You Don’t Have to Be Smart to Be Rich

Building wealth and saving money is more about behavior than book smarts. Financial freedom can be achieved by everyone.

People often equate wealth to intelligence. While it seems that the correlation may be high, that just isn’t so.  Earning wealth and gaining financial freedom is as simple as making a sandwich. If you follow these four steps, you will be well on your way to being a single parent that is financially stable and living a debt free life.

Step 1 – Be focused.

In order to gain financial freedom, you must be focused. In order to be focused, you must have goals. Once you have goals, you need a plan to achieve them. By having a goal and a plan to achieve it, you are setting yourself up for success since you will be focused on reaching that goal. Its like a trip. If you get in a car in search of your dream vacation, you’ll fail. How will you know if you’re headed in the right direction, or if you’ll even reach that destination if you haven’t detailed what it is you’re trying to do? Have a goal, make a plan, stay focused. Its that simple when building wealth and eliminating debt.

Step 2 – Be Determined.

Determination is the quality single parents need if they want to overcome many obstacles, including financial ones. Challenges will come, that’s guaranteed. But in order to take control of their finances, single parents must be determined not to let unexpected expenses, debt, stress, and a helpless attitude lead them down the road to debt, or keep them there. Being determined helps with focus and both of these qualities have more to do with behavior than intelligence.

Step 3 – Be intentional.

Intent is having a purpose for doing something. It covers being resolved, committed, and “set on” whatever it is you want to do. Being intentional requires putting the focus of a plan, the determination of a marathon runner, and the purpose of a dedicated individual together in order to power your way to success. Having intent means that you will think before making that impulse buy and leave it in the store, instead of indulging. Being intentional means being deliberate, planned, and making decisions based on the sole purpose of achieving your goal. Again, none of this requires an Einstein intellect, rather, the patience of Ghandi.

Step 4 – Be Ambitious.

Ambition is the trait of being determined, motivated, striving, and a “go getter.” Sometimes the word gets a bad rap, especially when associated with people being ruthless, but being ambitious when it comes to getting one’s financial house in order is necessary in order to break the chains of debt. Ambitious people dream big and let nothing get in the way of their goals.  There is a healthy balance in being ambitious that is necessary in order to obtain financial freedom. Its in all of us and can be cultivated by following the first three suggestions.

Focused.Determined.Intentional.Ambitious. Those are the qualities that it takes to be successful and get rich. Single parents are in the best position to take control of their finances since they are the only one in the driver’s seat. While having a second income may have its perks, following the four steps above will get anyone in the right position to take control of their money and financial destiny. So what are you waiting for? Get started now!

What qualities do you think are necessary to be rich? Please share in the comments below and join our Facebook group, SingleParent$aves, to be part of a community of savers like yourself.

Happy saving, live well!  

Ten Tips to Stay Focused on Your Financial Goals

Staying focused on financial goals can be a constant struggle. Use these tips to stay headed in the right direction.

As the year rolls on, many people have lost their excitement in achieving their financial goals. Everything from a broken appliance, car repair, or an unexpected expense can dampen the spirit of even the most dedicated people. 

But why should “unexpected events” like that slow you down?  Guess what, they can’t if you are prepared and have a plan.

But how is it possible to plan for expenses like those? Easy, have a sinking fund.

Car expenses are inevitable, hence they really aren’t “unexpected.” If you own a home, something will always go awry, so those tabs aren’t unexpected expenses either.  The point is, there really is no excuse to be unprepared in the event of an “emergency.” Follow these ten tips to stay focused on your financial goals and to be prepared for the “unexpected.” Just click on each hyperlink to be sent to an article to help get you started (or keep you rolling) in the right direction.

