The End of the Rainbow

When I was a kid, the end of the rainbow seemed so far away. This dream of a place you can try so hard to get to, but it’d always be juuust out of reach. A beauty to see, but not to hold. How much gold was at the end of the rainbow, anyways? Would someone else get to it first, and all the effort would be for naught?

The illusion is more magical than I originally thought. The way our atmosphere refracts the light of the sun behind us through the misty haze on the horizon before us makes it appear to be miles away. One day last year, and again today, driving on the freeway to a fun outing with loved ones, the rainbow’s end landed right on the pavement in front of us. “How could it be?” we thought. “Are WE at the end of the rainbow?!”

The value we see so far away is much closer to home than we think. When we search for the infamous gold, we must remember that it’s there waiting for us, even if we need to hit the pavement to find it.

Ok, seriously… Finances are one of the biggest topics we will ever face in this life. The way this world has developed has put money in the forefront of nearly every decision we have to make. Some people are gifted with being born into families with more than enough and never really have to worry about it, while most people have to work hard and consistently for most of their lives to be comfortable, or even just to make ends meet.

It’s not that simple, though, as many factors play into our ability to make money and keep track of it in a beneficial way. Some of the people with an excess get caught up in trouble and end up on the streets, while others born into poverty pulled themselves up from nothing and can now enjoy their lives, appreciating what they have done for themselves. Some have never been without, and others never had the financial support they need. Yes, we all have a story, but it’s best not to individualize all financial issues.

There are as many different relationships with money as there are people in the world, and the main problem we are all up against is the capitalistic system that has put profits before the people and spread like wildfire. It widens the gap between privileged and marginalized communities, especially with discrimination of our BIPOC and LGBTQIA+ members still running wild. It’s not fair and it’s hard to know how to overcome such an unjust way that this world turns.

Luckily there are many people before us who have figured out how to turn the downfalls to work for us instead of against us. There are many easy to follow guides out there and people who are more than happy to help us all go farther together. If we want to change our reality, the only option is to focus on how we can make money magic happen in our own lives (with the guidance and support of our community, of course).

To get out of financial stress, we must know where we are and where we want to go. It’s not always easy, and it may take some time, but with a shift into a more optimistic mindset and a consistent effort toward learning and showing up, you can absolutely set and reach your goals.

The general concepts I’ve learned over the last few years include:
– Reducing Unnecessary Expenses
– Finding Financial Assistance
– Reducing Debts
– Building Emergency Funds
– Saving for Fun
– Investing in the Future

Let’s get into it!

Reducing Unnecessary Expenses
Look at your statements: debit card, credit card, cash receipts, checks, apple pay, etc.
Did you need or really want everything you bought?
Can you do without some of these things for the sake of your future self and family?
Maybe you can make something at home for cheaper (food, coffee, diy projects)?

Many of the things we spend money on these days are little impulsive things that add up to big chunks of our money gone, out the window. Some things we are spending money on are accidental subscriptions to apps or services that we don’t even use. CANCEL THEM. Keep only what you need and really want. Like cleaning out the closet. Make room for what matters, so you aren’t overwhelmed by the pile of random crap shoved in the corner, taking up valuable space and creating mental clutter along with it.

Shopping around for lower prices, joining a “buy nothing” group on social media, thrift shopping instead of buying new things, buying foods in bulk, if you’re able to, or waiting to buy certain items until you find them for a reasonable price can also make a big difference.

Finding Financial Assistance
The housing and healthcare crisis is out of control. I was taught in jr. high that we should allot 25%-30% of our monthly income toward housing. Rent prices are so high these days, it easily eats up 50%-75% of many peoples income. One trip to the doctor without insurance could easily set many people back to square one as far as savings go, or into deeper debt, and that’s before any new problems are discovered that need to be addresses. Don’t even get me started on ER, urgent care, or specialist visits.

There are services and assistance programs out there that are ready and able to help you if you qualify. Some of the first to look at are EBT, food banks, and health insurance programs like Apple health. If you make less than a certain amount of monthly or yearly income, you can access those programs and save your out-of-pocket resources for the things you need to pay for yourself. Some local churches have programs to help pay rent. There are many other community resources for mutual aid and financial assistance, which you can find by researching a couple places and then asking around for resources that are harder to find.

Reducing Debts
This one may seem easier said than done. It depends on your view of debt. Some folks care to pay it back and others don’t. If you care to pay it back, reducing unnecessary expenses will definitely get you there sooner.

