You Can Change Your Financial Life in 6 Months (Here’s How)

In this episode of the Personal Finance Podcast, we are going to talk about how you can change your financial life in 6 months. How Andrew Can Help You: Listen to The Business Show here. Don't let another year pass by without making significant strides toward your dreams. "Master Your Money Goals" is your pathway to a future where your aspirations are not just wishes but realities. Enroll now and make this year count! Join The Master Money Newsletter where you will become smarter with your money in 5 minutes or less per week Here! Learn to invest by joining Index Fund Pro! This is Andrew’s course teaching you how to invest! Watch The Master Money Youtube Channel! , Ask Andrew a question on Instagram or TikTok. Learn how to get out of Debt by joining our Free Course Leave Feedback or Episode Requests here. Car buying Calculator here Thanks to Our Amazing Sponsors for supporting The Personal Finance Podcast. Shopify: Shopify makes it so easy to sell. Sign up for a one-dollar-per-month trial period at shopify.com/pfp Chime: Start your credit journey with Chime. Sign-up takes only two minutes and doesn’t affect your credit score. Get started at chime.com/ Thanks to Fundrise for Sponsoring the show! Invest in real estate going to fundrise.com/pfp Thanks to Policy Genius for Sponsoring the show! Go to policygenius.com to get your free life insurance quote. Go to joindeleteme.com/pfp20 for 20% off! Indeed: Start hiring NOW with a SEVENTY-FIVE DOLLAR SPONSORED JOB CREDIT to upgrade your job post at Indeed.com/personalfinance Turn your business dream into reality! Apply now at www.oneday.org/pfp Go to Acorns.com/pfp and start automating your investments and get a $5 bonus today! Delete Me: Use Promo Code PFP for 20% off! Shop Data Plans and Save Big at mintmobile.com/pfp Links Mentioned in This Episode: The Super Retirement Account (HSA) How to Open an HSA (and Why You Should Consider it!) - Money Q&A 7 Side Hustles That Can Turn Into a Full Time Business Connect With Andrew on Social Media: Instagram TikTok Twitter Master Money Website Master Money Youtube Channel Free Guides: The Stairway to Wealth: The Order of Operations for your Money How to Negotiate Your Salary The 75 Day Money Challenge Get out Of Debt Fast Take the Money Personality Quiz Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Andrew Giancola?

  Longtime listeners know, one of the best ways to build wealth is to increase your income. And one way to do that is by starting a side hustle. And that's one reason why I absolutely love Whatnot. Now, my son and I, we love collecting sports cards. And we've used Whatnot to buy and sell cards. It's been a really fun way to enjoy something we love together. Now, Whatnot is a live shopping platform where people sell everything from sports cards to clothing, electronics, and collectibles. And what's really cool about it is you can turn something you're passionate about into a business. And you could do it right from your phone. You don't even need a storefront or a website. So whether you're looking to make some extra money or find great deals on your next shopping trip, check out Whatnot.

• 0:44Andrew Giancola?

  Search Whatnot, that's W H A T N O T, in the App Store. Download and start selling right away. When I started the Personal Finance Podcast, I had no idea how big it could become. I just knew I had something I wanted to share, so I started putting it online. And looking back, I definitely wish I would have started a decade earlier. One of the horror parts about building something online, though, is making it look professional. A website used to mean hiring a developer, figuring out design, and potentially spending thousands of dollars. In fact, on my website, I spent tens of thousands of dollars. That's what impressed me when playing around with Hostinger's AI website builder.

• 1:27Andrew Giancola?

  I told it what kind of website I wanted, and I built the first version in minutes. No coding, no designer or developer needed. And Hostinger doesn't stop at launch. Their AI can help with SEO, website copy, email marketing, and more. Plus, your domain, website, email, and marketing can all live in one account, with plans starting at just $3 every single month. Hostinger builds your vision step by step. Create your website today. Go to hostinger.com/pfp and use code PFP for 10% off now. On this episode of the Personal Finance Podcast, you can change your financial life in six months. Here's how.

• 2:24Andrew Giancola?

  What's up everybody and welcome to the Personal Finance Podcast. I'm your host, Andrew, founder of MasterMoney.co. And today on the Personal Finance Podcast, we're going to be diving into how you can change your financial life in six months. If you guys have any questions, make sure you join the Master Money Newsletter by going to MasterMoney.co/newsletter. And don't forget to follow us on Spotify, Apple Podcasts, YouTube, or whatever your favorite podcast player is. And if you are getting value out of this show, consider leaving a five-star rating and review on Apple Podcasts, Spotify, or your favorite podcast player. Cannot thank you guys enough for leaving those

• 3:06Andrew Giancola?

  five-star ratings and reviews. And you can also watch this episode on YouTube. Just search my name, Andrew Giancola, and you will find us on YouTube. Now, today, we're going to be diving into a six-month plan to turn your financial life around. A lot of you listening may be on the beginning of your financial journey, or maybe you have been struggling to find your way when it comes to your finances. And so what this episode intends to do is give you a mapped-out plan that is going to help you step-by-step on that journey. And I want you to be able to turn your finances completely around in six months or less. And so I'm going to give you the steps today to do this. We're going to go through month one all the way through month six and tell you exactly what to do

• 3:49Andrew Giancola?

  each month. And by the time you reach six months, you will be able to have a clear financial plan and already taking action towards turning your finances completely around. And so this is one of those episodes that I really, really love doing because you can take action on this advice. Now, listen, if you ever want any of these resources, you can go to MasterMoney.co/resources. And we have tons of resources on the topics we're going to be talking about today as we dive into this. And if you've ever been someone who has said to yourself that I just can't turn my finances around, this is just something I can't do, I'm not made to be good with money, or I don't have the skills to be good with money, or I just feel like I am never getting ahead. Well, this episode is for you. This is going to help you transform those finances in six months or less. Without further ado, let's get into it.

