How to Save a Billion Dollars on Taxes!

H&R Block Bahooey

It’s that time of year again...tax time. And along with tax time comes the barrage of advertisements about who you should pay to do your taxes.

And OMG I passionately hate the particularly annoying advertisement plastered everywhere: “Get Your Billion Back America.” H&R Block has been running these super cute, super slick, super fun ads that let you know if you don't use them, you won't get your portion back. Your portion of a billion dollars! Wow! Makes you feel left out, doesn't it?

Advertisements like these play right into people's fears that they are missing some important deduction, that if they don't use a professional (or as they call them, “Tax Pro”), they'll be paying more to the government, that the tax code is somehow set up for you to have to be "in the know" to get all of the right tax breaks, and that you probably aren't smart enough to do it yourself.

For the majority of Americans, this is a bunch of bahooey. If you are like most people, have a job with W2 income and own a home, your taxes are fairly simple. Should you pay someone to get your taxes done? Well, if you have room in your spending plan and don't want to do it yourself: yes. But will the H&R Blocks of the world get you a bigger tax refund than Turbo Tax will? No. Absolutely not.

Frankly, I think they should be ashamed of themselves.

There's an ethical code you learn when you become an accountant. You're here to help people, not play into their fears. You're supposed to teach them, not tell them they'll never know how to do their own taxes.

Now, if you own a business, have rental properties, or any other special circumstances, then my opinion on professional vs. Turbo Tax is different. The more special circumstances you have, the greater the likelihood that you should hire a professional. The more you have at risk, the likely it is a worthwhile expenditure. But if you fit into one of those categories, the national tax franchises aren't where I’d recommend going. You can read my “where to go” recommendations on Forbes.com: Where Should I Go To Get My Taxes Done?

And, for those of you that who are on a limited income, and for whom paying a professional would be a hardship, research the programs that are out there to help you. The most well known one is VITA. You’re not going to get a hard sell there, like you do at the tax franchises. You’re just going to get some simple, straight forward, free assistance getting your tax return completed.

- Stacey Powell

“Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups.
Reach your financial goals. Get motivated. Get support. Get results. Are you ready?”

Prioritizing Needs vs. Wants

I no longer need or want a dryer.

We need air, shelter, water, and food (in that order).

Survival rule of threes: You can survive for three minutes without air; three hours without shelter; three days without water; and three weeks without food.

Absolutely everything else is a want.

When it comes to my personal finances. I need emergency reserves.

Everything else is a want.

It’s so easy to get distracted by our wants because there are so many of them and they are so easy to fulfill. I want a new pair of shoes, the store is just down the street, and they’re only $50, done. The problem is that those shoes aren’t going to do anything for me in the long-run.

My favorite financial want vs. need dilemma was when my husband and I moved into our new house and there was no washer or dryer and our emergency reserves were just under my comfort zone. We went to the laundry mat for a month before a friend gave us a free washer because they had just upgraded. Then I wanted a dryer, but my reserves were my primary concern, so we started hang drying our clothes because it was summer and 100 degrees outside. Months later, I no longer wanted a dryer. It turns out that I like hanging my laundry to dry—it’s good for my clothes, the environment, and my pocketbook.

Designating my emergency reserves as my financial priority helps me put my life into perspective and I haven’t even gotten to the amazing emotional rewards.

My emergency reserves provide me with a sense of freedom. When shit hits the fan, I’m prepared. Just want to emphasize that I just used “when” not “if” because no matter what, shit will hit the fan. That’s life. And it’s not just when there’s an unexpected home repair, it’s also when I want to make a life change.

My emergency reserves provides me with choices. The choice to live my life as I see fit. This does not mean to buy the things that I hope will make my life better. I’m talking about the freedom to change careers, travel the world, or even start working as a consultant.

The absolute best part about having emergency reserves is not worrying. When I have less than three months of reserves, I’m constantly stressed that something will pop up, because expenses are always popping up. When I have six-months socked away, I can focus my energy on the important things in life, because I’m not constantly worried about my emergency reserves.  

What's your financial priority? 

-Leah Schonlank

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

#Debtfree2014

I have long believed that the reason so many of us feel stuck financially is because we don’t talk about money. I write about it all the time. I think the single most important thing you can do to change your financial position is to find someone to have a constructive conversation about it with.

So imagine my surprise this month when I (for the third time) was making a concerted effort to engage in Twitter (I feel so old) and found people on Twitter talking about their money. I knew there were people like me, financial experts, using Twitter as a platform for their business. But I wasn't expecting everyday people telling their friends about how they've paid off another credit card, made their final car payment or sharing the actual amount of debt they've paid off.

