039 - How Do I Know I’m Doing The Right Thing With My Money?

CONNECT WITH SHARON

In this episode, I share the key things you can do to figure out how to know you’re doing the right thing with your money. 

If you’ve been following me, you’ll know that I go beyond typical financial advice that I don’t feel helps us address and overcome our financial anxieties and worries. 

In addition to your usual financial advice, I talk about how you can use practical strategies to help you identify your financial flashpoints, what conclusions or money stories those financial flashpoints led you to make early in your childhood but drive so much of your financial behaviours and habits in adulthood that you may not even be aware of.

I share my perspective and why I don’t think you really need that huge emergency savings that you’ve often been told if you manage your money right. This in itself relieves you of the anxiety that comes from not knowing what to expect and what curveball is coming around the corner of life - and we all have those!

Finally, I share more about my upcoming pilot program, ‘Stop Money Stress’, and how you can be part of my team of Founding Members where I’ll give you the step-by-step framework I’ve used and still use daily to become financially, calm, confident and certain.

I also mention the tool I love and use to help me manage my money, including my needs, wants, and emotions around money. I don’t get anything for it and I’m recommending it because I really love it and I trust the creator of the tool, Karen McCall, who is a money coach and someone I personally know and have interviewed on the show too!

Check out the resources mentioned in the episode below:

Transcript

Sharon: (00:04)
Hi, and welcome to the financially free woman podcast. I'm Sharon and I'm the creator of this nonfinancial financial podcasts about money and how money affects the work. We do, the relationships we have and our ideas about freedom. Most people don't realize that the path to financial freedom doesn't begin with gaining more knowledge or making more money in this podcast. You'll learn how to embrace and accept yourself as a fully whole albeit imperfect person so that you can become the highest and best version of yourself. And this, my friend is the key ingredient missing from typical lessons about money and personal finance. In this podcast, you'll learn about your own psychology and relationship with money. How money is more than just the dollars and cents and practical actions that are grounded. So you can transform your dreams into reality. Thanks for joining me on this exciting journey. Let's get started.

Sharon: (01:09)
Hello and welcome back to another episode of the financially free woman podcast. Today. I wanted to address this question that I'm sometimes asked by women, right, who are just starting out on their journey to be more financially confident and certain about their future is how do I know I'm doing the right thing with my money? I know I definitely ask this question. And when I was just starting out on this journey about how to live a financially free life and what does financial freedom even means? And to answer this question, although I started out in of course reading about all the personal finance website and financial advice, but I found my answer at least going beyond personal finance and into the area of spirituality, financial psychology, and so much more mindset and personal development. And my journey led me down those different areas. And I thought that I would just share here on today's episode a little bit more about the path I took and hopefully that may help somebody.

Sharon: (02:30)
And if it does, please let me know, send me an email or a comment on my social media and let me know if it helped you. Well, just going back to that question, how do I know I'm doing the right thing with my money? The first question I'm going to ask back at you is, well, what's right for you, right? What's right for you may not be what's right for me. What's right. For me may not be right for you. And that is why ultimately we have to find our own way. And that's the reason why I believe very much in just sharing frameworks. Frameworks are kind of the guide, the broad guidelines and filling in the details. It's going to be something that you have to fill in yourself. I can't tell you that whatever works for me, it's a hundred percent going to work for you, but I can tell you the framework I use, and then you can fine tune the details and see how it fits into your own life.

Sharon: (03:30)
So back to the question of what's right for you to answer that question, you really need to be quite aware and conscious of what your real needs and wants are. And the thing is that I, of course, I follow a lot of different personal finance blogs and different people on social media. And we share a lot of different things. And that's why I never claim to say that my way is the best way. It's the best way for me. And you'll have to find the best way for you. So your needs and your wants are going to be different from mine. And also you have to take into consideration the environment. You're in the context you're in, in our recently I've been reading a lot of comments about whether is it better to rent versus buying a house. And when I look at some of the responses, it just makes me wonder that there really is no better way.

Sharon: (04:28)
It depends on where you are, where I live and based on my own needs and ones, if for me owning makes sense, right? Because when I take into consideration the interest rates on the mortgage, if I look at our land scarcity, then obviously I know that owning land here is definitely an investment. And when I look at the returns on, you know, our property up, all of these things, so versus renting where the rental market, where I am, no, for me, it makes sense to own. Not only that, not just purely from a numbers perspective, but also what it does for me in terms of what I need for my own mental, emotional wellbeing and what my priorities are, which is to transfer wealth like my husband and I, we want to transfer wealth to across generations, right. To our kids. And because we have kids.

