Think you’ve got extra money because daycare is over or your car is paid off? You don’t. Not until you’ve stopped doing fake math.
In this episode, I unpack one of the sneakiest money traps high earners fall into: the illusion of “extra” money. You feel like you should have more to show, after all, your expenses went down or your income went up. So why isn’t your bank account reflecting that?
Because fake math is running the show.
I’ll walk you through my A.S.S. Method—Acknowledge, Save, Shift—the same process I use with clients to prevent lifestyle creep, stop overspending, and finally make real progress.
If you’re tired of wondering where your “extra” money went, this episode will help you put every dollar to work so you can see the extra money.
Listen to learn how to leverage the Acknowledge, Save, Shift method to ditch mental math and start budgeting with real numbers…
- [01:11] Mental math is fake math
- [06:08] Learn the Acknowledge, Save, Shift method
- [06:39] Acknowledge what has changed in your money flow
- [07:56] Save with intention
- [12:10] Shift your money to meet your new financial goals
Tune into this episode of Money Files to discover how to implement the Acknowledge, Save, Shift method into your money system.
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 hearing about the Acknowledge, Save, Shift Method, check out my episode, How Saving Money Helped Krissy Spend On Things That Mattered!
Transcript for “The A.S.S. Method: How to Actually See Your Extra Money”
Intro: Hi and welcome to Money Files. I’m Keina Newell from Wealth Over Now. I work everyday 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 something I see all the time with clients and honestly something you might be doing without even realizing it. And it’s when you tell yourself, I have extra money now and it feels true, I just want to normalize that I say it, you say it, we all say it. You paid off a credit card, you got a raise, or maybe you got a bonus, your kid started school and you’re no longer paying for daycare. You paused a therapy or you stopped paying a nanny. So in your mind you think that means I’ve got extra money to play with. But here’s the truth, you don’t actually have extra money. You have things in your life that have shifted and that money hasn’t been reassigned. And that’s where most people go straight into mental math, which is fake math.
So I need you to repeat after me. My mental math is fake math. I’m going to say it one more time. Your mental math is fake math and that is the very thing that is getting you into trouble and why you don’t feel like you have anything to show for the changes in your financial circumstances because maybe you have gotten rid of a big payment in your life or you reduced your expenses in some type of way, but when you haven’t acknowledged that you’re doing mental math, which is the equivalent of fake math, it’s why you don’t have anything to show for it. So just to give you a client example, I am coaching a couple right now and they had a nanny for their son and when he started daycare they stopped paying for the nanny. And so ever since then they’ve been telling themselves that they have the nanny money.
And I have to gently remind them, no, you don’t have the nanny money. And what’s happening when they’re telling themselves we have like the nanny money is, they’re spending the nanny money in their heads three or four different times and it never actually goes to live anywhere. They’re just telling themselves, okay, oh we have like that. Since we’re not paying the nanny, we have that money. And they’re telling themselves, oh, we can use that money for the birthday trip or we can use that money for the birthday party. Oh, we can use that money to fix something on their house. And you know that I don’t like dollars that are getting overworked. Their dollars are getting overworked because they’re doing this mental math. And so that money keeps getting assigned and reassigned in their minds, but it’s not actually showing up in a real way in their system.
It’s actually just causing them to overspend because they’re doing fake math. So what I do as the coach is I redirect and we’re looking at, hey, let’s actually go back to the plan and let’s talk about what happened with the nanny money. And let me just normalize that this is a very real thing that we do, especially as we’re building financial habits and we are changing how we think about our spending because they’ve been doing this for so long. Whether it’s like, oh, we paid off the car, since we paid off the car, we have extra money. But that extra $500 is really turns into $1,500 because you think you have $500 to spend on trips, you think you’ve got $500 on getting something fixed in the house. And so it just becomes over allocated money.
And so with coaching, like I said, we’re going back to the plan that we’ve actually created and we’re saying like, let’s actually look at that money that you were using for the nanny and let’s look at how we actually reassigned it. So for them, part of that money was actually going towards savings goals for home repair, just real life stuff, home repair, birthday parties, looking at gifts for them, creating a family fund for them. So things that we had actually acknowledged in one of our very first sessions that they wanted to make sure that they had money for. Part of it also went to making sure that they both have a personal allowance where they can spend money and then part of it also just gave them some breathing room in setting up like their three money bucket system.
