Title: Get Good with Money: Ten Simple Steps to Becoming Financially Whole
Author: Tiffany Aliche
Hardcover: 368 pages
Publisher: Rodale Books
Publishing date: March 30, 2021
Who is this book for?
Anyone looking to take charge of their personal finances, get their spending under control and learn how to live with financial wholeness.
What’s inside this book?
The 10-step formula for attaining financial security and peace of mind that was created and perfected by Aliche, AKA “The Budgetnista.”
Checklists, worksheets, a toolkit of resources and advanced advice from money-management experts.
Real-life examples to bring financial lessons home.
Actionable steps for taking charge of your credit score, maximizing bill-paying automation, savings and investing and calculating your life, disability and property insurance needs.
5 lessons you’ll learn from this book: How to achieve and maintain financial wholeness through a series of financial improvements.
How to create the game-changing “noodle budget.”
How to see your credit score as a grade point average.
How to practice mindful budgeting and spending habits.
A simple calculation to help you retire early.
3 questions this book will answer for you:
How can I determine if my money problem is that I don’t earn enough or I that I spend too much, and how do I fix either issue?
How can I learn to make a habit out of saving for a rainy day?
How can I protect my beneficiaries’ future?
What people are saying about this book:
“Aliche can take the most complex of money concepts and distill them into something relatable and understandable. No matter where you stand in your money journey, Get Good with Money has a lesson or two for you!” — Erin Lowry
“Get Good with Money helps you put all the pieces of your financial life together without making you feel overwhelmed or ashamed about your circumstances. Whether you need to budget better, slash debt, and save more money or learn to invest, boost your net worth, and build wealth, Tiffany Aliche offers great advice to let you know you can do this, sis!” — Lynnette Khalfani-Cox
“I’m so inspired by Tiffany Aliche’s own story of digging out of deep debt and building back her credit and her cash flow. Get Good with Money will soon have you believing in your own ability to set yourself up for a life that’s rich in every way.” — Farnoosh Torabi
Your Turn: What did you think of Get Good With Money? Share your opinion in the comments.
Q: Do I need to have a separate rainy day fund and emergency fund?
A: In an effort to simplify their money, people sometimes consolidate accounts. This is OK in many instances, but it’s important to remember that rainy day funds and emergency funds serve different purposes. Additionally, it’s important to have not just one, but both funds available to tap into as needed.
Read on for all your questions on rainy day and emergency funds, answered.
Why have a rainy day fund?
Say your washing machine decides to suddenly quit on you and needs replacing. You’re now looking at an extra expense that can run anywhere from $350-$850 (or more). Where are you going to get that kind of money in a pinch?
According to a Federal Reserve Board report, if you’re like 44% of Americans, you’ll need to sell something you own or borrow money to fund such an unexpected expense. Or, you might choose to charge the purchase of a new washing machine to a credit card, which means you’ll pay extra in interest and the cost of the new machine will be haunting you for months—or even years—to come. Either way, a surprise expense of a few hundred dollars can be enough to send you into a tailspin of debt.
Is there a solution? Here’s where your rainy day fund comes in. It’s a small savings account created just for these types of small, unfixed expenses that you know will crop up on occasion. You’ll tap into your rainy day fund to pay for minor household and car repairs, to cover the cost of summer camp for your child, or to replace your broken kitchen table. When you have a way to fund these small financial hiccups, they won’t have as much of a chance to disrupt your financial health.
Why have an emergency fund? In contrast to your rainy day fund, an emergency fund is for much larger expenses. It should have enough padding to keep you afloat even if you experience a major disruption in your life, like a divorce, job loss or illness. Without an emergency fund, any of these, or a similar event, can leave you scrambling to pay your bills and quickly send you into a debt trap that can last years.
How much money should be in each fund? Your rainy day fund, created for minor expenses, only needs to hold $500-$1,000. That should be enough to tide you over in the event of a small, unfixed expense.
Sometimes, you may be able to anticipate these expenses and save up for them accordingly. For example, if you know your child will need braces next year or that your HVAC system will need replacing in a year or two, you can build up your rainy day fund over the next several months until it has enough to fund these anticipated expenses.
Your emergency fund, however, should be positioned to pull you through major financial crises. That’s why you will need to have a lot more money in the account. Ideally, it should hold 3-6 months’ worth of your living expenses. This value will vary according to circumstance and can be anywhere from $3,000-$10,000 or more. Find your own magic number by tracking all your fixed and discretionary expenses for a month and multiplying that amount by 3 or 6.
Where should I keep these funds? By definition, the cash in both of these funds needs to be easily accessible. Don’t lock the money up in a Savings Certificate or another long-term savings account that will make it difficult and/or expensive to withdraw when the need arises.
Your Advantage One Savings Account is a perfect home for both your rainy day fund and your emergency fund. You can even set up multiple accounts for each one. Your money is always safe here, and federally insured by the NCUA up to $250,000. Best of all, you’re free to withdraw your funds without penalty whenever you need to do so.
How can I build my funds? You’re convinced: You need an emergency fund and a rainy day fund. But how are you going to get the money for both? If you’ve never saved up for unexpected expenses before, the prospect of doing so can be daunting.
No worries, though. With a bit of discipline and hard work it can be done! Use these three tips to build your funds:
Start a side hustle. Freelance for hire, take online surveys for spare cash or accept a seasonal position. Keep all or most of the extra money you pull in for your funds, making equal contributions to each fund.
Trim your budget. Take a long hard look at where your money goes each month and choose your biggest money-gobbler to be pruned. Use the money you save for your funds.
Make it automatic. Set up an automatic transfer from your Checking Account to your Savings Accounts so your funds grow on autopilot and are less tempting to use for fun.
It may be some time before your funds are fully padded, but that’s OK. It takes time to save up that kind of money, and hopefully you won’t need to tap into your savings until you’ve successfully built your funds.
Also, you won’t need to stick to your tightened budget or keep your extra job forever; you can drop both as soon as your funds are built, taking them up again only when the money in one of the funds is depleted.
Start setting up your rainy day and emergency funds today! You’ll sleep better at night knowing you’re prepared for any financial eventuality.
Do you have a rainy day fund and an emergency fund, or do you use the same source to fund any extra expense? Share your take with us in the comments below.