• 4:35Andrew Giancola?

  All right. So for the first month, our entire goal is to get clear with our finances. We are going to put together goals also so that we can get very clear with our finances in the path that we want to take. Now, the first thing I want you to think through is I want you to do a financial audit. Now, what is a financial audit? We are going to go through your finances and figure out where you stand. And so really, the best way to do a financial audit is to put all of your information into some sort of tool. You can use something like YNAB, Y-N-A-B. You can use something like Monarch Money. There are a bunch of fantastic budgeting tools that are out there that are going to help you track your finances. Now, budgeting tools do not just budget anymore. That's not the intent of these. These are going to help you track your expenses automatically.

• 5:20Andrew Giancola?

  In addition, they're going to help you track your net worth. They are going to help you figure out how much you are saving every single month and all of the above. Now, you may be saying to yourself, well, I gotta pay $5 or $10 or $15 for one of these tools. I don't want to be wasting more money on another subscription. But let me just tell you right now, these are investments in your financial self. Putting dollars into some of these tools are really, really important because it saves you so much time. If you're tracking this stuff on a spreadsheet, or if you are tracking this stuff with some other tool that does not do a good job, you need to make sure you have the right tool for the job. Because here's what we want to figure out first is we want to figure out where you stand on things like your baseline expenses.

• 6:03Andrew Giancola?

  So your baseline expenses are your needs, your housing, your food costs, your transportation, your healthcare costs, and your debt payments. These are all the needs that you have into place. Then we want to look at your wants, things that are not your needs, like eating out or entertainment, or just random frivolous purchases from Target, or Amazon, or Walmart, or things that go towards your hobbies like golf or whatever else. Those are going to be the types of things that you want. Then we want to look at your investments and how much you are actually investing for your future. These are things that like your emergency fund, and these are things like your retirement accounts. How much are you putting towards that? And then we want to understand our net worth and our savings rate. Now, if you don't know what your net Worth is this is your assets minus your liabilities.

• 6:47Andrew Giancola?

  So your assets are things like your house. It's things like your cars, all of your investment accounts. It's going to be things like your cash that you have on hand. You can even put things like jewelry and stuff in there, but that's what's going to make up your net worth. Your liabilities are going to be any debt payments that you have. So this is going to be things like your mortgage and how much is left on your mortgage. This is going to be like your credit card balance. This is going to be personal loan balance. If you have a HELOC, this is going to be a HELOC. If you have any other things that are happening within your finances, that is going to be your liabilities. And so you take your total amount of assets and you subtract it by your liabilities, and that is going to give you your net worth. You want to make sure that you are tracking this on at minimum a yearly basis, but I like to do it quarterly and take a look at it quarterly

• 7:33Andrew Giancola?

  only because there are a lot of updates that I am currently making. But your net worth is a very important number because this is your scorecard. Now you may run this calculation and there's a lot of tools that will do this now. Again, some of the ones that I mentioned are Monoc Money and YNAB. But Empower is also a free tool that will do this. And we'll link up Empower down below in the show notes so that you could check that out. But these are all tools that are going to really, really help you track your net worth automatically. So if you link all of your accounts to these tools, they will do it automatically so you don't have to think about it and you don't have to do it in a spreadsheet. Also, as you want to understand your savings rate, this is a number that is very important to understand. How much money am I putting towards investments? And how much money am I putting towards my emergency fund? Those are the two categories that we consider to be within your savings rate.

• 8:18Andrew Giancola?

  This is not saving up for the next car purchase or saving up for your next house purchase or your down payment. This is not money going towards other things like that, like your vacation or whatever else. Your savings rate is what you are saving towards future you. What are you putting dollars towards your future self? That is going to help you achieve financial freedom. So that's going to be that emergency fund and that is going to be your investments. Those are where we want to think about our savings rate. Now, in month one, we also want to set very clear goals. Now, we have a bunch of people who have joined Master Your Money Goals over the course of the last month or two. That is our course teaching. You how to set financial goals. If you want to check that out, you can go to mastermoney.co/courses because we have a very specific system on how to set financial

• 9:02Andrew Giancola?

  goals so that you can actually achieve those goals. But you first want to set up some of your short-term goals. For this specific exercise, we want to have short-term goals that we want to achieve over the course of the next six months, and we want to break them up into three-month chunks or 12-week chunks. And so when we do this, we want to make sure that we have two separate sets of goals that we want to achieve throughout this exercise. So I want you to think through that and set some six-month goals. Then I want you to think about long-term. What are some of the bigger goals that I would achieve over the course of the next five, 10 years? And why do I want to achieve those? And what are those big goals? Maybe it's to save your first 100K. Maybe it's to have a half a million dollar portfolio. Maybe you want to become a net worth millionaire. What are some of the goals that you have over the course of the

• 9:46Andrew Giancola?

  next decade? I want you to write some of those down, and I want you to put them in order of priority. This is very important to do, is to put them in order of priority. So first, your six-month goals. What do I want to do first? I want to get out of debt. Maybe you have $5,000 on a credit card. You want to get rid of debt. You want to make sure that you get control of your spending. You want to make sure you start investing. You want to have a fully funded emergency fund. What are your goals, short-term, over the course of the next six months as you do this exercise? This is going to be one of those things that you definitely need to write down and put them in order. Then secondarily, what are some of those longer-term goals that you want to achieve? Think through those. And then define that why. Why do you want to achieve these goals? What is the big reason? Is it to make sure you have financial freedom for your family?

• 10:31Andrew Giancola?

  So your kids can live in a way that you never got to live. Your kids get to live without financial stress in their life. Maybe that is something that you want for your life. And if that is what you want, define your why. Why are you doing this? Maybe so you and your spouse can stop fighting about money. You guys want to get your money right together. Or maybe this is a situation where you just want to achieve financial freedom, and you want to do it as fast as you possibly can. You are starting from ground zero, and you want to get there. Or maybe you've been living paycheck to paycheck for way too long. You started to invest a little bit. You have some money in your emergency fund, but you want to get to That next step, define your why and what it is. This is going to be a very powerful exercise for you because once you start to write this down, and I want you to look at this every single week. And if you can, look at it every single day.

