The Rachel Cruze Show - 10 Ways You’re Losing Money Without Realizing It

Starting point is 00:00:05 I always enjoy hearing what other personal finance creators are saying about money, and I recently saw a video from Nisha of called Seven Ways That You're Losing Money Without Realizing it, and I thought that is so interesting. Saving you from wasting your money is something that obviously I can get on board with. So I thought I would kind of go through that list and react, and then maybe give you three of my own that I think are important to the subject. But before we dive in, make sure to subscribe to this channel and share this episode with a friend. All right, according to Nisha's list, first way you might be losing money without realizing it is keeping your head in the sand. And this is everything from avoiding hard conversations in your life, not asking for a raise,

Starting point is 00:00:46 not communicating with your spouse, not reaching out to a financial advisor. You know, you are like procrastinating when it comes to taxes or paying bills. Maybe you're stressed out, so you're like, I don't even want to look at it. Maybe you're not moving your money from, you know, just a savings account to a high yield savings account or a money market account to earn more interests, but like your head is in the sand. You don't want to know. You don't like it. And that is causing you to waste a lot of money. And I agree. I do think this is an important one to have on the list, and I like that she has it at number one, because ignorance is not bliss when it comes to your money. And people really do avoid this topic in their life and understandably because

Starting point is 00:01:24 they're stressed. Maybe there's some shame. They have a lot of, you know, regret from decisions they've made. And so there's kind of like a plug my ears. I don't want to hear it. I'm going to just get through life, but you could be losing out on so much when you do this. So you have to face the facts. And again, I really think that emotions drive so much of our money and our money decisions, which is not always a good thing. Like sometimes having facts in place is something that can actually ground you and anchor you down. So knowing where you are is so, so key to winning with money long term. Number two, obsessively comparing. So when we talk about social media and this whole world that we have to keep up with, right? We have to keep up with the Joneses is so real and you're

Starting point is 00:02:06 losing money because of it. I completely agree with her. Yes and amen. It is so wild how much money we spend because maybe not even we feel like on the surface that we're comparing and we're like, oh, we have to be like that. But it's just this idea of, oh, there's something out there. There's this product I would have never heard of otherwise, but because of social media and because of what's out there, we're like, oh, yeah, this is normal. This is great. And you go and buy into it. And again, over time, I think that rhythm starts to create this world where you feel like, okay, this standard of living, this way I should be living, should be normal. And if I'm not up here, I got to spend money, maybe even money I don't have, to fill in that gap

Starting point is 00:02:45 because I have to, you know, have a certain level of living. And that's what's so difficult is with social media that is thrown in our faces constantly. So I completely agree with number two. Love it. Number three is not turning your capital quickly enough. So she talks about unused savings, just sitting in a bank account and your money. missing out on interest. And so there's kind of this idea of like releasing control of the nest eggs so that you can make progress with your other goals. I would say I'm kind of in the middle

Starting point is 00:03:11 of this. I think that, yes, it's true. I do think having money available and it's not earning super high interest. And again, maybe this is just a high yield savings account. But having money you can get to like for an emergency fund, I think is really important. And I don't feel like you have to like be investing all the time and creating like all this crazy interest, right? There is a part of just having security and peace, which is what we're going for. So with her, I totally see what she's saying, but kind of in the middle there. Number four is not assigning yourself an hourly rate. So I love this, because we talk a lot about like side hustles or like what's worth your time. And so she talks about in here actually assigning an hourly rate to all of it. So you want to calculate,

Starting point is 00:03:50 you know, what you make per hour on some of these side hustles or these things that you're doing, even your job. And I think that's really good because I do think people, even on salary, you know, that can work so much more than what you're actually getting paid, can shift your career path. And you could actually say, is this worth it or not? And so understanding your hourly rate is really key, and I would agree with that. Number five is not living on 90%. So she talks about putting 10% towards savings and investing and paying off debt, high interest debt. And so, and again, you have that 10% margin where you're like, okay, I have this buffer here. I'm going to live on 90, but take 10 to do these other things. And I would just say probably I don't agree with

Starting point is 00:04:31 that specifically. The idea of having margin, I definitely agree with. But the percentages, I think, are going to shift depending on where you are because I recommend paying off all of your debt as soon as possible. So getting a $1,000 emergency fund and then becoming debt-free is key. So when you're looking at your budget, that may mean you're living on 70% of your income and throwing 30 at debt, right? Or maybe you're past that stage and you're investing 15% of your money. Well, that's obviously more than 10%. Also giving away 10% of your money, I think is a great goal, too. So the percentages are all going to shift.

