Did you know that 70% of people live paycheck to paycheck?
For most, this creates a cycle of stress and uncertainty, where financial freedom feels like a distant unachievable dream. But influencer, millionaire, and business investor @Codie_Sanchez isn’t having any of it. She shares a tweet of the nitty gritty details that got her to a place of freedom; and is passionate about helping get others there too.
She wholeheartedly believes anyone can take charge of their finances and thrive without money being an issue. This isn’t about a quick fix or a miracle; it’s about creating a no-BS system that works.
Sanchez shares exactly what she did to become a successful business owner and how you can do it too:
Track Your Money with a Personal P&L
You can’t manage what you don’t measure. Treat your personal finances like a business by using a Personal P&L (profit and loss statement). It doesn’t have to be fancy- a pen and paper or Excel spreadsheet can work just fine.
Start by listing every source of income and every expense. This allows you to clearly see where your money goes and how much you’re saving.
Taking it a step further, Sanchez shares she loves to conduct a Course of Action (COA) analysis. Ask yourself, “What if I got a $10K raise? Cut back on dining out? Started a side hustle?” Plug these scenarios into your P&L to see how they could impact your bottom line. These actionable insights often spark motivation to make informed decisions about your money.
Diversify Income Streams
The days of relying on a single paycheck are over. The average millionaire has seven income streams, including rental properties, dividend stocks, media ventures, and side businesses. You don’t need all seven to succeed, but experimenting with a few is key.
Start with something that excites you, whether it’s monetizing a hobby, investing in real estate, or freelancing. Focus on diversifying income while keeping it manageable. Building multiple streams creates a safety net and accelerates wealth-building.
Automate Savings and Investments
Saving money shouldn’t be a choice you make occasionally; it should be a habit. Set up automatic transfers to your savings and investment accounts every payday. This “pay yourself first” approach ensures your future is prioritized over impulse spending.
Once your savings are growing, put your money to work. Move savings to a high-yield account or invest in index funds to maximize growth over time. For example, switching from a traditional savings account earning 0.02% interest to one offering 4.6% could add thousands to your annual returns on $100,000.
Leverage Tools for Money Habits
Building better habits doesn’t have to be overwhelming. Use tools like the Streaks app to track small but impactful actions daily. Simple tasks like “save money on one purchase” or “check your bank account” keep you engaged and aware.
Sanchez writes that where your attention goes, results follow (in this case, money). These small wins build momentum toward bigger financial successes.
Outsource Low-Value Tasks
Your time is money. Calculate your hourly rate and outsource tasks that cost less than your hourly value. For example, hire a virtual assistant for repetitive tasks like data entry or small admin work (i.e. if you’re trying to start a side business).
This frees your time to focus on high-value actions, like growing income streams or upgrading your skills. Think of it as reinvesting in yourself. With access to a worldwide workforce, you can find an affordable team that fits your business and money goals.
Categorize Spending
Catalog your expenses into categories like Needs, Wants, ROI (return on investment), and Experiences. Needs come first, while ROI-focused expenses, like paying down debt or investing in skill-building, should also take priority.
Sanchez thinks Wants and Experiences are fine in moderation, but tracking them can reveal wasteful spending habits. For instance, $200 a month spent on subscription services you rarely use could turn into $2,400 in annual savings or more if invested properly.
Always Negotiate Your Salary
Sanches shares that many people leave money on the table by not negotiating their salaries. Even an extra $5,000 annually, when invested, can grow into over $1 million over a 30-year career.
The worst that can happen is a “no.” Always counter job offers, advocate for raises and understand your worth.
Optimize Taxes
Taxes are one of the biggest expenses in life, yet most people leave optimization strategies untapped. If you have a side hustle or business, consider forming an S-Corp to take advantage of distributions that avoid self-employment taxes.
Keeping more of what you make (legally) is an overlooked key to building wealth. Analyze your tax situation annually and look for ways to save.
Invest in Continuous Learning
Your financial IQ will determine how far you go. Read books, listen to podcasts, and surround yourself with people who inspire you to think bigger. Some starting recommendations by Sanchez include The Millionaire Fastlane by MJ DeMarco and Rich Dad Poor Dad by Robert Kiyosaki.
Knowledge compounds, just like wealth. The more you learn, the better decisions you make and the more opportunities come your way.