Sharon: (05:26)
So if you don't have kids, you might have different considerations. So first of all, the thing to answer your question, how do you know if you're the right thing is to understand clearly what right means for you and you don't have to compare with anyone else you just need to know for yourself, what's important to you. And there's this other piece that sometimes, I mean, I certainly didn't think about it, which is our financial flashpoints, what doctors, Ted and Brett clients call financial flashpoints. And these are kind of the traumatic and emotional experiences around money that we experienced when we were growing up adults around us, what we observe, how they behave around money, what we were told about money, all of these can be traumatic for a child, whether we feel, and we grow up in an environment where there's never enough or money is all around and use the control, or it is used to really help people and a lot of generosity, or there's a lot of scarcity around us.

Sharon: (06:26)
All of those things feed into our belief system and the stories that we end up telling ourselves around money, what we make money mean to us. And, you know, at that very young age, we don't really think about it, but we actually carry those stories into our adult lives. And they come out and manifest in many, many different ways, how we are around money just the other day. I was so taken aback that I didn't realize I had become one of those people that when we go out, I'll tell my kids, don't order Juice or desserts here because it's cheaper to get ice cream in the grocery store and eat it at home. And I never wanted to be that sort of a person. And the kids remembered that. And when my daughter told me that incident, I'm like, what did I really say? That that's not the kind of person I want to be?

Sharon: (07:18)
Because when I go out for a nice meal, I want to enjoy the full experience. It is not a utility thing. It's not like we're just going to get our stomachs filled. So I didn't realize that, but that was kind of also all of the financial flashpoints I had growing up that became part of my story around money and what money represents and what I will spend money on and what I want. So we also want to be aware of what our money stories are, which are often formed because of those traumatic experiences, emotional experiences that we had around money that we observed when we were growing up. And finally, what we want to do in trying to identify or define what this, what right is for us is to discover and uncover our money stories. So what are we making money mean in our lives?

Sharon: (08:13)
So that's going to help you to also define what's going to be right for you. So now that you've got an idea of what's right for you, right? How do I know what, whether what I'm doing is the right thing to do with my money. And then you now have an idea of your money stories, what you grew up with, what you make money mean. Does it mean more freedom and options for a lot of people? It does. Does it mean more respect and status? Does it mean recognition and approval or does it mean control? Does it mean greed? What does that mean for you? And then start to pay attention to that shows up in your life. For example, the one I shared about the comment I made about going out to eat and not ordering dessert or ordering drinks, because it's cheaper to get that from the grocery store and have that at home that tells a lot about my own mentality around money, very scarce based approach that if you spend it here in the restaurant, you're going to, I have less somewhere else or also the idea around what I value, right?

Sharon: (09:25)
The practicality side of it, or filling my stomach versus the experience. That's really, even though what I thought in my rational mind was that no, I actually want to go for the experience, but what I actually did reveals what was truly happening at my subconscious level. So you want to start paying attention to that and then notice these things and see if there's anything you want to change about it. Or maybe you're just really happy about whatever your money stories are that have got you to where you are today in terms of your financial life. I know for me, it brought a lot of financial anxiety because of the scarcity based approach. I always felt like if I spend it, I won't have enough, or I will run out this idea that I will run out and I won't have enough or later was very, very dominant.

Sharon: (10:13)
And that the reason why I don't buy the ice cream, when we go to the restaurant to eat, because if we spend the money here, we're not going to have enough for something else in the future. So once I knew what was right, as in, what do I want for my life? What kind of a role do I want money to play in my life? If I'm going to use money as a tool, how am I going to use money as a tool to create the kind of life that I want? So those are the answers. Those are the questions that you want to start, you know, finding the answers to. And then at a very practical level, the next thing you want to do, and something that you can do right now is to track your money, which is where money is coming, where money is going.

Sharon: (10:57)
You want to know what the situation is right now in order to answer the question of whether you're doing the right thing with your money. First of all, you need to know what exactly are you doing right now with your money and tracking is kind of the simplest way to do it. It may sound like such a tedious process. It doesn't have to be initially of course, is to requires you to take some action, to make a note, whether it is all school pen and paper or technology or an app to really start paying attention to where your money is coming and going. And I, and I mean every single thing, right, for at least a month. And I personally love and use Kara McCall's money grit for both my personal money, as well as my business. And that's the tool I would recommend because it is a little bit different from your usual budgeting tool that is just looking backwards in time of you have spent and what you have made, and it actually looks forward and it addresses your needs and your wants, it helps you to review your money stories and all of that.

