Whether you’re an entrepreneur, college grad or a retired Goldman partner, you’ve probably experienced some form money anxiety. For a tiny piece of paper, money has this incredible power to trigger intense feelings such as FOMO, envy, inadequacy and outright fear (aka the “poverty mindset”). And it never ceases to amaze me how rational people (and many finance professionals) turn a complete blind eye to this important area of their lives.
Today’s guest, Ashley Feinstein Gerstley coaches people (like me) out of their own money madness (via her 30 Day Money Cleanse). Ashley’s a coach and creator of the Fiscal Femme blog. But our listeners will relate to her story: she started as an investment banker and grew the Fiscal Femme as side hustle until finally jumping off into entrepreneurship. Her advice is particularly spicy for entrepreneurs, and we discuss how much runway is enough, “death by a thousand small withdrawals” (my personal favorite), the dangerous belief that we can out-earn our expenses, and how avoiding the topic is really avoiding accountability.
More about Ashley
- Get a head start on Ashley’s 30 Day Money Cleanse
- Ashley’s Blog, The Fiscal Femme
- @thefiscalfemme on Twitter
- Cultivating a Growth Money Mindset (Ashley channels her inner Carol Dweck)
And don’t miss our previous episode with Lisa Shalett: You are where you’re supposed to be
Why we’re not set up for success with money
- We never learn about it
- We can’t talk about it
- We have to deal with it almost every day
- It’s emotionally charged
- Because we don’t talk about it, we assume everyone else has got it on lock
How did you think about runway as entrepreneur?
AFG: I called it Project Freedom. Based on what was coming in, minus expenses — which was a negative number — how many months would I survive?
KH: How many months/years did you give yourself?
AFG: It’s interesting because it would change every month!!! The 3–5 year plan looks nothing like what it originally looked like.
Advice for Aspiring Entrepreneurs
KH: What would you tell someone looking to leave, with a kernel of an idea?
AFG: Part of it is figuring out what your lifestyle is because if you’re really unhappy in your work, you probably spend more money. [Ask yourself] can you significantly increase your runway and would you be willing to let go of certain things, to do whatever you want and spend time on working in your business.
Investing in your business versus the slow trickle of depletion
If you know how much your business spends and you know how much you need to be paid for your personal life, and you have an idea of what you may earn over the next 3–6 months, based on that — how much do you need to invest in your business?
It’s such a powerful feeling to say: I need to put 20k in my business account in order to survive the next six months rather than every week having to slowly transfer X dollars. Because then you feel like you’re failing, when you actually knew it was going to be 20k. And now you’re actually investing in your business.
Money and ego
Money is difficult to talk about because we collapse self-worth with our net worth. We don’t want to tell the person across from us what we’re earning because we don’t want to make the person across from us feel worse if we’re earning more; and we don’t want to feel worse if we’re earning less, but its really about the value of your services in the market.
On Money Avoidance (Khe Hy is so guilty of this!)
AFG: The key piece I see missing from the puzzle is “what is your life cost?”
KH: What prevents people from actually drilling down?
AFG: Most people don’t know. It’s partly because we have a natural tendency to not want to know, technology’s made it really easy to not know, and our culture is very much into “top line.” There’s this idea that we can “out-earn” what we spend, and I argue that with that mindset it’s Never Enough.
On Becoming ok with an Online Voice
“I wanted to share what I was learning, but it was terrifying to me to put something out there — what if I changed my mind, what if it evolved…
One thing that stands out is the idea of “they” and “what would they think?” Which meant redefining who that “they” is. The original “they” was so broad, which is what made it so daunting.”
Two Budgeting Apps
Both recommendations favor you having to input expenses into a spreadsheet-like format for true accountability.
- I Will Teach You to be Rich, Ramit Sethi — very practical and applicable personal finance info
- Think an Grow Rich by Napoleon Hill — money and abundance mindset
- MONEY: Master the Game by Tony Robbins — long read, but consistent with Ashley’s philosophy
- Predictably Irrational by Dan Ariely — on human irrationality when it comes to money.