From Financial Chaos to Ease: How to Turn Significant Change into your Biggest Superpower

Drew Faloon |

 Intro

Something big just happened in your life. For some, this is something good and exciting like a promotion at work with an expected pay increase or finally branching off on your own to start that new business. For others, this is something negative like a death in the family or a divorce.

Regardless of the specifics, I often see finances take a back seat. Especially with negative events, it can be natural to say, “I’ll get to that once things settle down”. But here is the ugly truth…

Things rarely settle down like you expect. Life happens.

Life continues to happen regardless of how fair or unfair it is. My mother used to tell me that life goes in 3’s. Typically big events happen in clusters of 3’s and waiting until it “settles down” often leaves people too exhausted to have conversations about important topics. 

2 Paths: Chaos or Ease

Whether your life event is positive or negative, you have a tremendous opportunity in front of you to change your life. 

Close your eyes and visualize life 5 years from now and imagine 2 scenarios;

  1. Imagine if life stayed just as it is. If you just started a business, imagine having a stagnant business with no clarity. If you had a recent death in the family, imagine if you are still picking up the pieces of that event and trying to “manage” things.
  2. Now imagine the best possible situation. For the business owner, imagine a growing business that is well on track to help you accomplish every dream you could ever imagine. One in which you have full clarity over your numbers. For the recent death, imagine turning that situation into a positive. Imagine having a newfound perspective on life, allowing you to take your financial situation and act with intention so that you can live your best life every day.

Chances are you will start to crystalize what scenario you want. 

The reality is, this comes down to a simple question. Do you want continued chaos or newfound ease? 

I've seen both situations play out time and time again and have found the following 5-step formula to turn the chaos into ease. I call it the 5-A Transformation Framework;

 

  1. Attitude
  2. Alignment
  3. Awareness
  4. Application

  5. Action

     

For steps 1 and 2, I suggest that you go to a new environment. Get out of town, go on a hike, and take a long weekend with your family. The best breakthroughs often come about when we change from the form.

Attitude

“Your relationship with money and willingness to change will determine the elevation of your life”

I know, I know. Talking about your “money mindset” may sound like some new-age guru stuff that has nothing to do with making real progress, but I implore you not to skip this. 

The reason is, that it's imperative to understand your current attitude when it comes to money so you can strategically work on fixing it. After all, there is nothing worse than accomplishing all your dreams, only to have a negative attitude and never really be satisfied.

For attitude, I use a simple reflection exercise I call, SEEDS. It stands for;

  1. Self Reflection. Simply reflect on your current attitude toward money. Does it cause you stress? Do you loathe talking about it? Is it a hindrance or an opportunity?
  2. Experiences. How were you raised growing up and how does this affect how you feel about money today?
  3. Emotions. When you hear about money, what emotions do you feel? Are they positive, negative, or a combination of both?
  4. Desires. What do you want your money to do for you? Think about this in terms of experiences and those you care about. We all want nice things, but true happiness typically comes from the people around us and our experiences with those people. 
  5. Shift. What gaps do you see and how can you proactively change the narrative that isn't serving you anymore?

For now, keep things simple and just reflect on these things. Bringing awareness is half the battle here.

Alignment

“A thoughtful vision from the start avoids the lost time, money, and energy in the future”

I said that the worst-case scenario is to accomplish something and not be satisfied with it. But actually, even worse than that is spending time, energy, and money only to realize you were going the wrong way. 

You can fix this with alignment exercises. You are at a crossroads in life where you can create your future. Have fun with this and involve loved ones.

My favorite exercise with this is as simple as looking backward. As I say, sometimes you have to look backward to move forward.

  1. What experiences or people bring you the most joy?
  2. When do you remember smiling the most?
  3. When did life slow down or speed up?
  4. What is the most perfect day you have ever had?

Now look through these and find trends. These trends are core values, people, and activities that will shape your future into the best life possible. Keep these handy for the next steps.

 

Awareness

“Get your ship together”

Now, awareness can be a long and arduous process depending on the situation. If your situation is complex, there can be a lot of value in finding professional help.

But, at its basic level, consider organizing the following;

  1. Specific goals you have. I like to put down 10, 3 and 1 year goals. But remember to align these with your values from the last step.
  2. Find your cash flow. This is a step that can take some time, but keep it simple. Spend 1 hour writing out a budget and then go through financial statements to see what you spend money on. 
  3. Lastly, find your financial balance sheet. Your balance sheet is a snapshot of all of your assets and liabilities. Our firm uses a software called Asset-Map. If you would like to get a complimentary copy of your Asset Map, please click here.

This step can get more complex by looking through tax documents, business metrics, estate planning documents, etc. But keep it simple here. Organizing the basics should be a good starting point.

 

Application

“Progressional steps ensure optimal progress”

Okay, so you now have an idea of your attitude, your values and goals, and an understanding of where your money is. But now what? 

Again, this is a step that could be very complex depending on your situation where you may want to seek professional help. But in a basic sense, follow these couple of steps;

  1. Ask what the priorities are. Another way to look at this is to ask what goals or action steps affect others. For example, if you have a goal of buying a house in 3 years, organizing your cash flow and paying down debt are two key aspects that affect your ability to save for a house. I suggest choosing 3-5 priorities to start. 
  2. Now, ask what key action steps you can take TODAY that will help you with your top priorities. You probably can get the theme here, but keep this simple. You don’t need to get your masters in mathematics to stick to a budget.
  3. Put quarterly rewards for each of your goals. 1 quarter or 12 weeks is long enough to make a lot of progress, but not too long where you have the mindset of putting it off. These rewards do not have to be major or expensive.

    1. An example reward I have used for myself is taking a long 3-day weekend with my dog and girlfriend. 

      Action

“A plan simply stays as one if no action is taken”

I can already see the eye-rolling when you hear this last step. After all, it's a bit of a “no duh” step, right?

Well, the most obvious steps are often the most difficult to follow through on. How many times have we failed to follow through on a diet or workout plan? I do it every year.

You’ve done all of this work, and now it is time to follow through with it. Here are some easy steps to follow;

  1. Set up a weekly, 15-minute check-in to look over your accounts. Just remind yourself of your goals, and what you need to be doing and see if any glaring issues have come up.
  2. Schedule an hour-long monthly meeting to update your numbers and make changes accordingly. Remember, we are not looking for perfection, but progress.

Summary

This is the process and formula I use for each of my clients. 

I’ve seen my clients achieve great things by following this process.

And I have also seen clients who have everything. A big-paying job. A big inheritance. Or a successful business. And I have lost count of how many times these exact people do not make any progress or even negative progress in the same timeframe.

Life events have the power to change us for the better or the worse. The difference comes from the decisions we make. 

 

You now have the tools to create financial ease in your life. If you are looking for more help or have some more complex items you would like to tackle, our team at IWP is happy to help. Feel free to schedule a time with us, here.