One particularly courageous soul (@famdebtjourney) links to her blog where she’s declared 2014 the year to put it all out there and share her family’s story about their journey to get out of debt. Beginning with a blog in January, My Family's Debt Journey itemized their debt:

• Credit Card Debt:           $27,102

• Auto Debt:                     $16,173

• Mortgage:                     $133,968

Can you imagine posting everywhere your truth? That’s laying the gauntlet down! Making that kind of public declaration will no debt propel them, and hopefully provide inspiration when the going gets rough. Just like a diet, becoming debt free is a journey with peaks and valleys for sure.

Who would you be willing to share your numbers with? Do you think it would propel your financial health?

-Stacey Powell


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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

Why Do We Need to Hit Bottom to Change?

For the past couple of months, I’ve been trying to figure out why I (and so many that I know) need to hit a bottom before we implement change.

My current personal quandary is my behavior change due to the current drought. I consider myself water conscious. I’m very aware of our household water usage. And more often than not, I find myself asking someone (friends and strangers alike) to turn off the tap when it’s running unnecessarily. That being said, I also know that I could be doing a lot more.  

For instance, I’ve known for years, that I should implement grey water usage at home. Years! But it wasn’t until last month when Governor Brown declared the current drought a state of emergency that we finally started using our perfectly good grey water at home.

Step one: We switched from environmentally friendly detergent to grey water friendly detergent. Easy to find and reasonably priced at Trader Joe’s.

Step two: Was already done! This is the part that blew my mind. We were already set up for the biggest change, we just had to make a little extra effort to actually do it. Our washing machine already drains into a utility sink, which makes it very simple to stop up the sink and bucket out the water to water the lawn and plants.

The most ironic part of all of this is that we stopped watering our lawn last spring to save the water since we’re planning on replacing it with drought-resistant landscaping. Now that we’re using our grey water, our lawn is starting to come back.

Now, back to money; because everything relates back to money.

Why do we need to hit a bottom before we do something different to change and make our money better?

I’ve talked to so many people that say “I’m good” when I ask them about their money, but when we start diving deeper and asking more questions, they reveal that they’re not doing so good. Turns out that they’re just making due and they just don’t want to deal with it. For most of us, it isn’t till we hit our own personal bottom that we really change anything. And that’s okay. To each his own and all in good time. 

But I want to ask you: What is your bottom? What does it look like? And do you really want to be there before you start making things better? 

-Leah Schonlank

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

Why I Love My Credit Cards

A number of experts recommend that people go all cash to learn how to manage their budget. It seems to work for many, but it doesn’t work for me. Personally, I rarely keep more than $20 cash on me when running around in my daily life. I’ve found that when I have $100 in cash, it just disappears. I save all my receipts and still can’t figure out where all of it went. When I keep $20, it seems to last forever.

So, these are the reasons I love my credit cards:

Tracking

I can see every single little thing that I’ve spent my money on all in one place. I can easily see if I overspent on one category or another. I’m also reminded of purchases that may have seemed justifiable at the time, but a month later, give me reason to question my logic.

Convenience

Remember back in the day when people wrote checks at the store and the minute you saw the checkbook come out, you started looking for a new line, because you knew it was going to be a while. Now, that’s how I feel about cash. First the customer has to count it, then the cashier has to count it, then there’s change, or the dreaded “oh wait, let me give you a nickel” scenario. Credit cards are so much faster. No counting required. Swipe. Yes. Sign. Go.

Protection

If I lose my credit card, I can cancel it. If something goes wrong with a purchase, I can dispute the charge. If someone else uses it, the credit card company won’t hold me responsible. Some cards even insure the things that I buy with it.

Rewards

Cash Back. I earn 1-3% cash back on my purchases. And it may not be a lot, but it’s considerably more than 0. I pay my household bills with my credit card for the cash back every month. I even charged the down payment for our car for the cash back.

Plus, some of the sign-up rewards are incredible! My husband and I each signed up for a new credit card the other day because they were offering $200 cash once we spent $500 on the card in the first three months. So we spent $1,000 combined on things that we would’ve purchased no matter what (food, gas, bills, etc…) and they credited us $400 cash. 

It’s always important to remember that ‘they’ (the financial lending institutions) are in the business of making money. They provide these incentives to lure people in and they are betting on the majority to hold a balance so 'they' make money on the exorbitant late fees and interest. Don’t fall for it. If you don’t have the cash to pay it off, don’t use the credit card. 

