Establishing Your Financial Wellness

By Kathy Wright, Valley Bank with contribution from Jennifer Lee AIF®, AWMA®, founder of Modern-Wealth

Library | 4/22/2021

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Budgeting and money management have merit and application in everyone’s lives, especially for us women in business. Having our personal finances on track makes it that much easier to ensure our business finances follow suit.


Getting a grip on your financial world will help you to direct your choices so that you can make meaningful decisions about your financial picture. To do so, you need tools that will provide you with the foundational components to assist with reaching a solid financial footing.


Let’s break down the approach into three basics of budgeting to understand your money and its role in your life.


1.  Understanding Your Discretionary Number

Discretionary income is the amount of your income that’s left for spending, investing or saving after paying taxes and personal necessities like food, shelter and clothing. You can determine your discretionary number with a simple equation.


Income – Expenses = Discretionary Income  


To calculate, first consider what goes into your bank account such as wages or pay, commissions, alimony, real estate income, pension, annuities or business income. Then, take a look at what goes out of your account in two separate categories: fixed expenses and variable variable expenses. Fixed expenses include mortgage, rent, savings, 401k contributions, insurance and auto payments. Variable expenses might be gifts, entertainment, Netflix, concerts, or recreation (Boating/Golfing/Travel).


Understanding your discretionary number gives you valuable information. If your bank account isn’t accumulating by your discretionary number each month, then you might be spending unconsciously. It’s time to consider tracking your expenses.


2.  Mind Mapping for Your Future Self or Business

Mind Mapping allows you to take a minute and get the creative juices flowing and get clear on what you want. Most people can benefit from sharpening their focus. We go about our day-to-day financial world, business world, family world: managing kids, spouses, fires, finances and dinner. Often times we do all this without a clear mindset and objective. And yet, we expect to magically achieve our not yet clear goals.


A mind map is a graphical way to represent ideas and concepts. It is a visual thinking tool that helps structuring information, to help you to better analyze, comprehend, synthesize, recall and generate new ideas. So, grab a piece of paper and freely let yourself write like crazy. No thinking, no judgment, no limitations. You can always color code and rewrite your thoughts. Just get it out!


As you write, consider things like:

  • What are your first Memories of money?

  • Were they positive and of opportunity, excitement and challenge?

  • Were they fearful and of lack thereof?

  • Where did you learn from those memoires?

  • How have these stories woven into your fife today?


3.  Financial Planning made Simple

A financial plan creates a roadmap for your money and helps you achieve your goals. Financial planning can be done on your own or with a professional. It starts by thinking about things in terms of two categories: “What do I have?” and “What do I want?”


What do I have?
Consider your resources: income/commissions, savings, personal investments, inheritance, alimony, real estate, property, pension, 401k, annuities or your business.


What do I want?
Now, think about what you want. Is it a certain lifestyle, peace of mind, paying your bills, sending your kids to college, traveling, having more fun and less work, future income/retirement funds, empowering others, taking Fridays off, leaving a legacy or to to taking care of your family?


Once you know the answers, you can get to work planning for your financial future!


Hear from Valley Women in Business Program members on their best personal finance advice


Kim Tarnakow, CPA, Stambaugh Ness in Alabama

For most of us, achieving personal financial security doesn’t come in the form of a single, dramatic event. Instead, it comes through setting financials goals and making intentional, consistent daily choices to achieve those goals

  • Choose to contribute monthly to your emergency fund

  • Choose to contribute to you company’s 401(k), no matter how small the amount.  

  • Choose to pay down credit card debt a little each month.  

  • Choose to save for purchases first before buying with credit. 

  • Choose to live within your means. 


While all of this together may seem like a daunting task, each of these is a small step by itself. You’ll soon realize that small changes can make big differences in your personal financial health. As you see your savings grow and your debt decrease through your efforts, you’ll be empowered to take control of your own financial destiny.


Cara Lovenson , Plan Professionals, Inc. Insurance Broker and Consultant

Ask yourself, how is your relationship with money? After suffering financial distress, I wondered myself, ‘what IS my relationship with money?’


The first step to fixing this was having financial clarity. I knew I needed to know exactly how much I had, where it was, and where it was going. To do so, I used an expense tracker app to keep track of cash, purchases and designate it to specific categories such as groceries, drinks, restaurants, tickets, etc… An app, like the Valley Bank app, helps consolidate your finances so you can quickly view at a glance.


Now I know in a pinch what I spend on coffee, lunches, clothes, vacation and the list goes on… 


As you gain more clarity about your money, it will lessen financial stress and give you the confidence to work toward your goals and vision. It can also prevent debt and feeling deprived. For example, take that desired vacation but then you can see where to cut back or maybe increase your income.   


Donna Melega, an Agent & Financial Services Professional with New York Life Insurance Company

"When it comes to your business, it’s really about 4 things: your family, your business, your team, and your future."

This article was written by Jennifer Lee AIF®, AWMA®founder of Modern-Wealth


Valley Women in Business
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Valley Women in Business

Valley's Women in Business program connects and empowers professional women. From entrepreneurs, to executives; we provide networking and educational opportunities that enrich the professional lives of women at every stage of their career.

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