Sharon: (12:02)
To me, the things that really matter in terms of helping you to gain more financial clarity and confidence and peace of mind. So the thing you want to do next is to really track your money and money grid of course, makes this very, very easy to do, and it doesn't have to be tedious. And then the next thing besides looking at what's happening right now, you want to start planning a little bit right for the future. So when you start tracking, you are probably going to notice some patterns about how you're spending. It's going to review to you a little bit about your money behaviors, your habits. And you also start to think a little bit more about not just what you're spending now, but also what's coming up. And that is really, I find the key to financial, calm, security, and peace of mind, because as much as everyone tells you to have emergency savings for that rainy day, for that unexpected emergency, you can actually reduce your anxiety levels.

Sharon: (13:13)
And your worries, if you know, what's coming around the corner, isn't it. I mean, that is the thing we get anxious and fearful because we don't know what to expect is unpredictable. We don't know what's going to happen. And we are worried that it's not going to be enough. We're not going to have enough money for what's going to come around. However, if you really just sat down and spend the time to plan out all these so-called emergencies, eventually a lot of things can actually be planned out. So what I'm talking about here is things like your periodic expenses, things that you may not be spending on the day-to-day week to week or monthly basis, but things that happen maybe every other month, every quarter, maybe every year, every two years, every three years, when you have a clear picture of all of this and you plan for it, you know how much it's going to cost, how much you need to set aside, how much you need to make, then you have greater certainty with greater certainty.

Sharon: (14:14)
Is that then how you better manage your anxiety around money. And that's when you know that you are doing the right thing for you when you're building your life. According to your definition of what's right for you, when you know what you need to plan for, what you're going to pay for, what's coming up. What's important for you to take care of it is when we have no idea. And we're just living day to day, month to month. And then suddenly something comes up that actually isn't really a true emergency. Like maybe you need to get your car tires changed or is due for a servicing, or maybe there was an annual insurance premium that was due and you totally forgot about it. Then that's when it becomes unexpected. And when it's unexpected, it then feels like an emergency. So all of those things can be completely eliminated when you start tracking and you start planning.

Sharon: (15:10)
One of the things that I really like that Karen McCall teachers is this concept of periodic savings. And that is where you, when you already know what's coming up a year down the road or two quarters down the road, then right now you can take action right now to start setting aside for it. You don't have to wait until the time comes and find out that you don't have enough, so you can start putting that away. And the other thing that used to cause me anxiety is that I see that coming and I don't have enough right now. And when I work it backwards, right, let's see I is due in 12 months, I take the total amount and I divide it by 12. And I find that I'm not going to be able to bring that in every month consistently for the next 12 months.

Sharon: (15:54)
That would definitely cause me to feel worried and stressed out because I'm be wondering, where am I going to get that from? So the thing is for sure, yes, that might actually cause you to feel a little bit worried. However, at least that is the first step. The clarity of knowing what's coming up, that's really the first step, rather than not knowing and be caught off guard. And by surprise 12 months later, because now that you know how far off you are, how much more you need to make on a and bring in on a monthly basis, then you can really start looking at all the expenses, income you've been tracking and look at how else you can make more or reduce your expenses, or is there somewhere else and something else that you can do about it. And eventually there's always going to be something you can do is just a question of whether or not you, um, going to be willing to do it.

Sharon: (16:56)
Right. So as much as I know, that's really difficult because I've been in situations sometimes where I just don't see a way out. Then the next thing that I would suggest is you just have to take the next most right and most inspired action that you can take, because that really is all that you can do. And then to just somehow some way, trust that there's going to be some way that you can figure it out. So I know this seems like the stretch definitely is for me because I'm a planner and I need to know all the steps ahead of me in order to feel calm in order to feel confident. The reality is sometimes you can only see the next one, two, maybe three steps ahead, and you can not see the full 10 steps. So what are you going to do about that?

Sharon: (17:56)
You can obviously continue to stay stressed out about it, or you can learn to coach yourself and take just the immediate next step and trust that that's the best that you can take forward. Having planned out everything, having tracked all your expenses, having brainstorm and staying open to all the other possible things that you could do, then you just take the next step. That seems the most right for you. And when I say right, most right for you pay attention also to your feelings, because for a long time, I kind of have been let well, I guess, conditioned right by a variety of factors, surroundings, environment, school, society, that I need to disregard my feelings and do what's rational and to leave emotions away outside when it comes to money and just use your head and use a rational approach. Well, I've found that actually that doesn't help because the rational part of me back then said that I was supposed to be investing my money and putting it away for the future.

