Compounding Kindness: Unlikely Stress-Reducing Financial Concepts

Have you ever wondered if financial strategies could actually reduce stress and spread kindness? Today we're exploring how unconventional money concepts can create a ripple effect of positivity in your life and in your community. Now, compounding is one of the most misunderstood financial concepts, so get ready to discover the surprising connections between compounding financial

wisdom. In compassion, in a world where chaos seems to reign supreme, where uncertainty lurks around every corner and financial markets are now more unpredictable than ever. There's one place you can turn to to find clarity and control. Welcome to the Wealth Wisdom Financial Podcast. Hey, I'm Brandon. And I'm Amanda. Join us as we dive deep in the world of personal and business finance to assist you in navigating through the chaos and building the

financial future you deserve. We believe when conventional financial thinking doesn't get you where you want to go, you need wealth wisdom. So if you're ready to take control of your financial destiny. Tune into the Wealth Wisdom Financial Podcast because in a chaotic world, your money shouldn't be. Subscribe now and never miss an episode. OK, welcome back to the Wealth Wisdom Financial Podcast. So glad to have you

here. This month, in our previous episodes, October 2024, we've explored holistic wealth and combining different financial strategies and concepts. Today we're building on that theme of virtue and kindness, but we're taking a little bit of an unexpected turn to discuss how certain financial concepts can not only improve your bottom line, but also reduce stress and foster kindness in your life and in the community that's around you. So welcome. Be sure you hit the subscribe button.

We've got some more kindness and virtue episodes coming up this month. Go back and watch those last two if you missed them, but not required to get a lot out of today. Our big idea today is that smart financial practices can create a compound effect of kindness and reduce stress, much like compound interest grows your wealth over time. Now, before

we talk about these three unconventional financial concepts. Let's explore a little bit about compounding. I said at the top, this is one of the most misunderstood financial concepts, and it's because people generally underestimate the power of compounding. Now, you might have heard the classic example of choosing between $1,000,000 today or a penny doubled every day for 30 days. In this choice, right?The penny doubled turns into over $5 million.

So it's kind of used as an example of why would you choose $1,000,000 versus a penny doubling every day for 30 days?But even that, you know, feeling and understanding, it's hard to like really grasp. So I've got two other examples for you that maybe might help you with this. The first one's for my visual people. You can kind of picture this in your head. I recently came across this example. I shared it with my six-year-old, and his mind was just blown. So if he can get it, you got this,

okay?I can't remember where I saw it, but here we go. If you take a piece of paper, like any piece of paper, and let's say it has a thickness of 0.1 millimeters, you know, normal piece of paper, very thin, and you fold it 50 times, how thick do you think that paper would become?A couple inches, maybe a foot? Well, the math shows that it becomes 69,960 miles thick. Yes, miles. For perspective, that's 29% of the way to the moon, right

from the Earth to the moon. It's that 69, almost 70,000 miles gets you over 1/4 of the way there. Or to put it another way, 69,960 miles is like going around the Earth's equator 2.81 times. You could almost go around the earth three times to get the thickness that that piece of paper becomes. And all you started with was a piece of paper that you folded over 50 times, right?Like, how how cool is that?OK, now another example. Do you remember that movie Pay It Forward?It came out in the year 2000,

24, almost 25 years ago. That you know kind of dates me, I guess. I remember watching it. Now, the film didn't do so well at the box office, so I'm going to guess that maybe a lot of you have never seen it, maybe even never heard of it. In this movie, a 7th grade social studies teacher, played by Kevin Spacey, gives his class this assignment to figure out a way to change the world. And one 7th grader named Trevor, played by Haley Jo Osment, you might know him from Forrest Gump or Sixth

Sense. I see dead people, right?That's Haley Joe. He gets an idea, or his character Trevor gets an idea. Trevor does a favor for someone and tells them that they can't pay it back to him. They have to pay it forward, and they have to do a favor for three other people. And of course, ask those people to pay it forward and do a favor for three other people. AndOf course, it's a movie, so there's mixed results. The, you know, the movie has to have conflict and unexpected twists and turns to keep us

interested. I'm not going to ruin the whole movie for you, but spoiler alert, at the end we see a scene where thousands upon thousands of people have been impacted by the 7th grader's good deed. And kind of the the idea is that it continues to spread from there. It's not just done at the end of the movie. How, like, how, how good would that be if like you're like, I just did this one favor and it's impacted all of these people.

