Chapter 3 – Own It: Get A Grip On Your Money

Articles

17 Dec

Written By Vestpod

You'Re Not Broke, You'Re Pre Rich by Emilie Bellet Chapter 3

These mini-money guides are based on the practical money book "You're Not Broke You're Pre-Rich" by Emilie Bellet.

Do you have a plan for the next decade? Don’t feel bad or guilty if you don’t. Research shows that just 4% of us are thinking that far ahead – most of us just plan for a few days or weeks in advance.

It’s time to think about the future. A plan is a good thing, especially when it comes to money. It forces us to ask ourselves the big, exciting and scary questions – What are my dreams? What do I really want to do? – and gives us a way to turn those answers into reality. A plan saves us from stress, and debt, and helps us to sleep better.

So, let’s start with the ‘easy’ part: writing down your goals. They might range from a big birthday party in Hawaii to buying a house or looking after your parents in later life.

Now re-order that list depending on whether those things can be achieved today, in the short, medium or long term.

One last step – be more specific. Think about what you want to buy, how much it costs, how it can be achieved, how long it will take, and whether that goal is meaningful or exciting to you i.e. you will stick around when the going gets tough.

Your targets are allowed to change, so don’t panic – you can regularly revisit them. You’re also allowed to slip up occasionally. But this task will require some discipline, and there’s no getting around that. Your financial health is mostly up to you – no one else will do it for you. The good news is that money discipline gets easier the longer you do it, because it becomes a habit. And there are lots of ways to stay focused, from apps like Stikk sending you reminders to creating a mood board on Pinterest. You can never have too many visual reminders…

Once you’ve saved up enough money, it’s time for a reward. Why not sign up for a cooking course, book a trip abroad or make an appointment with a life coach? Research shows buying experiences, rather than material goods, are worth more and make us happier in the long term.

Talking of the long term… one (you) might become two (with a partner) or even three or more (with children). How do they fit into the equation?

When it comes to sharing finances with your partner, there is no right answer: it’s highly personal and depends on your circumstances and the relationship. There are perhaps clearer and more practical lines with children, however – these include considering life and health insurance, saving for the child’s future and making a budget for your maternity/paternity pay.

There are other things to discuss if you want to protect yourself, like signing a prenuptial agreement, and writing a will (the majority of UK adults don’t have one). We will go into all of those options.

Really long term means even beyond marriages and children and even beyond retirement – an increasing number of us will live until 100! We need a plan more than ever, for all stages of life.

If you aren’t quite ready to get to the big questions and long-term plan stage, and you definitely don’t have a plan, then just remember one thing: save for an emergency fund. Start saving whatever you can, right now. A rainy day fund should cover at least three to six months’ worth of expenditures in case life throws you a curve ball. We are all hit with curveballs at some point or another – especially if we live until 100. A money plan can’t guarantee that we avoid disaster, but it certainly helps us to bounce back.

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If you want to learn more about the book and see a few photos from the book tour, it’s here. You can order "You're Not Broke, You're Pre-Rich" on Amazon and if you’ve read the book and enjoyed it, I will be forever grateful if you could review it on Amazon or Goodreads.