Sharon: (19:10)
So what that led to was I went way into that overboard into that I think, and I put all my money into long-term investments, leaving me with very little cash flow for today that led to me having to go into debt. And I could not, it was difficult to get out of the debt cycle because I was told, or rather I believed at the time I cannot pull my money out of my investments. I have to continue to invest for the future because that's what financial security is not realizing that it was counterproductive when I was incurring a debt. So what do I do in that situation is what I did was I actually started to put small amounts of what Karen calls, periodic savings away and start to plan out what's coming around the corner that I need to pay for so that when it does happen, I don't need to put it on a credit card and get into deeper debt.

Sharon: (20:07)
So this whole step about planning ahead for all these so-called emergencies really helped me to see the few steps ahead of me that I needed to see and to stop charging it to a credit card and get into deeper and deeper debt. And that also meant that I had to pull away from some, from putting into investments at some point in time, because I knew that I needed to overcome the debt and I needed to get out of the debt in order to get a better, to get into a better place emotionally, psychologically. And in fact, ultimately financially. So after I dealt with the debt and then, then I could see in a complete picture, my long-term needs in my investments after also taking care of the periodic savings so that I don't compromise on my current life, totally not living alive or quality life because I'm trying to do what I'm supposed to do from a rash, purely rational approach.

Sharon: (21:08)
And that is a reason why I like the money grid tool, because it's a good balance of both taking care of your emotional needs, your wants, as well as applying a rational approach to it. So back to my point about then what are the right things that you're supposed to do and taking the next most inspired step that is really sometimes all you can do and that after you've done all of these, taking a balanced approach in terms of your long-term view, knowing your current expenses and income through your tracking planning for all of the emergencies or your periodic spending, putting that away, trying to brainstorm how else you can, if you need to bring in more income or reduce the expenses, then just taking the next step. That feels right for you. That feels good when I say feels right? Meaning that it feels good.

Sharon: (22:02)
Val Nelson talks about this in turning towards the breeze. And that's, that's how it feels like when something feels good, it's like you're turning towards the breeze. It feels good. It feels right. As opposed to something that's a little bit off. Sometimes we feel like something is off, like the way it was with investments. I felt like it was something I ought to do. Although it created a lot of stress for me, it didn't feel good, but I just felt like that was the thing I was supposed to do. So that clearly led me down to a place that caused more anxiety. And I'm suggesting that you learn to pay attention to your feelings as well, when it comes to your money, not let the feelings take over. That's not what I'm saying. I'm saying to not just choose your head over your heart or your heart over your head.

Sharon: (22:50)
It can be both. When you do that. When you say that tracking, you know exactly where things are going right now, you know exactly what's coming around the corner. No, you're no you're taking all the steps that you are feels good to you and is the right thing for you to do because that's your definition of right? That's when you start to gain confidence and you might be surprised how things open up, how opportunities somehow show up, because that's the other thing that I think sometimes we don't, I think about when it comes to something as rational as your money and personal finance is there is a universal order to everything around us. And we are a part of these we're part of the entire order of things. And when we are in tune with what we, what feels right and good us and doing a balanced approach, doing things that use both our heart and our mind and taking care of ourselves completely physically, emotionally, mentally, then just letting go of the next 10 steps.

Sharon: (24:04)
That was the thing that really helped me when I stopped resisting my current reality and fighting my current reality of where I am now versus where I want to be and being impatient about it and wanting to know the 10, 20 steps ahead of me when I could actually let go of that and just take the next most right. Logical and fuels. Good step for me that really opened up so many opportunities and doors for me. And even to this day, sometimes things happen and they get me anxious or have like a big upcoming expense. And I start worrying about it. And what I do is I'll just, just self-aware about it. And I talk about self-awareness in the previous year, just be self aware that the anxiety is rising in you, that you're feeling where it, and recognizing it, acknowledging it, and then making the position and setting the intention to say, this is all that I can do about it right now is no use for me to fight it, resist it, to be frustrated or be, or to give into the fear of it right now and just take the next most.

