Silent Preparation Series- Part II – Signs You Might Be Living Outside of Your Means

Silent Preparation Series- Part II – Signs You Might Be Living Outside of Your Means

Silent Preparation Series- Part II – Signs You Might Be Living Outside of Your Means

 

How do you even know if you’re living outside of your means?

 

If no one taught you how to manage money – just that you needed to make some – you’re reading the right post. It is my hope that you have useful information for yourself and can provide more tangible knowledge to the younger generation after reading this.

Here’s why…

As I was growing up, I often heard the message “don’t live outside your means.” I heard this phrase a few times a year until I was about 21-ish.

My default response was always “Hmmm, mmm OK”, when really I had no idea what the heck that even meant.

At the time, I didn’t even have any means to live outside of! 

I definitely didn’t know what to ask about this elusive piece of advice. “Hmmm, mmm OK”, felt like the appropriate response.

Download our Ultimate financial resource guide to get started on finding the right resources to work on your financial game plan or share this with someone who may need it.

After I turned 21, I started hearing the phrase financial freedom a lot. Yet another elusive phrase!

Meanwhile, guess what? I didn’t know what financial freedom meant either, but it sure did sound good.

After some hard life lessons, I at least learned what it meant to live outside of your means. I damn near became the poster child for it.

Before you start reading about those lessons, you have to agree to a couple of things. 😉

Seriously!

First, no pity parties.

Second, no self-deprecating thoughts about yourself. It’s safe to not be perfect.

Finally no judgment – of ME!

Wait, did you think I was talking about you this whole time?😁

Nope!  I’m getting ready to share some vulnerable stuff with you. 😊

Now back to the poster child thing: 

Too much credit card debt…✅

Couple hundred dollars in savings but more than a couple of hundred in expenses… ✅✅

Very little contributed towards retirement…✅✅

Dependent on every single paycheck – Jackpot baby! ✅✅❗❗✅✅❗❗

To top off all that financial unsexiness, I also learned that living outside of your means was the kryptonite for financial freedom. 

Who knew!?!

I couldn’t even reach financial security, so financial freedom was a mere pipe dream for me.

If you can relate to some of this, you’re in the right place, because I learned how to fix all of these challenges.

Getting back on your feet and maintaining a reasonably normal financial life is possible after a divorce. 

You may be thinking, “Look Nikki, I just want to make sure that I can keep food on the table, a roof over my head, and enjoy THIS new sense of freedom that may be coming my way after my divorce.”

Oftentimes, we think about putting together a budget as the first step. While that step is critically important, I want to show you a deeper perspective.

By the way, if you’re one of those parents or family members bestowing the “don’t live outside of your means” advice to some unknowing young lad or lady, note that it’s the equivalent of giving a pacifier to a starving baby.

I beg of you on bended knee!

It’s time to fill in the young person with the real meaning behind this message.

Above all, if you don’t have the time to teach them, connect them to some resources.

Heck, you can just send them the link to this post so they can read it 😋

Furthermore, if you can relate to 2/3 (or 66.67%) of the items listed below, you might want to re-strategize your own financial game plan and take some action.

You can change how you manage your finances. It’s easier than you think.

If you’re thinking, I don’t really have a financial game plan – well just steal the items below.

I’ve shared some vulnerable moments about myself already. The moments when I messed up once, or even worse kept doing it over and over again.

I share these anecdotes in the hopes that it will help you see that I’m human, learn from my mistakes, and most importantly take impactful action.

Let me clarify something. I’m not perfect by any means. 😉

However, I practice self-compassion often to reduce my therapy bill, and to remind myself that we all can come back from missteps. 

Sooooooo, let’s start with uncovering the “living outside your means mystery” once and for all.

Of course, the list is not exhaustive but you’ll definitely get the gist.

Just because 1 or 2 items apply to you doesn’t mean there is a major issue in your life.

You could be going through a temporary hiccup or some other exception warranted transition. So please, no angry emails if this is the case! 

Also, please don’t take any of this too personally.

See my 2/3 comment above to know if you might want to worry a bit though.

10 Signs We Might Be Living Outside Your Means (“we” because we’re in this together)

  1. Our household can’t afford to miss one or two paychecks (I’ve definitely been here).
  2. Inability to save regularly. Saving 5% of our monthly income feels unattainable.
  3. The full mortgage loan (not payment) is more than 3-4x our annual household salary.
  4. Our car note is above 15-20% of our take-home pay.
  5. Revolving debt (credit cards or lines of credit) does not revolve (aka the limits are typically maxed).
  6. We consistently borrow money from family & friends, payday loan stores, or other high-interest options (and we might not pay them back).
  7. We run out of money at the end of EVERY month.
  8. Bills are paid late on a regular basis.
  9. Bank accounts are constantly overdrawn.
  10. Our monthly clothing & shoe expenses exceed 10% of our monthly net income.

 How do you feel after reading that? Did you start to feel overwhelmed as you read each line item?

Uncomfortable… at peace… angry… sad… any of those emotions would be appropriate and completely normal.

It’s super important to remind you that thinking “yep, that’s me” for a couple of lines is not a terrible thing. You may not be living outside of your means, you just might be struggling to manage your money in general (which is a different thing).

