Savers Want Expensive Pretty Things Too

I’ve been tooting my horn a lot about being such a great saver. Not to say that I’m not. But it’s time for me to reveal some of my human weaknesses. Yep, humility here I come.

My favorite moment of weakness was when my husband and I were buying our first house. We ran our numbers and we decided, together, that we didn’t want to spend more than $200,000. That’s not much in California. We knew that the homes in our price range were going to need more than just a little TLC. But we were prepared to put our blood, sweat and tears into fixing up the place. That’s another story.

So, we met with our mortgage broker and she told us that we were qualified for a $400,000 mortgage. What?! Really?! That. Is. Awesome! The houses in that price range are SO much nicer. This is when I got distracted by pretty shiny things. My rational thinking went out the window and my emotions were in overdrive. We all want nice things, right? So, when a financial professional and the entire banking industry tells you that you’re eligible to buy more, bigger, better - It’s hard (no, practically impossible) to say, “no, I want less.”

At my core, I’m a small-quaint-house person. But the carrot dangling in front of me turned me into a big-fancy-house person. I was dreaming about moving into a house that wasn’t just turn-key, it was perfect. Luckily my husband wasn’t distracted for a minute. He saw me going over the deep end and he let me indulge in my fantasy for a minute. But after a couple of weeks, he sat me down and had a nice long talk with me about our house budget. It felt like Thor's hammer came crashing down on all of my newly found dreams. I hated him.

He reminded me that the banking industry determines how much we can afford based on our current lives, but they don’t know what our future lives look like. We knew that we would eventually leave town, rent out our house, and be unemployed for an extended period of time while traveling. He reminded me that a $400,000 house wouldn’t make those plans easy. He was right. It wasn’t a pleasant conversation. Honestly, it wasn't a pleasant couple of weeks afterward either. But it had to be said. And in the end, I was glad he said it.

It took us a while to find a house that was in our price range that wasn’t a complete dump. Seriously, a few houses were going to come crashing down with a big gust of wind, another one flooded every year, and the one with the great view was going to implode from a leaking oil tank. All of these dumps made it really hard to keep looking at houses in our budget. It would’ve been so much easier if we could’ve just spent $50,000 more. But it would’ve increased everything – the mortgage, taxes, insurance, maintenance…the list goes on…

We finally bought the cutest little cabin five blocks from Lake Tahoe for $180,000. Then we put another $20,000 in renovations (plus the blood, sweat and tears that I mentioned earlier). The best part is that we’ve never had a single moment of buyer’s remorse. It took us longer to find the house than we would’ve liked, but it fits perfectly into our lifestyle and into our budget. Which meant we were able to rent it out and be unemployed world travelers for six months.

We’re all human. Sometimes we can rein ourselves in. Sometimes we need someone else to rein us in. We rarely want to hear it. But sometimes we need to. 

-Leah Schonlank

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups. 

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Teenage Money Date Night, Part III: Judgment Free Coaching

I began “Teenage Money Date Nights” when Oliver’s brakes went out and I realized that I let her buy a 10-year old car without teaching her to immediately begin saving for repairs. Bad mom. Bad financial coach. I needed to immediately step up my efforts to teach her two of the most important things we all need to know: how to budget and how to save for predictable, but nonrecurring expenses.

Once a month we set ourselves an appointment and went to dinner at the super-cool Bows & Arrows cafe. We'd hang out afterward to have little working sessions. Being at Bows & Arrows set the stage for fun. Note to the parents out there: choosing a place that served wine was also a plus.

Date Night #1 was rough. Frankly, I wasn't too sure what I was going to teach her. I've taught tons of people, but I've never taught a teenager. I knew that lecturing wouldn’t help much; she was already getting lame “financial literacy” education at school. I knew what she really needed was what many of my clients need, someone to do the work alongside them and ask them the right questions. Ooooh, that’s what I needed to do, treat her like a client.

First task with a client: see them as a hero. I learned from Master Coach Maria Nemeth to always see the good in your clients, to know that they are on a mission in life and that it is your sole purpose to support them, to the best of your ability, on that mission. So when I decided to fashion our Teenage Money Date Nights like a client meeting, I knew I’d have to see Oliver as the hero she is. Which meant I had to set all judgments aside, even the ones about her buying ridiculously frivolous things and even the ones when she didn’t send her savings away like she said she would. It was not my job to judge; it was only my job to teach. 