• 11:16Andrew Giancola?

  Take a post-it note, put it on your bathroom mirror. Think about this every single day because the next six months, I want you to take ownership of your finances. We're going to show you exactly how to do this. Now, the third part of this is we are going to track our spending. Now, the bad word, the bad way to say this is to create a budget. But no, we are going to prioritize, optimize and look at our spending. So how do we do this? Okay, the way that we do this is within three categories. We have 20% going towards our future self. Okay, we have a rule called 205525. And the way that this works is that the at a minimum, we want 20% going towards your future self. What is your future self? This is going to be dollars going towards your emergency fund. This is going to be dollars going towards your investments.

• 12:00Andrew Giancola?

  Maybe it's your 401k or your Roth IRA or your brokerage account. Or maybe it's going towards crypto. I don't know what you invest in, but whatever you're investing in right now, any dollars going towards your future self, that counts as part of your 20% of your income going towards future self. Now, this is 20% of your gross income going towards future self. Okay, so that's 20. Next, we have 55. So 55 stands for a range, actually. So it's the middle of the range, but you want to be spending 50 to 60% of your income on your baseline expenses. These are your essential expenses, things that you need day in and day out. So this is going to be housing. This is going to be food, your groceries. This is going to be transportation. This is going to be healthcare.

• 12:46Andrew Giancola?

  This is even going to be your debt payments. All of those are categorized as essentials, things that you need. So when it comes to housing, it's going to, you know, utilities are grouped into there. You know, your electric bill, your water bill, those types of things. When it comes to transportation, your insurances are grouped into there. Your gas is grouped into there. That's transportation. And then when it comes to making sure that you have enough for food, this is your grocery bill. Eating out is a luxury, so eating out doesn't count in these essentials. But this is all of those. Different things. And this is also making sure that you have enough set aside if you, you know, have a hospital run that you have to go to unfortunately, or doctor bills, or your copayments, those types of things. And then we have debt payments. Those are really important as well. You can even factor in other essentials, like for example, I would consider a gym

• 13:29Andrew Giancola?

  membership an essential because you want to take care of your health. It is part of that medical expense side. And you want to make sure that you're taking care of your health. So those big, big priorities that would be essentials, I would put them in this category. Okay. So that would be your baseline expenses is 50 to 60% of your income. Now, if it is way out of this range, if you are seeing that, oh man, I'm spending 70, 80, 90% of my income on these baseline expenses, you have one of two problems. Either you are spending too much money on those essentials. So either you may be house poor, for example, if you're spending 30% or more on your housing all the way through, then you are most likely house poor. Or if you're spending way too much on transportation, you got those big car payments, you got the jacked up truck,

• 14:12Andrew Giancola?

  you got the SUV, and you're driving downtown with the chromed out rims or the black rims, then maybe your car payment is too high. And if that's the case, then it might be time to make an adjustment. We can talk about that. And then lastly is things that you love. So the 25 stands for I want you spending 25% of your income on things that you love, but you got to get the other, the first two in check before you can do this. Otherwise, the first two are going to eat into this 25%. And so if you're spending too much on those baseline essentials, then you could be either spending too much, or you have an income problem. For some people out there, you do not make enough money to cover your baseline expenses. And so if you have an income problem, we need to

• 14:54Andrew Giancola?

  focus our time and energy throughout the six months on increasing our income. That is where we want the biggest bang for our buck. We're going to make some money moves here. Don't you worry. But at the same time, we want to focus that time and energy on increasing that income. And then lastly is that 25%, like I said, on things that you love. So this is going to be hobbies. This is going to be eating out. This is going to be doing things that you want to do experiences with your family, vacations, all those amazing things. This number can go up over time. And so as you start to get those baseline expenses under control, you can adjust this. Number, or maybe you want to invest more dollars to future you so that you can retire faster. Maybe you want to retire in your 40s or 50s. Well, increasing the amount that goes to your future self is going to be a huge, huge, big priority for you.

• 15:37Andrew Giancola?

  Now, how do you ask yourself, well, what do I spend on myself? Or how do I know how to actually even allocate dollars towards spending on these things? You figure out what you value. So I want you to think about your money for a second, and I want you to do this exercise. What do you truly value? What do you want your money to do over the course of the next 10, 20, 30 years? Maybe you truly value getting your time back and buying back your time. If that is you, guess what? We need to put more dollars towards our future self. Or maybe you truly value spending more time with your hobbies. Maybe you like to go to special yoga classes, or maybe you like to go to spin class, or maybe you like to go and play golf all the time. Or maybe you like to play pickleball and you want to get an indoor pickleball facility, membership, wink, wink.

• 16:21Andrew Giancola?

  Maybe there are other things out there that you want to do. But you got to think through, what are your big hobbies? And what do you want to spend more time and energy doing? That's where that 25% goes to. For some people, it may be going on some lavish vacations. Maybe you want to fly business class. Or maybe you want to get the fancy hotels because you like hotels. Or maybe you love clothing and you want to spend more dollars on clothing. Or maybe you just like to buy whatever you want. You want to DoorDash every single day because you think it's fun to get a brand new present to your front door every single day. Well, that is going to be one of those things where you allocate it towards what you love. And I want you to make a priority list of what you love. And I want you to put it top to bottom, what you really want to do. Now, if you're married, or you have someone in your life who you are managing money with,

• 17:04Andrew Giancola?