And so that’s what I want for you too, is that I want real math to be showing up for you and I want real math to show you where your money is going before that extra money you have just goes to something random like Chipotle, it goes to Costco, it goes to Amazon orders coming to your door. And just to let you know that this is a very normal conversation. If you listen to my podcast with my client Christie, she talks about this and she said that was one of the reasons she came to me was because she was paying thousands of dollars for daycare and she didn’t know where the money went when she stopped paying for daycare. She’s like, where is this money going? Basically like I should be rolling in dough and I’m not rolling in dough when I was spending four figures on daycare every single month and I don’t have that expense anymore, where is it going?
So she came to coaching feeling like she should have more to show from the extra money from daycare, but it was just disappearing. And that’s exactly why I teach the acknowledge, save shift method. And you could call it the ASS method, so don’t let your money, make an ass out of you. But it’s how we are going to stop the vortex when you are like, oh my goodness, my money just feels like it’s being drained from my account. It’s how you’re going to actually build financial peace and is actually how you’re going to create visible progress that you are going to see in your bank accounts. So let me just walk you through the three parts so you can start implementing it.
So step number one is acknowledge. It’s what’s changed in your money flow. So I would suggest you do this with paper and pencil. Don’t just think about it. I think it’s a really great exercise to take into a money date, but what’s changed? Did you get a bonus or a raise? Did you pay something off? Did you pause something or cancel a major expense? Did you reduce a major expense? This step one is really about naming the shift of what’s happened in your finances. Most people skip this part and they just feel the freedom to start spending from the feeling that they have extra money. But if you can pause and say, okay, I freed up $300 a month by paying off this credit card, then you are actually building an actual real math foundation to make some real decisions for yourself.
So on your next money date, if this is you, I want you to ask yourself, what shifted? How much did I free up? And where is it showing up? I’m going to read those three questions again. What shifted? How much did I free up and where is it showing up? Step number two is to save with intention. So once you’ve acknowledged the change in your account, then you can ask yourself, okay, what in my life feels underfunded right now? And when I talk about underfunded, it could be a lot of different categories. Maybe you’ve noticed, I’m spending more on my groceries because things are just getting to be more expensive or it’s warmer outside so I feel like I’m eating out more.
Maybe you feel like your personal allowance doesn’t actually reflect your lifestyle, or maybe you set some goals this year for your vacation savings or your emergency fund, or you have a goal of buying a home, whatever that looks like. But like what in your life feels underfunded and you want to see change in the next six months? Or you just want to give yourself more permission to spend in a particular area of your life because you’ve been watching your patterns and you’re getting comfortable being real with yourself and honest with yourself about how you actually spend money. And so that’s where we are going to make the decision about how you want to spend the extra money.
So sometimes I’ll have my clients use like a 50, 30, 20 split when we go into this, they might decide to put 50% towards savings. Maybe they put 30% towards like some future bills or some debt that they have that they’re going to start accelerating and pay off and like put 20% towards fun. This really gives a nice balance to be like I’m being an adult and I’m actually saving and I’m making sure like if you are someone who’s still paying off debt, like I’m making sure that I’m still accelerating my debt and I’m also not depriving myself and I’m giving myself a little bit of extra money to have some wiggle room. So the 50, 30, 20 split can be really useful. You can change how you want to do that. Maybe you want to put 50% towards your debt, you want to put 30% towards increasing some of your savings goals and you’re going to do 20% for fun.
But the goal is that I always want my clients to, as they free up money, make sure that they’re paying attention to their future self. Really building this concept of wealth over now and doing things that they can automate. Like if you can automate your saving, it can just be something that you can set and forget, especially as you continue to earn more money. But this helps, this 50, 30, 20 split can really help with that all or nothing mentality because budgeting isn’t a punishment. It’s about really creating this both and lifestyle for yourself and being able to say yes to the things that you want to say yes to. So in your money date, the questions that you can ask yourself are, where did I say I wanted to be financially by now? What matters to me in this season of life?
