30 day money action plan

Yay!!! April is Financial Literacy Month.

If ever there was a time to get your money affairs in order, it would be this month.

Over the next 30 days, you will participate in a series of activities that are designed to help you identify your main financial challenges and then take the necessary steps to resolve them.

All you will need for these activities is a pencil and several sheets of paper. You are more than welcome to use a spreadsheet application if you so choose.

Freedom is self-determination, and you can't self-determine without understanding money and capitalism."

John Hope Bryant

Day 1: Set Your Goals

In order for your financial goals to be actionable, they first have to be well-defined. So, instead of "Saving money" being your objective, a well-defined goal would be "I plan to save $5,000 this year."

A goal that is specific can be quantified. And an objective that is quantified can be measured, and it's progress can be tracked.

So take 10 minutes and put your top 3 Financial Literacy Month goals on a piece of paper.

Day 2: Establish Your Baselines - Income

A huge part of getting your finances in order is understanding how much money you have coming in.

In 2018, nearly 59% of all workers were paid hourly. Increasingly, a steady check isn't enough to cover bills and still have something left over to put aside.

A Bankrate survey revealed that nearly 4 in 10 American adults also have a side hustle to supplement their regular paycheck.

When establishing your baselines, it is necessary to understand exactly how much money you have coming in. It isn't enough to only count the biweekly paycheck. You also have to record any additional income that you earn from additional sources.

Day 3: Establish Your Baselines - Expenses

A lot of people, even those who know how much they make, struggle with getting a handle on their monthly finances because they don't understand exactly where their money goes.

A critical mistake that most people make is that they put their major bills, but they don't account for the small purchases that create leaks in their budget.

In order to gain control of your finances, it going to be necessary to write down all of your regular monthly expenses. It is also necessary to account for your other miscellaneous expenses that generally go unaccounted for.

Day 4: Establish Your Baselines - Credit Report

Maya Angelou once said, "You can't really know where you are going until you know where you have been."

So it is with your personal finances.

Before you can chart your course, you have to identify where you currently stand.

For a lot of people, starting is the hardest part, because most would rather remain in the dark about their situation than to actually face it head on.

Today, we are going to start with your credit report. It is possible to get a free copy of your credit report from each of the major bureaus once a year, for free. Go to Annual Credit Report and request a copy of your credit file from Experian, Equifax and Transunion.

Day 5: Establish Your Baselines - Net Income

According to Robert Kiyosaki, the key to wealth was, “It's not how much money you make, but how much money you keep."

This part of the process is a simple, yet often overlooked practice.

Add up all of your Income, and subtract it by all of your expenses.

The answer is your Net Income; how much money you have left over after you have paid your bills.

A positive number is a good thing. A negative number is a sign that you have a lot of work to do.

Day 6/7: Devote 1 Hour a Day to Reading

My mentor would always say, "If you want to increase your Value, increase your Knowledge."

A huge part of the process of improving your personal finances is improving your base of knowledge.

For Days 6 and 7, devote an hour each day to reading either a personal finance or a self improvement book.

Getting into the habit of reading these types of book is an investment with a massive return on investment over time.

Day 8: Establish Your Baselines - Assets

An asset is defined as "Property owned by a person or business, regarded as having value and available to meet debts."

An asset could be considered anything that you own that puts money in your pocket.

Understanding the value of your assets will go a long way in determining your overall financial health.

Include the value of your real estate, vehicles, investments and just about anything of value.

Day 9: Establish Your Baselines - Liabilities

A liability is "The future sacrifices of economic benefits that the entity is obliged to make to other entities as a result of past transactions or other past events."

Simply put, a liability is something that takes money out of your pocket generally to satisfy a debt owed.

Having a clear picture of your outstanding liabilities can help you get a much better view of your overall money picture.

Day 10: Establish Your Baselines - Emergency Fund

A recent Bankrate study revealed that only 40% of Americans would be able to pay an $1,000 emergency without going into debt.

For many people, a small unexpected expense is all that it takes to blow a hole in a household's budget.

An emergency fund plays a huge role in helping people stabilize their finances.

Experts recommend beginning with $500 in your emergency fund, and slowly building up to a six to 8 month reserve building fund.

Day 11:Establish Your Baselines - Credit Score

It is mind-boggling how much a simple 3 digit number can affect.

Your credit score impact where you live, what you drive, where you work and even your insurance rates.

Credit scores are generated from the information in your credit report. Credit scores can range from 300 - 850, with 300 being the absolute bottom and 850 ranking as the best score that can be attained.

You can get your score at Credit Karma or, for the score that most lenders use, MyFICO.com.

Day 12: Establish Your Baselines - Net Worth

Your net worth is a snapshot of your overall financial picture.

You can find your New Worth by subtracting your Liabilities from the value of your Assets.

A positive net worth is a sign of healthy finances. A negative net worth is the sign that you have to analyze your money situation.

The goal is to ultimately have a net worth that continues to grow month over month. Digging out of a negative net worth is a huge aspect of that.

Day 20/21: Devote 1 Hour a Day to Reading

At this point, devoting time to reading either a personal finance or self improvement book should be becoming second nature.

According to research on the habits of self made wealthy people, it was discovered that 85% of millionaires read 2 or more books a month.

At the beginning of your journey, you won't become wealthy overnight. But developing the habits that wealthy people have will impact your attitudes and ultimately your behavior towards money.