In many cases, it could purely be an income issue. There are plenty of situations where we just don’t make enough money to cover the basics, so a different approach is required.

However, if you read the list and thought holy crap… The FIIRM has been spying on me 😊 trust me, we haven’t but we understand you.

Either way… no worries, chica. No worries at all.

Before you get too deep on the other side of your divorce do some of the upfront homework to alleviate some of these stresses. 

Download our Ultimate financial resource guide today to get started on finding the right resources to work on your financial game plan or share this with someone who may need it.

We’re here for you if and when you need us.

Nikki Tucker

Nikki Tucker

Founder & Managing Director

 

Nikki is a 16-year financial services professional, a certified divorce financial analyst, and the primary divorce financial strategist for The FIIRM Approach. She helps female breadwinners prepare for divorce to avoid common financial mistakes and confidently maintain their financial security. She uses proven strategies within the FIIRM Approach methodology so her clients can manage their money, debt, and credit in their new financial life. TAKE ACTION & LEARN about the tools that can help make your new money life easier. Grab your FREE Ultimate Resource Guide HERE. 

Silent Preparation Series – Part 1

Silent Preparation Series – Part 1

Silent Preparation Series – Part 1

Prepare Your Finances for Divorce By Earning Money on the Side

 

I took a trip in 2019 to New Mexico with my business besties, Latasha Booth & Kemberli Stephenson. We had a great time in a rented VRBO with an amazing view, eating amazing meals and engaging in great girl talk while watching Brene Brown. The picture at the top of this post was taken on the balcony of our vacation property!

It was a fun but relaxing trip that I used my Freedom Funds to pay for. We planned the trip months prior so when it was time to go, I was more than ready, mentally & financially! 

What are Freedom Funds you ask?

Our money serves various functions in our life but it all can fall into 3 categories. Fixed Expenses, Flexible Expenses, and Freedom Funds. Freedom Funds are the dollars set aside to live life as you see fit. This may mean traveling, fine dining, indulgent self-care, or other fun ways to do WHATEVER you want. 

As you prepare for divorce, the freedom funds account becomes partially repurposed. It doesn’t mean you can’t have any fun, but it does mean that you may need these funds for “not-so-fun” things as a result of your pending divorce. 

In order to build your freedom funds quickly, it might be a good idea to earn some side/pocket money. 

In our Ultimate Financial Resource Guide, we’ve included income-earning opportunities for you to choose from depending on your situation. Most of the options are non-committal. We’re not suggesting you pick up a formal part-time gig (unless that’s what you need) just opening your eyes to simple ways to earn money to gain your “freedom” quicker!

 

Earn Side Money With Market Research Surveys

I used to participate in market research studies in person, but ever since COVID-19 hit all the invitations have been for online surveys. 

I get market research survey invitations multiple times a week that pay anywhere from $50 to $250 depending on the length of time needed and the subject matter. In July 2020 my son and I participated in a market research study that paid $250 for sharing our opinion. It took about an hour a day over 3 days to answer all the questions. 

While you won’t qualify for every survey and it’s purely optional which ones you decide to apply for it can be a simple way to increase your pocket change and build your freedom funds as you plan for your exit. In the same way that people fight over money while they’re married, I often hear people saying they can’t afford to leave.

Within the Ultimate Financial Resource Guide, I only recommend companies that I am personally signed up for or I know to be reputable. No one wants to participate in a study that they never actually get paid for.

Signing up with multiple research companies increases your chances of being invited and qualifying. If you decide to pause participating in studies (which I’ve totally done), it’s as simple as not responding to the survey invitation. 

Most pay in hard dollars, but some offer a points program or gift cards. I’ve never had to provide any bank account information for direct deposits – they just mail me a good old fashioned check. 

Popular market research companies include Precision Research, Schlesinger Associates, and Focuscope. 

Happy opinion giving!

 

Earn Side Money By Selling Your Stuff

One woman’s trash is another woman’s treasure. Not only do I have clothes in my closet with the tags still on them but I also have shoes that I never wear and purses that I rarely carry. As you prepare your life for your new future, purging items that you no longer need or want can be a win-win situation.

First, it gives you the opportunity to declutter, and 2nd you may be able to earn cold hard cash from the items that you get rid of.

You can earn side money by selling your stuff on websites such as Threadup, Poshmark, and Letgo just to name a few.  Here’s an important note in that statement – I said your stuff.

Selling your own personal items or what may be deemed in the divorce world as separate property is typically fine. Selling items that may be classified as “marital property” makes things a bit messier.

Before you decide to sell anything, I invite you to browse the sites listed within the Ultimate Financial Resource Guide. It may trigger ideas about all the good stuff in your home just waiting to help you earn more money.

Happy selling!

 

Nikki Tucker

Nikki Tucker

Founder & Managing Director

 

Nikki is a 16-year financial services professional, a certified divorce financial analyst, and the primary divorce financial strategist for The FIIRM Approach. She helps female breadwinners prepare for divorce to avoid common financial mistakes and confidently maintain their financial security. She uses proven strategies within the FIIRM Approach methodology so her clients can manage their money, debt, and credit in their new financial life. TAKE ACTION & LEARN about the tools that can help make your new money life easier. Grab your FREE Ultimate Resource Guide HERE. 

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