If regaining control of your finances and changing how you feel about money is part of your New Year’s Resolution, this episode is for you! Make it your focus for 2024 to release feelings of shame and uncertainty around spending, saving, and making money. I want you to spend money drama-free and feel confident about managing your finances.
In today’s episode, I share how to start your journey to financial freedom by outlining my five-step plan to build wealth. Each step is shared in sequential order and is designed to help identify your 2024 money goals. Set yourself up for success with my five-step wealth-building plan.
Stay tuned to hear insights on these key topics during this episode:
[01:32] Five steps to build wealth overview
[02:32] Step 1: Create a spending plan
[07:03] Step 2: Intentionally save money
[13:04] Step 3: Pay down debt
[18:05] Step 4: Earn more money
[20:51] Step 5: Investing
Tune into this episode of Money Files to learn my five-step plan to build wealth.
Are you ready to start asking for help with your finances? Apply to work with me, and let’s start working towards your financial goals.
IF YOU LOVED THIS CONVERSATION ON 5 STEPS TO WEALTH BUILDING, CHECK OUT MY EPISODE ON SHIFT THE WAY YOU THINK ABOUT SAVING TO BUILD BETTER FINANCIAL HABITS!
Transcript for “5 Steps To Wealth Building”
Intro: Hi and welcome to Money Files. I’m Keina Newell from Wealth Over Now. I work every day with professional women and solopreneurs to help them get out of financial overwhelm and shame so they can experience more flexibility and ease with their finances. Are you ready to gain confidence and learn to manage your finances intentionally? Tune in and grab financial tips that will help you master the way you think about and manage your finances.
Keina: Hello and welcome back to another episode of Money Files. I want to talk to you today about the five steps to building wealth. And these are the five steps that I want you to know in 2024 because I want this to be the year that everything changes for you financially, no matter where you are with your finances. Whether you’re like Keina, I just found your podcast today. Keina, I have a hundred thousand dollars worth of debt. Keina, I worked with you and I feel like I had a little hiccup. Wherever you are in this journey, I want you to be able to listen to these five steps of building wealth. And I’m going to give you my perspective on the order in which I think you need to build and create wealth.
I’m going to tell you a little bit more about why. So I’m just going to tell you the five steps and then I’m going to go back and go a little bit deeper into each step. So the first step is to create a spending plan. The second step is to know how to intentionally save money. The third step is to be able to pay down your debt. The fourth step is to earn more money or even being able to like clean up your business and the fifth is being able to invest. And when I think about these five steps, they go in this sequential order. And even as you hear me talk about each step, you’re maybe you’re like, oh, I have that, or I have that. But I want you to know why I think that these five steps go in this order. And I want you to be able to also know, okay, these are the five steps Keina is talking about and being able to also identify where might you want to focus in 2024 so that you can build more wealth this year.
So the first step is to be able to have a spending plan or create a spending plan and this is your foundational step. Your spending plan is the tool that’s going to help you decide how you want to spend money in your life. It’s going to help you decide how you want to spend money this week. It’s going to help you decide how you want to spend money this month. But like having a spending plan is going to ensure that you always have money for the things that you want. My whole goal is to help you be able to spend money drama free. And it’s why I want you to have a plan for how you want to spend your money. You spend how many hours making money. And so I want you to be able to take some level of attention and the first thing I want you to do is be able to create a plan for how you want to spend your money because it’s going to be the bread and butter for everything else in your life.
If you want to be able to spend money on family, if you want to be able to spend money on travel, if you want to be able to spend money on giving, we put all of these things into your spending plan because we want to focus your spending plan on the things that you value, the things that are a priority for you. My spending plan and your spending plan are not going to look the same. I actually was updating my plan for this year for 2024 and I was like, okay, I want to actually put more money towards giving and I want to actually put more money towards celebrations because I have a lot of friends that are turning 40 in the next couple of years. And so those are some of the things that I’m thinking about and it’s my plan for being able to spend money.
So when you think about what your plan is for spending money, you can think about how do I want to make my life easier. I know something that I’m thinking about for my plan is like, can I get my house cleaned every two weeks because y’all working from home, “I should have plenty of time to clean,” but no, my energy level is not there. So I’ve been thinking about like do I want somebody to come and help me clean every two weeks or maybe it needs to be once a month, whatever that is, but like how can I make my life easier when I’m looking at my spending plan? And so it’s dictating where my money’s going to go. Another question that you could ask yourself is like, how do I want my values to be reflected through my spending? So really being able to take a step back and think about what are the things that I value personally? What do I value professionally? And if I were to look at how I’m spending money, how would that show up?
