Learn the basics w/ Worry-Free Money
Shannon Lee Simmons has an awesome job and is making a huge impact on the pocketbooks of those who come across her work. As a financial advisor and founder of the New School of Finance, I wanted to hear her advice on personal finance - enter Worry Free Money...
Back up for a sec - we chose 3 books for April - Your Money or Your Life, The Financially Empowered Woman and Worry-Free Money.
It was a ‘pick which one resonates with you right now’ kinda month. Since I’ve written about the other two previously, this post will focus on Shannon’s book, Worry-Free Money.
First of all
The premise of Worry Free Money, is that no matter how much money you have, if you don’t have a plan, you’ll worry about your money. Considering the vast influence of social media, easy-access to debt and friends who seem to have it all, managing your finances is challenging!
Throughout the book, Shannon suggests more than a few ways to create a worry-free dynamic through budgeting, happy spending and setting clear priorities. Here is some of her advice:
Simplify your budget
Shannon preaches a particular budgeting style that makes tons of sense. Do some simple math and stick to the plan.
Essentially, figure out how much money you make a month. Then figure out how much you absolutely have to spend (fixed expenses), and minus from monthly income. Calculate how much you want to save for trips and emergencies (short-term savings) and want to save for the future (meaningful savings) and minus from monthly income. The remaining number is the amount you can spend on anything you want… food, clothes, trips, etc. But when you’ve reached that number, you need to stop spending until the next month.
Fall off the horse, and get back on!
The simple budget seems easy enough, right? Wrong. While that kind of math is easy, life is messy and lots of things get in the way of following a plan.
Life is also long and full of opportunities. Shannon says - sometimes you’ll run up your credit card, sometimes you’ll screw up and make a bad choice. That’s OK. The important thing is to recognize mistakes and get back on the plan.
Something I’ve never really considered before is unhappy spending vs. happy spending. When you’re trying to reduce monthly spending, Shannon recommends adding a column to your budget for happiness score. Understand which purchases bring joy and which make you unhappy. Consciously spend on what brings happiness and think of clever ways to cut the rest. How Marie Kondo-esque!
Unhappy spending usually happens when you feel obligated in family or social situations, those fuck-it moments when you get a wave of helplessness and spend impulsively and the times you spend out of feeling inadequate. I love the real talk in this section of the book.
Should you spend money?
One of my favourite parts of this book is on page 187, where Shannon includes a check-list to help you decide, should you actually spend money? This is useful in those - I’m somehow in Aritzia and I really want this leather jacket - situations.
Overall, I loved this practical guide to managing personal finance. A combination of clever, entertaining writing, real life examples, happiness ratings and simple math builds a sense that whatever life throws at you, you’re going to be OK financially.
Over to you
Which book did you read this month? What did you love about it? Where did it fall short? Comment below…