I am starting the new year by reading about personal finances. The last couple of months have been pretty rough. The biggest problem has been that my paydays are not aligning with when things are due. Honestly, I was doing great at the start of the pandemic. We had a buffer that I was able to pull out of when paydays and due dates were not aligning, but then a couple things happened: landlord raised the rent, gas prices went up, grocery prices went up, and more doctors appointment copays and meds.

Oh, yeah, almost forgot that the car insurance went up during this time period because male teenage drivers are apparently a risk in the eyes of insurance companies. We pulled from the emergency funds and savings. Some days are like that.

Part of why I had a buffer was that I followed Dave Ramsey’s 7 Baby Steps which is a financial strategy designed to help people achieve financial stability. While individual experiences may vary, many people find these steps to be a practical and structured approach to managing their finances. Here is a brief overview of the steps:

1. Save $1,000 for an Emergency Fund: The first step is to establish a small emergency fund to cover unexpected expenses.
2. Pay Off Debt with the Debt Snowball: List all debts from smallest to largest and focus on paying off the smallest debt first, then rolling the payments into the next one.
3. Save 3 to 6 Months of Expenses in a Fully Funded Emergency Fund: Build a more substantial emergency fund to cover living expenses in case of job loss or other financial setbacks.
4. Invest 15% of Your Household Income in Retirement: Start saving for the future by investing a percentage of your income into retirement accounts.
5. Save for Your Children’s College Fund: If you have children, start saving for their education.
6. Pay Off Your Home Mortgage: Accelerate your mortgage payments to pay off your home loan early.
7. Build Wealth and Give: Continue to invest and build wealth, while also giving to charitable causes.

The effectiveness of these steps depends on individual circumstances, financial goals, and preferences. Some people appreciate the simplicity and clear direction provided by the Baby Steps, while others may prefer different financial strategies. I had made it to Step 3 before 2020 happened, but now I am back at the beginning. Ideally, if pulling from the emergency fund, you should also be paying back into it. Unfortunately, that ability dwindled last year. Since I am a state employee, I also have a mandatory deduction towards my retirement fund…I am worth so much more when I retire *sigh*.

Personal finance is not one-size-fits-all. While many find success with Dave Ramsey’s approach, it’s crucial to evaluate your own situation, goals, and risk tolerance. Consider consulting with a financial advisor to tailor a plan that aligns with your unique needs and circumstances. There are also lots of great resources out there on the web.

As mentioned above, the process is not one size-fits-all which is why I am also looking into other methods. A lot of the other books I have been reading talk about having a money mindset. It is very much along the lines of manifesting (remember that post?). I have been tracking the unexpected cash bonuses that have been appearing in my life since I read The Witch’s Way to Wealth by Jesse DaSilva. In the past six months, I have tracked over $3000 has come my way. Yes, I am counting that as manifesting. For example, our grill died and we unexpectedly were gifted a used grill from a friend who didn’t even know we needed one. He was just moving and therefore downsizing. Author Jen Sincero seems to also imply the importance of mindset in her book You are a Badass at Making Money. If you live in a scarcity mindset, then it will be hard to climb out of that hole.

So all this to say the plan for 2024 is to build back the budget! What are your tips, books, or other recommendations when it comes to this area? And, hey, if you feel like supporting the great content here at NQS, you can contribute to the coffee fund! Meanwhile, I will be the one over here repeating “I am a Money Magnet” 😉 — Thanks for reading!