Your Best Personal Finance: How to Take Back Financial Control in 2020


The Best Ever You Network and The Best Ever You Show are pleased to welcome back financial expert, Norm Champ, who gives advise for how to take control of your finances and get back on track.


In addition to the article below, here's a special bonus:

FREE Audio Replay of Norm's interview on The Best Ever You Show.

Click to Listen: Norm Champ, Mastering Money


Take Back Financial Control

A 2015 survey from the National Foundation for Credit Counseling found that 4 in 10 American adults gave themselves a grade of C, D, or F on their finance knowledge. One-third hadn’t saved anything for retirement, another third had no savings, and 6 in 10 did not have a budget. John Pelletier, executive director of the Center for Financial Literacy at Champlain College, said of the survey, “Such negative financial outcomes and low levels of consumer knowledge and confidence make it crystal clear that financial literacy in America should be a national priority.”


The basics of mastering money are not complicated, but our society has buried them for so long they’ve become secrets. We’re a nation of immigrants and pioneers, enriched by the honest struggle of those who overcame slavery, poverty, and all manner of the toughest odds. At our best, we are a nation that made a better life through work and thrift to advance our children and grandchildren to a stronger place.


Twentieth-century Americans built the world’s greatest job-creating democracy. They didn’t do it with high-interest credit cards and handouts or lottery tickets—or by scraping by on benefit checks they didn’t need. They worked, they saved, they made smart investments, and they practiced thrift.


But our best days are not necessarily behind us. The upside of where we are now is that despite all the controversy, all the headlines, all the bad news, our current economy continues to offer far more job opportunities and sound investing options than our grandparents would have dreamed of.


Financial peace of mind is closer than you think.


Debt Begets More Debt

Debit spending has become a way of life in America, and we have begun passing it down as a cultural heritage. Some of our kids have credit cards before they have any

income. In 2017, 18 percent of kids aged 8 to 15 had credit cards. There is a big difference between responsible and irresponsible spending habits that parents pass along to their children. If done responsibly, giving children/dependents a credit card can help them build credit before they attain financial independence. So whatever cycle of regulation and enforcement we are in, your basic situation remains: you need to protect yourself against debt.


Once you have debt, you need to deal with it. If you have too much debt to pay off, it may take several years and a lot of sacrifices to reverse that.


Here are the steps to follow:

1. Stick to one credit card. Pay it off monthly. Use cash whenever you can.

2. Become a smart car shopper. New cars depreciate faster than a speeding Ferrari, so research the options: used, preowned, and dealers’ test-drive vehicles.

3. Reduce your housing costs. Downsize if you can’t afford your home. Take on a roommate. Buy a duplex (you’ll save on taxes too).

4. Pay attention to your credit reports. You can probably get your credit report for free from your bank. Credit reporting agencies must also by law provide you with a free credit report once a year.

5. Set an amount for discretionary spending each month.



Financial Literacy for Our Children 

Let’s say you’ve worked hard for a strong credit rating, and you want to add your child as an authorized user on a credit card. Just remember, the child will have the same spending power as you but none of the financial responsibility for the bills.


If you have children at home, find ways to share what you know about finance and saving money. After all, almost all kids are interested in money.


Become a Net Worth Warrior

For all of us and our nation as a whole to prosper, for our communities to begin to heal from the terrible but all too familiar partisan rancor and hatred of recent years, to protect the dreams of our children and grandchildren, we must slay the debt monster and reassert our own economic freedom. We need to drive the economy forward with a newly empowered citizenry with its own positive net worth and minimum consumer debt.


We need to reverse the dangerous revival of easy-credit mortgages, have more normal interest rates above zero, and encourage every American to save—really save—for that first house. Imagine how feeling economically secure and safe will ease the paranoia and fear that runs rampant among all walks of our citizenry.


To read more from Norm Champ, check out his new book Mastering Money.


About Norm Champ:

Norm Champ is a partner in the Investment Funds Group of Kirkland & Ellis LLP and the former Director of the Division of Investment Management at the U.S. Securities and Exchange Commission (SEC). He is the author of Mastering Money as well as Going Public: My Adventures inside the SEC and How to Prevent the Next Devastating Crisis. He is also a lecturer on Investment Management at Harvard Law School. Before joining the SEC in 2010, Mr. Champ was Executive Vice President and General Counsel of Chilton Investment Company, an investment adviser to long/short equity hedge funds and managed accounts. Mr. Champ has an A.B., summa cum laude, in History from Princeton University and a J.D., cum laude, from Harvard Law School. He was a Fulbright Scholar at King's College London where he received his M.A. in War Studies. Prior to joining Chilton in 1999, Mr. Champ was with the law firm of Davis Polk & Wardwell and clerked for the Honorable Charles S. Haight, Jr. of the US District Court for the Southern District of New York. Visit Norm Champ.com


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