Sharon: (25:23)
Right. And logicals that. So I hope that helps you and to overcome your financial anxieties and it helps you with a step-by-step of knowing what's right for you you'll know what's the right thing for you. If you just take the fundamental principles of good money management, which is of course don't be frivolous, unnecessarily, extravagant, completely short term, but take a more balanced approach, PreK what you're currently spending, what you're currently making, have a clear plan for what's coming up, knowing with certainty, what's right for you paying attention to your feelings and taking the next most inspired. Logicals that for you and just keep being open to the opportunities that will present themselves to you as you do this. And then finally just let go of the anxiety and know that you are part of a bigger picture here. You know, you're part of his universal order.

Sharon: (26:29)
There is a certain divine timing to everything. There is a certain order to how everything works as a certain intelligence around how the world works of which you are a part of, and then just trust and believe in yourself that that is the right thing for you. No matter what somebody else may say is the right thing for you. You already know what's the right thing for you to do. So if you're finding that this is useful and you want to find out a little bit more, I would like to invite you to join me in my brand new pilot course, it's called stop money. Stress is three workshops. You get three additional add on bonuses and also three short cut bonuses, all about helping you to gain clarity over your current financial situation, to gain clarity over what your money stories are. We go into your financial flashpoints, we discover all of those so that you know where you are right now.

Sharon: (27:29)
And then we look at a bit of the planning of the life that you want, the future that you want. What are some of those things that you can plan for so that you don't have to feel like everything's an emergency. And then we put in place a simple, very concrete and powerful plan for you to keep taking the next right action for you so that you can actually create that reality for yourself to turn whatever dream life you want at these in terms of also your financial life or even other aspects of your life and make that happen in your life. So that's kind of like the three key things we look at where you are now, we look at where you want to go and we put in place a plan to help you get that. And there are frameworks around it in the bonuses.

Sharon: (28:24)
I shared a tools that I use. I share the tips and strategies about how to help you to manage your financial anxiety. I talk about the signs behind goal achievement, how all of us already have in us to actually achieve whatever it is that we want to just, most people haven't really been taught to really activate that powerful source that's within us. And yeah, I hope that you will join me on this program. It starts in August. I'm doing the pre offer right now, looking for the founding members who joined the program and I'm going to limit it because it's going to be a program that I hope we will create together. The workshops will get released every week. And then we'll, co-create it. You'll give me your feedback about what you want to see more or less off, and I'm fine tuning it. And once you join, you come in, you're in for life.

Sharon: (29:16)
You get all the further updates along the way when I open it up to everyone else. So I hope you'll join me as a founding member and be part of my team here. As we create this program, that's going to help you overcome your financial anxieties. Stop stressing about money and experience more financial, calm, confidence, and certainty in your life. I hope you enjoyed. If you did, please share it with someone who will benefit from it. Subscribe to the show, leave a review. If it's been helpful for you. And I will talk to you again soon. Bye now,

Sharon: (29:57)
Thanks for listening. If you liked what you heard, please leave a review on whichever podcast player you were listening on. It really helps me further. My mission of helping more people realize their highest potential and live rich fulfilling lives. Don't forget to hit subscribe, to be notified when a new episode is released each week, finally download the worksheets and check out the resources for the episode and most importantly, practice what you learned so you can transform your life. I'll see you in the next episode.

Sharon: (30:42)
If you're wondering, you can even begin to turn your passions into profit. Then I like to invite you to join my online course and coaching program, Moms Who Profit. This is a program I created to teach my three step process to help you figure out how to get paid, doing what you love. Head over to momswhoprofit.com to sign up. That's M O M S W H O P R O F I T .com. I hope to see you in the program.

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SHARON SIDHU
The Financially Free Woman Podcast Host

ABOUT SHARON & THE FINANCIALLY FREE WOMAN PODCAST

The Financially Free Woman Podcast was launched in November 2020 during the COVID-19 pandemic to share the stories of everyday people making a living doing what they love. While training her students in leadership and mental resilience, Sharon noticed the rising level of financial stress and anxiety experienced by many of her students. It dawn on Sharon that this was an opportunity for her to share how she overcame her own financial anxieties triggered by her personal experience with a 6-figure business debt and being let go from her job as the family's primary breadwinner. She began sharing everything she learned about mastering not just the practical side of money but also her mindset around money. Through this work, Sharon began meeting and building a community of women creating and living their dream lives. The Financially Free Woman Podcast is a collection of stories, practical tips and strategies to help you discover your passions, and use them to make a lucrative living. Imagine a life where you spend your time doing what you love and getting paid well for it! That's exactly what these women featured on the podcast are doing and they tell you how! Get inspired and start creating your own your dream life!

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