  then I want you to make sure that you are also prioritizing this list with them. Money is a team effort if you are married. Okay, I'm going to say this again, louder for the people in the back. Money is a team effort if you are married. You guys both have to get on the same page. This is going to be a separate episode, but you got to both get on the same page in order to make sure that you are doing the things that truly, truly matter. Then, what we want to do is when we are starting to put together the spending plan, we got that 20% for future self. We got 55% going towards base. expenses. We got 25%, so it's really 20 to 30% going towards things that we love. Then we want to make sure we are automating this spending plan. So the cool thing about tools like Monarch Money

• 17:45Andrew Giancola?

  or tools like YNAB or tools, there's a bunch of them out there like Origin is another one that I've heard a lot of people like. The cool thing about these is that they will actually automate your spending. So all you have to do is do what I call the five minute drill. See y'all ready? The five minute drill is one of my favorite things for people who are new to spending plans. Because the last thing you want to do is spend an hour and a half at the end of every single month. And make sure you got all your budget categories lined up and everything's lined up. This is why people quit budgeting is because they do not want to do that. So instead, we created the five minute drill, which is something I love doing that allows you to spend five minutes every single day. Making sure your spending plan looks correct. So here's what you do.

• 18:28Andrew Giancola?

  You log into your spending plan app, or if you're using a spreadsheet, this is going to take you maybe six minutes. But if you log into whatever you are using to create your spending plan, a spending plan is just another word for budget. And when you have that spending plan in place, all you're going to do is log in there and start to categorize expenses that you spent yesterday. And that's it. You're done in less than five minutes every single day. I'll tell you right now, it takes me about two minutes now every single day. Sometimes even less depending on if we spend that much money. And so this is one of those things that as you start to think about your dollars and as you start to think about your money, you will be the most financially aware person in your entire friend group if you do this. If you do that five minute drill, it'll take you less time than everybody else.

• 19:08Andrew Giancola?

  And you'll be the most financially aware person of anybody that you know. Why? Because you are looking and categorizing every single day. And you're making sure that you are on track every single day. This is a huge difference maker for a lot of people is once they start to do this. They are really, really making a big impact. So here's where I want you to think through for month one. Okay? We're going to do that financial audit and we're going to get clear where we are. We're going to get financial audit. We're going to look at, hey, where are we laying on some of this stuff? Oh, I'm way too high on my things that I love spending, my want spending. And so I need to kind of reel that back in so that I can take more dollars and put them towards my future self or oh, I'm Way too high on my baseline expenses. I need to figure out what I need to do in order to reduce some of those expenses.

• 19:50Andrew Giancola?

  And you need to go and find money or whatever else you need to do in order to reduce some of those. And that's going to be really, really important. Sometimes you may have really high baseline expenses. This is the last thing I'll say on this is sometimes you may have really high baseline expenses because you have a lot of debt. And if you have a lot of debt, we're going to work on that here in a second and we'll talk through what to do that. But for month one, we're going to have that plan in place. We are going to create our spending plan or our budget and we are going to see where we currently stand. And so that is what I want you to do. You have 30 days to do all of that. And so that is going to be a big, big thing, but this is going to be the foundation to help you with your six month turnaround. Let's get into month two next. All right, so in month two, we are going to do one of my favorite things,

• 20:35Andrew Giancola?

  which is we are going to start building an emergency fund. Oh, boy, is this my favorite thing? So we have something here at the personal finance podcast and master money called the 136 method. Now, longtime listeners have probably heard of the 136 method, but what this is, is this is going to allow you to build a fully funded emergency fund gradually over time. So for most of you, if you have no emergency fund whatsoever, or you don't even know what an emergency fund is, all it is, is a fund, and typically we open them in a high yield savings account online, but it is a fund that is set aside for emergency expenses. So your car is going to break down at some point in time and you're going to have the money just there in your emergency fund.

• 21:18Andrew Giancola?

  Or your faucet is going to leak in your house and you're going to have to call a plumber and you're going to have the money just there, or you're going to have to fix it yourself, but you're going to have to go to Lowe's and get some tools and different things like that. Okay. Or your roof is going to have an issue and maybe some shingles are going to fall off during a hurricane that happened over the course of the last couple of months because you live in Tampa, Florida. I'm not just speaking for myself here. And so you're going to have to have the money just there to fix that. Or maybe something is going to happen and you're going to have a medical emergency and you're going to have to go to the ER and you're going to have a $500 ER bill because your insurance is deductible is a little more expensive. Or maybe you are going to, you know, have to do a couple of urgent care visits because The flu bug gotcha. And so now you're gonna have to pay a hundred dollars to urgent care. All of these different things will not be issues if you have the money just there.

• 22:04Andrew Giancola?

  And so the emergency fund is a way to build up an emergency expense bucket that is going to allow you to take care of those things. And here's the big one. Job loss. So there are a lot of different things happening right now. And there are a lot of companies who have started layoffs. And if you lose your job and you have a fully funded emergency fund, you're gravy, my friends, because if you follow what we talk about here in a second, you will see that once you fund your emergency fund, you don't have to stress. You're going to have time to go find your next job. And this is going to cover your expenses during job loss. This is very important to do because the last thing you want to do is go financially backwards or go deeper into debt or go into debt because you lost a job. And so the emergency fund, the number one purpose of that

• 22:45Andrew Giancola?

  is to protect you against job loss. And so this is a huge, huge deal for most people. So here's how the 136 method works. One is we are going to focus on first, building up one month of expenses in a high yield savings account. Well, how do we do that? Well, how much do you spend every single month? Do you spend 5,000 a month? Do you spend 7,000 a month? Do you spend 10,000 a month? Do you spend $3,000 a month? But you figure out how much do I spend every single month? And that's how much I need to save up in order to have one month of expenses saved in my high yield savings account. Okay? And so this is going to be the number that gets you this little start to a fully funded emergency fund. This is phase one, and there were three phases into this. Okay?

• 23:25Andrew Giancola?

