the best, but I am always on budget. I do this for our personal finances and my business finances.I have a monthly planner for each and I break out our budget and the dates and everything gets paid and checked off each one as I pay them throughout the month.

For me, Friday is finance day. I take 20 to 30 minutes, review my budget for both my business and my personal, pay my bills, make sure I know I’m on track. And every month near the end of the month, I print off my digital budget and I break it out by week. And so my planner, it’s just that’s easier for me, I still like pen and paper, so I take my digital, I print it out and then I transfer it onto paper.

Now, for me, this system has allowed me to have my finances be a part of my weekly routine.

So let me quickly recap that.

I have the digital and I actually use Dave Ramsey’s Every Dollar budget.

So I use that and I fill everything out, but my brain doesn’t work that way, like, I can’t just operate off that. So what I do is I have that all mapped out and then I print it and then I have another book where I break that budget into the weeks. So what am I paying and all of the things. And so that really helps me personally stay on track.

So besides that, I have other financial goals and plans I have created that I work on outside of my budget. So, for example, doubling up on mortgage payments.

Now, before you can get to that, you need to first learn how to walk before you can run if your finances are not where you want them to be, so don’t make a bunch of elaborate plans. First, start with the small things.

You need to cut out the clutter and do the following three things.

#1 Fix your relationship with money.

Start working on that. And what does that look like for you? You know, for me, it was starting to realize that I’ll always figure it out that me getting mad at innocent bystanders because something didn’t go our way, wasn’t helping anybody and knowing that I’m resourceful that we’re going to figure it out.

And I just have to figure out plans. And once I figure out the plans, my relationship with money started really improving. I wasn’t I’m not scared of it, you know, taking the fear out of it and not coming from a lack mindset, but an abundance mindset, knowing that no matter what, we’ll always figure it out. And I know that that is hard. I am not saying that it’s easy, especially when you are living in lack, when lack is your reality.

But trust me, when you do, things will start to shift.

#2 Start a budget and track your income and expenses.

And like I told you, I’m pretty great at my budget skills, but I am not so great at tracking like every penny we spend. Honestly, like I know in my budget all the things get paid for, but there are people who are definitely more hardcore than me and like they print out all the transactions and their bank accounts and all the things, and they know exactly what has been spent.

I will admit I’m not that hardcore. I just do my budget. I make sure that everything in my budget is paid.

#3 Find money in your budget to start paying off any debt that you have.

So this means, my friends, that you may have to eliminate some expenses. And that is just the truth. And you can do it and you’ll be fine. And you might be a little uncomfortable, but you really want to do this.

I have this debt calculator that I had a programmer make for me years ago, and I pulled it up the other day and I was just looking at a mortgage. And if you paid it off, even with the cheap rates that we have now, I put them in and I was shocked. The hundreds and hundreds of thousands of dollars on a mortgage that you would acquire if it took you that long, like the twenty to twenty-five year term to pay it off.

I was just like what? That money belongs to you. So start being smart with it and make a plan to eliminate your debt. And I know if you were committed to fixing your finances, you’re going to figure it out. Trust me when I say it is so much better on the other side, learn to get excited about planning your finances.

I never thought that I would ever be excited about financial planning. And it is so great because with that planning comes so much freedom and I’m much more relaxed.

So there is just this sense of relaxation. There’s no longer stress around it. And like I said, when things aren’t working out, we just come up with a plan, you know? And so once you start planning and you take back control. That, my friends, is the first step to financial success. So go out there and make it happen.