Where Does Your Money Reside? Know Where Your Money Is Going
by Jasmine Powell
Durell Smylie may know ‘where the money resides’, but do you know where yours is going? Are you letting your constant DoorDash spending and Amazon purchases slip under your nose?
There are times I find myself cringing at the thought of checking my bank account. Why? Because I know I probably won’t like what I see.
Again, why? Because I know that I’m not being as financially responsible as I want to be.
Ignorance isn’t Blissful
When I lie in bed and think about just how much money I am spending, I can’t help but feel nervous and slightly ashamed. Not being aware takes the pressure off our shoulders for the moment, but ultimately, being ignorant of our current financial status could be the downfall.
Know Where the Money Resides
It’s important to know what we’re spending our hard-earned money on. It’s especially important to know how much these expenses are helping or hurting us in our daily lives.
Not being aware of where our money is residing is a symptom of a Scarcity Mindset. With a mindset of scarcity, we find ourselves spending impulsively while having a negative perception of our financial goals. Spending for today without little thought of tomorrow isn’t the best habit.
In order to improve our finances, we have to know where our money is going and learn how to manage it. One helpful way in taking back control of our financial future is talking to a Money Coach.
Becoming Financially Conscious
On my journey of becoming more financially independent, one of the biggest steps was meeting with a Money Coach. I was nervous. The thought of having someone take a look over your money and where it was going was nerve-wracking. Especially when you know there are areas you could improve.
The cool thing about Money Coaches is that they’re people – like you and me. They are completely aware of the economic strain going on in the country. The ongoing pandemic, climate change, the pay-gap – they are aware. And they understand.
I was honest and open. My Money Coach, Erin, was eager to listen, offering suggestions and input. We laughed about my countless DoorDash purchases. She dished on the importance of a 401k and having financial goals to work towards. I learned ways to improve my credit. Not only did my Money Coach give awesome advice, but she encouraged me. Coming out of the meeting, I felt more confident about my money than I had in months.
I had a game plan. I was aware of what I was spending. And, most importantly, I was motivated to take control of my money!
Your Money Coach can personalize your experience based upon your finances, and provide you with the best advice for your financial situation. These are a few things that I learned from money coaching in our meeting:
One of the first things that I was asked in my Money Coach meeting was what my goals were. Obviously, one of the first things most would say would be to be rich! Or make a million dollars! Though those goals are validated, looking at what you need now is a great way to see where you can start.
Also, finding out what your priorities are is a great way to set goals.
For myself, I looked at areas where I was spending large amounts of money each month.
Through the usage of the Nav.it Money Tab, I saw that my Work Expenses were totaling over $200! I was spending huge amounts of money on public transportation and job purchases! Ultimately, I decided that a major goal would be to get a car to reduce my travel expenses. The $20 that I would spend to get to work can be used on gas for two weeks (depending on where I am). Also, the extra $7-10 that I spend at work could be put toward miscellaneous things, like Netflix or other things I tend to use.
We set up a plan, based on my finances, that it would be reasonable to save at least $50 towards that goal. With more money I earn, I can increase that $50 to $75.Setting up a personal financial goal can help motivate you to want to save!
Identify Spending Habits
Diving into my spending habits, I found that I had developed a habit of eating out four times a week! Yikes. Not only was I ruining my diet (so much for new year’s resolutions) but I was ruining my bank account!
Money that I’d spent on food delivery could have gone towards groceries. That random waist trainer that I just had to have that now lays in the corner of my bedroom could have been put into a savings account. The makeup that I’d gotten could have waited (getting makeup out of a mask is a hassle!).
With Erin, I was able to pinpoint some of my common spending habits. We made a goal to reduce my top three spending habits.
When trying to identify whether your spending habit is a necessity, ask yourself these questions:
Do I need this now?
Would my life be harder without this?
Can I cut back on this expense?
For me, managing my credit score is like climbing a slippery slope. Some days I’m confident. Others, I’m nervous that I may see a sudden drop. Coming from having a 480 credit score to teetering towards a 700 score always has me on edge.
I’d gotten the secured credit card. Paid off my expenses on time every month. Monitored my credit report like an eagle. Kept my credit card utilization low. I saw major improvements over the course of a few months. Despite my success in this area, I still felt anxious.
Erin cleared those anxieties by reassuring me that I was doing the right things. Sometimes, we just need someone to confirm what we are doing is enough, and areas that we can improve in. I know I did.
After meeting with Erin, I realized there were many areas where I could save money.
One way that I could practice saving money was through budgeting. With budgeting, we are forced to remember our financial goals, and make plans with those in mind. Not only that, but it can shed light on some of our habits that aren’t so good. A great start to budgeting is utilizing the tools in the Nav.it App!
I quickly found that there were areas that I could save. The Amazon purchases that I made for fun could have been money I saved towards my goal of a car. I could also use that money for transportation to and from work. Suddenly, everything made more sense – taking care of my priorities first, my savings second, and my wants last would make things much easier.
With changing our mindset, we also have to change what we do with our money. Instead of being impulsive with my spending, I can start being responsible for what I purchase!
By identifying spending habits, and improve them, I found that I had more money. More money to put back on those financial goals I had, and have money for goals I may have for the future!
Before meeting with a Money Coach, I wasn’t so confident with money. Now, I feel like I can take full control of my financial future! After the meeting, there was a switch in my mindset! When I thought about money, I thought about how little I had, how I wasn’t getting as much as I wanted, and how much I would spend. Now I look at money in a completely different way – with a positive mindset!
Too often, our insecurity with money seeps into our spending habits. This is why spending while financially being unaware can be harmful. However, money coaching helped me identify this habit and gave me insight on how to change it.
Ready to find out where ‘your money resides?’ Money Coaching is a great first step!
Not only does financial coaching help your finances, but it can also give you a better view of money overall. Having someone to hold you accountable to your goals can make you more responsible. Not only that, but the things that you learn and the relationships that you can build with your money coach can make the experience all the better! Just having someone in your corner who can train you to become a better money navigator can make you feel more confident (and responsible!).
Chatting with a coach is easy – just look on the home screen of the Nav.it App to get started!
Knowing where your money is going, and developing healthy habits can improve your overall money mindset. We want to go into our bank accounts feeling confident and positive about our goals.
With these tips, we can change the way we view money!
Jasmine Powell is currently a graduate student at the University of Memphis and an intern at Nav.it. Her goal is to make writing her living and create material that will help people of color in their daily lives.’