  And so once you have one month of expenses saved up, then what I want you to do is look at your debts. Because the one month of expenses is at least going to protect you if something happens to you in life while we are attacking your high interest debt. Now, what is high interest debt? It is any debt above a 6% interest rate. If you have any debt above that 6% interest rate, we want to make sure that we are paying off that debt as fast as we possibly can. Because this is a pants on fire emergency. And so you have one month of expenses saved up in your emergency fund, and now we are looking at our debts. So debt is a huge problem for a lot of people. Now, low interest debt, I don't have as much of a problem as high interest. And so high interest debt would be, you know, something like credit card debt,

• 24:08Andrew Giancola?

  or it would be a personal loan. Maybe you did something like buy now, pay later, and all of a sudden that buy now, pay later had the interest rates payments come in. You didn't pay it off in time. And so now you're paying interest on buy now, pay later. Or maybe it is something where you got a loan from family members or friends, and they charge you an interest rate, and now you gotta pay that back. Or maybe you went and got a business loan, and you didn't pay it all the way back yet. Or whatever it is, maybe you went and got an auto loan, and you have a 9% interest rate on there. I've seen a couple of people with above 10% interest rates on their auto loans, which is really, really high. If that's you, then we need to make sure that we are paying off that as fast as we possibly can. Maybe you got a HELOC, for example, that's another one, and you didn't pay it off yet. So we gotta make sure that we are paying that off as fast as we possibly can. So any debt outside of our main mortgage is going to be high interest debt.

• 24:52Andrew Giancola?

  And it's gonna be very important that we attack this as fast as we possibly can. And the reason for this is because we can expect at least at a minimum, depending on what your portfolio is, somewhere around a 6, 7, 8, 9, 10% interest rate if we invest our dollars. And so the rate of return that we would get when we invest our money would be anywhere from 6 to 10%, depending on what type of portfolio that you have structured. And so because of that, we can expect that this high interest debt needs to get paid off first, so that we can take those extra dollars and begin investing them later on. So figure out what your debts are in order, and you can start to pay those off. Now, we have a free debt course. If anybody wants to take that, you can go to mastermoney.co/courses, and you will see our free debt course there available to you if you want to look at paying that off.

• 25:36Andrew Giancola?

  Next, once we have our one month of expenses, then our next goal, and you're not gonna do this all in six months, but I'm explaining the entire scenario for you, depending on where you are. And that way, during this six-month process, you can start to attack some of these things. But our next goal is going to be to get to three months of expenses. So you already have one month saved up, so you need another two months saved in a high-yield savings account before you can take the next step. Because three months of expenses are gonna at least help you in some situations. If you lose your job, it'll take care of some big expenses that happen, and will help you weather against some storms. It's not gonna be the end-all, be-all, because we have one more step there, but it'll get you started. Then, once you have that available, then we can make sure that we are also... So starting to invest now automating and investing is going to come later on in this

• 26:19Andrew Giancola?

  six month plan, but I'm just telling you that after those three months of expenses are saved up in that high yield savings account, then you can begin investing. And then, once you start investing, then we also want you to start saving for six months of expenses. Six months is the ultimate fully funded emergency fund in our book. Anything below that is not a fully funded emergency fund. Anything above that, you can go way above that if you feel more comfortable having nine months or one year or two years. It doesn't matter what you have, but at a minimum, we want you to have six months of expenses saved in an emergency fund. Okay. Now also during month two, you have this plan to start saving an emergency fund. You need to open a high yield savings account, maybe go to Ally, maybe go to wherever else you want to open a high yield savings account. You are attacking high interest debt because high interest debt is a huge priority.

• 27:02Andrew Giancola?

  Any debt above a 6% interest rate. Those are the first two things. Number three is if you identify that you have an income problem, we need to put together a plan to increase your income. Well, how Andrew do we do that? How do we increase our income over time? Well, number one, the number one place to do this is at your day job. You need to negotiate your salary at work. Now we have a step-by-step system on how to do this. We will try to link that episode up in the show notes on how to get a raise. But in addition, we also have a free ebook. If you go to mastermoney.co/courses, this lays out the entire system. This is also my friends, a six-month system. And the reason for that is because you are going to actually collaborate with your current boss. And we're going to teach you how to do this, where you collaborate with them to actually

• 27:45Andrew Giancola?

  show them that you deserve this raise and then you're going to get that raise at work. I promise you, we have had so many people go through this process and do it and they get raises all the time. And we have had some massive, massive raises happen just from this system. So make sure you are looking at that. Secondarily, though, is if you have some skills, maybe you are really good at photography, maybe you are really good at math and you can help tutor people. Maybe you are really good at coding and you can do some coding on the side. But whatever skills you have, see if you can start to freelance a little bit. Is there some freelancing that you can do where you can earn extra money that is going to help you within your budget, help you invest more dollars towards your future, help you put more dollars towards your emergency fund, help you Pay off that debt, all of these different reasons and whatever your big goal is,

• 28:29Andrew Giancola?

  that's why you want to start freelancing. You want to start doing this stuff to attack that big goal. But I want you to think through what you can do and then identify some of those skills that you can monetize. Maybe it's graphic design, maybe it's writing. There's so many different things that you could do, but I want you to think through this. Also, if you can find money, meaning if you can cut back subscriptions, if you can go out there and sell unwanted items that you have, start to find money to put towards some of these financial goals. You want to get the clutter out of your house, sell it. I don't care if it's five or $10. A lot of people are like, I'm just going to put it up for free. No, sell it. Put it towards your debt, put it towards your investments every single time. Try to get a couple of dollars out of it. If nobody buys it, then yeah, do a porch pickup and have somebody come take it. But outside of that, I want you to try to sell your unused items as much as you possibly can.

• 29:12Andrew Giancola?

