Money Talk: What drives your financial decisions?
I would have to say the main driver of my financial decisions depends on where I am in my money journey.
So when I was in debt, it was to get out of debt. I stopped spending as much as possible and I checked my debt balance obsessively. I made charts to see when I would get out of debt, I planned for everything. EVERY PENNY.
Once I was out of debt, I just wanted to save money and reach a comfortable amount of savings so I could breathe and not worry about having to go back into debt of any kind.. It was around the time of the market crash of ’08 and I managed to save $30K and was paralyzed in investing or spending because I had no clue when my next contract would come and when.
I couldn’t invest that bit of money, I thought I would not get a job for another year or two, and I needed all that $30,000 to pay for expenses in that case.
Fast forward to today.
Now, I am growing wealth. It is easier for me because I make a good income, but harder because I didn’t (until recently I have been running models on whether I am on track or not) have any real goals set up with true benchmarks of wealth or assets.
Today, I would say the main drivers are:
- Comfortable retirement (and on track for it, to give myself an #%9# kicking to stop spending so freely)
- Saving to be comfortable so that I am financially stable for Little Bun – he will not worry about me and I can help him if I need to
- Hitting the $1M mark this year. Yeah, THIS YEAR. I am trying to force myself to accelerate.
- Disregarding my car and house as liquid assets because I am being fooled into thinking I have money and I have it in fixed assets, so I will be splitting out my LIQUID assets versus fixed.
What drives your financial decisions?
You can read the rest of the Money Talk questions here.
As someone who grew up orphaned, low-income/working class, and had very low self-esteem, I never thought I would amount to much…until I was pregnant with my first child.
The fire inside me to succeed began the moment I knew he existed and has only been fueled by other circumstances I put myself in and a few others I had little control over.
My desire to be financially independent finally reached the first milestone on January 31st — more than six years after I made that goal – no government assistance.
The next step is saving 3 months worth expenses and NOT touching them because I finally make a reasonable income.
The goals I had because of my son, I now have because I WANT them for myself. It’s a nice feeling.
Sherry, I love that you write about these topics.
The economy drives my financial decision, whether it’s the stock market or real estate market. I worry about not having enough liquid assets to take advantage of a recession or a business opportunity.
Since I manage my own stock holdings, I also do not want to hold stocks during a recession as it happened many times in my past.
With that said, my main financial goal is to also achieve a rate of return on capital of around 20% per year which of course requires substantial risk taking.