We will begin walking through the process of getting control of your money. Step one is
to start an emergency fund and get it to $1,000.00. This is an EMERGENCY ONLY fund, and it will become very clear to you over time why this money is set aside only for emergencies.
As I have said before, Christmas is not an emergency, I have already reminded you it is December 25th. Birthdays are not an emergency, we know when they come.
First of all: how does a person save $1,000.00?
You know your finances, possibly you have some savings if only $20.00 this is a start. Begin to look around at your spending and find an item to cut back on, such as coffee, smoking, alcohol, or everyday snacks from convenience stores or giftshops! Sell some items online, run an ad in the paper or simply have a garage sale. This could do it quickly.
Your job is to set this money aside and never touch it EXCEPT when a true emergency arises. So you ask, what is a true emergency?
1. car breaks down-can't get to work.
2. Household repair needed now. Leak.
3. IT CAN BE VERY UNEXPECTED.
This is something you were not expecting and it happens. Murphy. What a guy. He shows up ESPECIALLY when you are house poor and car poor and those notes take every dollar you make. Then, something breaks. But not you IF you have an emergency fund in place.
I feel that talking about investing in a 401(k) is crazy if people reading my blog cannot pay for a simple emergency. Let's take it back to the basics - but believe me, we will be climbing to higher levels so let's get to work.
YOU GOTTA CRAWL BEFORE YOU WALK,
FINANCIAL PACEMAKER COACHING: "WE'LL PACE YOU ALONG."