Putting a budgeted amount of money into your debt each month is a great idea. There are a few ways to decide how much to put in. One option is to figure out how much you can afford, which could fluctuate each month. Another option is to decide when you’d like to have your debts paid and dividing the amount of debt plus interest by how many months until then and adjusting to fit into your budget. Automating these payments is highly recommended so you don’t run the risk of additional interest or late fees.

If you think you’re able to pay off one or all lines of credit within 1.5-2 years, there are options for Balance Transfer Cards that give you a period of time with 0% APR.

You may choose to split your budgeted money into paying off debts and building the emergency fund at the same time. Once debts are paid, all your budgeted money can go into savings and build your emergency fund faster.  

Building Emergency Funds
This is the cushion that softens the falls we have in life. Knowing we aren’t landing full speed onto concrete is a much better feeling. Aim to save 3-6 months of living expenses. That way if things go downhill, you will have time to figure out what to do. This amount varies depending on your cost of living and spending habits. If you’re not sure how much to save, more is better so you can roll any excess into more profitable long-term savings like investments.

Keeping this money away from your debit and credit card withdrawal accounts is very important. A High Yield Savings Account (HYSA) is the best place for emergency funds because you earn a higher savings interest rate(3% average) than a bank(0.23% avg) or credit union dividends(0.5-2% avg) and can access your money a certain number of times each month without fees, unlike investment accounts.

Setting up automatic deposits is also important so you can save without worrying about it and let time to the work for you.

Saving for Fun
This is the adult version of a piggy bank. Once it’s nice and full, smashing it or uncorking it to let the money flow and get yourself something special. What you buy with this money is a gift to yourself for all the hard work your done and attention you’ve given to your financial situation.

Again, depending on spending habits, or how much money you can save, it can look very different for each person. Whether it’s a new tool or toy, a special meal out with loved ones, a trip, either near or far, a concert or festival, or a large purchase you’ve wanted to make for a long time, this is one of my favorite parts about saving money. I have a hard time buying many expensive things, and when I do, it feels good when I’ve saved just for that!

Investing in the Future
Here is the big scary next step that so many of us have a hard time getting to. Again, this can be done during or after debts are paid and emergency funds are in place. But honestly, before those things are taken care of, it’s best not to worry too much about this. Juggling too many financial goals at once can be counter productive and spread your money too thin.

Investment accounts are intended to hide away and build at much higher return rates than all other savings accounts at 7-10% depending on how long the accounts mature.

When investing, there are two lanes – the “fast” lane and the “slow” lane. The fast lane is when you trade individual stocks as they increase and decrease in value, to try and make money quickly. The slow lane is investing in a varied portfolio of stocks like mutual funds, index funds and exchange-traded funds (ETFs) which average out together and gradually increase overtime. May of these options have up to 500 stocks in each portfolio. Unlike individual stocks, you won’t be gambling with one company’s success. When some stocks in the group fall, others rise and all of them rise over time, otherwise they are taken off the list. It’s much less risky and more predictable.

The fast lane sounds great, but I’ve heard it compared to one person going the speed limit in the right lane and another person speeding in the left lane. There are a few outcomes here. A very lucky driver in the fast lane could it all the lights just right and make it to their destination sooner, profiting on time. There are two more likely scenarios: Either both cars will hit the stop lights at the same time, wasting time and stressing the car in the fast lane for little return, or the fast car will get into trouble and end up having to spend time and money for getting pulled over for speeding. Missing one or two handfuls of the best trading days in your lifetime could cost you much more money than if you stick to the safer route. Slow and steady wins the race.

Keep in Mind
There are so many ways to solve our money problems. Staying curious and creative with your situation will help get you where you want to go.

If you’re not making as much money as you’d like, consider applying for jobs that offer additional income through gratuities like serving, bartending, working special event gigs on the weekends. Many people sign up with app gigs like food delivery, personal grocery shoppers, package delivery, and other odd jobs. It may be time to think about a new career that offers valuable on-the-job training that pays really well once you’re trained. Unions can often pay better than other jobs, and some jobs offer tuition assistance so you can get reimbursed for continued education as long as you maintain a certain grade point average.

You have the ability to create the life you want. All the information you need to change your life is available to you through the internet and your community. There are so many people who want to help you succeed. It’s up to you to make the move and make your dreams come true.

If you have any questions or comments, please share them below or send me an email!

Follow my on Instagram or Facebook to continue learning little ways to improve your finances.

Have a wonderful day!
– Laura

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