It was hard; really, really hard. But luckily I listened to the little voice in my head that kept saying, “treat her like a client, treat her like a client.” That first meeting was the hardest. I think we were both nervous, didn't know what to expect and emotions were charged. By the end of the night, I could see that there were judgments hanging thick in the air, but interestingly none of them were mine. By the time Oliver had sketched her spending plan together and realized that it didn't work, she was upset and berating herself. I didn't need to; she was doing a good enough job herself.

My job became being the impartial teacher:

• “Well, how far off is your budget?”
• "Are there any spending categories you want to shave a bit off of?” 
• “Is there any way to earn a bit more money?” 
• “What would the risk be if you saved a little less for car repairs?”
• “How close are you now?”

My job became being the truth telling cheerleader:

• “Honey, many people's budgets are out of balance.”
• “You're doing the next right thing by looking at it and calculating it.”
• “If you keep doing this work, you'll get it in balance. It just takes a while.”
• “Don't beat yourself up.”

My job became being the leader: 

• “I think we've done enough for now. Let's work on it again next month.”
• “I don't think we're going to come up with a final solution tonight, and that’s ok.”

I didn't push her for a workable solution. I knew it was time to walk away and come back to it before emotions got crazy out of hand. And I knew that she’d find the right solution on her own; clients eventually do. I taught her an important lesson I’ve learned, that there are few financial emergencies. Most financial issues, if dealt with consistently (and preferably in advance) have several potential solutions.

I showed up to that first meeting thinking I was going to be teaching her about money, but in the end I realized that it was just a little bit about the money. Mostly I was simply serving as a Sherpa, helping her navigate through her own ascent into the world and emotions of money.

-Stacey Powell

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Journey of a Spender and a Saver: A Bumpy Ride

 

In the beginning of our relationship, my husband and I would have a big fight about money approximately once a year. It wasn’t that we were holding it in for a year, we would have little “discussions” about money often, but once a year there was a biggie. The first one was the orange juice (part I). The second big fight was over a pair of jeans that he bought in New York and we fought about all through Europe. My argument was that he wasted $20 because he bought the jeans with the intention of getting rid of them in a couple of weeks. His argument at the time, was that they were only $20.

The challenge was that our value of money scales were so different: The spender thinks that $5 is nothing and $20 is barely anything. Whereas the saver, keeps every penny, because it’s one cent closer to a roll of 50 and it all adds up.

Fast forward eight years, we’re driving out to the coast for our anniversary and I ask my husband to refresh my memory about this long lost fight. He recaps defensively. I realize that something is still bothering him about that fight. He doesn’t talk to me for an hour. Fun times. Then after he’s had time to think back and sort his thoughts, the truth comes out...I wasn't ready for this one. 

He goes through all of the details again, along with the range of emotions that come when you’re angry, and finally lands on the real reason he’s mad – He thinks I’m a hypocrite! From his perspective, I was ragging on him for buying the disposable $20 jeans, when I bought a pair of leather boots that cost $127 (yep, he remembered) and the only time I wore them was on our trip. What he didn’t know was that when I bought them I planned on wearing them till they fell apart, but they ended up being horribly uncomfortable and made my toes go numb.

So, we talked about it for the rest of the ride… We now understand each other’s side of the story. And I’m embracing the fact that I’m a flip flop/barefoot girl and I accept that no matter how much I spend, the shoes aren’t going to be comfortable. So, I’m going to stop searching and save our money for something that we’ll both enjoy.

In short, these are the overarching lessons that we were reminded of:

• No matter how long we’re together, it’s all about ongoing two-way communication.
• While there may be some yelling, it’s best to talk it through sooner than later.
• Compromise. Compromise. Compromise. On both sides.

- Leah Schonlank

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Teaching Your Teenager about Money: Part II

Last year I walked my kid through buying her first car. She wasn’t responsible for the cost of the car; she had some special savings that had been put away , but we did make her responsible for putting together a Quick Spending Plan before she got the car, and made it clear that she was going to be responsible for registration, a third of the insurance, general maintenance and all gas beyond the $70 monthly stipend we’re throwing in. If you’re old enough to drive a car, you’re old enough to do research on the cost of insurance for different types of cars, the mpg of the cars you’re considering, the estimated cost of gas and the cost of registration. 