Speaking of which, that’s the perfect segue into the things I don’t do to make sure my credit cards and I continue to have a healthy relationship:

• I never keep a balance on a credit card. Ever. I pay every single month’s balance in full and on time. Credit cards are a very slippery slope.
• I don’t pay annual fees. It’s not worth it.
• I never spend money that I think/plan/expect I’ll have later. I only spend what I know I have now, can afford, and will have in a month when the bill comes due.
• I don’t authorize indefinite auto-payments on my credit card. If there is something that has to be an auto-charge, I track it very carefully to ensure there aren’t any glitches in the system…Ahem…over charges, fees, or extra charges.
• I double check all return credits to ensure that the money is actually being credited back to my account. As we all know, technology isn’t perfect. So, I keep all of my receipts to remind myself when I need to check. It’s my money, it’s my responsibility.

In short, I use credit cards because they save me money and they help me track my spending. 

-Leah Schonlank

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

Sudden Wealth and Mindfulness

What would you do if you won the lottery? Or a jackpot? Or, a more likely scenario, received an inheritance?

The statistics surrounding sudden wealth are remarkable:

•  Family money rarely survives three generation, with 70% evaporated by the end of the second generation and by the end of the third generation, 90% of the wealth is gone.
• Those who receive inheritances in their 20s, 30s and 40s only save about half of the inherited money. The other half is either spent, given away or lost investing.
• Lottery winners in one large study in Florida were found to be twice as likely to have declared bankruptcy within five years of their win than those who hadn't won a lottery.

In my years of working with clients around money issues, I've worked with those who have received large inheritances, small inheritances, large jackpots, and significant insurance settlements.

The first sudden wealth client I ever had, I must admit, I was not yet experienced enough to be guiding them. It was early in my career, but at the time I reasoned that they were refusing to go to anyone else; they trusted me because of a mutual friend. I led with what I knew to be sage advice: don’t make any sudden decisions. Carve out a small percentage for mad money, and then let’s look at the long term choices and implications. By the time I got them back on the phone later that month, they’d spent, loaned and gifted half of their winnings. It doesn't take a rocket scientist to figure out what their trajectory was going to be. They were one of the above statistics.

As I've gained more experience, and spent more time learning about our behaviors with money, my experiences with clients have become much richer. Some of my most rewarding experiences have been working with clients who came to me with a goal of “honoring their inheritance” that was received from a cherished and loving family member.

Some have honored their sudden wealth by being good stewards of the money, carving out an amount they were committed to saving, and not touching it. Others have honored the money by choosing something really special to spend it on. Still others used their sudden wealth to wipe their slate clean on debt that had been weighing them down.

Of the clients that I've worked with that looked back and felt good about their decisions, they had one thing in common: mindfulness.

They thought about and talked about what they wanted to do, they made a plan, they looked back from time to time to see if they were sticking to the plan, and they were honest with themselves (and me) about areas that they veered from their plan.

If you've found yourself in a place of sudden wealth, here’s my advice:

• Become a student – read a book on inherited wealth or lottery winnings;
• Hire a trusted and certified professional – it will be well worth the investment;
• Start a journal – write or draw your intentions for the money;
• Set look-back milestones – monthly at first, and then quarterly, look back and see if you are using the money within the intentions you set.

The spiritual axiom “how we do one thing is how we do everything” can become our crystal ball. If in the first few months of your sudden wealth, the money was spent outside of your intentions, it’s time for some truth-telling. Draw, or spreadsheet, or however you are able to see into a crystal ball what the path will be of your money. It will likely look very much like it did in those first few months because, how we do one thing is how we do everything.

More than anything, though, I urge you to bring mindfulness into your financial life. Five, ten, twenty, even forty years from now you’ll look back on the decisions that you made. If you practiced mindfulness with the money, you’ll feel good about your decisions, no matter what those decisions were.

-Stacey Powell


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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

To Debt or Not to Debt?

My very wise uncle, is a firm believer (and promoter) that if they’ll loan it to you, borrow! Especially, if they’re loaning it for less than you’ll make on it. I should note that he is not a professional money guy, he’s a lawyer, so we take everything he says with a grain of salt. 

That being said, I agree.  

But then I hear some money guy (it always seems to be a guy) on the radio telling the world: Pay off your debt now! Pay off your house now! Live debt free! And it reignites a yearly discussion between me and my husband. Which of course is a good thing. Just because we’ve done something for years, doesn’t mean that it’s still the right decision…So we discuss. 

