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In this episode, Chelsea talks solo about her personal journey with money, the big credit card mistake that majorly influenced her young adulthood, and how she started getting good with money when she thought she'd never be able to. She also lists the steps anyone can take to start getting their finances under control — without feeling shame.

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Hello, everyone, and welcome to another episode of The Financial Confessions.

Today, with just me, your beloved, magnificent, spectacular, talented host, Chelsea Fagan. And we're going to be talking about a subject that you guys ask us about all the time, but we don't always get to address here on The Financial Confessions, because we're often talking to higher-level experts on their specific subjects of expertise, and that is kind of the basic fundamental financial 101 that everyone should really have in their back pockets, especially during times like this, which for a lot of us have been really uncertain and upheaving.

But before we get into the topic at hand, I want to give a quick hello as always to our beloved partners with whom we make every episode of The Financial Confessions, Intuit. And as we're talking today about the subject of really building your finances from zero, one of the things that you will want to have on your side is the right tools. And I've mentioned this before, but the very first tool that I ever, ever got to help manage my finances was an app called Mint, which is one of the apps that Intuit makes.

They also make things like TurboTax, and QuickBooks, and Turbo. But basically, Mint is an all-encompassing budget app that helps you analyze your spending, and stay within your budget, and reach your goals, and just get a really good picture of your financial life. It definitely set me on the track to taking control over my money over the years to come, and eventually starting TFD.

But Intuit also makes many other foundational products for various elements of your financial building blocks. We'll get to more of those later in the show, but if you simply cannot wait to get started with your money, check out Intuit at the link in our description. So the subject that I wanted to explore with you guys today is one of really thinking about your finances from a total zero perspective.

For people who are just starting at the very, very beginning line of taking control of and understanding their money, or for people who feel like they need to do a total refresh of their finances. I'm recording this just at the end of May 2020, which means that things are still very much in a state of upheaval, and we are coming off some of the worst months of unemployment on record. Tens of millions of people losing their jobs or getting furloughed-- and even though many of those people are likely to eventually get their jobs back this year, at least in some form, for many of us, that has represented not just an enormous shakeup to our day-to-day financial lives and incomes, but also to our sense of self.

Recent TFC guest and friend of TFD-- and friend of mine personally-- Stefanie O'Connell talked a lot about her experience with her husband losing his beloved job on Broadway, and her taking a massive hit to her income at the same time as a result of COVID-19. And while of course a lot of dealing with that has to do with really diligent financial management and strategizing, a lot of it is also very emotional, and it's about really kind of reassessing how you've been thinking about yourself, how you've been valuing yourself, and what you've really been considering important. Suddenly, every element of their lifestyle was called into question.

And for many of us, it doesn't always necessarily even take something like a job loss for that to happen. Some of us might have spent ourselves into huge credit card debt, or experienced an unexpected move, or a breakup, or graduating into a bad job market, or any huge number of things that can face us with the reality that if we don't get in control of our finances, we're always kind of going to be playing catch-up after our own lives. So I wanted to kind of kick this whole discussion off with me sharing where I was at the worst times of my personal financial journey, and what inspired me in the very beginning to get good with money.

I of course now would consider myself to have a very healthy relationship with money, but for a long time-- kind of longer than I want to admit-- I had a relationship with money that was incredibly dysfunctional, and shameful, and basically cornering me into living a life that was terrible, in a lot of ways. That was full of stress, and anxiety, and embarrassment. But my story to kind of getting bad and then good with money is one that I think-- although it is unique to me, a lot of people could probably relate to certain parts of it.

When I was growing up as a kid, our family was very low income. We were not homeless, we weren't on the street, we weren't-- I didn't worry about food on the table every night, but definitely frugality was the name of the game. We just didn't have a lot to go around.

It was a lot of thriftiness, and hand-me-downs, and used things, and kind of getting by each month. And I know my parents at that time in my life, probably until I was maybe about 10 or 11, were very worried about how they were going to kind of make it to each month. It was very hand-to-mouth and paycheck-to-paycheck.

But I was also living in a neighborhood that was pretty poor. Were living in Charlotte, North Carolina, at the time. And we were living in a part of Charlotte, North Carolina, where kind of everyone was pretty low income.

I went to a school that-- I went to a magnet school that had kids of higher income levels, so I was somewhat exposed to different socioeconomic status. But because most of my neighborhood friends and kids around me were pretty similar to my lifestyle, I really never felt that poor growing up. I wasn't really aware that people lived any differently.

