The most important financial goal is not what you think
I’m not gonna lie. This year didn’t go according to plan.
There were surprises with my financial situation that I never saw coming. Reminders that “life” can happen to anyone, any time. Not that I didn’t know this, of course. But when reality hits, it can surprise anyone. At least at first!
But there IS good news to this story….
Because I had a handle on the most important financial goal there is, things turned out well. In fact, they turned out WAY better than I would’ve imagined had this same thing happened to me a decade ago.
So what happened?
To make a long story short, my household lost income I thought I could count on. I ended up walking away from a chapter that defined much of my career. And I watched life change almost overnight.
But despite everything, I am still here. Not only that, my husband and I were able to spend several weeks this summer driving across the country, exploring national parks, and watching sunsets I would’ve missed had I stayed where it felt safe.
That brings me to that most important of all financial goals…
With money, it’s not about how to make more of it. It’s about building enough financial stability that you can trust yourself when life changes.
Of course, this situation wasn’t the first time I experienced a major hiccup in my finances.
Job and income losses have happened to me before, usually suddenly. But back then they caused major disruptions to my life and lifestyle, to say the least. (At one point back in 2009 I was fired and at the time I had $10 to my name…)
But this year when my household went from two incomes to one overnight, I wasn’t caught off guard with nothing. THIS time, my husband and I were prepared. And THAT was the difference.
We were able to assess the situation, take immediate action, and get through it with a lot less stress, fear, and setbacks than would’ve happened without a plan in place.
So what did we do? This is what we did immediately to stabilize the situation…
1. We assessed our financial “runway”
Before making any rash decisions, we took a step back to evaluate exactly where we stood. How much did we have saved? How much did we really need each month? And how long could we comfortably sustain ourselves on one income? We looked at the real-time situation with a few simple questions. That way we knew how much time we had before we actually had to start worrying.
2. We reviewed and adjusted our finances accordingly
The net step was looking at our spending and our priorities. We assessed what could be reduced, what could be eliminated, and what could wait. Then we found a few things we no longer needed, and sold them for a little extra buffer.
3. We took the first month off
After looking at where we stood, we realized that we had a little breathing room. So we took a month off. We took time off from the anxiety, the constant planning, and the barrage of “what ifs.” Then we celebrated all that we had worked for, and were grateful for how prepared we were.
We took a 3 week RV trip during this time, too. This is something we never would’ve been able to do with both of us working full time.
BUT, this trip wasn’t a momentary impulse, although it might sound like it was. It was actually years of planning, saving, and preparing, followed by one moment of action when the perfect opportunity showed up.
These are the 3 steps we took right away. And we couldn’t have done it had we not had a plan.
All this said, I have to say that I’m honestly not a very good planner! This might surprise you, but I never considered myself a planner. But I’m an excellent preparer. Here’s why that matters…
The key wasn’t that we had the perfect plan. It was that we were prepared for whatever came our way.
Once you’ve been around the block a few times you learn that things are going to happen in life. Things you just can’t control, too.
But it’s not about avoiding the “bad” things. It’s about preparing for whatever might happen, so you can make anything a little less painful in the moment the next time.
People often mistake preparation for luck. As in, how was I so “lucky” to be able to go on a 3 week road trip after a major job loss in the household? But it wasn’t luck at all. It was preparing.
The goal was never to avoid uncertainty. The goal was to create enough freedom to keep moving forward when it arrives.
Sometimes the biggest return on your financial planning isn’t in your bank account. You find it in in the choices you have when life takes an unexpected turn. Because if you don’t prepare, your money defaults to the moment. And that moment us usually expensive.
So what is “preparation,” and how do you put it into practice?
Here’s the thing about preparation…
It’s not about spending hours and hours dreaming up worst-case scenarios so that you sidestep all potential pitfalls. It’s about taking the steps to ensure that you create as much stability as you can, no matter what comes up. (Because things WILL come up. That’s just life…)
Preparation also doesn’t have to happen in one big gigantic action step, and it doesn’t have to be complicated, either. It happens one day at a time, with a thousand ordinary decisions and small steps. Wealth is built the same way, one small action at a time.
Then one day, you’re standing in an amazing place that you could once only imagine. Which is just what happened for us this year!
So being prepared is about taking one small step at a time with your money. Preparing not only for stability, but also for your dreams. A simple move like opening a new savings account, setting aside a percentage of your income every month, making consistent payments to reduce debt, and (of course!) working on your money mindset.
The small steps add up, and they’ll lead you not only to your dreams, but also to peace of mind.
So, what small and consistent steps are you taking for your finances, or which ones do you plan to start taking? I’d love to know! Tell me here on the blog.
AND, until next time…
Love, light, and MONEY, Honey…
Kaylee