The result, she chose a reasonable 10-year old starter car that costs her $200 a month (and only costs me $150); she put an earning plan in place to increase her $650 monthly income; she suffered through DMV; she is now officially a car owner and understands the costs that come with car ownership.

And then an interesting thing happened: her excess earning plan fell through. Instead of being upset about it, or railing about the unfairness of her plan not working, she moved right on to Plan B. Because she had put the plans together, she knew immediately what her hole was going to be, the unfunded part of her plan. And she immediately set about making a new Earning Plan. And that’s the value of teaching your kids about money. You've not given them a fish but instead taught them how to fish. She solved her own problem.

But wait, that wasn't the end of the lessons. The next lesson was for her, and for me too. As it goes with 10 year old cars, 3 months into owning the car she had a major repair. She discovered her brakes were worn down to the rotors. Total cost: $400. Ouch. A $400 car repair is a hard hit to many adults, and to a high school senior, well, ouch.

This is where my lesson came in. I wanted to rescue her. I didn't want it to hurt so bad. I felt horrible for her. I remember sitting at my desk that day staring out at the window and I just kept telling myself that the right thing to do is to let her weather this. It wasn't just the money; it happened on her way out of town for a holiday weekend at the beach with her friends. She had to turn around and come home. She had to wait to get the car fixed by a mechanic friend who could do it a little less expensive.

She was so sad. And I wanted to make it better.

In the end, I steeled myself and let her deplete her saving to repair the car, as hard as it was. It was a great lesson for me. I saw it as a fork in the road: I could be the kind of mom that financially rescued my (almost) adult child, or I could be the kind of mom that taught her to rescue herself. I scheduled our first "Teenage Money Date Night." We went to a favorite cafe, and I started teaching her about her overall spending plan and the importance of "savings silos." We calculated how much she should put in savings every month for car repair, because a 10 year old car will need repairs. I sure wish my dad had done that with me.

Oh, and I also gave her $50. Not for the car, but so she could have a "staycation" that weekend she and her friends were stuck in Sacramento while the rest of their friends were camping on a Mendocino beach. She felt a little better, and so did I.

- Stacey Powell

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Journey of a Spender and a Saver: Finding Common Ground

My husband and I are celebrating our first date & wedding anniversary this Friday and I'm feeling a bit sentimental. So, I'm going to tell the story of how we got on the same page about our finances. Romantic, right?

A little background: nine years ago we had our first date, one month later we signed a lease, three months after that we were engaged, and then married three years after our first date.

When I met my husband, he was a spender. No, that’s an understatement, he was a big spender. He spent a lot on everything and often. He made good money and smart investments, but at the end of the day he should’ve had more money socked away (granted that could be said of me as well, but that’s another story).

I’ve been cheap for a long time and it’s ingrained in everything I believe and everything I do. Don’t get me wrong, I splurge on some things, but I splurge with intention.

It was apparent early in our relationship that our spending/saving habits were very different and it was going to be an issue. We had to get on the same page about our finances. We both knew that it wasn't going to be easy. And I can't speak for him, but I knew that we had to address this immediately, especially considering how quickly our relationship was moving along. 

I still remember our first big fight about money – it was about a glass of orange juice. Have you ever noticed that a tiny glass of o.j. at a restaurant is around $5, but you can buy a half gallon at the grocery store for $2.50? My husband hadn’t and he didn’t appreciate me bringing it up at breakfast during our ‘we just started dating’ weekend getaway. He argued that he likes o.j. with breakfast, so he was going to have o.j. with breakfast. I argued that it was a huge waste of money and just because we want something doesn’t mean that we should get it. It was not a romantic weekend.

We learned a lot about each other that weekend…We huffed and puffed…We talked and talked…Then we moved on. He admitted that my argument was logical, but he didn’t care. I learned that this approach wasn’t going to work.

It was time to do some deep thinking. I asked myself, “Why do I save? How do I justify depriving myself of wants on a daily basis?” The answer was simple, travel. The more I saved on the things that I didn’t really care about, the more I had for travel later – a longer trip or a nicer trip.

I knew that I couldn’t marry a man that didn’t enjoy traveling with me. And I figured that if he loved traveling as much as I did, he may refrain from impulsive purchases and expenditures in order to save for adventures abroad. 

