2256: To Change Your Financial Circumstances, Choose Focus by Joshua Becker of Becoming Minimalist on Money Advice

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[00:00:30] [SPEAKER_02]: To Change Your Financial Circumstances, Choose Focus by Joshua Becker of BecomingMinimalist.com

[00:00:38] [SPEAKER_02]: Hello everybody and welcome back to another bonus episode of ORD with me, your host, Greg Audino.

[00:00:45] [SPEAKER_02]: I am here once again in our weekly bonus episode to share content from one of the other shows

[00:00:49] [SPEAKER_02]: here in the OLD network, which by the way focus on personal development, finance, health,

[00:00:54] [SPEAKER_02]: and work life respectively. Today's feature comes from Optimal Finance Daily,

[00:00:59] [SPEAKER_02]: so with that here is OFD host Diana with the post and her commentary as we optimize your life.

[00:01:10] [SPEAKER_01]: To Change Your Financial Circumstances, Choose Focus by Joshua Becker of BecomingMinimalist.com

[00:01:17] [SPEAKER_01]: In his New York Times bestselling book The One Thing, Gary Keller argues for a simple truth

[00:01:24] [SPEAKER_01]: quote, when you want the absolute best chance to succeed at anything you want,

[00:01:30] [SPEAKER_01]: your approach should always be the same. Go small end quote.

[00:01:35] [SPEAKER_01]: He supports his thesis throughout the book by using research examples and personal experience.

[00:01:41] [SPEAKER_01]: Extraordinary results are directly determined by how narrow you can make your focus

[00:01:46] [SPEAKER_01]: he reiterates. This advice is not new or unique. In fact, the truth has been espoused

[00:01:52] [SPEAKER_01]: and modeled by some of the most successful men and women throughout history quote,

[00:01:57] [SPEAKER_01]: be like a stamp stick to one thing until you get there. Josh Billings quote it is those who

[00:02:04] [SPEAKER_01]: concentrate on but one thing at a time who advance in this world. Agbandino quote you must be single

[00:02:12] [SPEAKER_01]: minded drive for the one thing on which you have decided general George S. Patton quote

[00:02:19] [SPEAKER_01]: successful demands singleness of purpose. Vince Lombardi. Those who are most successful

[00:02:27] [SPEAKER_01]: in their life endeavors are those who identify, define and pursue their next most important step

[00:02:33] [SPEAKER_01]: without being distracted from it. I find his advice compelling in any area of life

[00:02:38] [SPEAKER_01]: but especially in our approach to personal finance and making the changes we desire.

[00:02:43] [SPEAKER_01]: Many of us feel the stress of our circumstances and sense that the clock is ticking on our

[00:02:48] [SPEAKER_01]: life. We want to budget better pay off our credit card debt, save for retirement fund our child's

[00:02:54] [SPEAKER_01]: college pay for the mortgage invest in real estate and we want to do it all right now today.

[00:02:59] [SPEAKER_01]: The options paralyze us or better put the immensity of what we should be doing with our money

[00:03:05] [SPEAKER_01]: paralyzes us. And so too often we throw up our hands and discuss deciding that doing

[00:03:12] [SPEAKER_01]: nothing is better than failing at everything. We understand the importance of healthy life

[00:03:17] [SPEAKER_01]: giving financial habits. We've seen their positive influence on the lives of others and we envy the

[00:03:23] [SPEAKER_01]: life they live. We desire it to be true of ourselves but the road looks too long from our point A to

[00:03:29] [SPEAKER_01]: their point B so we give up the pursuit before we even start. I want to offer a new approach for

[00:03:36] [SPEAKER_01]: you today. Go small, choose focus. Your one thing rather than trying to do everything

[00:03:45] [SPEAKER_01]: at once or before the end of next weekend, choose just one step to pursue today and pursue it with

[00:03:51] [SPEAKER_01]: blinders on. Refusing to be distracted by everything else you should be doing better in your financial

[00:03:57] [SPEAKER_01]: life. You don't have to start with a big step and you don't have to have everything figured

[00:04:03] [SPEAKER_01]: out before you start. Remember one small step down the right path is all you need to start

[00:04:08] [SPEAKER_01]: heading in the right direction. This truth applies to every positive life change we desire

[00:04:14] [SPEAKER_01]: to embrace in our lives. The journey anywhere almost always starts with one small step.

