Balance is Key: A 5-minute Personal Finance Lesson for Yogis & Other Magical Creatures

The barefoot wanderer in me doesn’t concern herself with retirement savings, Roth IRAs or index funds. However, as much as we all dream about living in a yurt in some beautiful location, growing our own food, and scooping ice cream for a living, I don’t want to be forced to do that a few years down the road because I neglected my finances when I was young.

If you’re like me and cringe when you think about having to allocate money to savings (ugh) or diversify your portfolio (DOUBLE UGH), get your shit together and follow a few little nuggets of advice I’ve acquired over the years (aka all of the unsolicited advice I’ve received from my more financially-savvy friends, experts, and advisors).

Simplify Strategically: Identify places in your life where you can cut back, and be aggressive about it. I like the idea of having a beautifully furnished home, but I don’t really find a ton of value in it. It doesn’t feed my soul and it’s not worth trading the hours of my life I spend working for a freaking West Elm bar cart (but- OH! – to have a bar cat with some pretty peonies on it). However, I do LOVE dropping cash on a great night out with friends, on delicious food, on some plane tickets to anywhere. I also don’t mind bringing my own coffee to work, rocking the same phone for 3 years (iPhone 5 HOLLER), waiting 6 months between haircuts, or driving the same car I’ve driven since HIGH SCHOOL. Don’t waste your money on things that you feel like you should be buying because of external pressures. Turn inward and ask yourself where you want to be allocating the abundance you’ve created through your hard work. You might surprise yourself with the things you’re willing to cut out of your life.

Automate: JUST FREAKING set up an automatic savings plan, where money is taken out of your paycheck before you even see it and invested in a 401K or whatever employer-supported retirement plan your job offers. Does your employer match your contributions? NO DOUBT you’re maxing out your matched contributions (#freemoney). Independently employed? You can still save for retirement on a tax-deferred basis. Check out setting up a SEP or SIMPLE IRA. You don’t have to squirrel away 50% of your take-home income or anything- start with something like 5% and see if you can scale up from there.

After that, set up a rainy day fund in a high-yield savings account- something that you can access quickly while still generating some interest (I use CapitalOne360). The key here is that it’s one less decision you have to make about where your money is going, and even if it doesn’t seem like a lot at first, compounding interest is your friend.

Spend your Money: Once you’ve cut back mercilessly on meaningless expenses, do some soul-searching and ask yourself what types of investments will enrich your life. Saving is crucial, but once you’ve hit your savings goals you should consider allocating your money – intentionally, not reactively – to things that bring you joy and help you achieve things that are important to you. Do you love going to see plays? Have you been holding off on taking a course at the local college because $300 seems like a lot of money? Freaking bite the bullet and enjoy your relative wealth. Invest in yourself, and don’t police little splurges every now and again. Do you live for your 12pm coffee break? Stop nickel and diming yourself and allow yourself to enjoy your damn latte without feeling guilty about the $2.40/day you could be saving. You’ve already automated that process, remember?

Get your Credit Card Under Control: Just slapped down the plastic for another $250 day at Lululemon? Here’s your new mantra, flowerchild: Don’t buy more than you can afford. Do you have the means to pay off your balance immediately, without transferring money from your emergency savings? If not, the balance is too damn high. That being said, credit utilization within reason can be a good thing. Earn some points (once again #freemoney), avoid paying interest AT ALL COSTS, and build good credit history. This will help when it comes time to put the down payment on your hippie bungalow on the beach, I promise. Also, people who tell you “carrying a balance is good!” are liars. Credit utilization ≠ carrying a balance. I digress. The point is: credit cards are okay if you can mindfully proceed with caution. Credit cards are like your arm balance practice- they can provide so much value and strength, but used incorrectly and without control, you’re in for a world of hurt.

Add Value: What are you good at? What makes your heart sing? Where can you add value in the market and/or in other people’s lives? How are you unique? Once you figure out your niche, keep building your skillset and make yourself indispensable. I guarantee that you’re infinitely valuable outside of your potential contributions to other peoples’ businesses, but if you’re looking to score a job or upgrade to a better one, ask yourself what exactly your selling to your employer/the market/your mom (if you’re like, an CutCo sales rep or something). Saving and managing your money is only half of the equation- you’ve gotta have a little income in order for this whole system to work.

Get Help: So, you’ve read a few lame blog posts (ahem) and you still can’t get your shit together? Time to get a little help. I’m not saying you need to head down to your local financial advisor and book an appointment, but buy a book or two on investment, carve out some time to learn the basics, and profit from your knowledge forever. Don’t let your ego get in the way of finding a teacher to help you out.

Now what? Go forth, set up everything once, and profit forever. Your small display of discipline in this matter is like hanging out in utkatasana- yeah, it’s not the sexiest pose and it might strain you a little, but it makes you stronger and prepares you for what’s to come. If you take issue with my 4^th grade reading level financial advice (or if you love it and it revolutionized your world), let me know!