Views expressed in guest blogs are the author’s own. 

Views expressed in guest blogs are the author’s own.

Personal finances are one of the most bewildering, yet essential aspects of adulting. Without a doubt, how you handle your money today, tomorrow and into the future, will affect your quality of life, and the life of everyone around you. If you find yourself asking the person in the mirror: “We learned algebra in school. If I can add and subtract, why is money such a difficult subject?” You are not alone. I do not claim to know the answer to this question, but by struggling to understand it I have learned to use a methodical approach when it comes to handling money. I want to show you a set of simple rules surrounding money that I follow in the hopes that they shine additional light on the subject, or maybe help you rediscover things that you already knew to be true. 1. Define your relationship with your money. First things first. Do you own your money, or does your money own you? This is more than a question, this is actually the moment where you change your relationship with wealth, and you begin your personal finance journey. You need to get to the point in your head where you visualize yourself as the CEO of Y.O.U. INC. If you are not the CEO of your own life, you are the employee of someone else’s! 2. Seek wisdom first, wealth second
The Richest Man in Babylon, my favorite personal finance book, taught me to first seek the knowledge of professionals before I make any decision with my money. Find yourself a financial mentor, or multiple mentors, and learn all that you can to avoid their mistakes. When was the last time you asked your banker for advice on an investment? Who better to ask for advice than someone who handles money for a living?
If you are struggling to find a mentor go to the library, into the Finance section and pick out your favorite. Surround yourself with individuals doing what you want to do, make friends with those people, and then you won’t have to look for opportunity. It will be drawn to you. 3. Create your life plan
You want to get a certain job. You attend a CMD resume building workshop. The workshop clearly outlines your skill and experiences in a simple and concise way. You can now see what are your strengths and what your next steps need to be. That is how your money plan should be. Clear, simple, and efficient. A. Budget your necessary expenses
B. Never borrow money for depreciating assets (things that sell for less than what you purchased them for)
C. Make a plan to be debt free in less than 2 years.
D. Save 3-6 months of your income for “a rainy day”
E. Save up a down payment for a house in 2 years
F. Invest 15% into your Roth 401K
G. Begin saving for that one thing you always wanted to do
H. Begin saving for the next thing you always wanted to do
I. Repeat G & H
J. Do the above in sequential order! How is that for, clear, simple, and efficient? I guarantee, if you sit down and budget out your money, you are going to regain control of your life. 4. Automate the little things, so you can focus on the difficult things
Keep It Simple Stupid (KISS) is something my father would say to me (not the stupid part) and he is correct. Life is hard. If we follow the Pareto Principle, or what some people call the 80/20 rule, we can assume that 80% of our results come from the top 20% of our efforts. Signing a check and licking a stamp to pay your electric bill on time is not going to make you a millionaire, why waste time doing that? We have these little things called smartphones, websites, and computers that can automate almost anything. Automate every bill and investment you make, and you will have more time to think, process, and commit to the 20% of things that ACTUALLY matter in your life. Once you have some automation in place, and you feel in control, then you can go back and optimize. I feel many people, myself included, fall into the trap of “optimization before implementation.” Simply put, stop THINKING about starting, and actually START. You can always change “it” later. 5. Never stop iterating, never stop learning
Confucius says, “a person who knows everything, cannot learn anything.” This is a warning: If you are not open to learn, adapt, or change to this world, you will be swallowed by it. I am not saying that is right or wrong, it just is. Some of that learning is failure. Failure is the best teacher, if you are willing to listen. My own monthly budget, yearly budget, investing goals and auto payments look NOTHING like they did three years ago when I first started my finance journey. I HOPE they don’t look the same when I am three years wiser. These 5 simple rules have allowed me to reach my goals, simplify my finances, make faster and better choices, and live a comfortable life. The last thing I will say is that personal finance consists of two major components: Income & Expenses. While I am a big fan of trying to reduce expenses, the lowest you can go is zero.

Your income, on the other hand, has no conceivable limit, and therefore you should put your maximum effort into bettering yourself, career and business.CMD has many resources to help you gain control of your career, which in turn will help you gain control of your personal finances. Attend a workshop, or schedule a one on one career navigation session with CMD and you will be one step closer to achieving your dreams.

Richie Croce 

He / Him / His

Mechanical Engineer | FlowTherm Systems

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