I decided to test my theory. Our first international trip together showed him that dreams can come true: we spent three weeks in Costa Rica jumping from one surf spot to another and staying at guesthouses on the beach. 

Hook. Line. Sinker.

My husband-to-be started to question his big ticket purchases: electronics. He realized that $500 on a new shiny electronic toy will only bring him a small amount of fleeting satisfaction, because it's outdated almost as soon as he buys it. He now sees that same $500 as a plane ticket to another adventure.

And the orange juice...he orders it when he really really wants it, but more often than not, he refrains because the white pineapple in Costa Rica tastes better than the glass of o.j. ever will. 

Lesson learned: Don’t tell him. Show him how it can be better. 

- Leah Schonlank

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Teaching Your Teenager about Money: Part I

This is an intermittent series on the foibles and successes of teaching my kid about money.

Here’s the truth. I did a horrible job of teaching my child about money. If you read "Telling the Truth", you know I’ve come to this work because I teach what I needed to learn. And when my kid was young, I’d pay her allowance sometimes, and then I wouldn’t. Sometimes it was because I forgot; but sometimes it was because I didn’t have $10. Or I thought I didn’t. And I never clarified what the allowance was for, because I had mixed feelings about the purpose of an allowance. [Note: Big mistake! Always be clear about what allowance is for. If it’s just because they’re a part of the family, be clear about that too. Tell them why you’re giving them money, or what it is they’re earning it for.] My mixed feelings led to vagueness and inconsistency. I gave her young formative mind so many mixed messages about money; I did it all wrong.

As she reached her teen years, I began feeling pressure to make up for lost time. I needed to teach her as much as I could, as fast as I could, to somehow make up for the years I didn’t have it together, and I needed to do it before she left for college.

How do you teach a teenager about money? Imperfectly. I started a few years ago by sharing our household spending plan. I’m sure she glossed over the dull areas like Shelter and Transportation, but I’m also sure she was the only kid in her class that knew exactly how much she had to spend on clothes and entertainment every month. She knew that every July we’d lay low on movies and art supplies, our typical entertainment expenditures, because our fabulous State Fair was happening, an event that we happily spent the entire months’ budget on.

I shared, but not too much. I began to weave in numbers where appropriate “well, it’s the end of the month, so we only have $80 left in our food budget for the month,” or “we haven’t been clothes shopping for a while, so I think you have $105 to spend.” She didn’t always need to know the numbers, but I think it made her feel a part of some of the mechanics of how our household worked, financially. And where possible, I’d include her in decisions. If we wanted extra money to buy more fun stuff at the State Fair, we made a joint decision about how much to borrow from September’s entertainment budget.

And, if she learned nothing else from my proactively sharing our household spending plan, she learned that it’s ok to talk about money. That it’s just a normal conversation; a part of everyday life.

Stay tuned for Part II  - Coming August 15

- Stacey Powell

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A Constant Battle Between Time and Money

“There isn't enough time.”

My entire adult life has been a battle between time and money. When I’m working, I have money and limited time. When I’m traveling, I have all the time in the world and limited money. Since, I’m just back from traveling, I’m still trying to figure out how to squeeze everything into the limited hours.

“There isn't enough time.” The more I say it, the more I realize, I’m not managing my time well. I associate managing my time with being more productive at work. So in my personal life, I prefer to go where the wind blows me. Well, within reason. But lately, this has led to wasted weekends. Which in my opinion, is a great tragedy. The weekends are already too short.

I know exactly what I want to do on the weekends, but I’ve never mapped out how many hours it actually takes to do things. So, before my husband and I lost another weekend, we sat down and wrote out what our ideal weekend looks like, down to the hours: wake up late; have a leisurely breakfast; six hours outdoor recreation with dog, friends, family (four hours if it’s the day we have to clean the house); and then a relaxing dinner and movie.

Once we wrote it out, it became painfully obvious where our weekends were going…and I’m a little embarrassed that we didn’t realize it sooner or maybe it just put it in a light we couldn’t ignore. Anyways, we learned that our leisurely breakfast was taking much longer than it was supposed to, which was cutting into our fun time, and then we would rush the fun, to make sure that we had enough time to clean the house…yeah, I just said that…Yuck. So unsatisfying!

We now have a weekend schedule. That still sounds horrible. But, now we know what time our leisurely breakfast should end. If it doesn’t, we’re making a conscious decision to minimize our fun time, because the must dos, must get done.