And then in middle school, my family moved to another town. We moved from Charlotte, North Carolina, to Annapolis, Maryland, which some people may be familiar with. But it is a sailing town in Maryland on the Chesapeake Bay that is very affluent, has a high median income, a lot of millionaires live there.

There's a lot of incredibly valuable real estate. I used to work, in high school, at one of the yacht clubs there, which is like a country club for people with boats. Like it is a very kind of hoity-toity area.

And I went to a high school that was a public high school, but did have a lot of kids who were very high income. A lot of my good friends were very high income, comparatively. And I think the combination of kind of usual preteen angst with the fact that we were better off than we were in Charlotte, but we were still very middle to sometimes lower middle class-- being around people that had so much more than me, and feeling like I came from that poor background and felt poor in comparison gave me a huge complex about money.

I felt really, really envious, and self-conscious, and shameful. Like I would ask for a brand name thing that every other kid had at my high school for Christmas, and then I would get like the knockoff version, or the Old Navy version and it would-- I would feel terrible. Like I would want to throw that piece of clothing out because I just wanted the thing that the cool kids had.

And I really learned to associate money, and spending money, and being able to afford certain things as a kind of marker of self-worth. And some of the kids in that town, some of the kids I knew, like they weren't overly nice when you had a crappy car, or hand-me-down clothes, or off-brand products. Teenagers can be very cutting about that kind of thing.

So by the time I was 18, and I had control over my own money for the first time-- I had been working from the ages of 14 all the way up-- like basically, since I could start working a real job legally, all the way through high school, I had worked a real job, and saved every single month. I had over $10,000 in the bank because my parents made me save 75% of my paycheck in a bank account that I could not access until I was 18. But by the time I turned 18, and I had control over my income, and my life, and my money for the first time, one of the first things I did was I drained that bank account to buy all of the name brand stuff that I wanted to buy, and go out to clubs with my friend-- 18 to party, 21 to drink, baby-- and buy UGG boots, and trips to Ocean City, Maryland, and bandage dresses from Forever 21, and all of the stuff that I saw other people having and wanted for myself.

And I spent all my money. And at the age of 18 as well, I got my first credit card, which like-- that was very pre-crash of 2008 that they were just giving away credit cards to high school students. Or I guess I was just out of high school then, but it was definitely a very different era.

I got a $500 Visa credit card with Hello Kitty on it. I spent all $500 basically immediately and threw the card away-- didn't look at any of the collections or anything like that. I also accumulated several moving violations, parking violations, tickets, things like that, that I never paid, which led to my license being suspended and my registration being suspended, which got me in huge trouble with my car.

I ended up getting arrested because of it, for driving on a suspended license. Basically, I was in a-- in as much as I could afford to be, I kind of had a compulsive/addictive relationship to shopping. I would work just so I could have enough money to get a few of the things that I wanted because buying things gave me the feeling that I thought that I wanted and that I saw other people having.

So by the time I was 22-- all through the ages of like 18 to 22, I was dodging collection calls, and having to go to court, and having to use check-cashing services because I was overdrawn at my bank, and just avoiding debt collectors, and living the shame-filled life of someone who has no control over their money and has a terrible emotional relationship to it. At 22, I sold my first book. It was not a huge book deal, but it was more money than I'd ever gotten at one time.

And it gave me enough money to pay off my defaulted credit card and a few of my other debts that I had hanging over my head. I decided to do that. I started saving for the first time.

For some reason, I just got it in my head that as long as I always had $1,000 in my savings account, that was enough, but at least I was doing that. I started to be just a little bit more responsible, bit by bit. By 24, I got my first employee staff job with a salary.

It was a very low salary, I was getting $36,000 a year. And I had to move to New York City for the job, so you can only imagine the kind of lifestyle you live in New York City on $36,000 a year. But I had that job, and so by the time I was 25, I thought to myself, OK, like you have paid your debts, you've started kind of building a better credit score.

You at least know what a credit score is-- my credit score used to be in like in the high 400s, it was a tragedy-- now is the time that you can kind of have a better relationship with money. So I downloaded Mint, which I promote here on the show, but trust me, I've been using Mint well before there even was a TFD. I downloaded Mint to start getting ahold of my finances.

And I started a Tumblr called The Financial Diet to track my journey with money. So that's kind of what happened. And the rest is history, as they say-- this is like a ESPN documentary.