Time spent developing the habits of successful people will ultimately pay dividends down the road.

Day 23: Write Down Your Life Goals

It is estimated that an astonishing 80% of Americans don't set goals.

Research has shown that the simple act of setting a goal can significantly improve the chances of being successful.

This means that one of the best ways to improve you life as you work to master your money is to simply define and write down the goals you want to accomplish with your life.

Take the time to put your 3, 5 and 10 year goals someplace you can reference them frequently.

Day 25: Set Aside Money to Invest

Almost a full half of the population don't invest in the stock market.

Investing is one of the 3 keys to building wealth over time, yet 45% of Americans don't participate.

These days, it is easier than almost any time in human history to get involved with the stock market.

While investing involves the potential of loss, over time, the market tends to trend upwards. You don't need a lot to get started.

Do some research, set an amount your are comfortable with, and get started.

Day 27/28: Devote 1 Hour to Reading

By this point, you should have gotten into the habit of developing your knowledge and mindset.

Even after this 30 Day Challenge is completed, you should still make it a point to read to continue your personal development.

Day 13/14: Devote 1 Hour a Day to Reading

When I speak with high school students, I advise them that one of the most important habits that they can develop to improve their chances of being successful later in life is to develop a lifelong love of learning.

That principle applies here.

It isn't enough to just hear about personal finance principles once. Instead, you have to invest some time to gaining a deeper understanding of money management principles.

An hour spent learning more about handling your money compounds in the knowledge gained and habits developed.

Day 15: Create Your Budget

Many people hear the word budget and think of being limited in how they can spend their money.

The reality is, a budget is one of the first and most critical steps to achieving fiscal responsibility.

A budget tells you where your money should be going and can identify leaks in your finances.

There are many ways to budget, but a simple approach is a 50/30/20 budget: 50% Needs; 30% Wants and 20% Savings/Investing.

Day 16: Reduce Your Expenses

A huge part of organizing your finances is not just figuring out where you money is going, which you did on Day 3, but to also make sure you have control of your expenses.

It is simple to save a few dollars on things such as utilities, cable, cell phone and other miscellaneous expenses with a mere phone call.

There are also apps that can monitor your spending habits and automatically seek out better rates and any applicable discounts.

You can also save money on your bills by switching your service provider.

Day 17: Increase Your Income

While there is a floor to how low you can reduce your expenses, the only limit to your ability to increase your income is your imagination.

You can put in extra hours at work, work a second job or leverage a talent, interest or hobby into a side hustle.

A recent study revealed that 1 in 3 Americans (34%) currently have a side hustle.

With the gig economy, you can drive for a ride share service, deliver food or even rent out an extra room in your home. The opportunities are limitless.

Day 18: Reduce Your Debt

Probably the most profane 4 letter word in the English language is "DEBT."

While debt can be leveraged to purchase assets that are too expensive to buy with cash, such as a home or a vehicle, 45.5% of American households carry some level of consumer debt in the form of credit card balances.

In order to pay your debt down quickly, consider using either the Debt Snowball or the Debt Avalanche methods to supercharge repayment.

Day 19: Dispute Your Inaccuracies

In order to fully understand credit and your credit report, you have to know that the credit bureaus; Equifax, Experian and Transunion, are all private entities, and they very often make mistakes.

According to the Federal Trade Commission, 25% of consumers found errors on their credit reports that could have affected their scores.

Review the credit reports you received from the credit bureaus on Day 4 and make sure to dispute any inaccurate information, especially entries that can adversely affect your credit score.

Day 22: What is Your Money Personality

Each person has a dominant money personality type. You can be a Big Spender, Saver, Shopper, Debtor or an Investor.

Each trait has its strengths and challenges. Understanding your money personality will shed insights around your attitudes regarding money.

Many people are a combination of more than one of the above traits.

Learning about your Money Personality can help you move forward on your Money Journey.

Day 24: Write Down Your Money Goals

As important as your Life Goals, are your Money Goals.

While your life goals will outline the type of life you want to live and the impact you want to have, your money goals will establish the path you take to achieve your life goals.

When setting your goals, you must aim to have goals that are SMART:

• Specific - Specific goals are actionable

• Measurable - You should be able to track progress

• Achievable - Your goal is attainable and realistic

• Relevant - Your goal aligns with your values

• Time Bound - Set a deadline for reaching your goal

Day 26: Apply For an Affiliate Program

On Day 17, we discussed Increasing Your Income.

One of the simplest side hustles is Affiliate Marketing.

With affiliate marketing, companies will pay you a commission for customers you send them using your customized link.

If you have a social media account, you can easily leverage affiliate marketing as an additional stream of income.

Signing up is relatively easy, and usually free.

Day 29: Scorecard

As we end the month, you can now take a moment to look back and see what you have accomplished.

Over the past 30 days, you have taken small but necessary steps to improve your fiscal health.

On your scorecard, list your ending balance of your assets, income, debt, net worth and credit score.

If you remain consistent with the habits you have begun to develop, over the next few months you will see your numbers start to improve.

Day 30: Reflection

Congratulations!!! You did it!!!

You took the first step to developing better money habits and, when exercised consistently, these habits will help you create a more prosperous life for yourself.

You have started to track key personal finance metrics such as your Net Worth and Credit Score, while also earning more income and paying down your debt.

In the beginning, facing your money situation can seem like a daunting task, but now that you have done it, you now empower yourself to be the master of your money going forward.