EPISODE #7: Solve for Freedom (Part 1 – Finances)

“Hello, and welcome to the Accelerate Your Legacy podcast, where we talk all things, money and money mindset. My name is Laura Sexton. I am a trusted financial coach and money mindset specialist. My goal with this podcast is to encourage and inspire you. As you set out on a financial journey that eliminates stress and amplifies freedom. Today’s the day you stop paying for your past and start saving for your future. If you’re looking for more peace in your finances and margin in your budget you’ve come to the right place Hello, and welcome to part one of this three part series solving for freedom. Today, we’re going to talk about solving for freedom in your finances. This one’s actually pretty simple to be free in your finances, you should be debt-free. And then you should stay debt free. This is easy to say and harder to do. Unless you have a plan. And I have a plan. So first. We need to know why you want to be debt-free. I’m just going to talk about me here, but I’m going to assume a lot of you feel this way because I hear it a lot from you. For me, I want to be debt free because I believe the borrower is slave to the lender. This is a biblical proverb, the book of Proverbs, Chapter 22 verse seven. Says the rich rule over the poor and the borrower is slave to the lender. You may have heard Dave Ramsey say this a lot. I know I say it all the time because I resonate with it. The rich rule over the poor. And the borrower is slave to the lender. Which one do you want to be? Do you want to be the rich one that’s ruling over or do you want to be the one that has to do what somebody else says? I don’t want to be a slave. I don’t want to be a slave to anything, not to Toyota Motor Company, not to an addiction, not to anything. I want to be free. That’s why we’re having this conversation today. We’re having this conversation about how to be free in your finances, because we don’t want to be the slave to the lender. When somebody like Toyota Motor Company demands payment, you must comply or you have to suffer the consequences. What are the consequences? You don’t make your payments, they come and take the car. But when you own your own vehicle, No one can come and take it from you. There has been detailed research, 100% of foreclosures in America happened on a home with a mortgage. And I’m going to let that resonate with you for a second. What am I saying? I am saying that you can’t repossess a home if it’s already paid for. If I don’t owe anything, there’s no lien on my home, there’s no lien on the title, you can’t come and take it from me. What is rightfully mine, I paid for it, I own it, there is freedom in that. To know that no matter what my home is completely paid for. I get to sleep in it tonight. There is no risk factor here. The anxiety in my body is calmed considerably. Because I own it. And I know that there is a safe place for me to lay my head tonight. Let’s talk about another way that you can be a slave to your lender. Every time you make an interest payment, that’s a penalty. You’re being penalized for the choices that you’ve made in the past. So what you’re doing by taking on that penalty. You’re making Wells Fargo rich. You’re making Bank of America wealthy. You’re putting money in the pockets of the people that work at Chase bank. I dislike all of these places, by the way, in case you can’t hear the disdain in my voice, Wells Fargo, Bank of America, Chase. They’re all awful. You want to be putting that interest money in your own pocket. That’s where the freedom comes from. You get to make 100% of your financial choices. We get to decide. We get to decide what we want to do with our careers. We get to decide what legacy we want to leave. We get to decide how generous we want to be. We get to decide. We get to decide because we are in charge of our money. We master our money. This is why I call my coaching program The Money Mastery Program. I want you to be in charge 100%. You tell your money. Where to go. Later in this series, we’re going to talk about solving for freedom in our careers. We’re going to talk about solving for freedoms in our lives. But for today, solving for financial freedom, let’s talk about what the plan is. We talked about becoming debt free and then staying debt free. So what does that look like? Well, the plan that I like to use is the one that’s gotten millions of people out of debt, including me. And that’s Dave Ramsey’s seven baby steps. I’ve talked about it before. Absolutely love it. But for today, let’s start by talking about why these steps are so very important. If you haven’t listened back to my story, I’ll tell it to you briefly. My husband and I paid off $372,347 in debt. When I tell you that this system works, it really works. And I’m going to explain to you why the plan works. Let’s go back to baby step zero. Baby-step zero is knowing your why. Baby step zero was making sure that you were caught up on all of your payments. And baby step zero is making sure that all of your four walls are covered. Your four walls are first your food, because you should always make sure that you have eaten. Then your utilities, so you stay warm. Then your rent, so you have a place to live. And then your transportation, so you can get to, and from work. That’s baby step zero. Baby step one is having a starter emergency fund. All right. What does that mean? It means that you’re going to put a thousand dollars aside into a savings account. Is a thousand dollars enough? No. But it’s not meant to be enough of an emergency fund. That thousand dollars is simply a buffer between you and life. It’s a buffer between you and something bad happens. And usually when you decide that you’re going to change your life, the universe is going to come in and test you and see if you were really ready to change your life. When it comes to your money, something crazy is going to happen. A tire is going to blow in your car and you’re going to have to replace it. The hot water heater is going to go out. I had one couple that their dog got sick and they had to have emergency surgery at the very beginning of their new money journey. So, whatever it is, something is going to come up. And you have to decide, are you really going to do this? Are you really going to solve for freedom in your finances? Are you ready to be free? Yes, you’re really going to be free and you can go back to last week when I talked about my, why. Digging into your why, figuring out why it is you want to be free and that’s, what’s going to keep you going when the times get tough. When the tough times come, it is important to have a buffer between you and life. So that we don’t go backwards. We don’t put more money on a credit card. Having that thousand dollars in a starter emergency fund keeps you from saying, well, I have to take care of this thing. So I’m going to put it on my credit card. It’s a week in and I’ve already fallen off the wagon. I quit. This is just an extra seatbelt that we’re going to put on so that you can not fall off the wagon. Okay. So step one, have a starter emergency fund of $1,000. Step two. And this is my favorite baby step. Baby step two is paying off all of your debts using the debt snowball method. There are plenty of different ways that you can pay off debt. But the debt snowball method