Should we pay off our mortgage early? 

The answer was “no” when we bought our house and it’s been “no” every year since. We pay a little extra every month, but we don’t have any plans on paying it off early. Our answer is based on our circumstances: we bought a small fixer upper in a good enough neighborhood, close to the bottom of the market, for a low price and locked in a low interest rate. 

When we bought the house, we decided to get a 30-year fixed loan rather than the fashionable 15-year with a lower interest rate because we wanted to lock in the rate for as long as possible, because you just never know what the future holds and we can always pay off the 30-year sooner, but we can’t extend a 15-year. 

In addition, we plan on buying another house during the next recession and we can’t do that if our money is tied up in our first house. 

At the end of the day, everyone’s circumstances are different. It’s up to each of us to determine what’s best for ourselves. And I’ve found that the best way to figure something out is a good old-fashioned conversation over a massive cup of tea. 

-Leah Schonlank

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups. 
Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

To Hire or Not to Hire a Tax Professional?

Ah, January. The beginning of the month is all about starting new and fresh…we’re all full of hope… ready to make our world a better place...Then the tax forms start showing up and reality hits us square between the eyes.

Taxes…

I do my own taxes, because overall, I don’t mind doing them…I may even enjoy it…I always learn something…and I always feel a great sense of accomplishment when they’re done. I'll admit that every year, there’s at least one moment where I’m reading through the tax codes about something and I want to pull out all of my hair and pay someone to do my taxes for me. But every year, I make it through and the numbers work out in my favor.

Well, until last year, when we had to pay additional taxes for the first time. Which of course made me think that my husband and I are finally at a point in our lives when it’s time to pay a professional to do our taxes for us.

There are easy tax years, when I know that I can ignore my taxes till April 1^st and get them done in one night (those years aren’t as common anymore). Then there are the more complicated years, when I need to start in January because there’s a new and exciting taxable something or other in our lives that I need to deal with.

This year is going to be one of the complicated years because I need to learn about depreciating a rental property. Fun for the whole family… Just a quick glance at the IRS Depreciation of Rental Property webpage and I’m convinced that this is the year that I hand it over to a professional.

That being said, I’m still going to do them myself first so that I’m at least familiar with the rules, regulations and numbers and then I’m going to hire a professional to do our taxes. 

My decision to hire a professional was further validated when I started asking people about their taxes and the general consensus is that the people who have a tax professional consider them an absolute must. 

Looking forward to saving some money on taxes this year. 

-Leah Schonlank

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

Speaking Your Numbers Out Loud

We all have different ways of learning and digesting information. Some of us are visual, others auditory and still others kinesthetic. Yet when it comes to knowing where we are with our money, there’s usually only one way of learning what where we are financially: by reading reports. 

If you’re a visual learner and good with numbers, then financial reports are probably a great way to anchor yourself in where you are financially. For everyone else, though, financial reports just might be saying to you “blah blah blah blah,” much like the Far Side cartoon from the 90’s.

In my years of working with clients, I have often incorporated different approaches to teaching clients their numbers. At Creating Answers, we not only give clients reports, but we read them to them, have them read them to us, draw them on the wall, and sometimes have them write their numbers down themselves. 

My most remarkable memory of the impact that this had with a client was with a client on her first visit. Admittedly, I was a little nervous about how I could help this client. She was extremely successful financially, as in multi-million dollar success; her industry was one that I’d had very little experience in, and I knew that she already had some very highly respected consultants advising her in her business. I wasn’t sure I was going to have much more to offer than she was already receiving. 

In her first meeting, I handed her the financial reports and proceeded to walk her through them, asking her to speak the numbers out loud to me. She was floored. She’d been looking at her financial reports for months, but had never really understood them the way she did after she spoke them out loud to me. 

There’s a huge body of work out there that explains the brain science behind all this. But that’s not my passion. My passion is to help people really understand and know their numbers. If you want to have a different experience with your numbers, try a method you’ve never tried before. Here are some ideas:

• Get a pencil out and transcribe your major numbers: income, major categories of expenses, and net income.
• Take your monthly financial report and go stand in front of a mirror and read it out loud to yourself.
• Get some crayons and butcher paper and draw your assets and liabilities in a chart or graph.
• Look at your 2013 income, expenses and growth of your assets and liabilities and write about 6-10 sentences about how you did last year (e.g. “my business earned 116% of what we budgeted” or “I have $3,400 less debt than I did at the beginning of 2013.”)