But in all seriousness, that's kind of what happened for me. And so I definitely don't-- I definitely didn't have any one pinpointable moment that I thought, OK, this is rock bottom financially, or this is when everything has changed, or come out from under me and I need to start over, I need to change my habits. I probably had like 50 rock bottoms that I didn't even recognize as such at the time.

But I know what it feels like to feel like you have to start from nothing to build healthy financial habits and control over your finances, and to not know where to start. So this is what we're going to talk about today. I want to talk about how to get control over your finances from zero.

Also, one last note, in addition all the financial changes I've been making, I do go to therapy once a week. Shout-out therapy, big up therapy, can't get enough of that therapy. OK.

So the first thing that you will want to do when you're trying to get a hold of your finances from zero is to really assess your net worth, and look at your finances as closely as you possibly can. Really, you kind of have to take a magnifying glass to it, and then you have to like hop into a drone, and fly overhead to get the big, broad look at it. But basically, what that entails is looking at all of the income you have, all of the assets you have-- that can be savings, investments, it can be real estate, any of those things.

All of the debts that you have-- you can have credit cards, mortgage, student loans, all of those things, anything that is something you owe, you want to get a total picture of where you stand on all of your different kind of financial indicators. Your credit score is also a really important one. But you want to know what's coming in, what's going out, and what do you have?

For many of us, we technically might have a negative net worth, if you have, for example, release substantial student loans. And that's not necessarily a bad thing. I mean, obviously for many of us, making the investment in something like your education can pay huge dividends over the rest of your life.

But it's really important that you understand what that entails on the macro level of your finances. You should also understand, like, what is my current schedule of paying off these debts? If you're only making the minimum payment every month, how long are you committing yourself to be paying that debt?

And how much will you end up paying in the end with all the interest you're accruing? It's also important to understand your various sources of income. Do you only have one?

Maybe you would like to add one. You want to look at all of your spending. What are you spending on every month?

Can you go through your spending and eliminate at least a few things every month, or find things that you could get for cheaper, or rent, or borrow? Basically, you want to do a complete inventory and analysis of your own finances at a high level with your net worth, and at a low level with all of your various choices. For a lot of us, this can be extremely unpleasant.

I actually avoided looking at my bank statements for months after I had already committed to and paid off my outstanding defaulted debt, because seeing those numbers up close and seeing the things I was spending on was still really scary and emotional for me. But I will say looking back that I didn't really, really start on my healthy financial journey until I forced myself to go through all of that and to get an actual financial picture. I had a negative net worth at the time-- surprise, surprise.

I also had a ton of problems that needed to still be resolved after having paid off those debts, such as my atrocious credit score. I had almost nothing in savings. I still had many, many problems to fix, and obstacles, but I knew exactly where they were.

I knew exactly what I had to do, even if it was unpleasant to actually do the work of doing it. And no surprise, when I looked at my spending really, really closely, I was able to identify a lot of things that I was doing wrong. And I found, interestingly, that the second I started really analyzing and tracking my spending, and really understanding my savings habits and my net worth, suddenly, just by the act of looking at it and understanding it, I was almost intrinsically motivated to start really changing my habits and being smarter with my money.

I wanted to save because watching that number go up now that I was tracking the number was incredibly satisfying. So that analysis is really the first step. The second step is to outline all of your goals and make a few different budgets/plans to help get you there.

I say, making a few budgets, because I think one thing that we all learned this year is that it is in-- if we didn't already know it, let's be clear-- but one thing we all learned this year I think for sure is that it is very important to have a regular budget and an absolute, bare bones, just the basics budget that you can default to if you have to, and you already know where those things are. One of the things that can make it incredibly difficult if you've gone through something like a job loss is suddenly feeling like you have to panic and go through every single bill that you have, every bit of spending, every subscription, and start figuring out places where you can cut back. If you've already outlined those things and know where they are in case of emergency, you can just say, OK, we click from day-to-day great budget to emergency budget, and you already know how to do that.

And that in and of itself will give you a much, much bigger feeling of control, because being out of control and feeling like you wouldn't know what to do if something happened, or that you don't know what to do, is one of the feelings that can give us that huge level of shame, and fear, and anxiety, around money which leads to us putting off thinking about it and putting off being proactive about it. So having in your mind that you already know what to do if you suddenly have to make huge cutbacks in your budget is half the battle. You also want to, in these various budgets/plans, make a few plans for perhaps earning a little extra side income, identifying a few places where you could pick up a gig here or there, a freelance project here or there, do a little side work nights and weekends-- basically, pick up extra if needed.