has the highest rate of success of any of the methods out there. There has been a study recently from Northwestern University, where they came out and said the debt snowball actually has a higher rate of retention. And that’s what we’re after, because this is not about the math. We’ve talked about this before. It’s not about the math. It is about your habits. It’s not the dollars and cents, but it’s the momentum that you need to keep going. And that’s why the debt snowball method works so incredibly well. You pay off one small credit card and then you pay off another small credit card and then you pay off a small student loan balance, and then you pay off the car and then you pay off a larger student loan, and then you pay off the larger credit card and then you pay off the consolidation loan, and then you’ve got the other student loan and the other student loan. You start snowballing. It starts to feel really, really good. And you’re going to turn it into a game and you’re going to see how much faster you can get it done. So the way this works, just to reiterate, is that you list all of your debts smallest to largest, regardless of the interest rate. So, what I want you to do is I want you to take math out of the equation just for a few minutes and look at your heart. If your heart is telling you that this is a smart method, I want you to do it. I 100% want you to do whatever is going to help you get there. And if having those higher interest rate things later on in the snowball causes you to get a little angry, because you’re losing money, I want you to let that anger propel you forward. But I also want to tell you that in the grand scheme of things, That interest rate is not really going to matter. Because if you’re doing this program, if you’re working with me as a coach, You’re going to have everything paid off in 18 to 24 months. That’s the statistical average. It took me 36 months to pay off my giant number but that is also higher than the average amount of debt that we see come in. That 26% interest rate is going to feel like it’s doing something to you. And if that makes you angry. Good. I am glad that you’re angry. I want you to go out and I want you to attack your debt and I want you to be done with it. Because. Once you’re done, you will never be penalized again for your past. Not financially anyway. So this is baby step two, where we’re paying off all of our debts from smallest to largest, regardless of interest rate. But here is the kicker. Once you’re done paying off your debts. I don’t want you to ever go back. I know plenty of people, some of them financial coaches who think that it’s okay to be debt-free and say, I’ve been following the system, I’ve been doing it for awhile and you know what? I am now smarter than the system. This system is so archaic. This is grandma’s way of handling money. I am so much smarter than grandma. I am sophisticated now. I can play with other people’s money. I can put it in the algorithm. It’s all going to be fun. They start playing the credit card game again because they think that they are smarter than it now. They can handle it now. And they fall right back into the shackles. They go right back into the slavery of owing someone else money. The anxiety that is inside your body when you owe someone else, this is a chemical response that your body has with anxiety, alarm bells going off all the time. When, you know, you owe someone money. Anxiety rings, alarm bells all the time. You can’t sleep peacefully with anxiety, alarm bells going off in your brain. Why would you want to go back to that? Why would we go back to anxiety and shackles when we could just have peace? I don’t want you to go back. I want you to get free and then stay free. The other thing that these people have gone backwards is they also have a lack of margin in their budget. Where they used to have multiple choices if something were to come up now they have to use their emergency fund because they don’t have the margin they had before. They don’t have as much wiggle room to move things around. They also don’t have the same rate of savings. They used to be saving 15, 20, 30% of their income for future wonderful things. They want to go on vacations. They wanted to buy new homes. They wanted to upgrade their cars, whatever it was that they were wanting to do. They wanted to save for their kids’ college. They wanted to save for retirement, but their rate of saving decreased dramatically. Because now they’re paying for their credit cards. Paying for your past means robbing from your future. I don’t want you to do that anymore. I want you to be completely free. Baby step three is a fully funded emergency fund. This fully funded emergency fund keeps us free. Keeps us from ever having to go backwards. Like I said, $1,000 is not enough to cover everything we have going on. But we’re going to have three to six months of expenses set aside so that when life happens, we can have things covered. I’ve told you guys this story before, but when my son went into the hospital, I didn’t have to worry about paying the medical bill, because I already had it covered. I can tell you also, there’ve been times when I’ve blown a tire and I need to get it replaced. And they said, well, your other ones are really bare and we need to rotate them. And I think you’re just be smart if you would go ahead and just get four new tires. That’s not cheap. It is not cheap to have to get four new tires. But I didn’t have to stress about it. I didn’t have to be overwrought and anxious and worried. It just was what it was. And what it was was fine. So I want to encourage you. That when you get out of debt, you set up systems and processes so that you never go back into debt. Later in this series, we’re going to talk about what life looks like when we move past these starter steps in, into the aftereffects of freedom. But we have to start by getting free. We have to break the chains. And if you want to start a legacy of wealth and abundance, a legacy of freedom and ample choices for yourself and for the community around you. If you want to start that. It starts today. It starts with you deciding for yourself. Whether or not, you want to be in debt again. I’m willing to submit myself to a process that somebody else has already created. And if you were looking for help and accountability and getting this process started. You’re more than welcome to reach out I’m 100% here for you. And I want to be here to champion you along. As you move through these baby steps. Alright Accelerators. I will see you next week when we talk about what it looks like to solve for freedom in your career. Thank you for spending some of your most precious resource your time. Working on yourself today. But don’t just listen to the show. Implement something you heard. If you found a piece of today’s show, valuable chances are you have a friend who will too. So please share this with them. And if you feel led, please rate and review the podcast to help spread the word. Remember the legacy you leave is not just dollars and cents and a bank account, but the tools, habits, mindset, and reputation you leave behind. If you have questions or need encouragement, send me a DM on Instagram at accelerate your legacy. Or check out the resources listed in the show notes. I’ll be back next week. Bye. For now.“