Want to become a better coffee professional? Go to the dentist.
And other personal finance #annesplaining
So this post is one about a tough topic: money. Specifically, personal finance. Which, is a funny thing in this world of specialty coffee. As coffee professionals, especially once you’ve moved on beyond the retail café environment, we tend to talk about trade and macroeconomics constantly. I am actually typing this post at a conference on green coffee buying as we speak.
Yet, talking about our own bank accounts is much more taboo. I remember when I got started in coffee, money was certainly not any part of a deciding factor to get into the business. Money simply was not a priority, and by the end of the first chapter of my coffee career, I only had a lot of debt and heartache to show for it. I’ll share more of that story another day.
In my late 20s, I realized how utterly common my debt and heartache experience was. Almost any young American at this point ran into unexpected debt, and didn’t know what to do about it. Turned out, I’d ended up in a relatively lucky position, because I’d caught it early, wasn’t locked into a big loan, and found a way to get out of that place. But that still didn’t make it easy, or make it feel good.
It wasn’t until I finally started taking that basic financial advice to budget, repay, save, and plan that I started to regain confidence in myself. Like all things I do, I got really into it. I read a lot, listen to podcasts, and actively embraced my own financial health. I’ve since paid back all of my former businesses’ debts, and saved up enough for a down payment on a house, as well as establishing an emergency fund. My relationship with money is not perfect, but it certainly is a lot better than it used to be.
One of the things I learned through this obsession is that most financial authors that are worth their weight in salt all say pretty much the same thing. There are five basic principles from these books I’ll go through here, and then give you a list of my personal favorite financial advisers. If you are thinking about starting a business, changing a career, or building a stable future on your terms, I highly highly recommend getting started on a path of financial confidence first and foremost. Pretending the money stuff doesn’t exist only forestalls an inevitable outcome - trust me, I’ve been there!
1. Create an emergency fund.
Everyone can agree – shit happens. Usually when you least expect it. And usually it costs money. The basic premise of the emergency fund is simple – put little chunks of money away long enough that you won’t freak out financially when shit happens. I started, I think with $15, or $25 a paycheck, and finally ramped it up to $65 per. I ended up with four months of savings, which made planning for an uncertain future much much more comfortable. Does this sound impossible right now? Read up – you will get very helpful advice on how to get started.
2. Pay down credit card debt.
Hate the interest on your credit cards? So does everyone else. If you are paying any, try your darndest not to. It’ll depend on your credit score/health, but work every angle towards a low/no interest balance transfer, which will move your debt to a lower rate. Be careful not to pay more in fees, and pay your bills on time! As you’ll learn, creditors care a lot more about timely payment than amount of payment. Use that to your advantage!
3. Save for the future.
This might sound like the lamest advice ever, and I understand. At some point, though, a lightbulb goes off like “wait, I want to RETIRE some day.” Who pays for that? You do! Sometimes, your employer also pays you – and I like to take advantage of any money an employer gives me. Get your retirement accounts set up and max out your matches from work, if you have them.
4. Evaluate any big loan payments.
If you have student loans, a car loan, or a mortgage (like me! Heyy!), you may want to do a loan review to see if you could save money. Whether it’s increasing your monthly payment, making extra payments, or refinancing to a new loan program, there are options to help you save money and pay off your debt sooner. Also make sure you’re getting tax breaks for student loan interest!
5. Live within your means.
There’s this Katy Perry song I love – “This is how we do”. I love everything about it except one line in the bridge. She says “shout out to all you kids, buying bottle service, with your rent money… Respect!” And I swear, I yell at her through the radio every time. No no no! I say… Pay your rent! Save your money! Katy Perry and that club do not need your money – you do. Find ways to still live comfortably and happily, without breaking the bank.
The biggest final advice I have on this topic is: find a financial voice that speaks to you. As long as they stick to something like those five basic tenets above, you likely won’t go wrong. The important thing is to get motivated enough to start. Let a personal finance guru inspire you so that you get established on a successful financial path. It will build both your worth, and your confidence. Ultimately, that foundation will enhance your career.
And like I said at the top – go to the dentist. Regular checkups now prevent literally thousands of dollars of dental work – in the not-very-distant future. I heard so many dental horror stories as my coffee colleagues hit their late twenties after skipping appointments for years… It is not worth it! Use your insurance if you have it, and if you don’t, find a dental school that will check your teeth for free. Keep in mind that dental insurance will not cover all of your costs later - that's just not how the plans work. Seriously. You’ll want that money – maybe for bottle service at a Katy Perry concert. Just not if it’s earmarked for rent, ok?
personal finance resources
These are the resources that spoke to me as I built my relationship with money. (Note there are some affiliate links in here! As I learned more about money I realized that the win-win of recommending products I would anyway for referral fees… I hope you will gain similar financial insights from these items! You never have to buy them - in fact, I originally checked out all of the following books from the good ol' public library.) Also, please get in touch with me if you want any help with any of this stuff. Seriously. I will hook you up.
If you are totally overwhelmed and afraid by my post above, ease into it! Start by reading Adulting by Kelly Williams Brown. She has a fantastic chapter on the fundamentals of money management. Also, adorable illustrations.
I bored myself silly reading the Wall Street Journal’s Complete Personal Finance Guidebook but ultimately it laid out the clearest definitions and step by steps on getting started. It was a very helpful resource.
What I learned from Women & Money deeply resonated: Women are much more likely to feel less confident and resourceful when it comes to their money. Personal finance management is a lot like going to the gym – doing it is hard but the results can be transformative. She’s who really kicked me into high gear (Thanks Suze!) and got me started on financial recovery.
After reading Suze, I found another wonderful author and financial adviser – Barbara Stanny. Barbara continued exploring the relationship between women and money in several books. I read Secrets of Six-Figure Women and absolutely loved it. If you are interested in getting financially empowered, I highly recommend her books. She’s also hosting a free webinar this week on January 11th if you’re feeling motivated to get your financial ducks in a row!