A few years ago, I was a financial counselor for a credit union. My role was to help members who were denied loans and lines of credit to learn how to manage their finances better. Part of the re-application process was to work with me to learn how to budget, read their credit reports, build up savings, and more so they can develop long-term healthy financial practices, and grow their credit score. After working with me and meeting other financial conditions, they were eligible to re-apply for credit.
During that time, I worked with a variety of families across demographics and backgrounds. Here is what I learned:
- Learn how to manage the income that you have before working more hours at work or starting a side business to increase your income. If you don’t manage what you have first, it’s like filling up a bucket with a hole in it. Ultimately, you won’t make real financial progress and it will end up being a waste of time.
- If you lack confidence in your ability to manage your money, you won’t do it. This is why it is important to identify the reason for lack of confidence so you can be equipped to gain the confidence to manage your money effectively.
- Budgeting impacts your credit. This has a domino effect on so many areas of your life (including employment prospects and confidence).
- Financial education needs to be taught. People want to do better yet have no idea how to do it.
- Financial education in isolation doesn’t create good financial habits. People must identify their financial emotional triggers, create new habits, and develop an accountability system so they are able to make lasting, financial transformation.
- Changing your money habits is a decision. Sometimes people make the mistake of thinking that changing money habits is a one time decision. However, this is daily, moment by moment decision to walk in financial wellness and to create new habits.
- People won’t follow a spending plan or financial blueprint if they fear the impact it may have on their lifestyle. Make sure the spending plan fits in your life, it is doable, and isn’t rooted in deprivation.
- Never make assumptions about people’s finances. You can’t tell someone’s financial worth or management ability just by looking at them.
- Have empathy. Financial management requires technical skills, but more often it requires emotional healing. Emotions impact behavior which impacts your financial habits. Give lots of empathy and understanding.
- There is no one size fits all approach to money management. What works for one person may not work for another. This is why I tailored my recommendations and plans to fit a person’s stage of life, emotions, experience, and ability to follow the plan I created for them.
There is so much more to finances than just create a budget. The lessons that I shared in this post helped me to give myself grace when as the “financial expert” I found myself feeling helpless about my own money management when I became a single mom. When you give yourself grace, you also give yourself the space to heal and get back up again and get to a point you’re able to thrive.
Aisha Taylor is a single mom of twins, personal financial coach, work from home entrepreneur, and author of “Navigating the ‘Impossible’: A Survival Guide for Single Moms from Pregnancy Through the First Year of Motherhood.” Aisha has been featured in ESSENCE, Jet Magazine, and Black Enterprise. She is also the Founder of FNPhenomenal (Frugal –n- Phenomenal), a movement designed to equip single moms develop the strategy to live whole, financially free, and rooted in Jesus Christ.