Now, back to money.

Have you ever said “I wish I had more money”?

If so, it’s time to create your ideal budget. Stay with me.

I did this when I first started working at Finance Gym and it was…interesting. Then I did it again in more detail, when I was creating a new template and…It. Blew. My. Mind.

Confession time: I’ve never had a formal budget. I keep track of all of my numbers and review them at least twice a month. I know where I can cut if I need to. I always have a savings cushion, just in case shit hit the fan and also so that I can splurge when I want to. This has worked for me for decades. So, the idea of creating a budget seemed unnecessary.

Now that I work for a personal finance company, creating a budget seemed mandatory. It definitely wasn’t something I was looking forward to…but our budget template, starts with creating an ideal budget, which I had never heard of before and it intrigued me because I love dreaming about what can be and then making it happen.

So, your ideal budget focuses on all of the things that you want to have or want to do. Then you see how much income you need to make your ideal life a reality. Once you compare your ideal budget to your actual budget – light bulbs start glowing everywhere!

My Epiphanies:

• We’re saving so much money by not owning a car, that I never ever want a car again. Ever. A car isn’t important to me. My husband’s going along with it for now, but forever isn’t in his plan. So, we’ll save for one. Plus, I’ll probably change my mind, when it’s pouring rain outside.
• We spend a lot of money on travel. This is our passion, so it’s in the budget (actual and ideal).
• We need to contribute more to our retirement. We’re not going to be young forever.
• We need to earn more money. And now we know what our ideal earnings are so that we can afford our ideal budget, which of course includes lots of travel and recreation.

Because everything is better with a cow. Pushkar, India.

Are you spending your time and money on the things that you value most?

- Leah Schonlank

You can get our free budget template, by signing up for our newsletter HERE. Or try the template that we created for the book. We only have a PDF right now, so break out your pencils. We would love your feedback.

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What Should Hobbies and Managing Your Money Have in Common?

Most of us have embraced one hobby or another at some point in our lives. Whether it be fishing, yoga, knitting, gardening, or working on a house. Our hobbies become an extension of who we are. We build a relationship with our hobbies. Friends may even tease “he spends more time with his fishing rods than with his friends.”

Whatever your passion may be, there was a point in your life that you knew nothing about it. Fishing is a great example, because even if you learned at a very young age, someone taught you and you continue learning. To become a master at fishing, you build a relationship with your new found hobby. Of course, you don’t think about it as building a relationship; you’re just doing it because it’s fun. You enjoy it.

But think about the things you do as you learn a new hobby:

• Talk to others about how and where to fish,
• Go to sporting goods stores to learn about equipment,
• Ask for help from someone more experienced,
• Read books, magazines and blogs about fishing,
• Watch fishing shows,
• Take a class,
• Spend money on the right gear,
• Invite your friends to fish with you,
• Set aside a lot of free time to enjoy fishing.

As you learn more about your sport, you become more confident, you enjoy it more, and you then become a mentor to others. For those that become the most passionate about fishing, it inspires them in other areas of their lives: they finish their chores during the week so they have time to fish on the weekend; they rearrange their spending so they can buy more equipment; they earn more money or more vacation time so they can fish in far off destinations; they focus their life around their passion.

Now, what if you managed your money as if it was the hobby you’re most passionate about? It’s a bit of a stretch, but stay with me.

• Who can you talk to about money?
• Who can you learn from?
• What can you read or watch to get learn about managing your money?
• What if you took a course?
• What equipment do you need to buy to manage your money better?
• What if you got together with a group of friends to talk about money?

You can have fun managing your finances, it’s all a matter of how you go about it. You can sit alone in front of the computer, hating the fact that managing your money is a part of life, and wonder why your numbers aren’t doing what you want them to. Or you can learn more, get the tools you need, grab a bottle of wine, sit down with a friend and talk about what’s working, what isn’t and get some ideas about how to make your numbers better.  

- Stacey Powell

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They Reduce. I Reuse, Recycle &/or Repurpose

I’m on a fairly strict budget right now, because my savings cushion is less than I’d like and we’re remodeling our house. So the general rule is “I’m only allowed to buy things for the house that will improve the long-term value of the home.” That’s the practical money side.

On the not-so-practical emotional side, I want to decorate my new house and make it a home. Our new-to-us home is 500 square feet larger than our last home, we don’t have many things to begin with, and I hate my current color scheme (in my defense, it has been a decade of black, white, red and browns).