It's also good to have a few plans of, OK, this is what I'm paying on my debts right now, if you have debts, but this is what I could be paying if I were able to bring in that extra income. For example, you might decide, I'm going to get-- if I have a little bit more flexibility this summer, I'm going to get myself a little side job that'll bring me 200 extra dollars a month that just goes to debt repayment because you're looking at it in the long term, and you can see, wow, if I put just 200 extra dollars a month to this debt, look at how much I'll save in the long term, and how much easier and faster I'll be done with it. So having a few different outlines of what your financial life can look like with budgets and expenses you can cut, areas of income that you can add, and places where you can increase things like your savings, or your investments, or your debt repayments, really helps to give you that level of security and comfort that no matter what happens, you know what you're going to do, and you know how you're going to reach those goals.

This is also one of the reasons why we highly, highly recommend having various savings accounts for different goals and labeling them by the goal themselves, not just leaving them some random account number, because we're so much more likely to make progress on goals when we feel like there's something real and tangible there. It's one thing to just say, oh, I'd love to own a home by age 30, or I'd love to have $100,000 saved for retirement by a certain age, or any of these things. It's quite another to feel like you have a really clear plan of what that looks like, how to get there, and a very practical real-life reminder of what you need to do everyday to make that a reality.

So planning out those various budgets and game plans will help ensure that you can reach any goal that you might have, as well as be protected in situations that might be out of your control. The third step that I think everyone will want to take is to really analyze their credit landscape. I know that some people feel very credit-phobic, but not having a credit score, or not having a good credit score, really limits a lot of your options in your financial life, and also can really hurt you in various ways.

Meaning, for example, you might get a much worse deal on things because you don't have that great credit score to ensure great financing. So whether or not it's something that you really want and like to think about, you really have to kind of confront your credit head on. And there's a few ways to go about that, right?

You want to first and foremost know what your credit score is, and know a few things that you can do to improve your credit score. And there are several great free sites and apps that you can use to really drill down into your credit score and understand what you can do to improve it. And it's also important to understand what you'd be doing with that credit, because do remember that a credit score is not just about credit cards.

Yes, I do believe that responsibly used credit cards should be a foundational part of people's financial strategies. But even if you're not someone who feels that you want to use a credit card at this time, because maybe you don't trust yourself to spend with it correctly or use it properly, credit score can have an impact on everything from being able to rent an apartment, to leasing a car, to even getting a good cell phone payment plan. All of these things are ultimately going to come down to how creditworthy a lender or a person that you're looking to do something with, or borrow something from, assumes you to be.

So you want that credit score to be solid for many, many reasons outside of just the credit card. Credit scores range from 450 to 850. And there are a few different credit reporting bureaus who are going to compile a bunch of different information about your behavior with regards to credit lending, that kind of thing, in order to give you a score.

If you have no credit history, that means you've never borrowed, you've never paid back-- there's no way to tell how you would be with credit because you have no credit history. But there are a few key things that go into having a good credit score and building your credit, and you want to start really focusing on the areas in which you can make dents. The few biggest ones are going to be regular timely payments on anything that you owe.

So that means like a credit card bill, a student loan bill. Any time you have a bill that's going to be recurring, that the credit reporting bureau is going to be looking at, you want to make sure that you never miss a payment, and that you're always, always on time, even if it's just the minimum because that's all you can afford. The worst thing you can do is be late on those payments because even a couple missed payments can have a huge impact on your credit score.

Also one important thing to keep in mind is that if, on occasion, you might miss a deadline to pay something like a credit card because you forgot, or you didn't have enough money in the account you were supposed to transfer over from, or something like that, often you can call the credit card company or whoever is in question and talk to them about what happened. And oftentimes, they will actually follow up with the credit bureau and have that removed from your credit report. That's actually happened to me more than once.

And in every case, I just called and was like, listen, I'm so sorry. I completely forgot to hook this up. It totally slipped my mind.

I won't be late again. And they took it off-- they took the ding off my credit report. So that's one of the biggest ones.

Another one of the biggest ones is your credit utilization ratio. And that's basically how much money you have available to you to borrow, and how much you're actually spending. So let's say you have a $10,000 monthly limit across your various cards, you're only spending-- the goal is to be spending, I would say, under 30%.

Ideally, even less than 30%, but definitely no higher than 30%, because basically creditors are going to want to see that you are not just spending the maximum amount that's available to you. That you have the credit worthiness to have way more available to you than you actually need. You're also going to want to be careful about not having too many hard credit checks.

