In 2011 I was depressed, divorced and in over $14,000 of debt. I worked at a job that was sucking the life out of me and was literally bad for my health. (I lost weight, barely slept and my hair was falling out.)
I was bored and unmotivated to the point where I slipping into depression. Then, after witnessing a drive-by shooting right outside my second-story window, I decided to change my life for the better. I began reimagining the different ways my finances could fund things that actually made me happy, and what having a fulfilling career could look like.
It took several years to turn everything around, but here’s what I did to reimagine my life and finances so that I could become my own boss.
1. Pay off all consumer debts
When I first began changing my life I started with my finances because, let’s face it; when you change your money you change your life. At this time it was 2011 and I felt lost and completely hopeless. I just went through a bad divorce and was on my own for the first time. I had over $14,000 of debt and couldn’t even afford a nice place to live.
Seriously, I was only able to afford a $650 per month apartment in a questionable part of town (did I mention the drive-by shooting?). I…was…terrified, and from that moment on I started making a plan to pay off my debts and start freelancing full time.
You may already know the story but it took about 14 months for me to pay off $14,000 of consumer debt while making $42,000 a year. I was living on 2/3rds of my income, and it was no walk in the park.
I basically worked all the time and cut my spending back to nothing. I even thought about becoming a vegetarian so that I could save money on buying meat. (Not my finest moment…) I did reach my goal though, and it was the best first step I made to changing my life!
2. Start freelancing on the side
As the old Chinese proverb goes, “The best time to plant a tree was 20 years ago. The second best time is now.” So if you’re hoping to quit your job one day, or want to be your own boss, you have to start planting those seeds now! There’s no way you can up-and-decide to quit and the next day walk out without a solid plan (and savings!) in place.
During my journey to become debt free I started freelancing on the side like crazy. My ultimate goal was to quit my full-time job to work for myself. It took about 2 years for me to accomplish this goal (which is waaaay too long, and I’ve since created a method that allows people to successfully quit within 6 months or so) and I was able to establish a solid financial foundation.
Whatever your passions or hobbies are, if you want to develop them into a full-time living, you have to start doing the work on the side of your day job, now. Don’t wait until you have more time — there will never be a perfect time to start.
3. Perform quarterly check-ins
It’s not always easy to see trends with your money, and this is especially difficult when you’re balancing personal and business expenses. In fact, I spent so much money on my freelance business in 2015 that I essentially went on a shopping ban in 2016 and was able to cut my expenses in half.
Another thing I did was to enact quarterly money check-ins. Every three months I have to send estimated tax payments to the IRS so I figured it was also a good time to evaluate my finances. I take into account how much I’m earning, spending, where I’m at with my goals, my credit score, debt balances (if any), retirement savings and anything else related to money.
This is actually something that my husband and I both do together, on both a monthly and quarterly basis as it keeps us on top of our goals. Plus, we’re able to find motivation in the fact that we’re continuing to save and earn more.
4. Automate finances with technology
Since you’re reading this blog, I assume you know how much I love using technology to streamline my freelance work and finances. This is something I’ve implemented since the beginning and continue to tweak over time. When it comes to project management I find ways to automate everything, and the same is true for my financial goals.
If something changes in my credit score, I receive an email alert notifying me of this change. If I’m nearing my monthly budget allowance I get a text message saying that I need to slow down my spending.
Technology is an amazing resource for streamlining your money so you can be sure you’re spending money on things you value — versus mindlessly spending and consuming.
5. Switch to online banking
I regularly save money towards various goals using the 17 different bank accounts I own. Most of them are with Capital One 360 as they give you the chance to open multiple savings accounts for free. I’ve found that this method eliminates most of the financial emergencies that inevitably pop up from time to time.
Need to repair your car? No problem, there’s money in the “car fund” set aside for this. Want to invest in your business and attend a conference? Done! Money’s been set aside in the “travel fund”. You get what I’m saying, right?
Online banking allows you and I access to our money instantly thanks to mobile app technology. I’m on the road a lot with my business so switching to online banking means I can make deposits on the go, conveniently get cash from an ATM, and transfer funds from different accounts. Online banking has been the biggest game changer for my financial life.
Ready to reimagine your financial life?
These are all important steps I’ve made over the past few years to reimagine my financial life so that it fits my priorities. My goals and values have changed over time and with that so does my money mindset. The only way to build wealth for the long term is to continuously evolve, experiment and grow.
Ready to join me? Capital One is redesigning the banking experience thanks to their digital products, innovative tools and human interaction. This is something I’m excited about because I’ve personally been able to witness in my 20+ years of being a customer with them.
Their goal is to empower people to feel confident about their money and one way they’re doing this is with the Capital One Cafes and the Banking Reimagined Tour. They’re hosting these free events all across the country and were recently in the Denver area.
To learn more about the Capital One Banking Reimagined Tour in your area, just click the button below. It’s completely free to check out the tour for yourself.