So, what’s a girl to do?

FIRST, I let my friends and family know that I’m interested in their unwanted goods and I have Uhaul on speed dial if needed.

The chairs and foot stools were from a previous ask.

I’m always amazed at how much stuff people get rid of or are willing to part with because they don't really need it anymore. In just a few months, we found ourselves with two washing machines (one top loader and one front loader), one clothes dryer, full size gas BBQ, 5’ x 7’ area rug that looks amazing in the dining room, heavy punching bag, vintage butterfly chairs, 50’s metal outdoor dining set, vintage metal rolling table, vintage desk fan, and a heavy duty metal work table.

This isn’t about hoarding or flipping for me, so I turned down a couch, loveseat, and three sets of fluffy fancy towels (from three different households…) because they didn’t go with my new color scheme. And the extra washing machine went to my mother.  

SECOND, Keep an eye out on the free piles.

We live very close to a nice neighborhood and people are always throwing things away or putting free piles in their driveways. So while walking the dog, we’ve acquired two practically brand new cordless home phones with answering machine, road bike handle bars and bar ends, road bike race bars, cashmere sweater, stack of 2’ x 4’ wood sticks, great old books on sailing, and some holiday string lights.

This works best outside of garage sale season. And the best finds are the things that people leave on the sidewalk because they don’t fit in the moving truck.

THIRD, Repurpose. Repurpose. Repurpose.

When I’m not on a budget, it’s so easy for me to buy something, use it, get bored of it and store it in the back of the closet, never to be seen again. There are three main events that get me hunting in the back of my closets: moving, spring cleaning and when I’m on a budget.  

I’m always pleasantly surprised when I go digging in the back of my closet because these are things that I once loved, which means there’s a good chance that I will love them again, as long as I can find a new use for them.

Bonus: the prints are more fun than traditional 
curtains and the sewing is already done.

The first repurpose of this house was out of necessity; our house has 18 windows and not a single usable curtain when we moved in. And no, this is not about using sheets in place of proper window coverings…although we did do, just until we got our curtains. Curtains are a necessity, so that expense was justified, but I was able to save money on the smaller windows, by using the printed cloth napkins and dishtowels that I already had.

My next project was to reupholster a living room chair that I’ve had since I was 16 and has been a redone more times than I can count. Since I couldn’t go out and buy new fabric, I had to “find” some. Turns out there was a perfect piece in the closet that was once a tablecloth and was just waiting for a new purpose.

Being restricted on some purchases can be a bit of a bummer, but it gives me an opportunity to be resourceful. Plus, I just think of the next trip that I’m saving up for and in the grand scheme of things, traveling is more important to me than a perfectly decorated house.   

- Leah Schonlank

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups. 

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The Power of Community

I had a client once who I’d been working with for about a year. Her finances were in a bit of a shambles when she showed up. She wasn't earning enough, was overspending, had no reserves and a lot of debt. She made incremental progress, but not enough. No where near enough.

About half way through the year she decided to train for a marathon, even though she had never even ran a 5k. It was with great interest that I watched her jump in. She had fear and trepidation, but she jumped in nonetheless. She put her running shoes on and stepped out the door. She announced it to all her friends on Facebook. She declared she was doing it. She asked for money. She tracked her progress. She inspired everyone around her. Within less than a year she went from not being a runner at all to running a marathon.

Meanwhile, she was making progress, small progress, slow progress, on her finances. When I asked her why she was so successful in one seemingly insurmountable goal, and making only margin success in the other, she responded with great thought:

I love how the marathon training makes me feel;

I made a commitment and that anchored me; and

I’m excited (and scared) about the marathon.

What would it take to feel that way about your finances? How could you get to a place that you loved the way working on your finances made you feel? What if you made a commitment right out there on Facebook to “run a marathon” (e.g. achieve 3 months reserves, pay off all of your debt, etc.) What if it wasn’t a secret but instead, you inspired those around you to do something bold by saying “I’m showing up differently to my finances.” What if you were excited about your money? What if you said out loud to someone “I’m a little scared too.”

