Hey Reader,

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Time to check your finances!

This is your monthly reminder to update your Net Worth -- an easy way to track your financial progress. 📈

Need the Money Meeting Agenda?

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Money Challenge of the Month: #7: Review your CASH PLANNING METHOD to SAVE for large expenses (e.g. cars, home renovations, vacations, etc.)

Method 1: Use YNAB (My fav budgeting software) or a Cash Planning Spreadsheet (Create your own, Google for one, or use mine).

or . . . Method 2: Open separate bank account(s) for large savings goals. This is what we did before YNAB. As our finances and goals got more complicated, it got hairy and we switched to YNAB.

or . . . Create your own method! As long as you're:

- Paying for large expenses using SAVINGS rather than DEBT and

- CONFIDENTLY INVESTING as much cash as possible (given your income and goals)

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Is CASH PLANNING the same as BUDGETING?

Tracking expenses is NOT the same as setting cash aside for upcoming large expenses (that's CASH PLANNING).

Some budgeting software includes cash planning (like YNAB-- it's like a digital version of the "envelope" system of budgeting).

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(BONUS!) CASH PLANNING helps you BUILD WEALTH THROUGH INVESTING! 📈 #1 MISSED OPPORTUNITY for people "doing fine" financially

CASH PLANNING aka allocating your cash to . . .

• Recurring monthly expenses (housing, food, utilities, etc.)
• ​Irregular or "True" Expenses (e.g. biannual insurance payments, property and income taxes, travel, holiday shopping, etc.)
• Emergency Fund
• Upcoming large expenses (cars, electronics, vacations, home renovations, vacations, etc.)

. . . (1) AVOIDS DEBT

. . . (2) but ALSO helps you CONFIDENTLY INVEST MORE. (Aka NOT cash-hoarding!)

Cash LOSES value over time (due to inflation) while the stock market goes UP an average of 4 out of 5 years. 📈

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After brainstorming your large upcoming expenses (plus a full emergency fund to cover unexpected expenses), consider INVESTING your remaining cash.

⚠️ I don't invest the cash for expenses that will hit in the next 5 years (due to volatility). After that 5+ year time horizon, consider INVESTING that cash for mid- or long-term goals.

Does this mean you need enough cash to cover 5 YEARS' worth of expenses before investing? No! Your emergency fund is usually only ~3-6 months of expenses. Most future regular expenses will be covered with your future regular income.

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Still want to learn the how/why/what/where of SIMPLE, EFFECTIVE INVESTING? 📈

Considering joining the WAITLIST for the fall session of my Investing 101 course!

This upcoming session will include 5 weeks of free Q&A Sessions.

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Your nerdiest financial friend,