2023 is a weird year.

On the surface, things look great! We’ve returned to “normal” after a global pandemic and the U.S. economy has avoided a hard landing (thus far) despite the dramatic rate increases over the last year and a half.

Look beneath the surface and people are really struggling. Those higher rates are still struggling to cool stubbornly high inflation. Inflation has made everything so dang expensive. Consumer debt is at its all time high and debt is getting more expensive to have.

There are still rumblings about a recession coming. The Fed is intentionally trying to cool wage inflation and even raise the unemployment rate. It makes sense for the economy overall but for individuals, It’s all very unsettling and exhausting.

It feels that all your efforts to work hard and get ahead are getting you nowhere. So why even try?

This hopelessness can make you feel like giving up on your financial fitness.

In this video I explain why money management is still where it’s at.

Transcript:

I hope this doesn’t sound to woo-woo, but there’s a benefit to financial fitness that’s kind of inexplicable. And it’s why you shouldn’t give up on managing your money today or any time that you feel that there are so many external factors, like high cost, wages that aren’t keeping up with inflation, and high interest rates, that are impacting your money so much that it feels like whatever you do doesn’t matter.

I totally understand the feeling that your money is out of your control and you shouldn’t even try to take control because you’re just going to end up frustrated and disappointed. But I’m begging you not to give up on financial fitness. I know it seems like your own efforts won’t change the equation but it absolutely does.

Staying organized, having a plan, tracking your spending, and being on top of your finances makes a huge difference in what happens to your money and the quality of your life. Having awareness and control over how much you’re bringing in and where it’s going still matters, I promise you.

But here’s the other thing that financial fitness does, that’s almost magical. I know that you might not have a natural knack for budgeting BUT your subconscious mind does. When you have a clearly written out budget, which I also call a spending plan, that your brain believes is possible to achieve (that’s a big one, your brain has to think it’s real and not a joke) then it goes to work on figuring out how to help you hit your goals.

And it’s not conscious. It’s like you give your brain a mission and then forget about it, and while you’re not actively trying to figure it out, you’re just in the shower or you’re driving, then bam, it comes to you. Your subconscious mind has delivered an idea for how you accomplish your goal. In some ways, your brain works like a missile towards your goals, but only if your goal is clear and has a precise target.

Maybe it’s sparking your creativity. I don’t know exactly how it works or even how to explain it but I’ll try. Have you ever had a problem and the solution came to you in a dream or in some random other way that doesn’t follow logic?

When it comes to financial goals, people tell me that they found ways to cut costs or bring in additional income, the exact amount of income they needed to make their budget work, while they weren’t actively trying to figure out a solution, it just came to them, like out of the blue. Do you have a name for this? Let me know in the comments.

Even though I can’t explain the mechanics of how this works, I’ve seen enough examples that I’m confident that it works reliably. So like I’ve alluded to already, whatever this thing is, it requires two things to work.

First, it requires a clear goal, which financially speaking, means a completely thought through budget. Budgets get a bad rap, to the point where lots of personal finance experts help you come up with ways to avoid them. A lot of the time they actually recommend budgeting but they give it a different name. Fine, call it whatever you want. But create a budget that is inspired by your values and informed by your actual recent spending so that you can create an achievable spending plan that you enjoy spending in accordance with.

Secondly, it requires that you believe the goal is possible. The mindset aspect is key and is why it’s so incredibly important that you develop a healthy relationship with money. Your relationship with money dictates what you think is possible with you and your money. If you don’t think that you’re capable of being good with money, then even having clear goals, won’t activate this power in your mind to help you see it through, because your brain just thinks that you’re fantasizing. When your thoughts, beliefs, and feelings are aligned with your goals, then your brain will provide some behind the scenes power to help figure out how to make it a reality.

I know that the world, the economy, the financial system that we live in is so powerful as to make it feel like our own efforts don’t matter. You would be justified in feeling that way. But don’t give up on your financial fitness.

Your money mindset and your money management absolutely matter to what you’re able to achieve financially. It matters for practical reasons and also now you hopefully understand that quasi-magical power that financial fitness gives you.

Stay strong and I’ll catch you in the next video.