Keep trying a method until you find one that really speaks to you. Have some fun with it. And most of all, embrace the fact that truly knowing where you are financially is empowering and motivating. 

-Stacey Powell

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

My Experience Buying Bitcoin

We researched. We read. We watched. We discussed. We figured that this was as good of a time as any to get our foot in the door. So, my husband and I bought some Bitcoin over the weekend. Only $100 worth to get our feet wet and learn the ropes of this brave new world.

An interesting thing happened when we started the process, because yes, it’s a process to buy this digital currency that works outside of the financial institutions that we know. 

There are a number of ways to acquire Bitcoin. First you have to create a wallet and it can be stored online or on a device. Once we had a wallet, my husband’s first attempt to fill our wallet was to ask our friends via facebook to send us a small amount, pennies even, just so we could test out using our wallet and transferring Bitcoins. No go.  

Second attempt, my husband was a gamer in his younger years, so he decided to try buying Bitcoins through a game broker. I doubt this is what they’re actually called because I don’t understand how this option works, but he seemed to think it was going to be easy enough. It wasn’t.

Third attempt, buy through a Bitcoin broker that requires a bank account number and credit card attached to our wallet. Not our first choice because of security concerns. But it was the easiest, or at least the most straightforward. 

So, we addressed our main security concern (really the only one we can do anything about) by opening a bank account that is just for buying Bitcoin; it has little to no money in it and it isn’t connected to anything else. 

We were ready. Or so we thought. Right as we're about to hit the button that started the verification process of attaching our bank account to our Bitcoin wallet, my husband says “Wait!” Which was a surprise considering that 1) he’s been the main driver on us buying some Bitcoins and 2) we were so close to finally buying some Bitcoins after trying for more almost two weeks. 

He was having second thoughts because it’s new to us and it’s entirely digital, which leads to greater security concerns. Even though we had taken some precautions, he was still concerned. Which is justified, considering that 70 million Target customers were affected by the recent security breach. But on the other hand, the Target breach proves that nothing is safe. 

So, we took the conversation to the place of no regrets. Under what circumstances would we regret our decision when we’re 70?

Scenarios:

1. If Bitcoin goes through roof like the experts predict, then yes, we would regret not getting in when we could. So, we should BUY.
2. If Bitcoin tanks and disappears, will we regret spending $100 on Bitcoin to try it out? No. So, we should BUY.  

Both scenarios point to buying a small amount of Bitcoins. No regrets!

My husband and I were reminded of one of our core life principles: we have to continuously push ourselves and do things that are new and slightly scary, so that 1) we don’t become obsolete and 2) we don’t end up 70 years old wishing we would’ve done things differently.

Living life with no regrets!

-Leah Schonlank

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

Money and Sex: Normalizing the Conversation

When I was a teenager, I remember closing myself off in my bedroom to listen to Dr. Ruth’s pioneering radio show on sex. No one talked about such things! It was shocking. And somehow, normalizing. There were real people, getting on the phone, asking questions and admitting that they had questions and uncertainties. Wow, me too! I learned a lot from Dr. Ruth and from all of the callers.

Money and sex are a lot alike. No one talks about money. No one wants to admit their uncertainties. Most people feel they should know so much more, that their money situation could be so much better and that they are the only ones. But as with listening to Dr. Ruth, once you spend some time listening to your peers about how they feel about money, you feel some relief. “I’m not the only one.”

As a financial coach, I’ve experienced over and over new clients walking in and before the end of their first session, grabbing the Kleenex box. Talking about your money is cathartic as well as motivating and clarifying. But wow, is it hard and scary. I’m not sure why it is that we’re so fearful. It’s as if something is going to break if we tell someone else how much debt we have, how much we earn or how much we have (or don’t have) set aside for retirement. It’s a shared fear for most of us.

And if telling a financial professional isn’t scary enough, can you imagine what it would be like to tell an entire group? I’ve led countless mastermind groups through the process and it’s always so interesting and inspiring to watch everyone’s financial growth as they first admit to something they don’t know and then share some truth about their finances.  I think it must feel a little like I felt as a teenager, closing my door and listening to people talk about something I never thought I’d get to hear them talk about. I think a lot of people who’ve joined a Finance Boot Camp must think “Wow, me too!”

