Have you finally decided that you want to take control of your finances? You are tired of living paycheck to paycheck. You are tired of not having the security that you always have the money to pay for your daily needs and any emergencies.

And now, you are taking action. Enough is enough. It’s time to control your money instead of money controlling you.

But where do you start? You’ve come to the right place.

We’ve compiled the best of the best standard of operations from the leading financial experts and gurus and modified them based on our personal circumstances. So, if you are a mom who is currently running a business and tired of the daily grind and hustle, this is the exact step-by-step plan that I follow so I can move closer to becoming financially independent.

For context: I am currently at Coast FIRE. I have a five turning 6-year old daughter and a baby on the way. I am currently running a small business, and my husband is as well.

Petite Budget’s Step-By-Step Guide on Getting Your Finances in Order

1. Get Your Money Mindset Right

There’s a never-ending supply of money in this world. Whether you are starting from the very bottom or already making your own, there’s always a way to make more money. To be able to free yourself from this scarcity mindset, you need to instill in your mind that money is abundant. Money is everywhere. You just need to figure out how to ask other people to give you their money through:

• working a job
• offering a service
• selling an item
• sharing your knowledge and expertise
• learning from your personal experience
• and many more creative things

2. Start Tracking Your Spending if You Haven’t

The most common pitfall people experience when they are getting started on their journey to financial independence is not tracking their expenses. If you do not know where your money is going, then how the heck can you make the changes necessary to move closer to your goals?

I know, I know. It can be daunting to track every single line of expenses. And hey, you might be one of those people who doesn’t have an inch of attention to detail in their body.

That’s okay.

The most important thing is you find something that works for you.

If you want to print out your statements monthly and look at your line items one by one, that’s fine. You can also use an app if you are savvy enough to use it on your mobile device. You can create your own spreadsheet if that’s your thing.

Heck, you can even go old school and use plain paper and pen. Just make sure you utilize the power of habit stacking, where you place your paper somewhere in your house that you always use because of habits.

One of my favorite podcast hosts, Mindy Jensen of Bigger Pockets Money, suggests placing your notebook tracker by your front door. This way, every time you come home, you can log in all the expenses while you are away.

The bottom line is: Regardless of what method you choose…TRACK YOUR EXPENSES!!!

3. Create a Budget to Tell Your Money Where To Go

Majority of us prioritize paying our bills once we receive our paychecks and save whatever is left over. More often than not, we tend to have zero leftovers for savings, so our savings bucket is not growing.

Creating a budget to tell your money where to go, instead of the money telling you what you can or cannot do, is a much better scenario for me. I’m sure that sounds appealing to you, too.

Budgeting is not about restricting yourself. Budgeting is all about making a plan so you can be sure and feel secure that you have enough for all your basic needs in addition to paying yourself first. Yes, you read that right. You should ALWAYS PAY YOURSELF FIRST in your budget before anything else.

If you are following along with this Step-By-Step, you should already be tracking your expenses for a few weeks now. By doing so, you now have an idea of how much you are spending on your categories. Use the average when you are setting up the budget for each category. Also, make sure that you only have a maximum of 10 categories so it stays less complicated and easier to manage.

If you don’t know what budgeting method suits you the best, I have created this super easy quiz that you can take to figure out the best budgeting style based on your personal situation. Based on your answer, we’ll provide you with a personalized budgeting spreadsheet that you can use to help you get started with budgeting. I will create different versions depending on where you are at in your financial independence journey. Will update this post once I complete it so you can download the Petite Budget Budgeting Spreadsheet and start crushing it.

One last thing I want to emphasize in this step is to try your best to be consistent. It is okay if you blow up your budget in the first month. The important thing is you stick to your tracking and adjust your budget the next time around. I’ve never really had a perfect budget myself so don’t beat yourself too much.

4. Start Paying Off Debt Fast

I have two thoughts on this step. If you have a debt with no over 5% interest rate like your mortgage, I would say to pay off the minimum if the debt doesn’t really keep you up at night. If it does, then always pay extra to pay it off as soon as you can.

If you have debt with over 5% interest rate, such as credit card debt, student loans, or car loans, then I strongly recommend paying them off as soon as possible. Throw every extra dime into these debts as they are eating away your wealth building.

There are two popular methods to repay debt: the Avalanche or Snowball method.

I personally use a mix of both because that works for me. Basically, the hybrid method that I use is that I allot 30% of my income for debt repayment. I pay the least amount of debt first, and then I throw the remaining 30% into the one with the highest interest rate. This way, I get a dopamine boost from getting rid of the least amount of debt, and at the same time, I am making progress on the debt with the highest interest rate.