What is missing with our financial lives is that sense of community. When we jump into a group effort to raise money for a great cause and shout it out to everyone we know, we are inspiring those around us and providing ourselves with the anchored commitment that “we’re going to do this thing.” A sense of community is how how farmers’ barns were built and how enough money is raised to build our great cultural institutions. But we have no sense of community with our personal finances. It’s our little secret. For many of us, it’s our dirty little secret. We’d rather share details about our sex lives before details about our money.

And why? What would happen if you shared how much debt you had? Would you someone’s lose respect? Lose a friend? Or would you inspire others to do something about their credit card debt.

What would happen if you were on a Team in Training for your financial life?

- Stacey Powell

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups. 

Are you ready to reach your financial goals? Get motivated. Get support. Get results!

Entrepreneurship and Making ‘Adult’ Financial Decisions

When I launched on Forbes.com I promised myself that I was going to start Telling the Truth. It’s easy to be a financial guru, talk at people, and tell them, “This Is How You Should Handle Your Money.” It takes more courage to be transparent and share stories not just from our clients, but from ourselves, and even more courage to share not just from our past, but from our present. So here I am, being courageous.

Every summer I head to Dallas for the annual eWomen Network Conference. I look forward to it all year long. It’s the largest business women’s conference in North America, and an amazing place to learn, connect and be inspired. Sandra Yancey, CEO of eWomen Network, provides the incredible opportunity to learn from a long list of business rock stars: Michael Gerber, Tony Hsieh (Zappos),Robert Stephens (Geek Squad), Lisa Nichols, Zig Ziglar and the list goes on. This summer, I’m not going.

What’s an ‘Adult Financial Decision’?

Adult financial decisions are logical decisions—ones we intuitively know are good decisions even though every other part of our being disagrees. When we make adult financial decisions, our inner child screams, “But I wanted that!” or our lips pout or our hearts feel heavy. Last month I made the adult financial decision that my team was not going to the conference this year. As a result, I’ve been walking around pouting and having a heavy heart. And then I heard a voice shout: “Stacey, how many hundreds of times have you advised people who were conflicted about when and how much to spend on professional development??? Stop being a weenie and write a blog.”

Entrepreneurs make the assumption that they are the only ones making emotional spending decisions. “If I just ran my business more like a business owner, I don’t think I’d have these cash flow issues.” The truth is that entrepreneurs are human beings, and most of us humans make emotionally-based financial decisions. That’s not a bad thing. It’s when we don’t balance emotionally-based decisions with logical ones that imbalance can capsize our ship. Over the past year, my business has made a number of bold spending decisions, some logical, some emotionally-based. We’ve also pruned our client tree (let a few clients go who were no longer a good fit). The end result is that our reserves are at low tide.

Could we go to the conference? Yes. Do we have the cash? Yes. Would there be consequences? Yes. Is it worth the consequences? Logically, no.

When do you spend money on Professional Development?

The short answer is every year. If you aren’t learning, you aren’t growing, and you aren’t serving your business or your clients. Every major corporation has a budget for Professional Development in the neighborhood of $2,000 annually per employee. Investing in your people is critical to the success of a business. The American Society for Training and Development says that an increase of $680 in a company’s training expenditures per employee generates, on average, a 6 percent improvement in total shareholder return. For solopreneurs or entrepreneurs with micro-businesses—those with fewer than 10 employees—the spending decision is often emotional and not logical. We logically know we should go to conferences, use coaches and consultants, and buy books. But we emotionally weigh the decision against having $2,000 more to cover payroll, invest in marketing, pay off a line of credit or build reserves.

Having an annual spending plan helps keep us focused on the logic of the decision, but when it comes to writing the check, an entrepreneur knows the pros and cons of letting that money go out the door.

What’s too much? What’s too little?

The most truthful story I’ve ever heard about the pains of investing in professional development is fromAllison Byrd. She’s an up-and-coming business rock star herself, and courageous for telling audiences her truth. She tells of driving through three states, staying in a run-down motel and barely having enough money for gas to be at a training she knew, intuitively, she had to be at. That was not an “Adult Financial Decision”; it was emotionally-based. And it was a good decision. It dramatically changed the course of her business. If I was her CFO, I wouldn’t have advised her to go, but as I say in “10 Decisions Not to Make Alone,” don’t always take your accountant’s advice.

People talk to me about money. People I’ve just met find out what I do, and then tell me in a quiet voice some truth about their money. I’ve heard many people share with me in confidence stories similar to Allison’s. But we don’t share with others. We show up at trainings and conferences and announce to the world that All Is Well and Business Is Great. It might be more helpful to our fellow entrepreneurs if, like Allison, we told the truth.

