1. Your Money. Past. Present. Future.

Welcome to week seven, mastering your cashflow. And I am very, very, very excited to be sharing this information with you because it’s these principles that are really going to help you separate yourself from where you currently are and where you want to be when it comes to really truly building wealth. So up to this point, we have been doing everything in terms of getting our credit fixed, cleaned address, building credit. Now I’m going to show you how to supercharge this and make sure you can maintain excellent credit because we worked so hard up to this point. So we’re going to make sure we maintain credit, want to put systems in place to do that, but I’m also going to break down really the true secrets of how you really, really can start building wealth because of your cashflow. So there’s two ways you build wealth, um, or you start the journey.

It’s what your cash and it’s what your credit obviously you want to go to, and I’m going to teach you guys ERI, but your cashflow and your credit are very important. So in this particular module, I’m going to talk about your money, the past, the present, and then the future. So here’s what we’re going to cover. So the first thing I’m going to go get into is understanding three buckets and how this is going to be really, really impactful when it comes to managing your money. Moving forward. What I’ve discovered is budgeting does not work. However, managing your cashflow does. I’m going to break down how to create your cashflow pro program in this week. So in this module, when you break down just understanding the buckets, but the rest of this week, I’m going to give you a clear vision in terms of where we’re going.

So I’m going to get into creating your cashflow program. So that way, you know exactly how to do it. I’m also going to show you how to start automating your finances. This is going to be something you definitely want to implement. And I’m also going to get into accountability and the, my cash clarity system and how this really is going to plug and play into your cashflow. And then your overall financial situation. Then I’m going to end the week with breaking down some strategies, if you currently have a traditional nine to five on how you can increase your cashflow. So this is a really, really powerful concept. Many people don’t even understand or they don’t get, but let’s go ahead and start with this particular module, understanding the three buckets and how this is going to be efficient. So here’s what I discovered in my years in the financial services industry, many people don’t know this.

I started with financial services back in 2007, 13 years ago, 13 years ago. And I started with a company and I started as a financial advisor and all the, at this point, thousands of people that I have spoken with, and then even when, before I even created MyMoneyEDU, the hundreds of people that I physically met with what I discovered was, is this is how they manage their money, right? They had their money coming in to one particular account, right? So they have money coming in, but then they had money going out and they were completely, or not organized in terms of where everything was going. They knew they had the money coming in, but it just, they were just responsible for making sure that everything fit. So I had to make sure I had my credit card payments, paid my dining out, my entertainment, my car loan insurance, auto loans, just taking money out to the ATM, just randomly taking cash out.

And then we take the cash out. It’s just seems like when you take cash out and it just magically disappears, right? You know, you had to pay for groceries. So what was going on was you had no clarity, no organization, no accountability amongst the cash. And those of you who know this, you, you have spent a lot of time up to this point, really doing everything you needed to do to build your credit. You, you have, you’ve got, you’ve done everything. Now, what I’m going to really break down is I don’t care if you’re making 5,000 a month, 10,000 a month, 50,000 a month, right? If you don’t have a handle on this, you will continue to maintain being broke really just at a higher level. So what I’ve discovered is there’s a more effective approach when it comes to your money. It’s the three buckets of money approach.

And I want you to think of your money three ways. I want you to think of your money as the past. Okay? And that past is what we call fixed bucket. And more specifically with that fixed bucket, that is our 35% of our score as well. So inside that fixed bucket, we really want to make sure that everything inside of that bucket is, is paying our bills on time and making sure we do not miss any payments you guys understand at this point, the how hard I have gone when I’m telling you to make sure you pay your bills on time. But we’re going to look at that as a past commitment, and that’s going to be in the fixed bucket. And that’s going to really make sure we impact 35% of our score from a cashflow perspective. Then we have our verbal bucket.

That’s our present choices. These are the choices that we’re making on a day daily basis. Then we have our future bucket. Our verbal bucket, again, has a lot to do with our revolving credit. Now, here is how we’re going to get into this. So here’s what goes into the buckets, right? So with your fixed bucket, I want you to think of this as your 30 day money or bills that you’ve already made in the past. Your variable bucket is going to be your seven to 14 day money. This is going to be the money that’s going to. If you’re getting paid every biweekly or every two weeks or even weekly, that’s your seven to 14 day money. And then your future bucket, that’s your future money. So we want to be thinking about our money in three ways, three different categories. And the reason why is because many of us focus so much on the present so much on the past, and we don’t even give ourselves the opportunity to put any money away for the future at all, because we’ve got fixed and variable bucket problems.