  1. Have a plan, set SMART financial goals. The saying goes, “If you fail to plan, then you plan to fail.” Don’t start out on the wrong foot, set smart savings goals if you want to achieve them.
  2. Start saving today.  In order to get the full benefits of compound interest, the sooner you start, the more you’ll save.
  3. Find ways to cut costs. As single parents, choosing the right daycare, cutting your cable bill, and saving on groceries can be like getting a second job! This is one of the easiest ways to keep money in your pocket. What cost can you slash?
  4. Decide to be debt free. Rid yourself of the burden of credit card debt and find a plan to help chart the course. Click here for one that worked for me.
  5. Use sinking funds to be ready for those “unexpected expenses.” This article talks about vacations and car insurance, but you can create accounts for anything you need to save up for.
  6. Be nice to yourself and allocate money for self-care.  While it is important to save with intensity, you must enjoy life now. That’s why its important to maintain the right balance with your money.
  7. Stay encouraged by reading about personal finance and saving. These 5 books will change your life.
  8. Have a plan for the unthinkable. Two emergency funds may be best if you want the security of a six month emergency fund for job loss, plus money set aside for those pesky “unexpected emergencies.” I feel better with two in place, although one is a start.
  9. Avoid making money mistakes. Choose a home you can afford and consider purchasing a mature home. Also, don’t try to keep up with the Joneses. Stay focused on your money goals. Avoid these other traps.
  10. Just have fun. We only have one chance to live life. Try not to stress over things and enjoy the life you’ve been given.  Hindsight is 20/20. Instead of dwelling on what you didn’t do or what has happened in the past, get excited about the wonderful opportunities that are sure to come – especially when you’re financially free and building wealth.

What tips will you try first? Pick two or three then share in the comments. Also, join our Facebook group to be linked to a community of single parent savers like yourself.

Happy saving, live well!

Learn the Secret to Financial Freedom – Have Two Emergency Funds

Why one emergency fund is not enough. 

Stay with me here, it gets complicated.  You read the title correctly. I have two emergency funds and think you should too. While it kinda defeats the purpose of having an “Emergency Fund,” let me explain why I decided to have two so that hopefully you can decide what works best for you.

The purpose of an emergency fund is to pay for, well, emergencies. Lost wages. Broken car. Unexpected home repair. Medical expenses. However, since I purchased a home that is rather old and I firmly believe in Murphy’s Law, my anxiety has led me down a different path of preparedness.

Having saved up a 6- month emergency fund, paid off all debt, and feeling financially comfortable, it seems that every time I turnaround, something new pops-up. Clogged toilet, slow moving drains, car repairs, window cracks, clothes that are too small, everything! While my emergency fund is in place to cover those expenses,  I view it a bit differently. I want my primary emergency fund to be used solely in case I lose my job or have some extended leave due to a medical emergency – the primary reason why we save 3-6 months of expenses.

All of those other “emergencies” should be taken care of either through increased cash flow or extra savings beyond my 6-month stash, so that the primary emergency fund remains untouched. In essence, I’ll treat my 6 months of savings as if it doesn’t exist and anything above that serves as my secondary emergency fund – for anything that happens – because we all know that life happens.

Why do I feel this way? Its simple. If I saved up 6 months of expenses but tapped it for every common “emergency,” then I’d never truly have an emergency fund. I’d constantly have to replenish it. If, after I saved my primary fund then started saving into a secondary fund, then I’d always have my 6-month fund available, should a true tragedy happen like a job loss. This is what allows me to sleep like a baby at night. 

If you follow Dave Ramsey’s Baby Steps, then I would not delay contributing to my retirement account after saving the primary emergency fund, rather, I’d figure out a way to divert some money into the secondary one, like a step 3B. For me, since I know that I am not saving for my kids’ college, I’d replace step 5 with a secondary emergency fund.  That’s it!

Its up to you what advice you take and what ultimately helps you rest easy at night, but this is a suggestion that’s worth a try if you want to be sure that you’re always prepared should the unexpected and truly unexpected happens.

What’s your view? Would having two emergency funds make you feel more secure about your finances? Post your thoughts in the comments below. Happy Saving! Live Well!