  No matter how small the a dollar amount is, I am shameless when it comes to selling things. And this is coming from someone who has figured out their finances. I am still shameless at selling things. I'll sell something for 10 bucks and I don't care. I'll sell a spaghetti strainer for $5 if I can sell it. And so this is one of those things that I think that most people just need to keep doing this. I did this over the course of one summer where I started to sell unwanted items. And I would sell things for $5, some things $10, some things for 100, some things for $200. And at the end of the summer, I had over $3,000 just from doing that, just from selling unwanted items. It is one of the things that I think every single person needs to sell is many of their unwanted items. Go look at it. Have you used it in the last six months? No, get rid of it. Get it out. Let's move on, get that cash flow coming in and let's get those dollars coming in.

• 29:56Andrew Giancola?

  And so that's month two is I want you to start building that emergency fund. I want you to reduce those debts and we want to increase our income. It's a big, big month in month two. First month, we set up our plan. Second month, we are attacking, we are making progress in month two to turn our finances around. Really pumped for you to be able to do this as well. Now let's jump to month three. My relationship with money has changed a lot over the years. Early on, I thought building wealth was about making more money. Now, I know it's really about having clarity. When you know exactly where your money is going and whether you're on track, you make better decisions. That's one of the reasons I love Monarch. It's the personal finance app that tracks everything, from your accounts and investments to your savings, goals, and spending.

• 30:40Andrew Giancola?

  So you can see your entire financial picture in one place. One habit that's made a huge difference for me is my five-minute drill every single morning. I open Monarch, check my spending, investments, cash flow, and net worth, and I'm done in just a few minutes. It gives me confidence that nothing is slipping through the cracks. I also love the AI weekly recap because it'll flag spending changes, upcoming expenses, or shifts in my net worth before they become a problem. Instead of reacting after the fact, I can make adjustments early. It really feels like having a financial advisor in your pocket. Write your own money story with Monarch. Use code PFP at monarch.com to get your first year of Monarch Core half off at just $50.

• 31:23Andrew Giancola?

  That's 50% off your first year at monarch.com with code PFP. It's kind of amazing how much can change in just a single year. Every summer, the kids are a little bigger, a little more independent, and life looks a little different than it did the year before. And it reminds me that while we can't predict the future, we can prepare for it. That's one of the reasons I like PolicyGenius. See, PolicyGenius isn't an insurance company. They're an online marketplace that lets you compare life insurance quotes from some of America's top insurers, side by side, for free. And their licensed team helps you compare coverage, prices, and terms, answers your questions, and even handles the paperwork so you can get the right policy without the hassle.

• 32:08Andrew Giancola?

  For me, having life insurance isn't about expecting something to happen. It's about knowing my family is protected so I can actually enjoy these moments together instead of worrying about what comes next. And with PolicyGenius, you can find 20-year life insurance policies starting at just $276 a year for one Million dollars of coverage. Head to policygenius.com to compare life insurance quotes from top companies and see how much you can save. That's policygenius.com. If you've been listening to this show for a while, you know it's not just me anymore. It takes a great team behind the scenes to make everything happen. And if I had to hire someone tomorrow, I'd want someone who could jump right in and make an impact. That's why I'd use Indeed Sponsored Jobs.

• 32:52Andrew Giancola?

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• 33:33Andrew Giancola?

  And listeners of this show will get a $75 sponsored job credit to help get your job the premium status it deserves at indeed.com/podcast. Just go to indeed.com/podcast right now and support our show by saying you heard about Indeed on this podcast. Indeed.com/podcast. Terms and conditions apply. Need to hire? This is a job for Indeed Sponsored Jobs.

• 33:57Speaker 01

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• 34:21Andrew Giancola?

  All right. So in month three, we are going to start to automate and optimize. This is where we have made some big, big moves over the course of the last couple of months. And now we're going to start to automate and optimize our finances. We want to see, are we making progress and how can we optimize this process? Automation is the biggest one. And if you do not automate your finances, there's a reason why I didn't put this in month one, because I want you to start getting this stuff rolling. I want you to get your hands dirty a little bit. Then I want you to start automating because automation allows you to manage your finances without having to lift a finger. It allows you to manage your finances and build wealth without having to think about it all the time. And so what this does is it's going to get you in a great spot to start transferring money out automatically.

• 35:05Andrew Giancola?

  Now we have a, an automation system that we're going to be talking more about coming up here soon. That is really going to help a lot of people, I think, get their finances automated for the long run. So first thing we want to do is we want to start to set up automatic transfers to savings accounts. Okay. We want to use the bucket method to do this. So typically we want you to have a high yield savings account that has different budget categories in it. Ally Bank does this. I think Marcus does that. There's a bunch of different bank accounts out there. You can kind of do a Google search and say which high yield savings accounts have buckets or ways to budget inside of that high yield savings account. Okay. And you can pick your favorite one. We're not affiliated with any of them. I use Ally personally, just because it's one of the earliest ones that did the buckets, but there are a bunch of them out there. And you want to start to set up automatic transfers to things like your emergency fund

• 35:50Andrew Giancola?

  or whatever other savings goals that you have. Maybe you want to save up for a house down payment. Maybe you want to save up for your next car. You want to start automating into those different buckets for your savings goals. Now, the beautiful thing about this is what happens is that once you start to automate into these accounts, you're going to start to see these things are going to grow without you even having to think about it. Now, if you've ever had a 401k at work or you've ever had that match and you know, they just take it out of your paycheck every single month. And all of a sudden you look at your 401k, two years down the line, you're like, holy cow, where did I get all that money from? Well, this is the same thought process. Automation allows you to automatically save money into some of these accounts. Secondly, is we want to automate our bill.

• 36:31Andrew Giancola?