And it may show up in the fact that you love creating experiences and so maybe you have a really big travel allowance and that’s because you really enjoy being able to create experiences and memories in your life. I have a client who she’s been talking about like maybe I want to train for another triathlon or maybe I actually want to take some sewing classes, like that is brilliant. And for the conversation that I had with this particular client, we were talking about the fact that these things are also really just geared towards her mental health and being able to feel vibrant and joyful. And so those are some of the things that she’s including in her spending plan this year. And then the last thing that you may ask yourself is like, how does my my spending provide an ROI in my life?
That’s the thing that I love to think about. It’s like what’s the ROI for you? Sometimes we spend money in ways and then when we think about it we’re like, why am I even spending money on that, like why do I have four TV subscriptions if I’m not even going to be at home in the next few months? Because I really want to be able to create memories and go out with my friends. So you might decide that you are spending, you don’t actually want your money going towards four different subscriptions and you may reduce to two subscriptions because you’re really thinking about the ROI in your life. And I would also add the same is true for our businesses when we’re thinking about creating a spending plan for our business. It’s like, how do I want to make my life easier in my business? How do I want the values and the goals of my business to be reflected through my spending and does my spending have an ROI for my business and being really clear about that for ourselves?
So the second step to building wealth is to be able to intentionally save. So we start with this plan and the next thing we want to be able to do is be able to intentionally save. Saving money is going to be able to support you in every area of your life. You want to know confidently that you can save money at any time that you need to save money, whether that’s saving $25 a month or saving a thousand dollars a month, whether it’s saving $2,000 a month. You want to know that you are able to do that and you’re able to think about that if I need to save money right now and I need to save $10,000, I know exactly how to do it. If I want to save $10,000 in the next two years, I know exactly how to do it. And if you know how to intentionally save, it’s going to make spending money more fun and drama free.
Because where the struggle generally comes in with spending money and being guilt free about it is the fact that we’re worried that we’re spending money that we shouldn’t be spending. But when you know that hey, I can intentionally save, I already have my spending plan, then you’re going to be able to be in a position where you can just spend money drama free and you’re not going to need to worry about, do I need to have guilt over this? Nobody actually asks themselves do they need to have guilt? But you go to bed feeling guilty because you don’t actually know where your numbers are and you don’t know where you have the ability to lean in to something that you really want to do and be able to spend money on guilt free.
And so being able to save money is like a skill that I want all of my clients to have. I want you to have and I want it to be a skill that you can replicate so you aren’t dependent on your circumstances for whether or not you’re able to save money. I was actually talking to a client recently and she has taken a nine-month career break and she’s like, yeah, Keina even though I’m like, I took this nine-month career break, she’s like doing some tutoring with AmeriCorps. She’s like, because right now that’s all I can handle in terms of a job. And she’s like, even though I’m making less money than I was making when I was working with you, saving is still a priority. So it’s a skill that she has and she’s able to replicate it regardless of her circumstances. But for her to be able to have that skill, it’s supporting her in her life right now and whenever she transitions to wanting to work again, like whatever money she’s going to have saved, it’s going to be able to support her.
But also as she makes more money, it’ll be the thing that she thinks about all the time because she is an intentional saver. And when I think about intentionally saving, the reason this is also number two before anything else I want clients to be able to do, it’s because of the fact that I remember when I lived in St. Louis when I was teaching, my rent was $600 a month. It was gorgeous. It was beautiful, $600. And when I was transitioning from St. Louis to DC my rent was almost like $1,500 when I moved to DC so my rent almost tripled. But I remember one of the thoughts that I had was like, dang, like if something happens financially where I am without a paycheck, I can’t afford to pay $1,500 in rent and just like pull that out of my back pocket. And I know when I was comparing it to when I lived in St. Louis, I was like, if I live there and it’s $600, I was thinking about how I could get like a job at Panera, a job at McDonald’s, like something really quick where they would hire me and I felt like I would’ve been able to make $600 easily to be able to pay my rent and like stay afloat.
Whereas when I moved to DC I didn’t have that same level of confidence that if I picked up a really quick minimum wage job that I would be able to pay my rent. And so what became a priority for me was making sure that saving was a priority because I knew that if I needed, like I had savings, then it was also going to help me from going into debt because I would have money that I could dip into in order to be a bridge for whatever situation I was in. And that has played true time and time again that whenever I’ve prioritized savings, it’s made being able to make decisions easier in my life because I knew the fact that I had created a safety net for myself. And so saving money and being an intentional saver, it is honestly, it’s the secret weapon as well to support you from getting in and out of that debt cycle because you’ll actually have money for the things that you would normally put on a credit card and go into debt for.
And also when you’re an intentional saver, it’s going to create this level of safety and comfort because you’ll believe in your ability to be able to save. I have a client who came to me a couple of months ago and she had money saved and it happened. I asked her, I remember on our consult, how do you have the money in savings that you do have? And she attributed it to the fact that she had gone through a divorce and that some of it was from settlement and she’s like, yeah, I just don’t know that if I had to dip into my savings that I’d be able to replenish it. Despite her being a six figure earner. And so in the last couple of weeks of working together, it’s like we have built intentionality around her being an intentional saver.