That's compounding. Now you might not get a penny to double every day for 30 days. I wish, right?I doubt you could probably fold a piece of paper 50 times. I think there's a limit on how how many times we physically can fold a piece of paper. You might, it's possible to do a favor for someone that then does a favor for three other people and the chain rarely breaks. That's

maybe more possible. But what if there was some very practical, you know, financial things that anybody could do, strategies to get compounding and a compounding of kindness working in your favor, in the favor of your communities and the world at large? What if?Well, you're in luck. I have 3 unconventional financial

concepts that, when applied thoughtfully and intentionally, can have a profound impact. on your wellbeing and the world around you. Here we go. Here's number one. I call it the generosity multiplier. The whole idea is you give a percentage of your income. You just set it aside and you give it Rather regularly, right?To like same non-profit or something like that. Or you just have it available in case anyone ever needs some help. You have that set aside however you're doing your

budgeting, right?I have a category in my YNAB that's for giving that I put a little bit into every month. And then when someone needs help, I can see do I have it there to help them. This studies have shown that being able to be generous activates pleasure centers in

our brain and reduces our stress. So even though I might not give it every, you know, all the time, even putting that in my budget, right, is reducing my stress, helping me to have more pleasure and be able to be more kind maybe to my family that day. This can also, right, actually the giving of it can create those ripple effects of positivity in your community. It also... And like by doing that, maybe even first, right after you get paid, there can be some financial

benefits too. It can encourage mindful spending and maybe even lead to some tax benefits, right, as you're able to claim those deductions on your taxes. The thing here, it starts small. You know, even 1% can go a long way to reduce your stress and impact others for the better. The caution here is, you know, especially for a lot of women, we have a hard time being overly generous. And we have to remember that we need to take care of ourselves first. We're going to talk about that in I think

it's the next episode. So hit that subscribe button so you don't miss that one, especially if you have a problem being overly generous. I I hear you. I'm with you. OK, so that's number one, the generosity multiplier idea. Now #2 is called the simplicity portfolio. The whole idea here is by streamlining your finances, reducing your accounts, your debts, your unnecessary expenses, just by streamlining, simplifying, you can have more kindness, and that kindness can

compound. Part of this is it's reducing stress. You have fewer financial decisions, less financial decision fatigue, right?Like all those things, you're maybe able to be more kind because there's just less moving parts to to juggle. And this can also give you more mental bandwidth to focus on your relationships and your community, right? You have less things that you have to spend time managing. But also on the financial side, it can lower your fees, which fees totally interrupt compounding

and destroy wealth. It can give you better insight on your money so you can make better financial decisions and potentially higher savings, right?As you get that compounding and better decisions working in your favor and fees aren't destroying them. This is why I love the bank on yourself concept. Some people call it the Swiss Army knife of financial products. We can use it for so many things, getting the same dollar, doing multiple things over the course of our

lifetime. If you want to learn more about it, I've got two opportunities for you. You can learn more at wealthwisdomfp.com/boy for Bank On Yourself, or attend one of our upcoming webinars at wealthwisdomfp.com/seminar. You can get access to that one hour seminar right there, sign up for the time that works for you. So there we go, Simplicity Portfolio. Then the third

idea I'm calling the Gratitude Bank. Now this isn't literally a bank, like we're not gonna go, you know, apply for FDIC insurance,And all those kind of things. You can think of it instead as regularly acknowledging and depositing moments of financial gratitude. You're gonna by depositing those moments of financial gratitude, you're building a reserve, a bank of gratitude that can have all kinds of ripple effects. It can reduce your stress.

Gratitude practices have shown over and over again that they lower our cortisol levels, that stress hormone. Even practicing gratitude can help with that. But also having that reserve of gratitude can help when you get into that stressful moment. Oh, I can tap into my reserves, right?And then, of course, being grateful increases our awareness of abundance. And how much we actually have, which can lead us to some great generous behavior, you know, within boundaries

like we talked about before. But it kind of helps us get into that abundance mindset in a healthy way. And then of course, there can be financial benefits as well. Contentment, right?When we're grateful for what we have, it reduces our impulse spending and increases intentional financial choices. It can help actually save us money and keep us from splurging. And you know, what is that called?Doom spending. And you know,

those kind of things. Gratitude is one of the best ways to be kind to ourselves and cultivate an overflow of kindness for others. So if you do nothing else, I hope that you'll start a gratitude bank, a reserve of things that you're thankful for that can help you in those moments when you're struggling financially to realize what you have to be grateful for in that way. Now, these

concepts, the generosity multiplier, the simplicity portfolio, the gratitude bank, they can intertwine with all kinds of strategies we talked about in our last episode. I already mentioned Bank On Yourself and how it can help with that. That's a great way to have a simplicity portfolio that has that emphasis on making the same dollar work

twice as hard. It also goes really well with the still method that we talked about before, and that that gratitude bank compliments, you know, setting your sights and the the s in the still method. As we get clear on where we're going, we can be thankful for how far we've come, and that's a beautiful thing now. Before we get to the flip side, and I talked to all of you out there saying yeah, but I want to give you a special chance to talk with us.

Ready to take the next step towards securing your financial future, whether you're planning for retirement, saving for your dream home, or you just want to make your money work harder for you. The team at Wealth Wisdom Financial are ready to assist you, and now it's easier than ever to see how we might give you a boost on your financial journey. Schedule a 15 minute discovery call with one of us today and let's discuss your questions and your financial goals together. Don't

wait any longer. Your financial freedom awaits. Schedule your discovery call at www.wealthwisdomfp.com/call.