5. Be Clear About Your Goals

Now that we are getting your finances in order, it is now time to sit down and really think about your goals in life and how being financially secure can help you achieve those goals. Personally, I have 3 buckets for my goals:

• 3-6 months
• 1-3 years
• 3-5 years

These goals can be anything. They could be financial goals, personal goals, career goals, etc. The most important thing about these goals is that they add value to your life, and they really mean something to you.

To give you an overview, here are some goals we set up for our family:

Goals for 3-6 Months

• Build our emergency funds to cover 6 months of our living expenses
• Build our emergency funds to cover 6 months of business expenses
• Pre-pay for all the travel expenses when my husband’s parents visit the Philippines
• Save up for childbirth (This is a bit tricky as we do have health insurance and government subsidy. So if we end up not using it, we’ll roll the funds to other goals)

Goals for 1-3 years

• Pay off all credit cards and real estate debts
• Build our earthship
• Go to Canada for a month to meet Daryl’s friends and family and see where he grew up
• Club Med vacation for my 30th birthday

Goals for 3-5 years

• Have baby #3
• Be a certified equestrian
• Start a CrossFit Gym, Laundry Shop, Trampoline Park, Car Wash, and a Snap Cafe

So make your list and let your goals be the guide for our next step. Remember, these goals are my own personal goals. You need to create your own that resonates to who you are and what a fulfilling life looks like.

6. Devise an Investment Plan and Be Religious About It

Once you have started tracking expenses, set up a budget for you and your family, got rid of your debt, and determined your goals, it is time to devise an investment plan and religiously follow it. You’ve already set up a solid financial foundation and it is your time to shine by working on growing your wealth.

Personally, I create a personal statement that I try to review every day if not every day, at least once a week. This personal statement is a reminder of how I want to live my life and my north star to decide on what I should do with my finances.

I have Php 126,000,000.00 in cash with $5k monthly income each coming from Stocks, Rentals, and P2P lending. I also have 500 dragonfruit plants planted for every child. We live in a self sustainable home producing our own food, electricity, and water. I also have a CrossFit gym, laundry shop, car wash, and snap cafe living a long happy, healthy, joyful, wealthy life surrounded by people who grow with me.

Based on this personal statement, my investment plan revolves around investing in stocks, real estate, private equity, local boring businesses, and agriculture. I’m currently heavily invested in real estate so I am trying to balance this by focusing more on investing in stocks and working on my dragonfruit farm.

I have a second baby on the way and currently have around 800+ dragonfruits planted. Based on my personal statement, I need 200+ more dragonfruit to plant, and I will be on track with that aspect of my investment plan.

Note that my investment plan is for the long term, I plan to hold my stocks for as long as possible as long as it makes sense. My dragonfruit farm is a 20-30 year investment plan. The local businesses are also for long-term.

So this is my personal investment plan. Your investment plan will depend on your own personal values and goals. It won’t be as polished in the beginning, and it will definitely evolve as you learn more about yourself and what you want to do with your life. But once you got started into building it, be religious in following it and make sure that you practice and enforce this plan as much as possible.

7. Protect Your Wealth

One of the most important things that people tend to forget to include in their wealth-building journey is setting up a plan and defenses for how they can protect their wealth. The wealth that they worked so hard to build.

Here are some important strategies you need to have in place so all your efforts won’t be in vain:

• Protect yourself from identity theft
• Do not click on any links in phishing emails or text messages
• Do not give your personal information to people you do not completely 100% trust
• Have a will in place as early as you can
• Have a pre-nup (Yes, you should. Unless you want the government to decide what will happen to your wealth if ever the inevitable happens. This is to protect you.)
• Make sure that you have access to all your financial accounts in one secured, unhackable place. If you have a spouse, make sure you both know each other’s financial accounts.
• Get a life insurance if you have at least one dependent

These are just some strategies that I personally try to set up for myself and my family. There are some more precautions you can take, but these strategies are the bare minimum.

8. Start Your Strategic Investment Journey

Based on the investment plan you created from Step 6, start investing religiously. Keep in mind that this investment plan is for the long term. So, regardless of what the market is saying during this time, trust your research and plan that they will recover. Buy low, sell high. That plain easy.

Also, don’t forget to enjoy your journey as much as the finish line.

There you have it! 8 Steps on getting your finances in order and working towards your financial independence.