Starting point is 00:05:02 But the idea of margin I like, but I don't necessarily agree with that specific percentage. Number six, focusing on cutting back instead of making more. And so she talks about how you can't stay stagnant and you have to take risks in your career and when it comes to investing because you want to play the offensive game versus the defensive game. And I can see that totally. I mean, there's a part of me that I really do agree with that. I think there is something important to say, hey, I'm going to be proactive in this. I'm not going to stay stagnant.

Starting point is 00:05:31 I'm going to continue to move and move and go and go. But for me, my question would be, you know, what's your motivation for that? Because I do think some people try to tackle like, oh, I want to have a million dollars one day or whatever the number is. And sometimes, sometimes these goals can be really empty. And then you think I'll be satisfied if I have a million dollars, we'll just pretend, which sounds great. And that would be nice. But like the idea is, okay, but once you get that, what's on the other side of it, right? And that finish line can continue to move.

Starting point is 00:05:59 So I would say, yes, be proactive, but also make sure your motivation's coming from a healthy place. Number seven is not tracking expenses. And I love this one. I love that she has this on the list. I totally agree. I think our spending can be so out of control and we don't realize where our income's going. We just spend and spend and spend and don't realize it versus saying, hey, I'm actually going to have a plan for where my income is going to go. And I'm actually going to track and see, okay, this is what's

Starting point is 00:06:27 actually happening throughout the month because that's going to help you stay on budget. All right, before I share my three tips of what I would put on this list, I do want to tell you about one of our sponsors, delete me. I saw a headline recently that really caught my attention. One third of the U.S. population's background info is now public. So for a 115 million of us, data breaches mean that our info is just out there for anyone to find. And this is stuff like our names and addresses, phone numbers, and so much more. So that's why I love and use Delete Me, because they find and remove your information from hundreds of data broker websites that buy, sell, and trade your personal data. So take control of your online privacy with DeleteMe.

Starting point is 00:07:07 Individual DeleteMe plans start as low as $9 a month. So sign up today at join DeleteMe.com slash Rachel for 20% off or click the link in the description. All right, here are the three things I would add it to this list to make sure that you are not losing money. Number one is a budget. Kind of mentioned this earlier with tracking your spending, but a budget is more planning on the front end versus during it, right? When you're tracking expenses, it's money you've already spent, right? You've already gone to the grocery store, so you're like, okay, this is where that transaction's going to go. But when you budget, you are planning ahead of time and saying, here is what would be best for my money, well spent, because it allows me to do what I need to do, and you're planning it

Starting point is 00:07:46 ahead of time, so being very proactive. And if you've not checked out every dollar, you guys, that's our budgeting app. Make sure to do that. I'll put a link in the description, but there's something about, again, knowing where your income's going, but planning it ahead of time. That's key. Number two is your debts, because you are losing so much money when it comes to interest. You know, there is so much data out there that talks about not only just the peace of mind that you're losing, but you're also losing money because you live in this world of minimum payments. And when you do that, then you're paying so much interest on top of it. So getting it out of your life altogether, high interest, low interest, take it all out, right? All the debt, pay it off. And that is what I would do

Starting point is 00:08:26 for sure to save money long term. And then the third is actually giving, which kind of is a psychological twist here. But there is something about the idea of, you know, golly, I feel like I'm losing money when I give. But there is so much more that you gain when you live your life with an open hand. And when you become less attached to money where it's like the center of your world, there is so much to be gained there. Yes, I want us to be wise with money. Yes, I want us to do things like get out of debt and get an emergency fund and invests. Like all of that is very, very important. But there can be a time and place like you become so obsessive with it. And that's where I feel like it starts to steal part of your life. And so when you live your life with an open hand and you are generous and you're giving,

Starting point is 00:09:10 money doesn't have this like hold on you that I think long term can take a toll on you and your soul, honestly. So putting it in its proper place is really, really key. And that's going to end up saving you money down the road because I think you make better and wise decisions because it's not the thing that you're chasing day in and day out. Now, if you want another financial self-checkup, make sure to check out my episode, four ways you're ruining your budget without realizing it. You can click the link here. Or if you're listening to a podcast, I will put a link in the description. All right, you guys, remember to take control of your money and create a life you love.

The Rachel Cruze Show - 10 Ways You’re Losing Money Without Realizing It

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