When developing a financial plan, financial educator Marsha Barnes counsels her clients to stop unnecessary spending and work on building at least six monthsâ€™ worth of expenses in an emergency fund. She also encourages them to make an effort to look for free items.
Barnes says her parents taught her money lessons as a child. She saw her mother clip coupons, refuse to buy anything not on sale or on the clearance racks, and she always ordered from the kids menu in restaurants.
But the best money advice her mother gave her was when Barnes showed up at her motherâ€™s house with a new BMW she had taken out a loan for, and her mother candidly stated, â€śMarsha, you donâ€™t make BMW money right now.â€ť
Marsha admitted that she wasnâ€™t Â happy with her momâ€™s thoughts about her new car, but took her advice to heart and traded in her BMW for a Volkswagen, which put her back on track for financial health.
Barnesâ€™ company, Financial Empowerment, goes into the public school system and conducts seminars and Q & A sessions with individuals seeking money management advice.
Barnes shared a story of one client who literally did not have $5 to save. SheÂ paid all of her bills, including a gym membership, but after paying for everything she had nothing left. The client is now working with Barnes to get her finances in order.
The client was really dedicated to going to the gym, and it would take the last of her money. Barnes stepped in and showed her that it should not be the gym, but exercise that she should be committed to and that she didnâ€™t need a gym membership to exercise.
It comes down to thinking differently about how you spend your money and finding other ways to meet your goals while still keeping your finances on track.
Additional reporting by Sheiresa Ngo