This is an important distinction to understand, because when you just, let's say, are using an app to check your own credit, and monitor it, and see what you can do, that's a soft credit check because you're not inquiring into your own credit to potentially borrow for something. But if, let's say, you're applying for an apartment, or a car lease, or a new credit card, that lender or landlord is likely to look at your credit score. You have to give them permission to do it.

They're going to look into your credit score to see if you qualify or for what kind of plan you qualify. That is considered a hard inquiry into your credit. And too many of those in a short amount of time can have a negative impact on your score because it looks like you're credit shopping.

And if you have been working on your emergency fund, and you've been looking at your credit, and you've been doing all of this really, really diligent stuff, and you want to get that higher level view of your finances I highly, highly recommend the app Turbo by Intuit. Basically, it gives you a very intimate portrait of how you look to, for example, a potential lender. It shows you your debt to income ratio, it shows your credit score.

It shows all of the various points that any potential lender-- like let's say, for example, someone who might lend you the money to buy a home, is going to be looking at to assess you, essentially, as a candidate. You want to have a really, really high level understanding of your finances and how to improve them, and Turbo gives you sort of that extra step. I assume you've already been good, and you've been budgeting with Mint, and keeping track of your day-to-day spending and all that stuff, but eventually, if you do have bigger, longer term goals, you're going to want to get to that higher level of financial understanding.

And Turbo is a really, really good app for getting that kind of higher level, more nuanced, and more long-term understanding of your finances. So if you're ready to take that step, and I hope you are after listening to this episode, check out Turbo with the link in our description. It is totally free, like Mint, so you have no excuse not to.

Lastly, one of the most important factors to keep in mind is the overall length of time that you've had credit available to you. I have an old credit card-- it was the first-- it was like my rehab credit card, where basically when I still had terrible credit, I got like this prepaid credit card for $300 from Capital One that was treated like a credit card, but really kind of functioned like a debit card to help me rehabilitate my credit. And that is the longest card I've ever had, because obviously, I got it right when I moved back to the US and wanted to start my credit Journey.

I don't use it anymore. I just pay the annual fee of like $15 or $20 to keep it open just because it keeps my credit history as long as possible. If I were to close it, the next closest card is like I think a year later or something like that.

So it's in my interest to keep that card open to keep my history long. So those are some of the factors that you're going to want to consider. And again, there are ways around it if you don't feel that a traditional credit card is going to be something you can trust yourself with.

Although again, for lots of other reasons, like credit card churning, and points, and stuff like that, I do think it's good to work yourself up to being able to use a real credit card. There are plenty of ways to start building credit without doing that. And the prepaid credit cards at banks are very, very good option for that because it ensures that you're not going to be able to go above and beyond your ability to spend.

So yeah. Get really familiar with your credit and make a really conscientious plan for how you're going to raise it. I've raised my credit from probably the worst score a person can have to something in the excellent range.

So if I can do it, Honey, anyone can do it. The next step is going to be analyzing your savings landscape, and figuring out what your savings goals are, and how you're going to start saving more and smarter. Obviously savings, also entails your investments, your saving for retirement, your portfolio.

And I do think that that's all important to think about, and we have tons of great information on all of the various ins and outs of investing on TFD-- including our recent episode with Amanda Holden, which I recommend you checking out. But I really want to focus for just the 101 stuff on what it really means to save money, regardless of what you're doing with that money. You could be saving for a trip to Florida or you could be saving for retirement.

It does not matter. What matters is your strategy for how you're going to save and how you're going to allocate your different savings to different goals. So I think one of the most important things that anyone can do if they're just starting to get a-- just like the beginner's hold on their finances is to commit themselves in the first month, if they're not saving yet, to saving something every month.

I swear to God, I do not care if it is $10 every month that you're saving. Commit yourself to saving something because the act of taking money out of your pocket, dedicating it not to something that's instant gratification, or frivolous, or something you want right now, but saving it for a future self, or a future goal, is incredibly important as a mental and emotional exercise, and something to get in the habit of doing. Of course, beyond that, your goal should be to ramp up your savings as much as you can, and to start allocating it intelligently to all of the different goals that you might have.

And again, you want to be really, really smart about prioritizing your goals in terms of what's most important versus what's just nice to have. But before you can start really ramping it up and dedicating it to all kinds of different things, the most important thing you can do is just start saving something regularly. I would honestly recommend transferring, if you can, a smaller amount on a weekly basis into savings at first, just so you can get more and more practice with that feeling.

