P3I Investing Strategy of the Month- Financial Starting Point by Dannielle Fritz-MacDuff

We began the P3I investing workshops as a tool for our clients to take back control of their financial future and empower each customer to reach their goals and achieve their dreams. So I thought adding one strategy each month to this blog would be helpful to others.

Financial Starting Point-
Most of us know how to plan a road trip. Start with where you are and mark out a path on the road map. If you run into a road block, re-route and keep moving forward.
This simple strategy is the best way to start a financial journey as well.
What I find is that often clients do not know where they really stand financially and many are afraid to find out. It is much less traumatizing to go along semi - ignorant of what our financial snapshot looks like, than to get in and be brutally honest about how much money we spend or borrow. This fear of what the real picture of our financial lives looks like is what holds most of us back and leaves the money in control of our actions. P3I investing is about putting the person in control of the money through action.
Start with one day and all of your financial information.-do a "brain dump" and list all of your income and where it comes from.
Next list all of your liabilities ( everything and everyone that you owe money to.) and the total balance due for each bill. Be brutally honest in this step, if you leave out the loan from uncle Jim or the doctor bill that is lowering your credit score, you will sell yourself short and set yourself up for failure.
List all of your expenses including monthly payments for each liability. Don't forget to include miscellaneous living expenses like toiletries and food. Also make sure you include a realistic expense for things like; entertainment, salon visits, clothing and other items that are just part of life.
Now List every thing that you own - if you had to give a list to an insurance adjuster because your home burned to the ground and you lost everything, what would be on that list. Go through your home and catalog everything that you own and assign a dollar value to these items. Also include things like cash in the bank, stocks, bonds, real estate owned, businesses that you own and other intangible assets.
Now set that aside and we will come back to it. For the next two weeks, carry a small notebook and pen or pencil with you and write down everything that you purchase or spend your money for. Include expenditures for things as small as a piece of gum form the candy machine. At the end of the two weeks go back and tally all of your expendituture by like expenses. This may sound daunting, but it will give you a place where you can review where your money is going and make you more conscious of where you are actually spending your money, which puts you back in control. That control allows you to make your money work for you instead of constantly working harder for money.
I am not saying that you will be able to quit your job tomorrow, or maybe you will. That is really up to you. But if you start here and consistently do five things, you will be able to make yourself financially free in 10-15 years. 10 -15 years is relatively fast if you consider that most of us work at our jobs for 40 plus years. Here are the five things that you MUST do to make yourself financially free:
Learn something new and useful everyday- the key word hear is useful. If you can not apply this knowledge, it is just taking up space in your brain. Don't get me wrong, interesting trivia definitely has its uses and can be fun, but learning something about your money that puts you in the drivers seat will help you have more time for the fun stuff
Know your exit strategy- why do you want to be financially free? The why is so much more than the how because the why drives us. The why makes us get out of bed in the morning and the why keeps us moving forward when it looks like it is all about to hit the fan. After the why comes the when- Complete this sentence -I will have made it when... . That when is your exit strategy.
Find a friend to hold you accountable and then ...lie. I don't mean start telling outlandish lies about what you are doing. I mean start telling people what you are working on. Since you have not actually accomplished your goal yet it is technically a lie and not fact. we lie to our selves everyday when we say things like "I could never do that" or "You can't do that here" or "I'll never be rich" and those lies hold us back because we believe them. so why not lie about the opposite and watch it come true. If you tell someone about your plans, you are three times more likely to succeed because you will subconsciously work harder at the project to save face. Get someone to be your success partner and ask them to talk to you once a week to check in and see how things are going.
Choose to be financially free - This sounds easy, but the trick is to make that choice everyday and then carry that choice over to the choices we make when we spend our money. Choose to spend your money on your education and on things that will continue to put moeny in your pocket even if you stop working.
And finally, Take Action - you have to act to make things happen. Just talking about becoming financially free is not enough, you have to begin taking steps to get to your goal. Do something, even if it is wrong. If you make a mistake, then at least you have learned something, even if it is what not to do.

Thanks for visiting our blog. Look for more P3I investing strategies coming soon and check our web site, we will be posting down loadable worksheets to help you with this strategy.