S6|E51 Know Your Monthly Baseline Expenses

Episode Transcript

Speaker 1 (00:01):
You can't build financial freedom if you don't know the
price of your peace.

Speaker 2 (00:12):
Educate, empower, enable impact. Thank you for tuning in to
That Will Never Work, an award winning podcast where we
share inspiring information and personal experiences related to business and
the entrepreneurial journey from those who are leaders in their
respective field. Now here's your host, author and business coach, Maurice.

Speaker 1 (00:41):
Okay, everyone, you see that we own this role right
now talking about finances. And again I'm not an expert
in it. I'm not an accountant. I'm just giving you
personal situations that I've had to deal with over a
period of time. And here's something that today I would

(01:03):
like for you to consider that before leaving your job
or fully committing to your business, I would like for
you to calculate how much you need to survive each month.

(01:23):
So before we talked about having an emergency fund, maybe
even eliminating a few little debts, being your credit cards
or things like that. But here's some other parts of
that idea that we don't talk about as often, and

(01:49):
I see myself speaking with my daughter about it right now,
which is what is a true cost of Number one?
How marias you know, Rent is housing, right, So let's
look at this in totality. So if you're just talking

(02:14):
about a roof over your head, yes, that's one thing.
But I just want to be clear that there's other
parts to housing that we need to consider. So Number
one would be food. How much food do you spend?

(02:35):
I mean, how much money do you spend on food
every month? I would like for you to consider how
much do you spend on food every month? Insurance? And
we could look at insurance in multiple ways. Number one,
if you're working a nine to five and you have

(02:57):
insurance health insurance, what is that cost? What is the
cost for your dental insurance? How about vision and or
mental health? What is the cost for all the above?

(03:23):
And I broke it down that way, and it could
be broken down even more from ancillary services, durable medical equipment, prescriptions,
you know, so who's taking care of all these things?
When we're talking about insurance, how does all that get paid?

(03:46):
Have you called an insurance company to see how much
of it costs to cover you every month? What is
that true cost? Another part of insurance is where are
you living? Are you living in a house, are you

(04:06):
living in an apartment? Are you living with a roommate.
But is there anything that you might have to do
from renter's insurance, mortgage insurance, homeowner's insurance in addition to that,
how about auto insurance. So when it comes down to

(04:32):
these things that are just relative basic necessities, what is
that price? What is that number in order for you
to cover just the basics? Again we're talking about the basics.

(04:53):
We haven't talked about getting business insurance yet. What does
it cost for you to have just your basic needs covered?
So in addition to your your your savings that you

(05:14):
put together, what is the essential expenses that you need
to have? So now does that two thousand dollars now
turn to thirty five hundred dollars because you may not
have considered all those things, and here are so many

(05:37):
other things that you have to consider. From a housing perspective,
how about internet, you know, TV service, cable service, how
about all those other subscriptions that you are taking on

(05:57):
every month just from a TV watching perspective, how many
of you are out there having subscriptions for food Hello
Fresh or any of those type of things that people
are having food delivered to them so they don't have
to go to the market because it feels that they

(06:18):
don't have time, which is a great service. Mind you.
I'm not sure how many of you have had food
delivered to your home, not just fast food, but you know,
every day essentials. I've done it once or twice. It's
not often because I like to go and touch my product,
you know, but I've had it done once or twice
just for time saving purposes, and it's fabulous, you know.

(06:42):
So how many of you out there that are not
taking these things, these monthly housing numbers that you need
to hit every every month, and do you have that
number saved somewhere? Do you have that spreadsheet put together

(07:05):
today of what all your expenses are and maybe over
a period of time just to see if there's any
spikes even some of those things, because keep in mind,
each one of these subscriptions are raising their prices. Where
it feels like right now anywhere between every eight to

(07:26):
thirteen months, that's what it feels like. I'm not saying
it's the truth, but those subscriptions feel like they're changing.
And then, you know, from a tax perspective of just
having cable sometimes you know, the the federal taxes, the

(07:47):
state taxes, the you know, use tax, whatever it is,
there's other taxes that seem like they those keep fluctuating
as well. Oh, here's why this matters. You can't hit
a financial target that you haven't truly defined. You can't

(08:15):
hit a financial target you haven't truly defined, and knowing
this number removes the guesswork and panic possible panic. So,
so if you know that your rent is two thousand

(08:37):
dollars a month, but your cable, any other utilities being electric, gas,
waste management, all those other utilities, and all of your
TV viewing options, your food, your insurance, all of that,

(09:01):
it comes up to be thirty five hundred dollars a month.
Because sometimes we don't realize that that number kind of
creeps up. And well, the other thing we don't always
realize is that we have yet to put in entertainment.
There's other facets of our spending that we don't always consider.

(09:22):
So are you going out for someone's birthday this month? Well,
how much did you spend? Oh? I just want to
turn up with my friends. Well that sounds good and fine,
but how much did you spend? And it's not gonna
be the last time you do that? Right, So understand
what is your real budget, What is that true money

(09:44):
that's coming in. So before leaving your job or committing
fully to your business, calculate exactly how much you need
to survive every single month, and then you could get
a clear picture on what your savings really need to
be and what it really needs to look like. Remember,

(10:07):
knowing the numbers removes the guesswork and the possible panic.
If you're falling short, talk to you a little bit later.

Speaker 2 (10:19):
Thanks for listening. Follow Maurice Chisholm on social media to
stay connected and check back weekly for new episodes until
next time. That will never work or will it