  Payments and we would do this by utilizing credit cards and we do this by utilizing our checking account when we cannot use a credit card. So if you've ever had credit card debt in the past, credit cards are not for you. Okay, let's just cut those things up. We can't trust you right now. We're going to throw those out. But if you've never had credit card debt in the past, we want to make sure that we optimize our spending through credit cards because it's an easy way to earn points for the things you're going to spend money on anyways. You get cash back, you get points for travel. And so this is a great way to do that. And so we automate our bill payments by putting it on a credit card and then paying off that credit card every single month. So we automate via credit card, then we automatically pay the credit card off every single month. It's a double whammy there, but that is how we're going to set that up. And secondarily, if you can't pay it on a credit card, you just start automating your

• 37:15Andrew Giancola?

  bill payments in your checking account. Now, this is why we have a spending plan because really, we're automating everything and then the spending plan is telling us, hey, here's where we stand when it comes to this. And so if you have an automatic spending plan already, then you're just doing the five minute drill every single day and you're able to have this financial dashboard that wow is all of a sudden coming together. This is a beautiful, beautiful thing for a lot of people. Once they get this going. Thirdly is we are going to automate our investments. This is the number one thing that you should do first is to pay yourself first. And so when we have 20% of our income going towards investments, we want to make sure that we have it going towards the investment accounts we want to go to. Maybe it's your 401k match, then you're maxing out your HSA, then you're maxing out your Roth IRA, then you're maxing out your 401k or 403B

• 38:00Andrew Giancola?

  or 457, whatever it is, you want to make sure you have that plan in place and you're automatically investing it every single month. A lot of brokerages now will allow you to automatically invest. One of the best with the best tools is Fidelity. I show you actually exactly how to do it in an Investing for Beginners free workshop. If you go to mastermoney.co/investingforbeginners, you can sign up for that free workshop. It's every Tuesday night at 8pm and we show you how to do it. We show you how to set up those automations inside of Fidelity. Vanguard's also a great tool. There's a bunch of great places to automatically invest, but you want to make sure you're doing so every single week. You could do it every two weeks. You could do it every month. There's so many great ways to automate now and get more dollars into these accounts. Okay, and so those are the big things that you want to make sure that you are doing.

• 38:45Andrew Giancola?

  And when you're automating your bills, when you're automating your investments, when you're setting up auto transfers into your savings accounts, you have a money system that is flowing beautifully. And when that starts to flow beautifully, all of a sudden, everything is growing and you are building wealth automatically. This is just a money-making machine. And so it's really cool how you do that. Also, secondarily, is if you have way too many accounts, if you have accounts all over the place, we want to start to streamline some of this stuff, okay? So if you have four or five checking accounts or your accounts are separated and you're married and you have all these different things going on here, we want to try to streamline this and combine accounts as much as we possibly can. And if you are someone who just likes to have different accounts to test them out, more power to you. But we want to try to streamline this and make this simple because when we have an automation system, the easiest way to do this is just to consolidate accounts

• 39:30Andrew Giancola?

  and try to keep it within as little accounts as possible. It comes easier for tax time, but it's also easier for a number of other situations. And so streamlining is a big thing there. Secondly, is I want you to cancel unused subscription. I want you to do a subscription audit and you're looking at your spending plan now by month three and you're really looking through some of this stuff. And we want to start to cancel some of those subscriptions that we do not use. This is a way to find, you know, hundreds of dollars pretty quickly, depending on how many subscriptions you have. And if your cable bill is too high or your cell phone bill is too high, let's call those companies up and start negotiating and getting those bills lower. This is going to help you just streamline your finances, get more money back. And then, once you save money with some of these accounts, then I want you to take that money and start to automate it somewhere else. You want to do the CIA method, okay?

• 40:14Andrew Giancola?

  So what you want to do is first, you cut. The C stands for cut. So you're cutting back, okay? And then you're identifying where that cutback is going to go. So let's say, for example, you cancel Netflix and you save 20 bucks. And so you cut back Netflix. Now you want to identify where's that $20 going to go? Well, I want to put this in my emergency fund. So now you identify that that $20 is going to go to your emergency fund and then you automate it into your emergency fund. You just increase your automation to your emergency fund by $20. This makes sure that the money doesn't go into your checking account, get commingled in there and then it just gets lost in translation. You have no idea where those funds went. Instead, you identify and you automate where that money is going to go. It's called the CIA method. Then we want to track our progress. We want to review, obviously, our spending, make sure we are making progress every single week.

• 40:58Andrew Giancola?

  And we want to make adjustments if we are not making progress. So look at what you're doing now and see if we can make adjustments on that progress. Now, let's go to month four, which we're going to invest and grow.

• 41:09Andrew Giancola?

  All right, so in month four, we are going to start making sure that we optimize our investments and get this thing rolling. So if you don't have investment accounts yet, and you are starting to take care of some of this other stuff, now is the time to look at it, opening investment accounts. So we really, really like accounts that are going to give you tax advantages. So we like accounts that are going to help you with your tax burden over time. So one big thing we want to look at is first, if your employer offers a match. Does your employer offer a 401k match, or a 403B, or a 457, or a Roth 401k, whatever it is, does your employer offer some sort of match? If they do, you need to take advantage of it. Why? Because it is free money, my friends, and I love free money. Free is my favorite number, and

• 41:54Andrew Giancola?

  you should love free money, too. And so taking advantage of some sort of employer match is going to be the first thing that you should be doing. Then you want to look into something like the Health Savings Account, or the Roth IRA, or both. The Health Savings Account, also called the HSA, is an account where money goes in tax-free. It can grow tax-free, and you can pull the money out tax-free, as long as you have a qualified medical expense. We have an entire episode on that. We have also an entire episode, and a couple of episodes from today, coming out on that as well. We are going to do a huge master guide on the HSA and talking through that more. But secondly, we also have the Roth IRA. And the Roth IRA is an amazing account that allows you to put money in that's already been taxed. So it was already on your paycheck, and it was already taxed, but the money grows tax-free,

• 42:37Andrew Giancola?

  and you can pull the money out tax-free. So it's a very powerful account because of that tax-free growth. Then you can go back to something like your 401k and get a pre-tax deduction on your 401k, and then that allows it to grow over time. And then when you pull the money out, you get taxed when the money comes out. But the goal here is to make sure we are getting 20% into these accounts, if we already have a fully funded emergency fund. If not, we follow the 136 method and go through those motions. But you need to make sure at a minimum, you have 20%. We really want to get 20% to 30%, and then increase that over time as well, if you can. Now, if you cannot get 20% into these accounts, we want to use the 1% rule. What does that mean? We're going to start with whatever the maximum we can start with right now, is... Say for example, it's 8%, okay?

