12 Steps to Change Your Money Mindset

Sep 2 / That Girl In Finance by Anna
Do you ever find yourself wondering where all your money goes? It happens. Sometimes it makes you think you should finally sit down and organise your finances. Figure out how much you’re paying for stuff, and cut back where you can.

And you mean to get that done, you really do, but then that little voice in your head chimes in: “Oh, you want me to do the math on a spreadsheet where every answer tells me I can’t buy something I want? Cool, no thanks, not right now.”

Yeah, that’s a tough sell. Not buying things isn’t much fun at all. So that idea falls to the bottom of the to-do list and you continue dealing with the stress of not being sure what’s going on with your money. But it doesn’t have to be that way!

It’s all about making sure your spending aligns with your priorities
Making decisions about how you want to spend your money is the key to reaching your goals. So, it’s more like a map of where you want your money (and your life!) to go.  A Money Allocation Plan, if you wish.

So, you’ve decided that you need to make a plan for your money. Maybe you have a debt to pay down, a home renovation to plan, exotic lands to explore...or maybe you’re just ready to feel like you want more control over your future. 
Money can be complicated. It’s like this swirling vortex of math, emotions, experiences, time, fears, and aspirations. Sometimes it seems easier to stand off to the side and order a MacDonald's delivery than to jump in.

But you’ve decided to organise your finances, untangle your money-related emotions, face your fears, follow your dreams, and push the buttons that really matter. It’s all kind of a big deal.

Let’s dive in and figure out 12 steps to change your money mindset:

1. Find Your Financial “Why”

It’s easier to commit to spending less and saving more when you have specific goals in mind. You’re not just organising your finances -  you’re making a plan for your future!

Write your awesome label here.

Write your awesome label here.

Write your awesome label here.

2. Self-Assessment

You know what you want, now let’s figure out what’s currently standing in your way. Ask yourself what is your biggest personal obstacle when it comes to managing your finances.

Rate your current financial situation from 1-5, where “1” I'm not at all where I want to be and “5” is I feel great about where I am financially now.
Oh, you want me to do the math on a spreadsheet where every answer tells me I can’t buy something I want? Cool, no thanks, not right now.
that little voice in your head

3. Journal Journey

Get out your favorite pens, stickers, and highlighters, and let’s do some journaling! What was money like in your household when you were growing up?

What is money like for you now?

What are your lows/frustrations/challenges/struggles around your finances?

Feel free to just write everything that comes to your mind. We’ll get back to that later.

4. Money Matters

They say that money can’t buy happiness. I’ve heard a ton of personal finance stories over the years and the common thread is it isn’t how much people have, but how confident they feel about managing it.

People who know that their spending and saving line up with their priorities experience less money stress.

And less money stress equals happiness. That’s science. Or math. Or common sense. (It’s something, I swear.)

So, is money the key to happiness...or is a money plan the key to happiness?

Find out for yourselves.

5. Organize Your Finances

You can’t change your reality unless you fully understand it.

Write in your diary/spreadsheet all your monthly take-home pay. Also, list out the money available to you right now.

This is liquid money like checking accounts, savings accounts, high-yield accounts, cash, etc. You don’t need to list any retirement accounts here.

6. Pay the Bills

Monthly bills will show up every month.

How is that good news? Good question. It makes planning for them easier though.

List how much you pay, and the due date usually.

But don't sweat it! If this part seems daunting, feel free to estimate your best guess at bills, or take a break and have a snack before picking up this next section.

7. Frequent Expenses

Now let’s tackle those necessary expenses that occur regularly but aren’t monthly bills.

Although some of these categories can’t be eliminated (I’m looking at you, groceries), these expenses often allow for a little wiggle room if you’re searching for opportunities to save money.

Estimate how much you pay now and then decide if that amount seems reasonable or if you’d like to increase or decrease the amount you spend. Get competitive with yourself about the potential to cut costs!

8. Set Up Some Sinking Funds

Expenses that pop up on an irregular basis throughout the year are known as variable expenses and the money you save for them is often called a “sinking fund.”

You can make these expensive surprises more manageable.

Estimate how much you’ll need and setting aside the appropriate amount monthly (or whenever you have some extra cash) instead of getting hit with a big bill all at once.

9. You Deserve a Little Treat 

Alright, there’s been a whole lot of talk so far about boring bills and stuff you shouldn’t buy, and frankly, it’s just not fun. It’s what gives money management a bad name—no one likes feeling guilty or restricted. 

And that’s why we’re going to plant a Wish Farm, friends.

Go through your Amazon wishlist, your Pinterest board, or whatever online shopping carts are full but haven’t been through checkout yet and choose three things that you’d really like to buy.

Pick one item for each cost category (small purchase, medium purchase, and large purchase.) When you create a spending plan, add these items as categories (plant your wish seed) and assign extra money to them (water your wish seed) until you fully fund one (harvest your bounty) and can replace it with a new wish!

Isn’t this fun?

10. Address Your Debt

Debt forces you to pay for decisions you’ve already made with interest.

It robs you of opportunities that you could explore if you didn’t have these extra payments hanging over your head.

Debt’s annoying at best and soul-sucking at worst.

Let’s smash it to pieces.

List your monthly payments, loans, and debt balances here.

These are things like credit cards, student loans, mortgages, car payments, payment plans, and any buy now, pay later purchases (like Affirm or Klarna payments).

11. Debt Paydown Plan

Take a look at the debts you listed.

Which three would you like to pay off first?

 Some people like to take the debt snowball approach and clean their smallest debt first, just to gain some momentum with an easy win.

Others prefer the debt avalanche method, where you pay off your debts according to which ones have the highest interest rates, so you’ll pay less overall.

With either method, once you pay off a debt, you take the extra money you were using to pay off debt #1 and throw it at debt #2.

Every time you pay off a debt, you’ll have more free money to use.
Write your awesome label here.

12. From To-Do to Ta-Da!

What we’ll do next is take this plan and turn it into something incredibly powerful to get you further ahead in life.

Fill out the form and get "Change Your Money Mindset Workbook" to make your finances organised and start your journey to financial freedom!
Thank you!

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