Worry-Free Money

The guilt-free approach to managing your money and your life

Shannon Lee Simmons

• Publisher: Collins
• Year: 2017
• ISBN:
  9781443454469
• Topic: Personal Development
• Subtopic: Personal Finance

NATIONAL BESTSELLER

"A fresh way to think about your money." David Chilton, author of The Wealthy Barber

Stop budgeting. Start living.

Managing your money can be frustrating and confusing. Life is expensive. Whether you make $30, 000 or $130, 000 a year, it can feel like you're constantly broke. Can you afford that new car, that vacation, that night out? You think so, but it feels impossible to know. And rigid budgets that force you to spend your money in unrealistic ways (like $9.50 per week for pants) don't make things any clearer.

But what if there was a new way to manage your money? One that left you certain you had your bases covered—both for your monthly bills and your future retirement—and then let you enjoy your money by spending it. (Yes, really.)

Enter Shannon Lee Simmons, a fresh voice in the world of personal finance, one who understands the new and very real pressures to survive modern life and keep up in the age of social media. Shannon doesn't lecture, judge or patronize. The founder of the wildly popular New School of Finance, Shannon recognized that most of her thousands of financial planning clients felt broke, no matter what their income. And feeling broke can be as bad as actually being broke, because it leads to overspending and misery. So she came up with a new plan: Worry-Free Money.

Worry-Free Money takes a fresh approach to finances, looking at the root cause of the pressure to spend and showing why traditional budgets don't work. It is a deeply practical book that will help you break the cycle of guilt, understand why you overspend, banish unhappy spending from your life, learn to recognize your f*ck it moments and find hope—and fun—in getting your money under control.

Part One

Stop Feeling Broke

Living a life of financial frustration leads to bad financial outcomes. I’ve seen it again and again. Money fear, scarcity mindset, worry, feeling broke—whatever you want to call it. If you constantly feel as if you can’t live the life you want to live without sacrificing your long-term financial security, you’ll be financially frustrated. And eventually you’ll give up on trying to be financially responsible because . . . what’s the point?

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“When our debt hit $5,000 on the line of credit, I felt something let go. It was like, fine, what’s another $400?”

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It’s hard to stay motivated about your financial plans when you feel broke. That’s the real trouble. Eventually you develop a tolerance to feeling bad about your finances. It doesn’t mean you like it; it just means that you’re resigned to the fact that you have given up or are giving up more often. It’s the reason why you abandon financial plans, stop checking credit card statements and constantly dip into savings accounts, all the while hoping every time it rains that the basement won’t flood. In some ways it’s just easier. And sometimes it leads to actually being broke.

When you constantly feel as if you can’t afford the life you want or thought you would be able to live, there can be a subtle but destructive shift in your approach to spending. Instead of stressing the details, you shrug and think, Why bother? Spend now and worry about it later. Before you know it you’ve overspent and under-saved and your financial goals keep getting pushed farther and farther out to make room for your short-term needs.

The good news is that once you understand why you keep falling off the financially awesome wagon and recognize the reasons why you want to overspend, you won’t be tempted to shrug off financially responsible decisions. You’ll give up less often, or maybe not at all. You’ll be motivated and confident about the future. And when you start putting some rainy-day money aside, you’ll understand that it isn’t “doing nothing.” It’s letting you sleep at night.

This is how you usher in a new era of money happiness, of Worry-Free Money. An era that will last because you won’t want to give up before you even begin.

CHAPTER 1

Feeling Broke Leads to Being Broke

Modern life sets up a horrific financial trap, blending an overwhelming pressure for you to overspend with a crippling fear for the future when you do. In other words, you feel afraid when you spend money and guilty when you don’t. Now throw in a bunch of daily headlines—“Debt Is Bad”; “Housing Prices Rise Again”; “Not Enough for Retirement”—and you’ve got a frustrating cycle of guilt and fear. You feel broke all the time. It’s no wonder you’re worried about money.

But if you’re like most people, your financial worry and financial decisions don’t always align. Like the mom in tears who feels so strapped because she has once again dipped into her emergency savings, this time to drop $300 on her niece’s wedding gift. “We should be able to give Nessa a gift for her wedding, no?” Or the professional who doesn’t have enough money for next month’s rent but still lays down a credit card for new work clothes. Both of these people are worried about their finances, yet they overspend, and their spending decisions make them feel out of control with their finances and frustrated.

Imagine this: You are terrified of having mice in your house but you still leave crumbs all over the floor. Then you’re up half the night, worried that you’re hearing mice, because you know the crumbs are on the floor. You know you should have cleaned up the crumbs so you could sleep soundly, but you didn’t. Your actions directly created more anxiety. It’s the same with your finances.

If you find yourself in a cycle of worrying about money but still overspending or under-saving, it’s not because you are bad with money or lacking in willpower. There’s something else at play here, something bigger than grit or financial literacy. I believe that we, as a collective whole, are slowly giving up on our finances—day by day, swipe by swipe, crumb by crumb. And every one of those crumbs is a F*ck-It Moment.

The F*ck-It Moment

The F*ck-It Moment is when you feel as if there’s no point in trying to be financially responsible and you end up overspending, even though you’re worried about your financial future.

Like when you’re working hard and following the rules but feel that you will never be able to afford the life you want. I can never actually afford a vacation, but I need one. F*ck it, life is too short. Swipe!