Okay, my friendly skeptics and people that are like, you've got some some kind of beef with me right now. I hear ya. I'm a skeptic too at heart. I've got a couple things. Like you might be thinking, this sounds great in theory, but does it really work in the real world? Can I really have, you know, this generosity multiplier, this gratitude bank, this simplicity portfolio?Let's address some common concerns. One, you might think, well, I can't afford to be generous. Remember, we're talking about

starting small. Even setting aside 1% of your income can make a difference both in your stress levels and, you know, reminding yourself that you have enough for you and and also in being generous to others and making an impact for them as well. And as you become more comfortable, you can increase that amount, but start where you are. And remember it also generosity doesn't have to be financial. that seventh grader

pay it forward. He did a favor for someone that just took a little bit of his time, and then asked them to keep doing a favor for someone else. OK, so can't afford to be generous. Look for ways, unexpected ways you can be generous, or even start small if it's if you want to do it financially. Secondly, Simplifying your finances can feel overwhelming. A lot of us, I love this

analogy. A lot of us are carrying around a bucket of financial rocks and it's just heavy bucket, all these rocks that we've thrown in there as we've picked them up throughout the course of our journey. And if we try to take them out and figure out how to simplify them, how to build something with them, it just becomes way too overwhelming, way too quickly. And we end up throwing them back in the bucket and, you know, keep calm and carry on. This is where I like to invite people.

You know, take it step by step. Begin by listing all your accounts and debts, right?Like, what is in your bucket right now?You gotta know what those rocks are. And then tackle one area at a time, perhaps closing one unnecessary account per month, or paying off one debt and then going on to the other. Perhaps using something like Bank On Yourself as a Swiss Army knife to take some of those products and make them work for you in

one place. Now, for those diversification perfectionists out there, remember, the theory with diversification is that 10 different stocks in different sectors are enough to diversify a portfolio. You don't need hundreds and hundreds of different stocks or ETFs or index funds, right?What if you used like 80/20 to get rid of some parts of your portfolio that are at the bottom 20% that are actually holding your returns back?

8020 is a law of nature. There is probably some efficiencies and things you can do by simplifying to maximize the top 20% and minimize the lower 20% or just cut that lower 20% out of your life. Think about it that way. OK. And

then for those of you that are just feeling so stressed right now that it it seems impossible to feel grateful for anything, let alone your finances. Start with some small acknowledgments. You're breathing. I am grateful for my breath, and you take a breath to really feel it. Maybe you can be grateful for that steady paycheck, or that you had that ability to pay that one bill on time. These small recognitions can compound on each other into larger and larger feelings of

gratitude. The goal here on all of these things is not perfection, it's progress. These concepts are meant to work alongside your existing financial strategies, not replace them entirely. Find some gem that I've shared today and think about how could I do that in a better way?Or how could I be more kind to myself when I don't do that the way I really want to?That's like the bottom line, all I can ask you to do, and then see where it goes from there, I

believe. By incorporating these unconventional concepts into your financial life, you're not just improving your own situation, you're creating that ripple effect of positivity. The generosity multiplier spreads kindness directly to others. The simplicity portfolio gives you more capacity to focus on what truly matters to you, and the gratitude bank shifts your perspective to abundance instead of scarcity. So try them out. See how these feel to you. Do it in the way that fits

you, right?That generosity bank could be in a journal. It could be a note on your phone that you can pull up to remind yourself of gratitude, you know, and all those kind of things. Remember, we're talking about compounding kindness, and if you want to see more compounding kindness in your life, I hope you do.

We've got more practical financial tips to be kind to yourself, give yourself space to and freedom to learn and explore more ways to improve your story with money in the Wealth Wisdom financial community. There are so much opposite of kindness out there on the Internet, right?In social media, even here on YouTube or in podcast land, there's so much like not kindness. We wanted to create a safe space where people can experience. Virtue, kindness, compassion related to money.

And so we did that in the Wealth Wisdom Financial community. You can join for free today at wealthwisdomfp.com/community. What you'll find when you get in there is a group of people, including myself, that want to pour into you, want good things for your your life, and want that ripple effect of kindness to spread all throughout the world. So again, that's

wealthismfp.com/community. You can join for free today, and we've got some resources in there to help spread all these things we've been talking about, but particularly kindness in your life. It's a safe space, right, to to to be kind to yourself and have others be kind to you as you move forward on your financial journey. OK. Thanks so much for

joining me. This was a good episode. I hope it wasn't too heavy for you or too light, maybe. Like, sometimes we can feel like it's like it's it's almost superficial to think about kindness, but go as deep into this as you want. Think of the times when you haven't experienced kindness, maybe that financial advisor that was mean to you, or the time when you beat yourself up because you overspent on this thing or made this bad financial decision. Forgive

yourself. Forgive that person, even in your heart, and figure out how you can compound kindness and reduce your stress with these things we've been talking about today. The generosity multiplier, the simplicity portfolio, and the gratitude bank. Thank you so much for joining us. Hit that subscribe button. You're not going to want to miss the next episode, and I hope you live long and

profit. The topics presented in this podcast are for general information only and not for the purposes of providing legal, accounting or investment advice. This also isn't mental health advice. Please consult a professional who knows your specific situation and therapy is awesome. I'll talk to you soon.