Here are some considerations when making your own adult financial decisions and emotionally-based decisions about spending professional development dollars:

• Did you integrate Professional Development into your annual budget? Less than $2,000 per employee or more?

• How much have you spent over the past few years? Have you seen a return on investment from those expenditures?

• Have you implemented what you learned from past trainings and conferences, or have the binders you brought back become ‘shelf-help’ rather than self-help?

• Do you have a stack of business books you haven’t even started reading? How many books have you read this month? This year?

Would you like to spend more than you’ve allotted? Here’s my favorite advice for how you can justify that decision. One of my favorite clients loves conferences and trainings. There is about $4,000 annually in her spending plan. She wants to spend more, but at this point in her business, the budget doesn’t allow for it. We developed a profit-splitting plan that puts a percentage of her business’ net profits into a savings account titled “Business Investments.” She doesn’t have to spend that money, but when a conference pops up that she wants to attend, she no longer has to discuss it with me or agonize over the pros and cons of the decision. If the money is in that savings account, she goes.

That is an excellent way to balance logic and emotions.

-Stacey Powell

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups. 

Are you ready to reach your financial goals? Get motivated. Get support. Get results! 

The Secret of 1,000,000 Followers: Karen Hutton’s

Photo Taken by Scott Jarvie

I would be thrilled for any client to reach 1,000,000 followers, but it has been exceptionally thrilling watching photographer Karen Hutton reach the 1,000,000 follower milestone on Google+. While it is a great accomplishment, that’s not what has made it thrilling. The thrill has been that she reached the 1,000,000 mark without seemingly trying. It’s not your typical story, but not much about Karen is typical.

What does it take to reach 1,000,000 followers?

Most of the entrepreneurs I know believe that it takes the right investment, the right guru, the right system that will firmly place them on the path to entrepreneurial success. Most have invested tens of thousands of dollars into marketing, consultants and coaches. They've spent hundreds of hours of time implementing strategies, launching ideas and working, working, working very hard. Karen, much like her photography, has taken a different approach.

Karen’s path to 1,000,000 has been creative diligence and imaginative consistency. To be an amazing artist you have to be creative and imaginative, but there are thousands of amazing artists who never near critical or commercial success. To reach milestones of success in any field, diligence, persistence and consistency are qualities you must encompass. And it is just those qualities that have catapulted Karen on her path.

I’ve written a blog about Karen before: Creative Brain vs. Business Brain. It’s the story of how she ignited her long-smoldering passion for photography while bolstering her ‘real business’. The back-story is that, while her photography has catapulted her in the world of photography and Google+, it’s not her principle vocation. Karen is a well-known voice over professional: she’s the narrator of the Echoes of Creation film, the voice of the #1 GPS app, MotionX and she talks you through the world in Trey Ratcliff’s amazing Stuck in Customs iPad app.

For the year of 2010, Karen made a strategic business decision to “live her life as an artist.” And while that may conjure up visions of a year of whimsy and impulse, to Karen it meant diligently, persistently and consistently enjoying, learning and growing her love of photography. Her goal wasn’t 1,000,000 followers. Her goal was to bring joy to her life through photography. And she met her goal with diligence, persistence and consistency. Twyla Tharpe’s inspiring book The Creative Habit tells you that creative success comes from doing exactly what Karen did.

She consistently stepped outdoors with her camera to connect with her creativity, she studied other photographers’ work and methods and she began amassing a large volume of work. When she joined Google+ she didn’t just join, she began diligently, consistently posting her photos coupled with her imaginative prose. She found joy in joining in the renaissance community of photographers that have convened on Google+, both online and traveling in person to the photowalks that have sprung from the online community. Admired photographers became friends, and then admirers of her work. The tipping point was when someone at Google noticed her body of work and added her to the Photography & Art interesting people to follow list.

The marketing gurus will tell you to do much of this: joint venture, build community, post regularly. The uniqueness, though, of Karen’s path was that she wasn’t seeking an outcome of 1,000,000 followers; she was using creativity to bolster her life. She was simply having fun.

Are you using creativity to bolster your life and your business?

-Stacey Powell

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups. 

Are you ready to reach your financial goals? Get motivated. Get support. Get results!