• 43:20Andrew Giancola?

  If you can invest 8% of your income right now, and you're putting it into some of these accounts, and you're starting to grow your money over time. Well, in month two, we want to put 9% in there. That's 1% more. In month three, we want to put 10% in there and slowly, gradually start to put more in there. And while we're doing this, we're finding ways to increase our income, to make up for each 1%. And so we're ticking it up slowly over time. Then, over the course of 12 months, all of a sudden, you're putting that 20% in one year later. And so this is a very powerful way to slowly increase it over time. Also, during month four, the one thing I want you to do is I want you to pick up at least one personal finance book, and I want you to start reading it. And I want you to go through that personal finance book and start to read, you know, 10 pages every single day. This is going to be the part

• 44:04Andrew Giancola?

  where you start your financial knowledge journey, and you're going to start to grow over time. Now, if you want our list of personal finance books, if you join our newsletter, the Master Money Newsletter, we put out books every single week in the High Performance Book Club is what we call it. And we have a ton of master lists of personal finance books in that High Performance Book Club. So make sure you check that out if you're interested in it. Even if it's stock market investing, it could be real estate or other asset classes. It is important that you continue your financial education, and now is the time to start expanding that financial knowledge. So you're starting to get the hang of this, and so now it is time to start expanding. Let's get to month five. All right, so in month five, what we're going to be doing is we're going to start to build out some additional income streams. And I want you to think through, hey, we already talked about increasing our income,

• 44:48Andrew Giancola?

  but now we want to start to diversify our income if we can. Now, this is not for everybody, but if you want a second income source, this is going to be the time to do it. And what I want you to do is think about, hey, can I start a side hustle by freelancing? Can I start an e-commerce brand? Can I start coaching people in something? How can I start a side hustle that's going to help me make more money? Secondarily, is there something else that you can do or invest in that you know about that can help you increase your income? Third, is there a side business that you can start that could turn into a full-time income at some point in time? We have a bunch of different series of episodes called Seven Side Hustles that could turn into a full-time business. And so I encourage you to check those out if you have not already, because those could be very helpful. As well and help you kind of grow your income over time.

• 45:32Andrew Giancola?

  And so thinking through some of those, I truly, truly encourage you to go through there. Also, can you monetize your skills? Maybe you can create digital products or online courses or offer consulting. Or maybe you can start to work on a personal brand. If you are really, really passionate about an industry, maybe you're passionate about sales or marketing. You want to create a personal brand around that. Maybe you're passionate about, you know, different hobbies that you have. Maybe it's, you know, fitness or golf or fishing and you want to create stuff around that. Or maybe there is just different things that you can do. Just start creating and trying things to see if you can turn it into a full-time income. We want to start refining our goals. We want to adjust our financial goals based on the progress and some of the new opportunities we have seen. We're five months into this now. And so we probably have seen what's working and what's not working.

• 46:14Andrew Giancola?

  We want to start making adjustments over that timeframe, which is going to lead us to month six. So in month six, we want to review, adjust and scale. So because we are in the last month here of this six-month turnaround plan, what we want to try to do is figure out first, a comprehensive review. So I want you to compare your progress to your original goals. I want you to pull out that sheet, look at your original goals and see how far you have come. Did you break through the barrier of those goals? Did you have some setbacks and you're still working towards those goals? Both are amazing and that is okay, but the fact is that you are sticking with it. Most people quit, but the fact that you are sticking with it in month six is a huge, huge win for a lot of people. Secondarily, I want you to identify areas that you can improve to become successful going forward.

• 47:00Andrew Giancola?

  We want to make this system as easy as possible, which is why we automate this process. We don't want you thinking about your money all the time, every single second of the day. Instead, we want to make this easy. Five minutes a day and you're spending five minutes a day to make sure that you set yourself up for the rest of your life. It is an amazing, amazing trade-off. But secondarily, we want to automate everything else. So we're not thinking about everything else all the time. And then double down on what's working. If you see things that are working, I want you to double down on those things. Invest more in successful ventures that you see are working. Invest more dollars into some of those retirement accounts, but double down on what is big and what is working. And then try to look at what are those time-consuming tasks that aren't helping you grow and try to either remove Or delegate them to someone or just try to figure out a way to optimize your day.

• 47:43Andrew Giancola?

  And then create that long-term plan. So we got to month six. If you're making progress, let's start creating that long-term plan. That's going to help us tremendously over the course of the next couple of months, if not the couple of years and continue automating, investing and growing your wealth. So the big thing in month six is we are trying to look at where we stand and try to make adjustments and then go back to continuing to make those progress and improvements. So that's the big, big thing here. So if you follow the six month plan, this is going to allow you to completely transform your finances in six months. And I promise you, if you stick with it for the long run, maybe it takes you 12 months to actually achieve that goal. Maybe it takes you 18 months. I don't care if it takes you two years. But if you are working towards these goals and you are working towards getting them done, it's going to make a huge impact on your financial life.

• 48:26Andrew Giancola?

  If you want to build wealth for you, if you want to build wealth for your future or your family, then this is the way to do it. I believe every single person in this world can build wealth and my goal is to bring you as much value as I possibly can for free on this podcast. And so that is our entire goal and that's what I want to do for each and every single one of you. Listen, thank you so much for being here on this episode. If you found value out of this episode, share it with a family member or a friend. And don't forget to follow this podcast to get more content just like this. Cannot thank you guys enough for listening to this episode and we will see you on the next episode.

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