And of course, many people will choose, as they go, to start automating their savings so they don't even see that money, and I think that's a great idea. But you have to start saving somewhere. And I do think there's a benefit at least at first to doing it-- to actively choosing to do it.

And the only other thing I will say on kind of getting in the mentality of savings is that the most important first place that you need to be putting your money for savings is in your emergency fund. An emergency fund is anywhere between one and six months worth of expenses. I would personally recommend trying for three months-- and that's bare bones living expenses, the minimum you need to live on-- which if you've done your emergency budget, you already know what that is.

It's three months worth of those living expenses so that if anything happens, like a job loss, a car accident, an unexpected move, you know that you can cover it. If you do not have emergency savings, you are in a position where any unexpected expense, or bad timing, or emergency can literally potentially be putting you on the street. So having that emergency fund and putting your money to that specific goal is the most important thing that you can possibly do with your money.

It comes before anything else. So the next step you're going to want to take when kind of rethinking your finances from zero is going to be how you can add income streams. I mentioned this before, but one of the things that often keeps us really locked into not only a budget, but also the lifestyle that goes along with the budget and keeps us really beholden to things being a certain way is not having any flexibility when it comes to our income.

Obviously, it is very advantageous and important to have something like a really strong emergency fund, so that if, for example, you unexpectedly get furloughed at work, you're not completely unable to pay your bills. But there's also the idea of looking at ways in which you can have a few different income streams lined up that maybe you're doing a little bit here and there in addition to your primary income, but you can also pick up in a bigger way if one of your income streams drops. You can also use specific income streams just to go to specific savings goals, or specific investments, or debt repayment, or basically, just give you a little bit more flexibility and control over your financial decisions.

Ultimately, being beholden to only one stream of income puts you in a pretty weak place. And it's not to say that you'll ever have a complete reliance on multiple streams of income, or you will have something that could totally 1 to 1 replace your major source of income, but even having a little bit more that you can rely on in case of job loss or emergency is going to be an incredibly important thing to fall back on, but also a really important thing to give you that ongoing sense of security and control. So the next thing that is really, really important to do, and is a little bit less literal/financial and much more kind of emotional/social is to really analyze your lifestyle and your social groups to see the impact that they're having on your finances.

A lot of us can be in relationships, friendships, family dynamics, roommate situations, that are putting us in precarious financial places, or exploiting us financially, or making us feel like we have to spend more than we can afford in order to keep up, or make us feel ashamed about talking about money, or put us in positions that lead us to make worse decisions than we otherwise would. We could also be living lifestyles that are not tenable on our current incomes. We could be spending too much going out, or buying clothes, or online shopping compulsively, or doing things that basically make for a very kind of out-of-control spending pattern.

Ultimately, the truth is that any lifestyle can work if you have the budget for it and you're making these choices in a healthy way, and what you're spending on is something you actually get value out of. Like if your joy is to spend on designer handbags-- I'm having a hard time finding a not judgey-- listen. Anyone is allowed to spend on whatever they want-- let's put it that way.

I spend on plenty of things that I'm sure a lot of people would consider frivolous. I've gotten a lot of YouTube comments about like the number of throw pillows I have, for example. But even if your habit is designer handbags, which I think a lot of people on paper would be like, this is a bad investment, if you can afford it, if you've budgeted for it, if you are making those purchases when you are of sound mind to be doing so for reasons of personal fulfillment, and getting a lot out of those bags, and getting a really low cost per use because you're getting a lot of use out of them, like that's a fine way to spend your money.

And that's a fine lifestyle to have. There's no one lifestyle that is right or wrong. But for a lot of us, there are at least parts of our lifestyles, parts of our spending habits, parts of our social group that are keeping us locked into patterns with our money that are not serving us, and are not even things that we really at the end of the day want to be spending our money on.

When I look back at the spending habits that I had all throughout my worst financial years, I really kind of-- I feel sorry for myself and a lot of ways. I feel sorry for the person that I was because I see how much I was trying to replace feeling good about myself with feeling-- with being able to afford the things that I wanted. I thought that if I could buy certain things that I would feel like the girl who has those things.

I would feel like the cool girl. I would feel like the pretty girl. I would feel like the smart girl that everyone likes.

And nothing that I ever bought made me feel that way. But I see how being around lifestyles that were way beyond what I could afford and my natural insecurities and impulsivity led me to a really unsustainable lifestyle. And I think there are going to be some spending habits that come down ultimately to you.