And so just being able to create that level of comfort and that level of safety for her that if for some reason you had to go into your savings, which the reason we have savings is because we’re planning for something, is that you can feel confident about being able to rebuild your savings. I don’t want you to have a savings and not feel confident that you can dip into it. And so I love to give my clients the confidence that they could magically save $10,000 at any point in time. And so that’s the second step for being able to build wealth. The third step in the process of building wealth is to be able to pay down your debt. And generally, I use this word paying down debt instead of paying off debt intentionally. Yes I want you to pay it off, but I also want you to know how to pay it down.
And I am saying pay down debt is because we pay it down before we actually pay it off. And I want you to know the progress that’s there when you’re able to actually pay down debt because being able to pay down debt is also going to be able to support you in being able to pay off your debt.
But when I’m working with clients and after we’ve made sure that they can intentionally save and that we have the spending plan in place, that’s when we actually start to look at the debt because knowing they can intentionally save, like I said, that’s my secret weapon for helping clients to stay out of the in and out of debt cycle because what I’ve noticed with my clients, especially when it comes to paying down debt, is that generally speaking, they are really in a rush to pay their debt off because they have a lot of thoughts about being in debt. They think debt is bad and honestly guys, debt is neutral. I love to spin it and be like, okay, what has being in debt, what has that afforded you? And to just like be able to release some of that shame that people have.
But when you’re able to know that you can pay down your debt, what is going to happen is that it’s going to help you stop paying off your debt in a lump sum and then in a few weeks or in a few months, you just find yourself right back in debt, you can probably relate to that or you put large sums of money towards debt, but then you notice your debt is not going down or maybe you put large sums of money towards your debt and then you find yourself actually needing the money, that’s why paying down debt is not the first step in my five steps of building wealth. Because when you actually have a spending plan and you’re able to look at the ways in which you want to spend money, we can then make sure that you’re an intentional saver and then we can focus on paying down debt because what’s going to happen is that you are going to start building your financial confidence along the way and you’re going to be able to create a plan that allows you to pay off your debt and have the relief that okay, I don’t need to be so stressed about this.
And this is simply just from like being able to create a plan, but it will also just keep you from feeling like you need to rush to pay off the debt because when you’re rushing to pay off the debt, you’re rushing from some type of feeling, you think it’s holding you back from something. And so when we’ve taken the time to actually create the spending plan and get really clear about how you want to spend money, then we know exactly how much we want to use of your overall monthly budget or not your monthly budget but your monthly income in order to put towards debt. And so you’re able to create a level of consistency there. I did this exact thing with a client earlier this year who, she came to me and she’s like paying $1,800 a month, sometimes $2,000 a month towards debt and her debt is not going anywhere. It’s like stagnant.
And so I was like, hey, we’re just going to pay the minimums. We’re not doing all these these lavish plans that you have. Let’s just focus on the minimums and let’s get in your spending plan. Let’s make sure that you’re able to, really just think about how do you want to be able to spend money. And so then when we got to her debt payoff plan, we were able to say, I think it was like a thousand dollars a month she ended up putting towards her debt. But she was able to consistently just focus on a thousand dollars, which then gave her space to be able to focus on the other things that she wanted to be able to do with her money. It gave her space to focus on where she wanted to be financially a year from now, two years from now, but really being able to dream and not being so wound up in her debt. And yeah, if you ever work with me, I will not focus on paying off your debt.
You’ll notice that’s not the first thing that we do. Only because when I’m focused on helping you build wealth, I want you to have a spending plan first, and I want you to be an intentional saver, then I want to focus on helping you pay down your debt so you get to a place where you can pay off your debt. And I think that way of thinking really has supported my clients and just being able to also just build their overall confidence that like, okay, I can be someone who isn’t turning to my credit card every single time that something goes wrong and I’m going to ask myself different questions about how I can take care of an unexpected financial situation because of the fact that I do have a plan and I am intentionally saving. So it just makes debt less triggering to their overall like emotional system because of the fact that debt has a home and it has a place.
So step number four is that I want you to earn more money. And once again, I’m doing it in this order. You are like Keina, yeah, but you are, listen to this, you already earning more money and it’s not actually helping you. And some of y’all need to earn more money because you actually don’t know that you could be making more money but that’s a different topic. But the fourth step to building wealth is to earn more. And so that might be looking at it through the lens of your business. It could be looking at it through the lens of the job that you currently have, whatever that looks like. But I want to support you in earning more money because as you earn more money, you are going to also be able to accelerate the type of wealth that you desire to build.