[00:04:20] [SPEAKER_01]: As I look back over the past years of my life, I see this theme reoccurring over and over again.

[00:04:27] [SPEAKER_01]: The journey of removing most of our worldly possessions began by simply removing the clutter

[00:04:32] [SPEAKER_01]: from our cars. The accomplishment of running my first marathon started by waking up one day

[00:04:38] [SPEAKER_01]: and running one mile. The journey of establishing a blog and inspiring others began with one simple

[00:04:45] [SPEAKER_01]: post. When my wife wanted to learn how to sew, she began by attending just one sewing class at a

[00:04:51] [SPEAKER_01]: local church with a few of her friends. When my son wanted to make the high school volleyball

[00:04:56] [SPEAKER_01]: team, he went out in the driveway with my wife and first learned how to bump.

[00:05:01] [SPEAKER_01]: Some of the most significant achievements in your life can be traced back to one

[00:05:05] [SPEAKER_01]: small step in the right direction. Today I encourage you to choose just one financial goal you intend

[00:05:11] [SPEAKER_01]: to pursue. Make it your one thing, the single most important first step that you intend to take

[00:05:17] [SPEAKER_01]: for you and your family. A next best step is going to look different from one person to another

[00:05:22] [SPEAKER_01]: and one family to another. As well as it should, we come from different backgrounds,

[00:05:27] [SPEAKER_01]: different starting points, different income levels, and different family and living situations.

[00:05:31] [SPEAKER_01]: But the importance of choosing just one step applies to each of us.

[00:05:36] [SPEAKER_01]: One step at a time. What is the next best step for you to pursue? In all my years of discussing

[00:05:44] [SPEAKER_01]: financial well-being with others, I have never seen an approach to financial intentionality work

[00:05:49] [SPEAKER_01]: better than Dave Ramsey's seven steps to financial freedom. For that reason, let's consider

[00:05:55] [SPEAKER_01]: these steps to help determine your best next one. They come from his book The Total

[00:06:00] [SPEAKER_01]: Money Makeover. Step one, save $1,000 for your starter emergency fund. Step two, pay off all

[00:06:08] [SPEAKER_01]: debt except the house mortgage using the debt snowball which is paying off accounts starting

[00:06:13] [SPEAKER_01]: with those that have the smallest balances first. Step three, save three to six months

[00:06:19] [SPEAKER_01]: worth of expenses in a fully funded emergency fund. Step four, invest 15% of your household

[00:06:25] [SPEAKER_01]: income in retirement. Step five, save for your children's college fund. Step six, pay off your home.

[00:06:33] [SPEAKER_01]: Step seven, build wealth and give. I encourage you to identify where you are on the list above.

[00:06:40] [SPEAKER_01]: What steps do you need to complete next? Save $1,000, pay off debt, start saving for retirement.

[00:06:47] [SPEAKER_01]: Maybe it's pay off your mortgage or become more generous. Resolve to complete just the

[00:06:52] [SPEAKER_01]: next one thing in your financial journey. Don't get sidetracked trying to do everything at once.

[00:06:58] [SPEAKER_01]: It's important to note that each of those steps above can be broken into smaller parts.

