Celebrating Every Baby Step in Your Financial Journey

With the innocence of a child, every small achievement is celebrated. Their first mumble, their first word (the debate on whether it is Mama or Dada is always heated), their first step. The common denominator? Each triumph, whether big or small, is celebrated. There is no judgement, no condemnation, and no guilt when there is a slip, a mess up or even an unforeseen obstacle.

Then, as we become adults, that sense of grace is overlooked and overshadowed by the expectation of perfection. That expectation goes beyond our daily duties at work. Instead of acknowledging the growth that is required in every stage of our lives, we begin to believe that our biggest days of growth are over and the things we do require immediate flawlessness. That same mind-step flows into our finances.

We begin to believe that we should already be wealthy (which, do not forget, is a relative term), that we are behind the financial curve for our generation, and that the steps in front of us are beginning to look like leaps. The thing is, we need to remind ourselves of the calming perspective that each small step is worth celebrating and that it takes (and took) months to begin to walk, and years to even run. The same thing applies for our finances. The initial steps are the hardest. It may seem like every time we try to take our very first step that we get pushed back down. It is easy to believe at that point that maybe, just maybe, we were never intended to be able to walk (or become financially stable or affluent).

Every financial step you make, even if you do not achieve what you set out to conquer in the time-frame you laid out, is worthy to be noted. When a baby slips and falls, what words come out of the mouths of the parents? Things like, “You can do it!”, “One more step, that’s my sweet girl!”, “That a boy, look at him go!”. We all, including myself, tend to forget that we still need that mental picture of celebrating the little things, especially when it comes to our finances. Just opened a savings account? Celebrate it! Made your first investment? Reward yourself for that decision. Started contributing to your work’s 401(k)? These are all wonderful milestones. Now, even if you are not making the progress within your financial world that you think you should have already made, that does not dictate the future finish-line of your financial marathon.

1. Roughly 58% of Americans have less than $1,000 in a savings account. This should be one of the first steps we all should strive for in our finances. If you do not have a savings account, I would recommend opening up an online savings account so that your money begins to earn interest. If you do not know where to begin, check out this short article on why Ally Bank helps your money work for you. If you already have that amount saved up, that is worthy to celebrate! Try to strive to reach 2–6 months worth of expenses in savings. Set up automatic monthly deposits so that you can predict when you will reach that goal. This will alleviate any mental stress that you have when unexpected expenses are suddenly incurred. This will also give you the necessary cushion to begin investing in confidence. Whether you do or do not have that amount saved up, “You can do it!”, still rings true.
2. Student loans, car loans, and credit card debt; almost every American has at least one of these types of debt. Maybe you paid for something you should not have and put it on your credit card. Or, you feel like you are drowning in your student loan debt without any shore-line in sight. Following the set payments instead of paying off your debts earlier is not only costing you thousands of dollars, but it is being satisfied with crawling when you were made to run. Around 25% of people that have debt do not have a plan for how to pay it off. That typically leads people to delay their payments and incur additional debt due to the interest that keeps stacking up. Know that you are not alone in having debt. Although you have debt, that does not mean you have to maintain that lifestyle forever. Create a spending plan and designate additional money to pay off those debts sooner. If you are doing those things, again, celebrate! If you are not, it is never too late to start.
3. Based on data from the U.S. Census Bureau in 2017, approximately 30% of people were saving for retirement in a 401(k). The stats also suggest that it is not due to a lack of retirement plans being offered by their employer, but a lack of participation. Actively participating to a retirement account is often over-looked and undervalued. If you are already participating with your company’s 401(k), that is how you begin to build momentum for your finances. If you work for an organization that does not offer a 401(k) plan and you do not know where to begin, check out Betterment. This is one of the easiest ways to begin contributing towards your financial independence in a structured way that takes the pressures of planning off your plate.

Some babies are walking by the time they are 9 months old. For another perfectly healthy baby, it may take up to 17 months. Would you suggest that the ability to succeed is higher for either of those babies? Of course not. Some things develop and happen differently for everyone. The same goes for us as adults and for our finances. What matters is that the steps are being taken. When you look back to track how far you have come, make sure you are peering back at where you have come from and are not comparing yourself to someone else. If the baby that was attempting to walk at 17 months was able to compare himself or herself to the baby that was walking 8 months earlier, how disappointing would that be if that baby decided that walking might just not be for them? That does not hold true for them and similarly does not have to be true for you.

*This is not financial advice. For educational purposes only.