The events of the Year 2020 have been some of the most unexpected in the course of human existence. As 2019 ended and 2020 began, many of us looked forward to the year. There were graduations, weddings, and many other things planned for the year. But, all of them had to change due to the events that occurred throughout the year.
One thing that caught people unprepared was the extended stay-at-home orders, and many businesses being forced to shut down for several weeks. Stay-at-home orders and many businesses closing, for a short time or forever made a lot of people realize how unprepared they were for such things. Because only 41% of Americans would be able to cover a $1,000 emergency¹ credit cards, loans and asking a family member are their go-to option when an emergency occurs.
For many years, 8 out of 10 Americans have been living paycheck to paycheck. Many of them don’t know any other way because everyone they know lives the same way. Many also believe debt will always be something they have to use because their income is insufficient to do otherwise. Many are so overwhelmed by debt Bankruptcy seems like their only option.
Those wanting to break the generational financial situation they and their families face frequently resort to working overtime, working a “side hustle”, gambling and other things to increase their income. After trying these things, most only see their situation continue in an endless cycle of each “payday” being nothing more than a “distribution day” for their income.
Regularly fighting with their spouse or significant other over finances is commonplace for many people and why it’s one of the main reasons divorce. Guilt over spending money, how much debt they have, lack of savings, and other financial issues put a strain on many relationships. The children in these relationships are also plagued by the stress from the fights they witness around the subject of money and finances.
Financial problems brought on by mental health issues are common for people who suffer from those kinds of conditions. These are not the typical anxiety over finances. Instead, they are the results of the behaviors associated with such conditions requiring professional help along with a caring support system to manage them.
Worries over retirement savings are another source of concern for many people and why according to Smart Assets article “Smart Asset – Average Retirement Savings: Are You Normal?”², 63% of Americans don’t think their savings are on track or aren’t enough to retire. This leaves many people believing their only option is Social Security and Medicaid
Other thoughts about retirement are what age do you wish to retire and what would your retirement years look like. Some people envision the fairy tale picture of lazy days fishing, spending time with the grandkids, traveling, sitting on the front porch in a rocking chair, etc. Others think of a less rosy picture and their retirement will come when they’re no longer able to work and end up alone in a nursing home waiting to die.
When someone is indiscriminately ask what they’d like to do if money wasn’t a restriction, their answer typically is being able to give more to charity and the needy or having the ability to randomly help others financially (i.e. paying for someone’s meal, buying their groceries, leaving a sizable tip to their server, etc.). These are common issues shared by many people and the source of great concern, worry, stress, sleepless nights, and fights. They’re also reasons so many people feel their destiny has been set in stone without any hope of changing without miraculous intervention.
But, it doesn’t have to be that way. One is only stuck as long as they’re willing to remain that way. When they’re no longer willing to proceed in those circumstances, they search for a way to make a change. Les Brown said, “at some point, you have to draw a line and say enough is enough”³. This is true in all areas of life including money and finances.
All of us at one time or another have reached that point where we’ve said we’ve had enough and we’re not going to take it anymore. It may have been a bully in the schoolyard, a relationship we no longer wanted, a job we no longer liked, mediocrity on the sports field and so many other areas.
In most of those aforementioned areas, we sought out a new way to go. Sometimes we just winged it and other times we sought out the counsel of others to help us make the changes we wanted. The baseball player who’s hitting in the 200s and wants to improve to the 300s so they’re able to realize a better playing career benefit from a batting coach. The golfer whose scores continually come in far behind the other players can only move up in rank when they improve their swing so it more effectively delivers the ball to the desired destination.
Those that seek a promotion or better paying job often take additional education or training so they have the knowledge and skills to achieve those goals. Someone who is struggling with emotional, behavioral, or mental health issues seek out a counselor or therapist to enable them to change those issues.
However, one place most people don’t seek help is with the money and possessions they have. This subject is one where the common thought is I should know how to do it and if I do it like everyone else, I’ll be alright. While that may be true to a point, managing the money and possessions you have on your own or as everyone else does will usually yield the same results everyone else experiences.
For the person who is tired of living like everyone else and wants to change how they handle the money and possessions they have working with a financial coach can fulfill that desire for change. Like many things in life, the behavior associated with the management of money and finances is 80% of the problem and likewise, it’s 80% of the solution. Changing one’s behaviors is not as easy as just deciding one day to do it. At least not if you want to be successful.
This is where a financial coach comes in. Financial coaching involves more than establishing a budget and creating a plan to pay off debt. Effective financial coaching involves helping the client change their perspective around money and possessions so they can change their behaviors and decisions for how they manage them. For this to work, a relationship between the coach and client gets developed.
Part of this relationship involves the coach learning the client’s beliefs towards money and possessions, where they currently are, where they would like to get, and how committed they are to reaching their goals and dreams. Based on these things the coach helps the client discover their “WHY” if they don’t already have one. A client’s “WHY” is more than getting out of debt, buying a home, paying for their children’s college, retirement, etc.
While their “WHY” may include all of those things, it should be bigger than just them so the client will earnestly work to achieve it. If the “WHY” isn’t big enough there’s a strong chance the client will give up on it and settle for their old ways and habits. Rewarding financial coaching helps the client discover their true “WHY” and encourages them to pursue it.
Many people are familiar with Einstein’s definition of insanity as “doing the same thing over and over, but expecting different results”. This is what so many people do with the money and possessions they have and wonder why they’re still in the same situation year after year. Like the title of Marshall Goldsmith’s book says, “What got you here won’t get you there”⁴. A financial coach helps their clients stop doing what they’ve always done and do the things that enable them to reach their “WHY”.
For those of you who are tired of doing the same thing with your money and possessions you’ve done time and again and who are ready to make the changes financial coaching can be the resource you’ve been looking for. To learn if financial coaching is right for you, I offer a free 60-minute consultation where we can explore your situation and your goals. Then, you can decide if you’re ready to change the course you’re on so you can have the life you were created to live. Schedule your free consultation now at https://ramseycoach.com/taketwofinancialcoaching.
I hope today’s blog was encouraging to you and provided information to help you and others better handle their financial matters. My purpose through these blogs is to inform the reader about money and financial issues so we all can become better managers of the assets we’ve been given. If you like what you read, make sure to sign up so you can receive my weekly posts. The goal of Take Two Financial Coaching is to provide the necessary information to help families and individuals break the chains of debt, build lasting wealth, and become outrageously generous by changing their perspective around money and finances.
For those who are tired of being in the rat race or just want to better manage what they earn, I am available to have a Free 60 Minute Conversation to discuss your situation and how I can help you change it. Go to my calendar at https://ramseycoach.com/taketwofinancialcoaching to arrange a time that works for you. You can also email me at taketwofinancialcoaching@gmail.
Credits
² https://smartasset.com/retirement/average-retirement-savings-are-you-normal
³ https://singjupost.com/les-brown-enough-is-enough-full-transcript/