Here are some of my favorite strategies and resources to help you normalize the money conversation:

• Join a support group: we of course love Finance Gym’s Finance Boot Camps, but Debtors Anonymous is a good option too.
• Take a class: Dave Ramsey’s Financial Peace University groups have been successful for many or look into your local learning center for classes on investing and other financial topics.
• Find someone to talk to: we of course love Creating Answers’ financial coaching, but there are also excellent professionals trained in financial recovery counseling, and CFPs who prioritize money conversations over charts and graphs.
• Set a “Date Night with Your Finances:” ask someone you respect to mentor you by joining you once a month to talk about your money.
• If you’re married, set a “Date Night with Your Finances” with your spouse. Once a month set a date, get out of the house, go somewhere special and talk about your money. Not the nagging “why did you buy this?” conversation, but the supportive “these are my hopes and dreams and fears” conversation.

And if you just can’t bring yourself to talk to other live people then take your radio into your bedroom, shut the door, and listen to a radio show on money.

-Stacey Powell

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

Reach your financial goals. Get motivated. Get support. Get results. Are you ready?

Have Your Cake and Eat it Too!

Or in my case, a doughnut.

Turns out that budgeting calories is very similar, if not, just like budgeting money. I can already hear some of you saying “duh,” but this is new to me, because I’ve never budgeted my calories before. It’s been over two weeks now and Oh. My. I’m loving this!

I wanted a doughnut. I ate a doughnut. And it tasted like sweet victory!

RELATED: Resolutions vs. Goals:Setting Yourself Up for Success

If I were on a diet, I would’ve wanted a doughnut, but I would’ve told myself, “no, I can’t, because I need to lose weight.” Then I would’ve wanted it 100 times more. My willpower may have held on for a week or so, but I would’ve broken down sooner than later, because all I’ve thought about for a week is that one stupid doughnut. When I finally got to eat the doughnut, it would make me feel weak and guilty. I would continue on, just long enough to reach my short-term weight goal and then I’d revert back to my old habits. Eventually the weight would come back. Cycle continues. 

Diets don’t work. Yes, I know, this isn’t news. I suppose I had always considered counting calories just another form of dieting...but after doing it, I realize it's just a method to educate myself so that I can make informed decisions. Which of course, is exactly how I already feel about budgeting my money. 

                RELATED: Budget for the Life You Want

So, back to the wonderful calorie budgeting present. My doughnut was 300 calories. I could totally work that into my calorie budget. I had so many options:

1. Doughnut replaces my breakfast.
2. Doughnut is an afternoon snack, so I have to cut a little from lunch and dinner.
3. Option 2, but I cut a little less from my other meals and exercise a bit more/harder.

Based on timing and circumstances, I went with option 3 and I enjoyed that doughnut completely guilt-free. OMG! Writing that sentence feels amazing! That's an accomplishment! 

Disclaimer: I get a doughnut craving about once every couple of months…My options would be very different if this was a daily or weekly craving, because I know doughnuts aren’t good for me, even if they fit into my calorie budget. That’s a whole other blog.

Options are everything! The truth is in the numbers.

When you need to save money for something fabulous, determine how much you need, cut a little here, cut a little there, earn a little extra, and voilà, you’re enjoying your tropical vacation worry and guilt-free.

But first you need to know your numbers. Get our ideal life budgeting tool for free when you subscribe to our newsletter. It’s all free and we promise not to spam you.

-Leah Schonlank

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

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Meeting 2014 Spending Goals

Leah wrote a great New Year's blog on the importance of telling the truth to herself about how much food she eats. In it, she admits that she realized she ate enough on Christmas Eve to feed a small village. It was knowledge and clarity she gained by logging her calories on a nifty app (Noom). I go through periods of logging my calories and it is indeed clarifying, and sometimes even shocking. But it takes work. You have to log in every little thing. Annoying. You’d think they would invent something that would just link to your stomach and directly sync your stomach to the app and it would know how much you ate, what the nutritional value was, and tell you how to adjust for the rest of the day, week or month. Ugh, so hard.

Ok, that’s a bit *sarcastic*. But when compared to how easy it is to track your money these days, there’s little comparison. Using an app like Mint makes monitoring your adherence to your goals super simple. It syncs automatically. A few minor corrections here and there, and you’ve got great data. And when you think simple, you can make budgeting even simpler. 

What do I mean by that? Well, don’t let yourself spin out by trying to assign budget amounts for every category they have, or even every category you spend money in. Mint has 21 major categories and each of those has an average of 5 subcategories. Wow. Who wants to keep track of 105 spending areas? It’s overwhelming, and thus not very motivating.