And if it's a matter of not having your credit card numbers saved in your computer and keeping them really far away from you so you can't access them, or having someone else hold them for a while so you can't online shop compulsively. Or if it's like changing your commute so that you don't pass by places that make you want to spend money, or any of those things. There are going to be lifestyle changes that you can make on your own.

And there are going to be swaps that you can find that give you just as much joy with a lower cost option or with axing something out altogether. But there are also going to be times where it may be some of the people and influences in your life who are not good for you. I, looking back, had certain people in my life that if I did not spend to keep up with them, I was really afraid of losing those relationships, or being judged, or being seen in a certain way.

There were times when I felt really afraid to say, this isn't in my budget, or, I can't afford this right now, or, I am not going to spend on that. And there were also friendships I had where they were not willing to go the distance of navigating a friendship across economic lines, which can be a very, very delicate thing, and demands a lot of nuance, and communication, and empathy. And I'm not going to say that I straight up just cut people out because I couldn't be my best financial self around them.

But there were definitely people that I actively started seeing less. I didn't completely X out that friendship, but I was giving them less time because I was a better version of myself when I was with other people, and I liked myself more. And I liked myself no matter what I could afford, or what labels I was wearing, or what I was able to spend on with them.

So this step is really about taking a very honest and sometimes painful inventory of your own life, including things like analyzing what bad habits you might have picked up from your parents or leftover negative emotions from childhood. I would say that there are still times today where I can feel like the poor kid. And I am not the poor kid, but I know how it can sometimes feel that way.

And I can still have some of those impulses to try and compensate for that. Obviously, this is where something like therapy can be really beneficial. I'm in weekly therapy for about half a year now.

I've been to therapy before, but I'm in it now-- mostly for other reasons, but I do occasionally talk about what can sometimes still to this day be a little bit of an unhealthy relationship with money. And I'm not going to pretend like there aren't times that I compulsively buy things for reasons that are not good or not healthy. But I definitely now today, even in the moment where I'm like, oh my god, I have to have that thing, I'm never, ever thinking that that thing is going to make me feel something that I don't feel.

So making sure that your life is one that can be lived truthfully, and honestly, and financially safely is a big step. But on a brighter note, on the emotional/social tip is to find a financial support system and a buddy system. I have a few great friends in my life who are just so honest about money, and where they come from, and the struggles that they've been through, and are so supportive of each other, of me, of themselves.

And having those people in my life and being able to talk to them honestly is one of the most helpful, and beautiful, and special things. And I have people in my life who-- we used to have a relationship or we never talked about money, and we had a huge income disparities. One of my dear friends-- I used to work for her and she had enormous amounts of money when I had no money.

And we now, years later, we'll talk about that. We'll be like, how crazy-- like, let's talk about that dynamic. And we'll talk about our experiences over the 10 years we've known each other and what's changed in our financial lives, and we'll celebrate each other's accomplishments.

And we really have a relationship that makes us both better people because we can be so honest and lucid about the financial nuances of such a long and, in many ways, complicated relationship with so many dynamics at play. And I also have friends who are from lower income backgrounds from me, who are lower income than I am, who are incredibly honest with where they are. And we find ways to meet in the middle and make something sustainable.

And those friendships and those relationships were incredibly necessary to me when I was just getting better financially, and trying to find good habits and finally feel like I could be honest and say that I couldn't afford something, or opt out of something, or any of those things. But they're just as necessary to me now when I have a much better relationship with money because ultimately being open about money, no matter where you are financially, being honest and empathetic makes you a better person. So often we're taught to just not talk about money and pretend that it doesn't exist.

And all that does is hurt people, and shame people, and subjugate people who have less of it. It forces them to hide, it forces them to pretend, to put things on their credit card that they can't afford to keep up appearances. And by being honest and breaking down those barriers, you get a much more nuanced and real perspective of who they are as a person.

And your friendship can be so much more empowering and productive, and you can celebrate each other's accomplishments and have a little financial victories group chat, or like financial complaints group chat, or you can be each other's support systems. And for a lot of people who come from families where money is a taboo topic, or it's a source of shame, or it's not talked about, it can give them the safety net, and the resources, and the foundation emotionally that they never had. So creating-- finding those people-- those wonderful, special people-- and forming a network with them and keeping each other strong, and accountable, and motivated is a hugely important step to when you're starting or restarting your financial journey.

