Money Makeover Series: Wrapping up Ready to Launch

Three months have come and gone in a flash, and it’s time to see how our Money Makeover participants fared. First up: Ready to Launch! Read on to find out the astonishing changes Mimosa has gone through and her exciting new plans for the future!

When we first met Mimosa, she was a highly motivated young professional on track to pay off her student loans and preparing to save enough money to move out on her own. But she also had some big dreams in play, including the desire to move to Europe someday. That meant Mimosa needed a plan in order to stick to her debt payoff goals, so she could achieve her dream of moving across the pond sooner rather than later. So how did she do on her plan?

If At First You Don’t Succeed…

When Mimosa and I sat down to create a spending plan, we knew we were in for a challenge. Mimosa has been using her young professional salary to make triple the minimum payment on her student debt each month, while paying for graduate school out of pocket, and dealing with the high cost of commuting from her town to the city where she works. Then there’s the fact that Mimosa is working full time while attending school. This all adds up to a lot of costs and little money to cover those costs. On top of that, one of Mimosa’s favorite hobbies is fashion.

Even with a challenging schedule and challenging goals, Mimosa started off doing great at sticking to the plan…until a friend of her’s came into town and a trip to the mall ensued. By the time Mimosa and I had our next follow up call, she was clearly feeling some intense guilt over the trip – and not much that I could say consoled her.

The thing is, when you lose track of a plan, it can be harder than ever to get back on the horse – and that’s the problem Mimosa was having. The one time slip up could have been no big deal, but it led her to avoid her financial situation altogether. She stopped tracking her spending because she didn’t want to be reminded of her slip up. Essentially, she was paralyzed mentally and couldn’t move forward.

…Try Try Again

I completely understood how Mimosa felt and didn’t think she deserved the guilt she was carrying. We all slip up on our plans from time to time, but the most important thing is to pick ourselves up and keep truckin’. I would know–my frugal side leads me to avoid spending, but it also makes it hard to turn down a good deal if I see one. It’s a catch-22!

Mimosa and I talked it out and realized that part of the problem was not that we were unrealistic on her budget, but we didn’t do the best job optimizing her tracking. She was using the cash envelope system and also keeping track of receipts at night. However, her busy schedule made this system a bit too much work to follow habitually. So I told her about a few phone apps that would allow her to enter her purchases as she makes them. That means it’s easy to keep track of her spending and to turn down a purchase in the heat of the moment (with the tracking tool playing the part of the accountability buddy right at the counter). Turns out, this made a lot more sense for Mimosa’s lifestyle and was just the thing to finally get her to forgive herself for her past slip up and get excited for her next steps.

Fail Fast

What’s the lesson from all this? The lesson is that when you create a spending plan and realize it’s not working, don’t keep pushing forward. This will only dig you deeper into a hole. Rather, analyze what’s not working and why, then decide how you can tweak your plan and build one that makes more sense. Fail fast so you can succeed faster!

Next Steps

The conversation between Mimosa and I took an unexpected turn into career territory – something that seemed to be a new trend as I get further into financial talks with each participant. We started to brainstorm about a way to look at her favorite hobby – fashion – and turn it into something useful–instead of a detractor on her budget. She mentioned that her other two passions were nonprofits and communications, and the next thing we knew the wheels were turning! Could there be a way for Mimosa to merge her love of fashion, nonprofits, and communications into a business so that she could sustain her spending plan, even in the future, and cultivate the career of her dreams? Stay tuned for the conclusion of the series in one month to find out!

Shannon Mcnay

Shannon McNay is the Community Outreach and Customer Support Manager at ReadyForZero, a website that helps people get out of debt faster on their own. Shannon loves to share her own experiences and tips she's learned along her own path to help people optimize their finances for a brighter future. You can follow Shannon on Twitter at @shannonmcnay.