What do I want to take a back seat on in terms of where I am right now? And listen, you are having this conversation with yourself. There’s no judgment here, there’s no room for shame here. You can say like, listen, it’s warm outside and I really want to be able to spend more money, but come September I’m going to go back to accelerating my goals. If you’re listening to my podcast about when you should be able to take a debt payoff pause like you might be building in that philosophy here. And so it’s about creating a plan that is going to help you make sustainable progress, not practice. And so be honest with yourself, not judgey with yourself. And as long as you’re having these conversations often, then you are going to be able to assess like when you’re like, Hey Keina, you just out there wilding out and you need to go sit down somewhere, versus like, no Keina, this is okay because you’ve actually built this into your plan and this feels good.
So step three is about the shift and this is where you’re going to actually move the money. So you’re going to update whatever routine you have on payday. If you are a client of mine, you’re going to update your three money bucket system and you know how much is going towards bills, how much would be going to savings, how much would be going to spending, you can change your transfers and like physically make sure that you are doing something different with your paycheck. Because without the shift you’re still just going to be in this space where you’re like, oh yeah, yeah, this is what I was thinking about doing, but I’m just going to wait one more paycheck. Or just give me a little time. And if we want to see change, we don’t want to just be waiting, I want to actually make sure that we’re actually taking action.
So something else that I see when I’m thinking about people as they free up money, in particular, the way that I mainly see it when people are talking about extra money is when people get promotions, when people get raises, or if you have the opportunity to earn commission at your job. What I see is lifestyle creep. And immediately the brain starts to tell you what you can do with the money. You start talking to yourself about how you can get a new car. You start talking to yourself about how you can get a new apartment. You can start talking to yourself about how you want to upgrade your life, like now you;re going to go get massages every week. And I absolutely love these dreams. I don’t know if you know this about me. I really actually do like to spend money. I’m a more experienced girl than I am like a material girl.
But you need to ask yourself this question, what does it actually look like on paper? How much is actually landing in my account? And when I say it, I mean the raise, I mean the promotion. Wait until you actually get your net paycheck and let’s actually see what is the actual difference, because yes, you could have gotten a $10,000 raise, but honey, that doesn’t mean you get an extra $10,000 a month. But sometimes you make decisions as though you’re getting an extra $10,000 a month. And that’s what puts you in a space where you end up in this lifestyle creep and you’ve given yourself permission to spend before you actually went through and did the acknowledged save shift method. You are going to have more peace of mind and you are going to feel safer if you can pause until you get a net paycheck or two and then walk yourself through the acknowledge save and shift method so you can actually feel the impact of your income increase and not just show up differently because you got a little extra change in your pocket because you don’t want to be going back to the days in your twenties where you felt really broke because you let lifestyle creep get you.
So let’s just wrap this up for today and recap what we talked about here. You don’t have extra money unless your system shows you exactly where it went. So your next steps are to acknowledge the change. Number two, I want you to save with intention. Number three, shift the money into your plan, make the actual shifts. And if you do that, you’re going to be able to look back month after month and be able to see your progress. And you’re going to feel so good about where your money is going. You’re going to actually feel the surplus. You’re going to see your account increasing, you’re going to be outside even more and not feel guilty about it. And you’re going to be able to trust yourself to make financial decisions. So if you’re listening to this and you’re thinking, Keina, you stay up in my business and I don’t know how you’re and my bank account, how you’re in my house, I don’t know what’s going on, but I would invite you to apply to work with me in my five month coaching partnership because this is the kind of work we get to do together every single time you get paid, whether you’re paying off debt or you are increasing your income, or maybe you’re just in a lifestyle shift, you’re like Keina, I am getting ready to get a really big raise.
I actually have no debt. I have the money saved, but I just want to make sure it’s going to the right places. Like you are still a really good fit for coaching because we want to make sure that you don’t procrastinate on the things that you know you should be doing, like working with a coach is going to give you that accountability and support. It’s going to give any one of my clients accountability and support. So you’ll learn in real time with me how to reassign your money. We’ll be having money dates together and you’re going to get comfortable with looking at your finances. You’re going to be excited about looking at your numbers because you are going to know every time I look at my numbers, like I’m seeing my numbers grow. Every time I look at my numbers, I feel safe. And that’s what I want for you. So if that’s you, you can go to wealthovernow.com and apply to work with me or go to my show notes and apply to work with me. And until next time, have a great week and I’ll talk to you later. Bye.
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.
