Why is coaching so valuable? How can it help me? Is it worth the cost? As a Master Financial Coach I know that coaching works. Besides coaching hundreds of people over the last 10 years I myself have been coached by several people who help push me, help me achieve more, help me improve my relationships, and help me win with money. My recent stint of being coached by Dave Ramsey's team helped me pay off $20,000 in debt and save an extra $15,000 in a year and a half! In my coaching practiceI have helped others to grow their businesses, improve relationships, and yes, win with money! I personally love giving and receiving coaching, but for many folks this process is new. Why hire a coach?
1. Coaching helps you define your goals. Many people are under such day-to-day money stress that they don't dream anymore. It's hard to look up towards the future when you're looking down at a pile of bills! Coaches help you to begin to dream again, to envision what your life could be like when your money is handled. What do you see for yourself and your family? Would you like tropical vacations? To purchase a nicer home? Have the freedom to do work you love? Have a retirement full of choices and opportunities? Talking with a coach inspires hope.
2. Coaching gets you in action toward your goals. Filling out the net worth sheet, and monthly budget, with your coach, is like a basic action step that gets you out of the "money fog", and into clarity on what needs to be done. A coach helps you get the numbers in front of you, and then helps you brainstorm opportunities to increase your wealth. Oftentimes the solutions are obvious: cut housing costs that are 50% of your income, or apply for a raise when you have been at a job 3 years with no increase. However, a coach can oftentimes help you see things you have overlooked: places in your budget where you can cut costs, or unexpected income sources and places to move money around so that it meets your goals faster. Coaches also help teach the give/save/spend money method, which creates overall life balance through meaningful giving, saving some money for the future, and spending wisely.
3. Coaching can save your marriage! Money fights and money problems are the #1 cause of divorce in North America! Don't be a statistic. Talking with a coach often helps both partners to feel understood, and to diffuse emotional tension that has been building up over money. Coaches can also help couples get on the same page with their goals and dreams, so there is unity. Once couples unite, figuring out the strategy and action items to get there is often easy. And a coach can help facilitate actions to take, and help the couple stay accountable to their goals with regular budgeting and follow-up. The cost of financial coaching is comparable to a standard therapy session. In my opinion coaching is uniquely valuable for couples tackling financial issues, because you get emotional support as well as tactical money strategy in one session.
Some people say, "oh, I can't afford coaching". If you are struggling with money, I say you can't afford not to hire a coach! Most people can cut their cable bill and afford coaching. Before I found Dave Ramsey's method and turned my life around, I wasted so much money on emotional spending. A few hundred dollars spent on financial coaching earlier in the game would have saved me thousands! How much is it costing you to put off getting your money handled?
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The Debt Snowball~this is it, folks! Baby Step 2, the "heart" of the Dave Ramsey Baby Steps to building wealth! This is where you find out how serious you are about managing money for the most benefit. Truth is, in our debt-happy culture, this step represents a major change in attitude, lifestyle, and heart. This is where the rubber meets the road. Are you going to change?
I found once I committed to it, this step was the easiest step of all so far. I became "gazelle intense"(like the gazelle running for its life from the cheetah!) and totally changed my lifestyle in order to focus on paying off debt. This single-pointed focus gave me the ability to just throw ALL extra money at the credit cards and loans. I had about $20,000 in consumer debt: credit cards, old phone bills, and my car loan, and I paid it all off in about 6 months.
How did I do this as a single mother? Well, there are 4 things I did that I would recommend to others. Like Dave says, it's not rocket science, but it does require that you change the way you have been operating so far.
1. Spend less money. If you have been living beyond your means on credit cards, loans, and so on, that means there is more spending going on than receiving. Simply reducing the outgo will stop the bleeding. I cut my lifestyle drastically: from renting out a room in my townhouse apartment to couponing and meal planning instead of eating out. I said "no" to my kids a lot, and we found lots of fun free things to do, like going to the park, playing board games, and playing music together. I also reduced my expenses for work, and was more strategic about which activities in my business were profitable, and which simply weren't worth continuing.
2. Make more money. You can also up the income side of the equation! I hustled with my coaching & music business to get more clients, and signed up for as many added hours at my side job at a housewares store as I could! This was the hardest part~I felt like I was working ALL the time, and I was tired. But I could see my debt numbers going down, and that was a huge motivator. I also applied some savings toward the debt, so that gave me a big boost in the beginning of the journey. I sold furniture and household items on craigslist and facebook. I made a goal at the beginning of each month to earn $3-400 miscellaneous income, and achieved it most months!
3. Do a monthly budget! This is a key step: track all ins and outs of your money, and have a plan for where each dollar is going to go before the month begins. I found doing the budget was incredibly empowering for me. In the past I considered it constricting, but now I see it is a tool that helps me get to where I want to go. The budget also helps put each of your expenses into perspective. Dave Ramsey and many financial coaches recommend you keep housing 25-33% of your take-home pay. When I saw my housing costs were 50% of my income, I rented out a room in order to create more margin for paying off debt.
4. Be grateful for what you have. Learning to be content with one's current lifestyle is key. When you give up trying to impress others, life is so much easier! Good homecooked food, a comfortable bed, and quality family time are priceless, and not that expensive to acquire. I found I could be pretty happy without a fancy house, designer clothes, or expensive travel. This created a sense of freedom, and the ability to focus on my own goals without worrying what others were doing. Stop "keeping up with the Joneses". The Joneses are most likely broke and deeply in debt!
When I paid off the last debt in September 2015, I did a "YES" day for my kids to celebrate! They got to choose what they wanted to do and eat all day, and got a spending allowance for treats. And then I took them out for dinner! How are you going to celebrate when you become debt-free? If I can do this as a working single mom, so can you!
Coach. Teacher. Author. Speaker.