YourMoneyNumbers

What are YourMoneyNumbers?

YourMoneyNumbers are a series of financial topic evaluations to give you a snapshot of your financial health. They include Net Worth, Budget, Savings, Debt, Housing, Credit Score, and Retirement/Financial Independence. Looking at YourMoneyNumbers individually – but more importantly – TOGETHER and OVER-TIME, can help you better understand the impacts of the financial decisions you make. If you don’t already have a roadmap for your financial life, analyzing YourMoneyNumbers can help you prioritize different financial goals.

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Why Approach Financial Health in this Way?

Instead of proposing a narrowly defined financial roadmap, this method focuses on each person really understanding the measures of their current financial health along with how making a particular financial decision or choice can improve or harm those measures.

There are a lot of personal finance “programs” out there that focus on step-by-step, one-size-fits-all philosophies to approaching your personal finance – think Dave Ramsay or Suze Orman. I believe that for some people, these approaches can simplify decision-making and put you on a positive financial track. However, I think that because of their rigid philosophy they leave many people behind or feeling judged for the approaches and choices they make (or have already made) with money… not a recipe for inspiring success. Still worse, if a person blindly follows a financial regiment, without consideration for their personal circumstances, they will not always make the best financial choices for themselves and may not feel in control of their own financial life. All this, because they are depending on someone else to decide their path for them.

THE BEST INVESTMENT YOU CAN MAKE IS IN YOURSELF — WARREN BUFFET

That said, I think education is great. I see value in learning about different approaches, financial behavior tricks, etc. But – I also try to think through the benefits and consequences for each approach. In my own life, I rarely 100% agree with the “rules” laid out for any particular program, but I find what ideas work for me and implement my own plan. If your circumstances are more complex (e.g. legal, investment or insurance concerns), I highly recommend working with an appropriate licensed professional to ensure that whatever approach you decide to take is appropriate and optimized to the situation.

But for the more straightforward aspects of your financial life, how can you know if your actions are having the desired impact on your financial health? I propose – of course — by knowing and tracking YourMoneyNumbers!

Once you have a snapshot of your financial health in front of you – and trust me, I know that facing some of the ugly parts may not feel great at first – you become empowered. Once you understand what YourMoneyNumbers mean, and how they impact your financial life, you don’t have to feel unqualified or afraid of owning and being responsible for making your own money choices.

Does your Financial Life Reflect Your Values?

Have you ever made a big purchase based on habit, or want, or feeling that you regretted later? You probably spent on something you didn’t really value. On the flip side, have you ever made a purchase that the personal finance “figureheads” or other people in your life would never approve and yet you have never felt one pang of regret or stress regarding it? You likely spent money or invested in something you valued. Knowing what you value – and checking in with those values when making financial decisions – can be the key to changing negative financial behaviors.

Let’s be honest—on who else can you depend to make your choices? You may have a detailed financial plan prepared by a certified financial planner, but YOU are ultimately the one who needs to implement aspects of the plan. Your advisor will not be there on the day that you need to decide between repairing your broken car or buying a new or used replacement. You need to have the confidence that you can and will make the right choice for your situation.

If you use YourMoneyNumbers and your values to help you make financial decisions, you make those choices from the position of KNOWLEDGE… not from fear or a state of unknown. You KNOW the implications of the choice you make and YOU are in control. Your choices would not be the same as my choices or anyone else’s choices – but that is OK!

YourMoneyNumbers Topics

This collector post will be updated with a link to each YMN topic post as it is published. Click on each link below to see an in-depth take on each YMN Topic.

YMN Topic 1: Net Worth A.K.A. How Tracking Net Worth Can Transform Your Finances

YMN Topic 2: Budget

YMN Topic 3: Liquidity

YMN Topic 4: Debt