So what we ordered and not even fixed and variable bucket problems, we are, we know we didn’t have a clear picture of where our money is going because we haven’t broken it down. So I’m going to take the next several minutes to explain and educate you on each bucket. So that way, you know, and then this week we’re going to implement this particular strategy because we have worked so hard to improve our credit. So fixed bucket. So what did these expenses mean? So these are expenses that you have incurred in the past, and you’ve already agreed to make monthly payments on. So again, you are able to predict these expenses. There’s no surprises. So these are bills that affected 35% of your score, right? Those bills are going to be in this bucket. And then it’s critical. Well, identify this. It’s critical to know how much money it costs your, cause your household operating a monthly basis.

Again, another common question. The thing I noticed through other people, I’ve helped with other people I met with, you know, they’d be making, you know, household income 7,000 a month. And then I asked them, well, how much of the bills? All the bills are $3,500. And then I’m like, well, where’s the other $3,500 going, Oh, we don’t know. Um, or they may say the bills are $6,000. And that so, that’d be. So the point I’m making is, is with this number. We need to know what it is specifically. So these are examples of what a fixed bucket looks like. So our mortgage or in, or our rip payment, our car payment, our credit card reduction payment. Oh, always. Now notice guys, I have put strategically that fixed bills that are tied to your credit reporting 192.5 points intentionally because we do not want to miss our payments there.

But outside of those bills, we still have insurance premiums that don’t typically change on a monthly basis. We have a household cleaning services if we need or gym memberships or whatever the case is, is their utility bills, property taxes. But the moral of the story with these fixed, the fixed bucket bills, this is just what it takes to keep the lights on in the house, right? This is what it takes to keep going and just make sure everybody’s good to go. You need to know this, but notice, yeah, everything in this fixed bucket is a is a, is a deal that needs to be paid. Student loans is an own here, but that student loan is an example of a fixed bucket expense, personal loan isn’t on here, but that’s an example of a fixed bucket, expense credit builder loans, not all here, but that’s an example of a fixed bucket expense.

I think you get the point with credit card reduction, but these are our fixed bucket bills. These are a fixed bucket. Examples. We need to identify what this is in our particular household and our financial situation. Then we can now clearly identify our variable buckets. So this is money that we’re going to use weekly for expenses that vary in cost. Okay? So generally these, these are the expenses that are going to affect the 30% of your score that revolving credit. Because generally speaking, you’re going to use a revolving credit for these. But what happens is, is because you don’t have focus, what happens is you figure out what’s what’s going on, man. I just got paid. Man was all my money gone. Well, the reason why you’re asking that question is because you didn’t decide upfront how much money you were going to spend in your variable bucket.

So you could say accountable. So what we want to do is identify a specific number that we’re going to have in this category and make sure we stick to it. And then also what this is going to do, because you guys are on this trajectory of having excellent credit. When you start getting revolving lines of credit, you’re going to understand that when I have control here, I’m going to make sure I’m going to systematically ensure that I’m able to keep my utilization between one and 7%. So examples of these expenses are groceries, going out to eat, dining out food, drinks, parking, um, you know, uh, lunches, recreation, entertainment. Again, I’m not going to go into the club. I’m not knocking having a couple of drinks. I’m not knocking any type of theme park or whatever you feel is recreational. You may, whatever you consider to be recreational, you spend there, right?

You’re shopping, which is a biggie, especially for my ladies and some of my fellows too, um, gas. So these expenses are going to vary. So you’re going to start making, and you may already be in the trap of making good money. You may be single making good money and have a really nice lifestyle because you all always spending your money. It’s the present. You’re like, man, I’m going to live right now. And there’s cool. I’m not saying not to live right now, but when you don’t have, and when you don’t define this upfront, you overspend in this category. And if you overspend in this category, then that means that either, Hey, you’re gonna have higher credit card balances, which we’re not going to do because we spent so hard understanding that 30%. But then number two, you don’t put yourself in position to take care of your future self.

And so, because you’re spending all your money today, right? So these are variable bucket expenses. Then what we have is our future bucket. Now our future bucket is a bucket that many people don’t even think about or even have the ability to do, because I love you because I do want you to build wealth. And because I do want you to be successful, I’m going to break this bucket down for you and show you how this is going to come into play in your particular situation, in your situation. So we already know that we need to have money for the future. So this is money that I’m going to spend in the future for whatever I need to spend the money for. So this bucket is really designed for any type of goal aspiration dream that I have. I need to start saving for it today.

And I can unequivocally guarantee that life is going to happen to you. Now, I’m not saying that to be disparaging. I’m not saying that to be negative. I’m not saying that to sound like, Oh man, this Kenny guys is a, is a, is a, is a downer. No I’m saying that because life will happen. So when life happens, what we want to do is put money aside so that when life happens, we have that life happens account. If you save your money, your money will save you. So that’s the other reason why we want to be focusing on the future bucket. So these are examples of future, uh, expenses or, or funds. So you like, I just was beating a dead horse about it, but cash reserve, emergency plan. We gotta have money aside. We do want to put money aside. So when life happens, even if we’re looking to gain our first a thousand dollars or our first $5,000 or first $15,000, right, we want to have that cash reserve.