So the last step-- and again, this one is kind of on the emotional tip-- is to start talking about money more broadly. Talking about it with your colleagues, talking about it with your family members, with your own parents. Talking about it on social media, sharing important information, learning how to empower each other, speaking out about injustices, speaking out about inequalities, advocating for the change that you believe in.

All of these parts of talking about money more broadly are not just important to get important information out there and help support good ideas-- and those things are important-- but it's also about for all of us, creating a climate where class, and economic realities, and financial realities are never something that people have to feel shameful or in the dark about. One of the things that I really love about working at TFD is seeing and hearing from so many people every day who tell us about how this is a community where they can talk about money. You guys in the comments section are always cheering each other on, sharing important things on our social media.

We have a Facebook group talk about money-- a private Facebook group where people are sharing things. And for some of these people, they still are not in a place where they have people in their personal lives that they can really be this candid about money with, but they have found in the TFD community a place where they can speak more publicly. And maybe through that, have found people to even add to their personal social groups.

But I think it used to be, for me, a really nerve-wracking thing. And to be perfectly honest, there are still people in my life who are pretty uncomfortable and stressed out when I talk about money. Definitely, like, for example, my in-laws, it's not something that they do and it's not something that they're used to.

And so when I'll share numbers or talk about things honestly, or talk about my experiences, I definitely can sense a little bit of like a-- [INHALES SHARPLY] why are we talking about that at dinner kind of feeling. But I feel like I'm glad that even around people for whom it's not like a mutually supportive thing, they're at least being exposed to the reality that more and more people, especially of our generation, are comfortable talking about these things, and are comfortable being honest, because we live in a generation where so many things have happened to us. So many unfair things have happened to our generation economically that to not talk about it is to further oppress ourselves.

So learning to talk about it publicly, and without shame, and even around people who may not be as open to the conversation, yes, I think that has to come after finding your own personal support system. But I do think in many ways, it's kind of the last step to helping other people be more liberated about this, because I know that part of what kept me in a vicious, self-destructive cycle with money for years was because I knew I couldn't talk about it, and I never saw anyone talking about it at that time. 2007 was not a-- 2007 to 2010 was like a rough time for discourse online. Like people were not woke.

So there were just not nuanced conversations happening about class and money at that time. But more and more, it's happening. And I think if you have gotten to a place where you feel like you can be one of those people who can be like, I'm in a massive amount of debt, and it's terrible, and this is what I'm doing about it.

Or, I think that this is wrong, and this is how it's going to change. Or like, I only got paid this much at that job, and like engage in salary transparency, and participate in those conversations within your industry. Like if you can become the kind of person that does that, I do think in many ways, it is the final and most important stop on the personal finance train.

More so even, in many ways, than earning a certain amount of money or accomplishing a specific financial goal, because I think that last bit of realizing that money does not define you, and should have no power over you-- it should not be anything to do with your character, or your value as a human being, or who you are as a human being-- is really the final stop. If you're still hyperfocused on your net worth, or a certain savings number, or a certain material goal, you're still kind of missing the point. You are still way, way too focused on money as a point in and of itself and as its own objective.

And I think the ultimate point is to get well beyond money as an objective, and to realize that it's just a little LEGO set to build the life that we want to live. But it's really-- it's nothing more than that. It really isn't, and it's certainly not who you are.

So get good with money so that it doesn't have to define you anymore. And if you are ready to get good with money and to start really, really building out your financial future, I could not more recommend you check out Intuit's products. I am a small business owner, and every single day, I start my day by looking at QuickBooks, which shows me a total picture of the company's financial health, who owes us, who we owe, our expenses, our income, all that stuff, so that I always feel like I totally understand where my business is.

And just like Mint has provided that level of peace of mind, and security, and control in my personal finances, Intuit's product QuickBooks has given me that exact same level of comfort, and-- I don't know-- kind of satisfaction. Like it feels very satisfying and sort of-- I feel so together when I look at QuickBooks. It's very, very cool, mostly because, again, if you listen to this episode, I used to never think I would be capable of even having like $1,000 in a savings account, let alone a very functional and profitable business.

So I'm personally such a huge believer in Intuit's products, and they have truly allowed me to gain a level of control over my financial life that I have been able to rise above it and focus on other things, because I don't have to be so worried about and obsessed about money 24/7. So I would love for you to have that same level of freedom and that same level of peace of mind. So check out QuickBooks as well as all of Intuit's other products at the link in our description.

And as always, I thank you guys so much for spending this episode of The Financial Confessions with me. I hope you will come back next Monday for a brand new episode. See you guys later. [MUSIC PLAYING]