[00:07:03] [SPEAKER_01]: We begin saving $1,000 by saving $100 then $200. We pay off our debts one credit card or loan

[00:07:10] [SPEAKER_01]: at a time starting with the smallest one. We begin saving three to six months worth of

[00:07:15] [SPEAKER_01]: expenses by reaching one month then two. See what I mean? Even the next financial step for

[00:07:21] [SPEAKER_01]: you can be broken into smaller steps. My hope for you is to help you become more intentional

[00:07:26] [SPEAKER_01]: with your finances and discover greater peace of mind because of it. Remember Gary Keller's words,

[00:07:33] [SPEAKER_01]: quote, if you want the absolute best chance to succeed at anything you want,

[00:07:38] [SPEAKER_01]: your approach should always be the same. Go small, end quote. Pick one small financial

[00:07:44] [SPEAKER_01]: goal and pursue with all your energy and focus. You can do it. You just listened

[00:07:53] [SPEAKER_01]: to the post titled To Change Your Financial Circumstances, Choose Focus by Joshua Becker

[00:07:59] [SPEAKER_01]: of becomingminimalist.com. I couldn't agree more with Joshua here. Small, consistent action is more

[00:08:06] [SPEAKER_01]: effective and makes the process more enjoyable than big leaps. I've seen this play out in my

[00:08:13] [SPEAKER_01]: own life in so many ways even from something as simple as my love for paint by numbers. Day by

[00:08:20] [SPEAKER_01]: day, week by week, I'm adding a tiny bit of color to this canvas. And while each tiny addition

[00:08:26] [SPEAKER_01]: doesn't feel like much, I'm always amazed at the final product. I think it all comes down to

[00:08:33] [SPEAKER_01]: belief in something you can't quite see just yet. You have to believe deep down that the

[00:08:38] [SPEAKER_01]: small daily actions will make a difference in the long run. If you can focus on building habits

[00:08:45] [SPEAKER_01]: slowly and consistently every day, you'll start to notice how these healthy habits compound over

[00:08:51] [SPEAKER_01]: time just like compound interest when you invest your money. Dave Ramsey's Baby Steps are fantastic

[00:08:58] [SPEAKER_01]: and have helped so many people get out of debt. But I'll offer you this. Rather than paying

[00:09:03] [SPEAKER_01]: off your smallest debts first, consider starting with your highest interest rate debt.

[00:09:09] [SPEAKER_01]: I think Dave recommends starting with the smallest debts first so that you can get

[00:09:13] [SPEAKER_01]: some early wins to build momentum. But I would recommend you look at your debt collectively

[00:09:19] [SPEAKER_01]: and use a debt reduction calculator to determine how long it'll take you to pay it all off.

[00:09:24] [SPEAKER_01]: If you plug all of your balances and interest rates into one of the many calculators available

[00:09:29] [SPEAKER_01]: online and compare the two strategies of paying off smallest debts first, which is known as the

[00:09:36] [SPEAKER_01]: snowball method versus highest interest rate debt first, which is known as the avalanche

[00:09:41] [SPEAKER_01]: method. You'll see that you'll pay it off faster by going after higher interest rate debt first.

[00:09:49] [SPEAKER_01]: And I think utilizing such a calculator to look at your debt collectively and the full-time horizon

[00:09:55] [SPEAKER_01]: could still provide the motivation you need to keep going. At least it did for me.

[00:10:00] [SPEAKER_01]: I have seen the Baby Steps work wonders in helping people get out of debt,

[00:10:04] [SPEAKER_01]: but I don't necessarily agree with the advice here on how much to save for retirement.

[00:10:09] [SPEAKER_01]: If you're in your 50s and haven't started saving for retirement, for example,

[00:10:14] [SPEAKER_01]: I'd recommend you save much more than 15%. Also paying for a child's education

[00:10:20] [SPEAKER_01]: and paying off your house might not align with your overall financial goals.

[00:10:24] [SPEAKER_01]: So I'd encourage you here to take the pieces of this formula that apply to you and leave the rest.

[00:10:30] [SPEAKER_01]: And that's a wrap for another Monday show. Have a great rest of your day and start to your

[00:10:35] [SPEAKER_01]: week and I'll be back tomorrow where your optimal life awaits.