And when I’m helping my clients earn more money, we’re not just doing it from the lens of, hey, I want you to make more money. That sounds good. We’re actually doing it from the lens of like where they want to be in terms of the lifestyle they want to live in five years, the lifestyle they want to live in three years. And so we’re being very intentional about how much more money they want to make. We’re not just earning another thousand dollars, another $3,000. No, we’re talking about, you said you wanted to be able to buy a home in three years. Okay. You also said you wanted to be able to fully contribute to your retirement. Okay? You also said you were thinking about having babies. Like we’re going through all of these conversations as we’re working together.
And what happens is we’re able to actually codify like how much more money they would want to make. And what I always love to see in this being the fourth step is that some of the people who were afraid to ask for money are like, oh no, no, no, I know exactly why I need to earn another 30 or $40,000 or why I’m going into this performance review asking for more money because their money starts to have purpose. Their money is no longer just attached to the fact that I feel like I’m being greedy or am I not worthy of that money. No, their money is really attached to a purpose in their life because of the fact that we have a spending plan that is aligned to their values. They’ve thought about, how they want to be able to spend money drama free and how they see themselves when we think about like what’s their wealthy life, what’s wealth look like for them right now.
And so we’re able to go in and really think about what would it look like for them to earn more. And so it may be, like I said, it may be negotiating, especially if you are someone who’s in corporate or for my business clients it’s really thinking about what does that mean that you’re charging for your services and how many clients are you taking on? And so we’re able to kind of break down what their numbers look like in their business and be more clear with that. And then the last and final step is investing. And so investing, it can be a large bucket here. A lot of clients that come to me, they’re already investing and when I say they’re already investing, they are investing in their 401K, they’re investing in a 403B, or maybe they have some stocks on the side or maybe they even have an investment property.
But when I’m talking about investing, I want you to really be able to think about where and how do you want to see your money grow over time. And so, for some people it can look like being able to think about home ownership. It can be about looking into, I have a client who worked with me several years ago and she just bought her first investment property in the last couple of years. And so it was because she had all of these steps, she has a spending plan, she saved over $10,000. She got out of debt, she started earning more money and she actually has a part-time job. And then she’s part-time in her business. And she was able to not only focus on increasing her retirement contributions, but then she’s also been able to circle back around and focus on an investment property, which was like something she never thought she would see herself doing.
And so these are my five steps to wealth building. And the thing that I love about them is when you are thinking about where you are as you’re building wealth, you can look and see like, okay, what do I already have at play for myself? Where am I right now? You can take stock of where you are and you can ask yourself what do I want to work on in 2024? What do I want my area of focus to be? And if you already have all five steps, you can also go back through and you can just continue to rinse and repeat. I love going back to my spending plan. I go back definitely at the end of the year, kind of really thinking about the new year, but I’ll evaluate my spending plan, even every quarter to kind of think about what and how do I want to be able to spend money.
I can think about it in my business, I can think about it in my personal life and even being able to come back to intentionally saving and being an intentional saver. It’s like, can I be doing more in this area? What does that look like? I can come back and look at debt and make sure that I am in alignment with whatever my goals are there and even coming back to earning more money. It’s just like rinse and repeat, rinse and repeat. And what happens is that in your life you get to experience compound results. You run through this cycle once and then when you run through it again, you’re going to be in a completely different place and have new sets of goals and you’re going to have new income and so you’re going to recalibrate for where you want to be moving forward.
So I just want to introduce you to these five steps because you’ll probably hear me talking a lot more and I want to intentionally share a little bit more about how these five steps play out in my own life. And yes, I am believing that this is the year that you really are able to start spending money drama free. I want you to be the type of spender that you desire to be. And I want you to be able to spend money on the things that you love. And I want you to feel like, you know what? I have something to show for my money. I’m not on this hamster wheel and this is the best year ever because in 2025 y’all, we don’t want the same intentions for what we need to be doing with our money. They need to shift. We cannot have create a budget on our list of goals for 2025.
And so if prioritizing your finances is something that you want to do in 2024, today is your day to apply to work with me. You don’t get tomorrow, you don’t get the next day, today is your day. So if you go to the link in my show notes, you can find the link to apply to work with me in my five-month coaching partnership or you can go to my website, Wealthovernow.com/appointment and you will see my calendar there. But we’ll have an hour just to be able to talk about what are the challenges that you experience with your finances, where do you want desire to be. And I will lay out a three-step plan and we’ll work together to create whatever desires you have for yourself financially, especially in 2024. So I’m serious, don’t listen to another episode, don’t do anything else until you’ve actually applied to work with me. Yes, actually. Alright, thank you so much for tuning in and once again, Happy New Year and I will chat with you later.
Outro: Thank you so much for listening to Money Files. If you’re ready to take the next step to reach your financial goals, head to www.wealthovernow.com/appointment and let’s get started.