Or when you’re in the middle of a home reno and you reach the point where all you can think is “in for a penny, in for a pound.” We’ve already spent $10,000. What’s another $1,000? F*ck it. Swipe!

Sure, I know that cooking what’s in the fridge versus ordering pizza is the better financial decision. But I’m tired and I had a terrible day. F*ck it. I’ll worry about it later. Swipe!

Typically, when you think of people who overspend, images of a mall-obsessed ditz binge-spending on expensive purses and fancy cocktails comes to mind. “But that’s not me,” you may say. “I don’t live extravagantly.”

That’s probably true, but from a financial perspective, overspending doesn’t mean extravagance. It simply means you’re not saving enough overall. Maybe you don’t have debt, maybe you’re already saving, but that doesn’t mean you’re not overspending or worried about money. In order to survive financially and sleep at night, you need to ensure that you are saving enough to reach your financial goals, such as paying down debt (if you have it), preparing for emergencies (because you will have them), saving for big lifestyle goals (a house, school, a new business) and securing retirement. That’s a tall order. It doesn’t matter if you forgo fancy cocktails and expensive taxi rides. If you’re not covering your financial butt, you’re overspending. And F*ck-It Moments are a big part of the problem.

The solution is to stop spending and start saving. Easy-peasy, right? Wrong. If it were that easy to stop spending and save money, everyone would be doing it and no one would ever worry about money again. But that’s not realistic. Life is messy and expensive and never follows the rules.

Real life forces you to make hundreds of small financial decisions every day. Renew the gym membership? Join co-workers for a drink or say no again? How much to give at the bar mitzvah? Now add in groceries, kids’ activities, birthday parties, weddings, grooming, the new screen door, even pants, and it’s easy to see how messy, overspending F*ck-It Moments happen.

Understand that I’m not talking only about the big expenses where you wind up house-poor, car-poor or baby-poor. Overspending can certainly happen there, but it also happens one small transaction at a time. Day by day, swipe by swipe, none of which is large enough to set off alarm bells like the shopping addict who buys $3,000 shoes online at one in the morning. Therein lies the problem. These small financial decisions add up over time. You probably can’t point to one specific transaction in your bank account and say, “Yes, that’s the moment where I screwed myself out of financial security forever.” You often don’t notice your F*ck-It Moments until it’s too late and you’re already frustrated, worried . . . broke.

Like my client Leanne, an entrepreneur who runs a successful retail clothing store. The store pulls in about $200,000 a year in revenue. Sounds awesome, right? But after she pays her rent, her staff, her suppliers and her marketing costs, Leanne makes $40,000 a year. She busts her butt every day, often working evenings and weekends, putting in roughly 55 hours a week. That means about $14 an hour, which is less than what she pays her staff. The amount of effort, brain space and exhaustion that her job demands, combined with the responsibility of making the rent and paying bills, doesn’t always seem worth it to her. She could work for another retailer and make more money with much less stress. She’s tired and burnt-out.

Leanne arrived at my office for our first meeting carrying a shopping bag. She had just dropped $150 on a blazer. Granted, this $150 purchase was unlikely to rob her of her retirement, but it was an impulse buy after a very long day at work. A perfect example of overspending and under-saving, but at the time she was too tired to care.

“Retail therapy,” she said with a shrug. “Pun intended.” Then she looked down at the bag. “I dunno why I bought it. I just work so frigging hard and I love this blazer. I was just like, Whatever, I deserve this. It’s only $150. It’s not like I bought a million-dollar house.” She was angry—I could tell by her body language. Not at me, but at the situation.

When we work hard, we want to be rewarded. Buying things and experiences that fill us up emotionally are ways of celebrating our achievements, enjoying the fruits of our labour. Money is the reason why we work.

“I should be able to afford a damn blazer without feeling crappy about it,” Leanne said. “But I already know I’m going to beat myself up for this later.” Her eyes filled with tears. “It’s just so annoying, you know? I work so hard. How is it possible that spending $150 is such a big deal? I’m 35 years old and I feel broke because I bought a new jacket. Pathetic.”

I get it. Modern life is a grind. Being in constant demand from work through phones, email and other electronic devices can leave you exhausted, physically and mentally. You work hard for your money, and having your income remain stagnant while the cost of living rises can frustrate anyone.

I’m sure you’ve had a F*ck-It Moment or two. We all have. You know, those times when you weren’t able to say no to spending money on something you knew you really couldn’t afford. You felt the pressure to spend and gave in because it just felt easier, and probably more fun, than being financially responsible. So why was that? Why did you reach a point where you felt like your financial plan wasn’t worth it, where you lost the motivation to stick to the plan?

F*ck-It Moments, big or small, are caused by an overwhelming pressure to spend money. The pressure takes over and in the moment outweighs your rational, logical thought that you should say no. Leanne should have said no to the blazer (it was an overspend for sure), but in that moment she felt inadequate—financially inadequate, as if she couldn’t afford the life she wanted to live. She felt broke.

The more intensely and frequen...

Table of contents

• Dedication
• Contents
• Introduction: Everyone Is Worried about Money
• Part One: Stop Feeling Broke
• Part Two: Stop Budgeting, Start Living and Get Control
• Part Three: The Future Is Financially Friendly (I Promise)
• Resource Library
• Further Reading and Resources
• Acknowledgements
• Index
• About the Author
• Praise
• Copyright
• About the Publisher