Implement Your Plan - Step 1

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Readers, apologies for taking a break this past week. I’ve been preparing for the winter (it’s indoor biking season), and looking a for a new place to live (moving to new city!). Anyways, back to our regularly scheduled programming…

Earlier in one of my newsletters, I provided 5 easy steps to get a grip on what you’re doing financially (located here). However, it was really high level and not really all that specific. I want to go more in to depth - specifically on Step 4: Implement. How specific should you be when beginning your financial manga carta?

Over the next three weeks, I’m going delve into a select few topics about how you can specifically going about doing this. For everyone’s sake, I’ll assume ya’ll have read the earlier newsletter post. And obviously this is not financial advice. It’s education!

Okay - so you’re tracking your finances through an app, and you have a goal in mind. Cool. Great start! But are you specifically planning? Are you setting limits around categories? Do you have a vision of how you are going get to said goal? Ok, maybe you do or don’t. Point is, a goal is not what you need. A system is. Something defined that paves the way to your goal. Because real progress looks like below. Life is full of unpredictable events and can change your goal, and maybe even if you are able to achieve it or not.

I’ll give an example of my system. For me, it doesn’t matter how much I make or spend granularly. It’s about the “net” or the combination of both. I aim to net about $3000 a month currently. I don’t try to budget categories to harshly, I’m more interested in the “net” amount I have left each month.

Income can change, and so does expenses. Which is why I rely on this “system” to guide me. The system is in itself a goal technically, but that’s another conversation. Here’s a sample of the system I do.

• Net $3000 per month

  • 1/12 of annual IRA contribution limit goes to a Roth IRA

  • 1/12 of annual HSA contribution limit goes to a HSA

  • Excess goes to taxable brokerage

  • (I don’t contribute to a 401k because my company does not offer a match and for my goals, I’d rather use a brokerage account. Yes it is taxable.)

• Goals: Optionality

I let my overarching “system” trickle down the requirement to the rest of my expenses and income. For said goal, I need to have x dollars here, x dollars there, etc. You get it. And you get to decide what that number is to you. I suggest considering an average here as well - I try to average this a year. Some months are higher, some are lower.

Tracking is the key thing to begin. You don’t know what you don’t know. And that can hurt you here. What lifestyle do you want, what things are must haves? Make a call, you can always change it. Ya just have to begin.

Start Tracking -> Create System -> Discipline Forms -> Achieve Goals -> Rinse & Repeat

It’s about the journey not the destination here (I feel like I’ve said this before, lol). The destination only provides you one thing - peace of mind - besides that nothing else changes. I think I need to stop getting all in my head while writing these. Occam’s Razor, people.

Next week - let’s get educated on certain investment vehicles and options available to you to take advantage of. And how to not get ripped off. (If you were in crypto lately, oof.)

Stay Frosty,

Andrew