You know, now you want to take a vacation. You know, now you want to go to Dubai. That’s where you want to go. Or The Bahamas or the North East or Korea or wherever you want to Egypt or Mexico. You know, now when you’re watching this video that you want to take a trip somewhere. So because you know, you want to take that trip. Why not put the money aside for it today? Um, car repair or replacement, when that happens, retirement savings, you know, now you want to retire. You know, now, you know, now you want to retire one day. You know, now that you want to put money aside for your kids or even yourself, you know, now that you even want to buy a house or furnish the house. And you know, now, you know, now when day, what day Christmas is, you know, now what day Black Friday is, you know, now what day your birthday is, the anniversary is, you know, now, so what am I saying?

I’m saying, because you know, now let’s put it aside for the future. So it doesn’t throw things off at that point. Okay. So that’s the future bucket. So let me explain how these buckets work. So the size of your fixed bucket, your past commitments, right. That we’ve already agreed to. And also we already have our payments allocated to make sure we don’t lose any points. There limits the size of our variable bucket, our present choices. Okay. And then what’s available after we have defined again, I’m not saying don’t live your life. Okay? So I don’t want you to think, man is Kenny guys crazy. After we have defined our present choices what’s available after that is what we will put for our future bucket for our future needs. And once so our money in the past, our money in the present, in our money, in the future.

So I’m taking care of my past commitments because I’m a responsible adult. I’m making sure I’m living today because if I don’t live today, I’m gonna go crazy and be mad at I didn’t buy that nice pair of shoes for myself that I budgeted for or allocated funds for, or went for a nice dinner with my significant other, or caught up with my boys, whatever the case is, I’m still living. Right. But I’m not going overboard because I’m still putting money aside for the future, right? That’s that’s how these buckets work. It’s a system now, lack of focus in the variable bucket. And trust me, I’ve been here, right? I have been here. So I’m not judging. Lack of focus in your variable bucket, your present choices where reduce or eliminate money that could be available for your future bucket. I, your future needs are once now, what does this mean?

This means yourself two years from now, five years from now is screaming to you from the future saying, bro, you don’t need those shoes, bro. So, you don’t need that dress, right? You don’t need to make that decision today. Right? Let’s come on, put in a little bit of money aside. So what we want to make sure we do is define how much money we’re going to live in that week and be responsible. Self-discipline right. Self-discipline is a powerful thing. Now self-discipline also breeds freedom because if you can be disciplined for a certain amount of time, you can have the ability and the freedom to do whatever you want to do. Now. Here’s what happened though. When a large expense occurs, ie. When life happens, when a horse water heater goes out, refrigerator goes out. Car accident. Somebody unfortunately passes away. Life. Okay?

When life happens, that’s what large expensive curves means. Life and the money has not been saving your future bucket. ie. your life fund, it gets added to your fixed bucket, past commitments in a form of debt. Now I have, I have shown you guys how to get credit, and I don’t want you guys to go into debt, but if you have to, I get it. But let me walk you through the rest of this story. Now, what happens is this builds up a larger fixed bucket because your past commitments are now larger on a monthly basis. And now that reduces any money that you have available for the present and really completely eliminates any money you have for the future, because you’re like, man, I got to live today, man, I’m going through all this stress, and I’m doing this and I’m doing that. And if you do have credit, you start to use that credit because you didn’t save and you start this cycle of bad credit because you didn’t put yourself in position to take care of your cashflow.

And again, I’m not trying to paint the picture that negatively, but that’s literally how you start the journey of bad credit. So we eliminate it, right? We put money aside for our president. We put money aside for our past, and we put money aside for a future on a systematic basis. So how we’re going to do things moving forward is instead of just having all of our money going in one account, and I’m going to get into this, how many we’re going to show you guys how to systematic. We have separate accounts and where to go open up new accounts. But just from a high level perspective, I want you to get this. So, number one, what we’re going to do, what we’re going to do is define our fixed bucket expenses. I’m going to walk you through it. We’re going to do it together.

I’m going to show you step by step. How we identify where our fixed buckets is. So we know, right? Not to mention our fixed bucket is going to be responsible for making sure we maintain all 192.5 points available to us. Now, once we’ve identified that in our fixed bucket, we’re now going to set aside money for weekly lifestyle. So again, I’m not saying, I’m not saying you’re not going to put this money aside for your food, your gas, like those things you got to do. But if you want to have a nice dinner, that’s fine. If you want to buy yourself a nice pair of shoes, that’s fine. You want to go get your nails done? Your hair, cut you all those things. That’s fine. If you want to live today, that’s fine. We just need to allocate that money aside. And then once that money is gone, the money is gone until we get our next infusion of cash, right?

