Episode description

• “When you are financially whole in the way I’ll teach you to be, you won’t have to live in fear. You’ll have a plan for each area of your finances so that they are constantly working on your behalf“. — Tiffany Aliche
• America’s favorite budget expert, Tiffany Aliche joins us to discuss her new book, Get Good With Money.
• Financial fear can come from financial trauma and drama. When you know that the money you are making isn’t quite enough for the things that you absolutely need, or you can foresee a future when your finances will not be okay, most of us carry that fear secretly and with a sense of shame.
• Tiffany wants her community of more than 500,000 Dreamcatchers to release that shame, focus on solutions, and create plans that actually work.
• According to Tiffany, wealth is more than just money in the bank. It’s really a mindset, which is the building block of personal finance.
• People often chase an end goal without a foundation to ensure they will still be okay if something were to happen.
• Tiffany’s teachings are foundational. The goal is to give you the foundation that you need to go on greatness, such as investing at a high level, buying the home you want, or starting a business.
• For many of us, fear comes from a lack of knowledge and it takes an external, traumatizing incident to awaken us. Tiffany wants to reach people before they get to that point by normalizing financial education early on.
• Tiffany’s approach is three-pronged: knowledge, access, and community. She delivers knowledge through her blog, The Budgetnista, and podcast, Brown Ambition. For access, she showcases other financial educators, like the ChooseFI Foundation, to those who want a financial education for the children and community. And finally, she built Dreamcatchers for the third prong, community, so that people know they are not alone.
• The 10 components that constitute financial wholeness are budgeting, savings, debt, credit, and learning how to earn for the first tier. In the second tier, she includes investing for retirement and wealth, insurance, net worth, your professional money team, and estate planning.
• This foundation of financial wholeness is what you build the rest of your goals, hopes, and dreams on.
• While writing her book, Tiffany decided to Google, Jake the Thief, a man from her past who had caused her financial trauma. She discovered that he had escalated his thieving behavior from poor 20-something-year-old women to defrauding the United States Government and he is currently sitting in federal prison.
• Jake’s story is a cautionary tale. Sometimes the wrong thing or risky behavior works for a short period of time. But it’s important to learn how to manage your money from the ground up versus from the top down because you can lose it all if you don’t know how you really built what you built.
• Tiffany ended up with credit card and student loan debt and a mortgage she could no longer pay for, In total, it was around $300,000 in debt.
• That experience taught her that her father was right, slow and steady wins the race. She now takes her time and is very methodical with her decisions. Even it means taking a loss, she’ll take a short-term loss if it means a long-term win.
• Once she built her foundation, she was able to build wealth much more quickly. She wants others to have the opportunity to build the life that they want.
• After reading her book and matching one of her workshops, Jonathan says he likes how good Tiffany is at organizational structure and categorizing things.
• With budgeting, Tiffany assigns control categories to expenses. First, she lists all of the expenses and then assigns them to categories.
• The first category is B, or bills, like a mortage. Some of those bills are usage bills that fluctuate depending on usage, such as water or electricity. She puts a U in front of those Bs.
• Everything else is a C, meaning cash or choice expenses, because these are expenses you have choices over, like haircuts or gas for the car.
• Categorizing in this way can help determine if you have a spending-too-much issue, or a not-earning-enough issue, when there isn’t enough at the end of the month. If most of your money is going to Cs, you are spending too much because of your choices. If most is going to Bs and UBs, you aren’t making enough to take care of your financial responsibilities.
• When things are temporarily tight, you know you can look at your Cs and make some cuts there first. If it’s not enough, move to the second level, UBs. If that’s still not enough, move up to the Bs.
• Tiffany’s father taught her in an age-appropriate way about the financial consequences of her actions and says it’s a lesson we could learn as adults.
• A budget isn’t deprivation, Tiffany says it’s your “say yes plan”. Budgets are like your mom. She wants to say yes, but there is an “if” button. You can do the things you want, but only if you’ve lined yourself up in a way that makes it sustainable and safe.
• If you can master your budget and look at it differently, it is there to accommodate your goals, hopes, and dreams. But it might require you to give something up.
• Jonathan thinks Tiffany’s book speaks well to those who are broke. When writing it at the height of the pandemic when people were losing jobs and scared, she didn’t want to leave behind those starting in negative territory.
• She wanted to give them permission to focus just on their sleep, health, and safety. It’s okay to focus on expenses related to health and safety and tell everyone else that you don’t have it right now. You will get to them when you get to a safer place financially.
• 30% Whole is the chapter Jonathan thinks is worth the book’s price all on its own and you really need to know these tips if you are in debt, such as dealing with debt collectors or mortgage lenders during foreclosure. You can insist on a debt verification letter to verify that they have the right to inquire about it.
• Debt freedom is a goal, but it’s not the goal. You can be debt-free and still broke. Financial freedom is an incomplete picture. There may still be holes in areas like insurance and estate planning.
• The FIRE movement is great, but Tiffany believes there is a holistic view that is missing. Not matter how high or low your income, financial wholeness is available and accessible to everyone.

• Website:  The Budgetnista
• Podcast: Brown Ambition

• ChooseFI Episode 240 From Financial Imperfection to America’s Favorite Budget Expert | Tiffany Aliche
• Get a copy of Tiffany Aliche’s book at getgoodwithmoney.com.

• Earn $1,000 in cashback with ChooseFI’s 3-card credit card strategy. 
• Share FI by sending a friend ChooseFI: Your Blueprint to Financial Independence.