Today on the blog we’re joined by none other than my WIFE, Alix Tucker as my first guest and interview. Obviously I think she’s pretty cool, but I’m also confident that you’ll think so too once you’re done reading. Last year, we did a podcast episode that was received so well by this community, I wanted to give you even more here on the blog.
As you know, this is a space where we talk all things health and wellness from a very holistic and loving approach. I like to speak to all of our layers- mind, body, and soul- when diving into wellness. This means we don’t only cover diets, how to change your body, or get abs. But more like wellness for mental health, increased energy, and overall feeling as good as possible in this human experience.
Money is a part of our human experience. This is a fact, and reality that many people like to dismiss with phrases like:
“Money is an evil necessity.”
Money isn’t evil. It just is. We need to feed ourselves, to pay rent, to see the world. We need it to survive. So, first and foremost, let’s not only accept that- but embrace it. Wellness in relation to finances is the same as wellness in relation to our body or our mind. We want our relationship with money to feel as good as possible. And, in order to do that, it doesn’t hurt to get some tips about how to plan, save, and support ourselves financially in a practical way.
Today on the blog, Alix will answer 5 questions on financial health and wellness that will help you cultivate a better relationship with money, and kickstart your wellness journey with money. If you want to learn more from Alix, you can always book a mentorship session. Or, just follow her on Instagram for tons of free useful content.
Let’s dive into the interview!
1. What does the term ‘financial wellness’ mean to you?
Financial wellness is how well you manage your financial life. As your financial wellness improves, so should the quality of your life. For me personally, financial wellness means that I have both the security and freedom to live the life I want to live.
In practical terms, that means I can pay my bills each month, I can invest and save more than 20% of my income each month, I can take my wife out to a meal whenever I want, and we can travel and take vacations throughout the year. We have the freedom to enjoy our life the way we like to because we have the financial means to do so.
To examine your financial wellness, start with these considerations:
- Are you prepared for an emergency?
- What’s your attitude towards money? How does talking or thinking about money make you feel?
- Do you have short-term and long-term financial goals?
- Do you have a budget? Do you stick to it?
- What’s your retirement plan?
2. In your experience, how have your finances impacted your health both positively and negatively?
Have you ever had a time you were living paycheck to paycheck? Maybe you had to take a little bit of debt through your credit card and you’re paying down your student loans. How did that make you feel? I remember when my wife and I were building our hotel in Nicaragua, Still Salty Escape.
We were 75% of the way through construction when our contractor dropped a bomb on us. Three months before we were set to open the hotel to guests, we were told that we needed an extra $150k to complete the project. Needless to say that $150k was not budgeted for.
We were panicking. We didn’t have that kind of money laying around and we had used our savings to pay cash throughout the project and we didn’t anticipate this moment. We ended up having to take a loan and pursued side hustles to finish the project.
Ultimately, we finished the project, but the restless nights, stress and anxiety, and inability to pay attention at work really took a toll on my mental health.
Eventually, we paid off the debt in 5 months. This meant cutting back on all non essential items. Working extra hours each day and on weekends for extra income through our side hustles. We used big chunks of cash like my bonus and our tax return to pay down the loan.
After paying down the loan, we built back up our emergency savings fund and got to a place where we were living within our means and investing each month. We started to be able to spend on nice to have items like vacations, new clothes, and dining out.
What a relief to get to the point where we could breathe again, work a little bit less, and enjoy the nice to haves again. The peace you feel in your soul when you can rest easy at night knowing you have what you need and you don’t owe money to another person, it’s priceless. That’s what financial wellness is to me.
3. In your opinion, why is it important for people to prioritize their financial wellness alongside their physical and mental health?
Prioritizing financial wellness is just as important as physical and mental health. In my experience, when I’ve been at my lowest point in my financial wellness journey, it has significantly impacted my mental health. Stress, anxiety, and depression crept in quickly when I was struggling financially.
Usually this meant that I forgot my core principles of financial wealth, I spent more than I earned and I found myself in a bit of credit card debt and I’d feel the worry creep in. This ultimately led to me working more than normal to get myself in a better situation and that meant trading the time I’d use taking care of my body to work towards earning more money.
This is why I see financial health as one of the most critical aspects to overall health.
4. Can someone improve their financial wellness if they’re living paycheck to paycheck?
Is it possible to improve your financial wellness regardless of your current state? The answer is yes. But something will need to change in order to do this.
You will need to have a goal, a plan, and a mindset willing to put in the work and take action to change your lifestyle. All the budgets and plans in the world won’t get you there until you decide you will take the action to reduce your expenses and increase your income.
5. What are 5 key components people can implement today in order to improve their financial wellness?
Decide you will take control of your financial health.
Once you’ve made this a goal, you can pursue a plan to help you get to where you want to go.
Create a budget.
Understand where your money is going each month and how much you have coming in. Set a budget for each of your expense line items, like housing, food, transportation, etc.
Cut down on expenses.
Ensure your monthly housing costs are less than 25% of your total after tax monthly income. If they are greater, consider moving to a cheaper housing option to free up more dollars each month. Lower your nice to have costs to less than 20% of your after tax income. You can do this by cooking your own food, buying pre-owned clothing, and enjoying staycations vs traveling.
Pay down your debt as fast as possible.
Leverage the Snowball Method by identifying your smallest bill, aggressively paying it down until it’s gone. Take the money you save each month without that bill and apply it towards your next smallest bill. Repeat until you’ve paid down all of your debt.
Ensure you are saving 20% or more of your after tax income.
Develop an emergency savings fund of 6 months of living expenses. After you’ve built up your emergency savings funds, start investing. High yield savings accounts and investing in stocks and index funds are a great way to help you grow your cash.
Generate more income.
Work for a promotion in your current job. Take courses that will help increase your salary. Start a side hustle to help bring in additional cash each month. Find a way to bring in more income so you can increase your savings and investments each month.
Ready, set, go save! You’re ready to take the leap into financial wellness. I can’t wait to hear how it goes, my friends.