So we were going to use debit or cash. So when the previous module, when the previous week we talked about establishing revolving lines of credit, and I gave you three options, whether it was a milestone gold card, the Indigo platinum card, or this, the good old credit builder card that you could use as cash. Why am I bringing this up right now? Those are excellent cards to use for variable expenses. If you already have a smaller card that you can use, you use that car and you pay it off before the statement date, because you already know if you violate it. Let’s just say, and I’ll get into the weeds of this, but let’s just say, you already know it cost you $500 a month for food. Well, instead of using the $500 cash, you keep the cash in your account. You use who’s the car.

And then when the statement balances, do you pay the car down? You show that credibility, right? So that’s that verbal bucket and all went in a little bit in the weeds there, but what I’m really breaking down and preparing you for is how to, how to get these credit card companies that give you money, right? But again, more of the story, our variable bucket, we’re going to define that we’re going to still live today. What will we’re going to do it responsibly? Then we’re going to put money aside monthly for our savings. So savings one could be just some emergency fund savings. Two could be a vacation, fun car fund, business fund, education fund, you know, um, whatever you want that to be fund, right? We’re going to put the money aside, even if it’s just 10 bucks, right? We’re going to put that money in that bucket.

And that third bucket could be retirement. It can be whatever you want it to be. More of the story is we’re going to put money aside every time we’re paid in that bucket. Even if it’s a small amount and I’m going to help you define what that is. And if you identify that you got to start small, it’s not a big deal because commitment and consistency self-discipline is, is the behavior is more important than the amount. Our repeat this. Your behavior is more important than the amount. At this point, you understand that your credit score and cashflow are reflections of your financial behavior and your future cash flow. Your future credit is going to be a reflection of your financial behavior, right? So this, this is the powerful thing that we’re going to do moving forward. Now there’s a couple of things. So what this is going to do is simplify everything that’s going on in the life is going to demonstrate that you have more financial resources allocated.

You’re going to feel more in control. You’re going to feel very, very in controlling and have way more confidence because not only is your credit going to be getting right with building credit, you’re going to have cash to show for it. At the same time, I’m telling you, you’re going to have a clear earth framework when it comes to making decisions, because you’ll know you won’t be able to, you won’t just make financial. You won’t make emotional decisions out of need, right? Well, you’ll probably make decisions out of need. Let me say this, but you won’t make decisions that you’re forced to make. You’ll be able to be clear about if it is, or is not a good decision and weigh it out because you have more options. The other thing is, is that you’ll be able to provide, uh, and be more effective if you’re in a relationship with how to communicate about finances, because you guys are going to know, Hey, look, we got, we got, we got 500 bucks this week on our fixed bucket, right?

Will we do it? Or if you were a Casanova guy, you can just be like, Hey honey, I took the Liberty of doing X, Y, Z. And I’m not just going to put it on the fellas. I mean, ladies, you can be like, Hey, look, I surprise you baby, because of X, Y, Z. And it won’t be an argument because you already knew that you guys had that money allocated in that bucket. Right? Powerful. It’s also going to prevent when I even prevent, because we can’t prevent life from happening, but it’s going to prepare you for life happening, right? It’s going to prepare you. And that’s what I want you guys to do. I want you to be prepared for life, right? So when life happens, at least you can stroke a check to at least make it go away, or at least satisfied to a good degree.

Now, money doesn’t make everything go away. Money doesn’t change things, but money makes things more comfortable. So when that flat tire happens, when that water heater goes out, when that whatever happens, not a big deal, chocolate check, take care of it, keep them moving, right? Because there’s more things that are, there’s a lot more things as well, more important than money. However, like, like your family, like spending time with your kids, like spending time with you, just doing things that you love, however you don’t to be stressed out because you couldn’t take care of a small $500 emergency or thousand dollar emergency. Right? You, you just want to just handle that. And then the last thing is going to do is help you clarify your priorities and what’s most important to you, right? So that way, you know exactly what is, what is, what is most important.

That’s why I had you start off this week with your smart goals worksheet, and then finding your, why you already kind of know what’s important to you. So all we’re going to do is go back. We’re going to reference that document, reference those things, and now put some cash flow strategies behind how to achieve those, because we spend a lot of time up to this point, really getting our credit taken care of. Now we’re going to start transitioning because now that you’ve opened up the accounts, I don’t want you to mess it up. And now that you’ve worked so hard to get your, your, your, your challenges out or done, we need to maintain it. Okay? So with that being said, you have the clear picture. The action step with this particular module is going to be, just look at what you believe to be your fixed bucket expenses, your available to bucket expenses and your future bucket expenses. If you have them. And then in the very next module, we’re going to start putting together your actual plan and defining all of this stuff in one place. Okay. So I will see you there. I am very, very excited for you and let’s get this stuff knocked out.