Ask Yourself 5 Money-Making Questions
Take your finances to the next level by answering these 5 critical questions.
Laura Adams, MBA
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Ask Yourself 5 Money-Making Questions
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Finding the right solutions for how to improve your finances usually starts with asking the right questions.
Here are 5 money-making questions you should ask to help you take your personal finances to the next level:
Question #1: Do I Have the Right Mindset?
Question #1: Do I Have the Right Mindset?Your money mindset is very important because it’s the precursor to your behavior. Do you consider money your friend or your enemy? Do your thoughts about money support you by moving you in a positive direction every day, or are they sabotaging your ability to make good decisions?
It doesn’t matter if you’re working an entry level job or are a highly-paid CEO, your money mindset will be the key to whether you build lasting wealth or not. Your ability to grow rich doesn’t depend on your education or earning power. Smart, powerful people can fail miserably with their money when they don’t follow the basics like living below your means, having enough of the right kinds of insurance, and investing for the future.
You’ve heard about rap stars and fashion models who end up bankrupt even though they made huge amounts of money. The reality is that anyone can wind up poor no matter how much flows in and out of their bank account. Likewise, anyone can end up wealthy if they have the right mindset and consistently put away small amounts of money. Having a healthy money mindset means that you have clarity about what you’re supposed to be doing with your money, and you actually do it!
Question #2: Do I Have the Right Focus?
The second money-making question to ask is whether you’re focused on the right things. Take some time to figure out whether the way you handle money fits with your personal values. Values are simply what you believe in deeply—like being independent, having close relationships, pursing optimal health, or giving your kids a financial head start in life. I always say to my coaching clients: I can look at your checkbook and tell you what you really value, because how you spend speaks for itself.
The benefit of staying focused on values is that they give you deep inspiration and motivation to make new and perhaps difficult choices, like boosting contributions to your retirement account, building your emergency fund, or sticking to a spending plan. Once you’re clear about your values, you should create specific goals. For example, if you value education, you might create a goal to save $30,000 for your child’s college education.
Question #3: Do I Use the Right Products?
The third money-making question to ask is whether you’re using the right financial products—like bank accounts, credit cards, loans, and insurance—for your situation. There’s a wide range of options and often we get lazy about shopping around for the best deals.
Even though many banks are increasing their fees, there are still FDIC-insured banks you can turn to for checking and savings accounts that are completely free and come with great perks. My favorite sites for finding an unbeatable bank account are checkingfinder.com, depositaccounts.com, and bankrate.com.
If you carry a credit card balance from month to month, do a search on nerdwallet.com for low-interest cards that would cut your monthly rates. If you have a mortgage, contact your lender to discuss whether refinancing makes sense. In many cases, refinancing is the easiest way to get out of debt much faster. And don’t forget to have an annual meeting with your insurance agent to discuss money-saving options that will still give you adequate protection.
Question #4: Do I Take the Right Actions?
The fourth important question to ponder is whether you’re taking the right actions with your money. If you’re living paycheck to paycheck, that’s a sure sign that you need to create and stick to a spending plan. If you’re not investing for your future, you should enroll in your workplace retirement plan or open up an Individual Retirement Arrangement (IRA) and set up automatic monthly contributions. Read or listen to What is the Difference Between a Traditional and a Roth IRA? to learn more.
[[AdMiddle]There are other actions you need to take on a weekly, monthly, or yearly basis, like paying bills on time, reconciling account statements, reviewing your bank and credit card transactions, monitoring your net worth, and checking your credit report. I give you a list of the most important money management tasks and when to accomplish them, in chapter 4 of my book Money Girl’s Smart Moves to Grow Rich.
Question #5 Do I Use the Right Professionals?
The fifth money-making question to ask is whether you’re using the right financial professionals. If you don’t have an insurance agent who willingly answers your questions, find a better one. If you want to make sure you get all the tax benefits you’re entitled to, hire a tax accountant. Take advantage of advisors who can help you pick the best investments for your situation—many workplace retirement plans and IRAs offer them for free.
If you need help with the big picture of your finances, like setting goals, knowing what your priorities should be, navigating through a complex situation, or just need to stay accountable to someone, make an appointment to work with a financial planner or financial coach. Many of my coaching clients come to me with these very same concerns. Working with the right experts can help you make huge leaps forward with your money as quickly as possible.
How to Improve Your Personal Finances
How you answer these 5 questions about mindset, focus, products, actions, and professionals, should help you identify what’s missing in your financial life. To fill the voids and take your money management to the next level, start with the area that concerns you the most. For instance, if you’re worried about losing your job because you don’t have a financial cushion to fall back on, build an emergency fund. It’s a good idea to reevaluate your answers to these questions at least once a year so you can see what progress you’ve made, where you want to go, and who you may need to turn to for help.
Download FREE chapters of Money Girl’s Smart Moves to Grow Rich
When you visit SmartMovesToGrowRich.com you can find out more about working with me for one-on-one financial coaching. You can also download 2 free book chapters from Money Girl’s Smart Moves to Grow Rich. I love making money simple—so the book tells you what you need to know about money without bogging you down with what you don’t! It’s available at your favorite book store in print or as an e-book for your Kindle, Nook, iPad, PC, Mac, or smart phone.
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There’s a huge archive of past articles and podcasts if you type in what you want to learn about in the search bar at the top of the page. Here are all the many places you can connect with me, learn more about personal finance, and ask your money question:
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About the Author
Laura Adams received an MBA from the University of Florida. She’s an award-winning personal finance author, speaker, and consumer advocate who is a frequent, trusted source for the national media. Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers is her newest title. Laura’s previous book, Debt-Free Blueprint: How to Get Out of Debt and Build a Financial Life You Love, was an Amazon #1 New Release. Do you have a money question? Call the Money Girl listener line at 302-364-0308. Your question could be featured on the show.