If you want to be motivated by tracking your numbers, do something simple and fun. Focus on what really matters. For me, that is often eating out, coffee on the run and groceries. I’m certainly not going to spend extra money on gasoline or the water/sewer bill, so why should I bother tracking it in a daily or weekly budget app. But I might be tempted to get a few more lattes than I said I would or a $30 bottle of wine instead of a $15 one. Using that passiveness of Mint lets me do that with hardly any hassle at all. It’s almost as if it was directly syncing with my bank (because it is).

In the budgeting area of Mint, I’ve chosen only the 6 areas that I think are important for me to monitor. I can pop in to the app on my iPhone or iPad, or log in on my computer. At a glance, I can see how I’m doing on that goal for the whole month. Totally clarifying.

What are the 6-10 most important areas for you to keep your eye on your spending?

-Stacey Powell

[A little disclosure. I love Mint. I use Mint all the time. But its effectiveness is for snapshots and monitoring. In my experience, it’s ineffective when you need to capture your annual income and spending, run reports for taxes or to analyze your finances. But day to day, week to week, it’s a breath of fresh air.]

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

We motivate. We inspire. We support. We help people change their lives by improving their finances.

Stop Lying to Yourself and Instantly Feel Better

I've been lying to myself for decades.

For the first time in my life, I'm tracking my daily caloric intake as part of my 2014 goal. My first oh-sh*t moment was when I logged 3,876 calories on Christmas Eve! That’s enough food for a small village in some countries. And to add insult to injury, I know for a fact that I forgot some things and incorrectly logged others. 

Lesson learned. From that moment on, I’ve been mindful about every bite I put in my mouth.

Fast forward to New Year's Day...what better way to celebrate the New Year, than with a huge American brunch? I was controlled. I only ate the foods that I really wanted. I ate just enough to enjoy myself. I didn’t overindulge in anything. I was so proud of myself :)

Then I logged the calories in my handy little app (noom)...Turns out reality is a b*tch! I just ate 80% of my daily calories and it was only 1pm.

This was my ah-ha moment of how I gained 25lbs in the past year. Without the numbers, I would’ve relied on how I felt and I was proud of myself for showing restraint; so, I would've gone about my day and eaten normally, which would’ve put me in the range of 2,400 calories—twice what I should be eating if I want to lose weight. Then at the end of the month, I would wonder why I’ve gained weight, when I’ve been so controlled—even felt deprived at times. 

Luckily, I was logging my calories! Knowing my numbers allows me to evaluate my options and make conscious and rational decisions to stay within my daily caloric intake. My choices are so much clearer now and I don’t waste my calories on foods that I don’t really enjoy.

My experience with calories is similar to the experience that some people have with their money: they don’t buy something, they feel good for having control, then they spend regularly the rest of the day/week/month, but when they pay their bills, there still isn’t enough money…then they throw up their hands and say they aren’t any good with money. It’s most likely because that one little cut isn’t enough.

Once you know the numbers, you can see the truth and make choices that make a difference. Then you can stop beating yourself up for things that you shouldn’t be beating yourself up about. 

Read more: Budget for the Life You Want. Get our free ideal life budget by subscribing to our newsletter here. 

-Leah Schonlank

Finance Gym offers personal finance coaching in professionally facilitated peer-advisory groups.
We motivate. We inspire. We support. We help people change their lives by improving their finances.

2014: The Year of Listening

I was sharing with my daughter the other day the fabulous axiom "we are the average of the 5 people we spend the most time with." When you're an entrepreneur, you end up spending the most time with people you choose to hire. 2013's hire was Leah, and I'm grateful that she's one of my 5. She has a completely different perspective and experience of life, money and health than I do, yet we share a focused intention to make our own lives the best we can and to support others in doing the same.

It's the beginning of the new year. In an accountant's world, that means new budgets. I've spent much of the last two decades spending this time of year helping others create their budgets for the upcoming year. But "budget" is just an accountant's word for "goals": [a framework within which to operate.] So with all the talk about budgets and goals for the New Year, Leah went and threw down the gauntlet. She put her own goals in her blog (for everyone to see) and then looked me in the eye and told me I had to do the same (for everyone to see).

That left me with 3 options: fire her, make up fluffy goals for the blog, or tell the truth.

And the truth is, I don't know what my goals are. Well, that's not true. Of course I know. I have a huge goal to change 1,000,000 people's financial lives. I've had that goal since 2007. And it's a SMART goal: specific, measurable, attainable, relevant and time-based. While I'd love to accomplish it in 2014, I know that it might not be attainable within the time-based framework of 2014. I'm not sure how long it will take, but I am sure I'll accomplish the goal, eventually.

What would I coach another business owner in my position? Break your goal down. Make it an attainable goal for 2014. But that's where I circle back to "I don't know." What I learned in 2013 is that I haven't yet cracked the code of how to get people to step up and say "yes, I want to join the gym, I want to work out on my finances, I want to change my financial life." And because I haven't cracked the code yet, I don't know what my core goal should be. I hate saying that, but it's my truth.

So, as I mull over my potential goals (and you know I have a spreadsheet of them!), my truth is that my overarching goal is this: Listen.

That's all I've got. My 2014 business and professional goal is to listen, and keep listening until I hear and see and feel what the right path to reach my 1,000,000 person goal is. 

I will not do the things that keep me from listening: I will not be driven, I will not implement 50 new strategies to see which one works, I will not work 60 hour weeks over and over and over. 

I will simply listen. I will incorporate into my weekly schedule more time listening to podcasts and audiobooks, talking with other leaders in my field, and simply listening quietly to my own intuition. I will keep a journal and title it "The Year of Listening." I will share that journal with one of my mentors.

I will create personal goals that will support and accentuate my ability to listen. Those goals?

The pertinent ones are:

• My body and soul: I will begin and sustain a yoga practice.
• My creativity: I willl schedule monthly blocks of time to draw, garden and paint my home.
• Fun: I will schedule something special every month; a vacation, a weekend getaway, a drive in the country, a walk by the river, windsurfing, paddle boarding, a long bike ride.
• Prosperity: I will build an additional $6,000 in my personal reserves.

I've never had an annual plan like this before. I'm an accountant and by nature, a bit driven to accomplish and succeed. But after 2013’s very driven year of two major accomplishments: writing a book and selling my first business, I feel called to listen to my intuition and simply: Listen

-Stacey Powell

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

We motivate. We inspire. We support. We help people change their lives by improving their finances.

Resolutions vs. Goals: Setting Yourself Up for Success

Goal reminder: me at my ideal weight. 

I love to eat! I live to eat.

When I was younger, my love of eating wasn’t as much of an issue because my metabolism could keep up…well, most years…that being said, my weight has always been an issue.

Back in the day, when I used to make New Year’s resolutions, my go-to was something along the lines of “eat less” or “lose weight.” I never achieved my resolutions. So, I stopped making resolutions, but I never stopped trying to control my eating and my weight.

It’s been more years than I can count since I gave New Year’s resolutions a second thought, but this year, I’m surrounded by people talking about New Year’s goals...Amazing how one little word can make all the difference in the world.

“Goals” I get!

I set and achieve goals for every aspect of my life, except my weight. Why is it common sense for me to set financial goals galore, but rocket science that I should set goals for my weight?

Of course, I’ve set short-term goals for my weight in the past, such as “I need to lose 20 pounds before bikini season/my wedding/vacation/family reunion…” Sometimes I’m successful, sometimes I’m not. But these don’t help me with my long-term goals.

New Year’s resolutions are supposed to be long-term goals that create a new healthy habit for an entire year, which turns that healthy habit into second nature for the rest of our lives.

If I were to make a resolution today, it would be “lose 25 pounds and learn portion control.” I can already tell you that that resolution is doomed to fail.

So, instead I’ve set measurable goals with action plans, including milestones, rewards, support and accountability:

Goals: 

• Lose 25lbs by June 1, 2014. 
• Then maintain a healthy weight of 135lbs till December 31, 2014.

Action Plan: 

• I will track my daily calorie intake on a mobile app for the entire year. 
• I will consume the recommended 1,200 calories per day to lose 5lbs every month for 5 months. 
• On June 1, I will increase my daily intake to 1,600 calories per a day to maintain my weight. 
• I will continue to eat healthy and exercise regularly. 
• I have set monthly milestone reminders in my calendar. 

Milestones: 

• At the end of each month, I will reward myself with a $25 non-food related splurge if I reach my monthly goal. 
• If I reach my overall goals on June 1 and Dec 31, I will reward myself with a $100 non-food related splurge for each.

Accountability: 

• My husband is my accountability partner. 
• At the end of every month, I will tell him whether or not I met my goal. If I don’t achieve my monthly goal, I have to tell him why I didn’t.

I’ve been creating this plan for a couple of weeks, but it’s the first time I’ve written it down – this is totally doable! :) 

What goals are you going to set for 2014?

If you’re ready to turn your “spend less and save more” resolution into an achievable goal – We can help!  

-Leah Schonlank

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

We motivate. We inspire. We support. We help people change their lives by improving their finances.