Sage Advice For Uncertain Financial Times
Author and Money Expert Cory Arnold Weighs In
Meet Cori Arnold who hails from my home state of Ohio. Her claim to fame is that she went from $260K in debt to becoming a millionaire in 10 years. As she often has said:
“I'm not special. I don't have rich parents. You can do this too!”
Last year I featured her in an article entitled Author Cori Arnold’s Quiet Journey From $260K In Debt to Becoming a Millionaire that garnered a ton of attention. She is the author of three money-related books:
Career Advice For Graduates: 62 Essential Elements to Excel Early
You’re Approved: Get Approved For Credit and Pay The Lowest Interest Rates
I recently reached back out to Cori for some perspective on the tough economic times our nation is facing. While many are still recovering from the pandemic, inflation and real estate prices aren’t helping matters. As she laments:
“Every time I go to the grocery store, I feel the inflation. I know you feel it too.”
The good news according to Cori is that the economy will rebound. And you will too.
Think, she says, about the most recent bear markets:
• In 2002, we had the Iraq war and the dot-com bubble.
• In 2008, we had the housing crisis.
• Today, we are recovering from the impacts of the pandemic.
Every bear market, adds Cori, has one thing in common: the economy rebounded every time.
“The economy is resilient just like you are. Think about the challenges you’ve faced in your life. You’re still here. You’re stronger because of those setbacks. Have confidence in the economy.”
Below, Cori offers some sage advice on six emerging trends and how you can make the most of them
Mental Health & Wealth Building
The isolation caused by the pandemic has put mental health at the forefront of our attention over the last two years. Coincidentally, I started a major diet and exercise transformation in 2018 with the intention of reducing my migraines. What I realized is these changes not only mitigated my migraines, but they also gave me the ability to think clearer, control my emotions better, and reduce my stress.
This became a positive cycle, pushing me to try other practices, such as meditation, gratitude, and affirmations. These new habits have completely changed my life. I am more confident at work. I make better investment decisions. And my net worth has grown.
I realized through this journey how connected every aspect of my life is. When you start winning in one area of your life, that improvement overflows into other aspects.
If you want to improve your money, start with your mental health. If you want to improve your mental health, start with the inputs in your life. Nutrition, exercise, television, news, and books are all inputs you choose to bring into your mind or not.
The Great Resignation
There is a large trend toward leaving the traditional 9-5 job in search for income in other ways, whether that be online, passive, or with a side hustle. With movements like FIRE (financially independent, retire early), many people no longer want to commit to the same 40, 50, or 60 hours every week. Many want control of their time. I understand this. I’ve wanted this as well. I fear, however, that many might be leaving their jobs prematurely.
I am all for taking the risk of entrepreneurship. However, I encourage those who are quitting their jobs to ensure they are running toward something, not just away from something. Running toward something is a much different position than running away from something.
The other caution I would offer is to confirm your side hustle or passive income strategy really works. When you take the plunge and cut off your 9-5 income, your side income needs to be proven. Saving up eight months to a year’s worth of expenses is key when your income becomes volatile.
Inflation
There appear to be two main drivers behind the inflation – the limited supply and higher fuel prices.
I know this is tough on a lot of families and individuals, especially those living paycheck to paycheck. If you were maintaining your lifestyle with little at the end of each month prior to inflation, then you are likely going backward each month with inflation. It’s painful.
The good news is that fuel prices are starting to come down. This should have a favorable impact on inflation. When the costs of producing and shipping products go down, so do retail prices.
In the meantime, there are actions you can take to mitigate some of this inflation. For example, you can consume cheaper foods, stop buying branded items, grow your own produce, and stop eating out in the short term.
Patience is the winning strategy for wants right now. If there is something you want, it may be best to wait and let this inflation settle before making the purchase.
Real Estate Investments
Real estate prices have soared over the last two years. There is a lot of speculation about the market flattening or dropping. My belief is the market will cool down, but prices won’t drop too much. I know rent has increased significantly as well, but I would recommend only buying when you are financially ready.
Being financially ready means you have at least a 10% down payment and not much debt. Having a 20% down payment would be better. This would allow you to avoid the additional costs of PMI (private mortgage insurance).
I personally jumped into real estate too soon in my late 20s and ended up selling the property for less than I purchased it for. I know what it feels like to want to own your own place. However, if you rush, you’re more likely to make a bad decision.
When I eventually practiced patience, I had my own cash in the deals and started winning with real estate.
Stock Market
The ability of the everyday investor to access the stock market has evolved substantially over the last 25 years. I remember wanting to invest in my early 20’s, but the advisor told me I needed $6 thousand dollars to open an account. Those days are gone. Today, you can open an investment account with $250 or less. This gives many individuals access to the stock market.
This is the third bear market I’ve experienced in my adult life. I was in college for the first one, and it scared me. I didn’t have anything invested in the market, but this was the first time I was paying attention. Experience is such a good teacher. I now have no fear of the current market. This will be a blip in a decade or two. Check out any of the index charts historically and you will see that every dip has a rebound
My advice is to be patient and continue investing just like you were investing prior to this market, especially if you were investing in index funds. Dollar-cost averaging is investing a specific amount at a specific frequency. For example, I contribute a portion of every paycheck to my retirement and non-retirement investments. Dollar-cost averaging is the way to invest, especially right now. See your current contributions as getting a deal on the price of stocks right now just as you believe a sale at the store is a good deal.
Diversity & Inclusion
There is an emphasis on equality for all in the world today. Sadly, not everyone is open to this, but there are many people opening their minds. My company, for example, is pushing this through discussions, targets for leadership diversity, and opportunities to come together. Every single person on this earth, no matter what sex, what color, what nationality, or who he/she loves is a human being.
Seeing large corporations and sports leagues starting to promote and support this is just the beginning. Although we have a long way to go as a human population, we also have a long way to go as individuals. If you feel like a victim of your past, you also have a responsibility to move forward feeling equal, no longer settling on those past feelings.
I was listening to a podcast the other day, and the topic of imposter syndrome came up. Imposter syndrome occurs when you are starting a new profession, new business, or just a different direction in life and you don’t necessarily feel like an expert. It is a form of self-doubt.
The host, a male, confirmed he feels doubt when starting new endeavors, but works through them. He finds the confidence within himself to keep going, whereas women most likely feel the same doubts, but allow the doubts to deter them. I should mention he was having a conversation with a woman. I could relate to this completely.
I want anyone who is venturing out on a new endeavor to keep moving forward through the doubt. I encourage you, especially when it gets tough, to keep your eye on your goals.
In a concluding thought, Cori had this to offer
How you adapt to this current environment determines how your future will unfold.
Will you be open-minded, patient, and persistent, or will you give in to instant gratification and your comfort zone? The world is always changing, and right now I believe it’s changing at a more rapid pace. You get to decide how you respond to it.
Cori Arnold went from negative net worth to millionaire in ten years, transforming her life. She recently started a YouTube channel, Cori Arnold | Negative Net Worth to Millionaire, as well as a growing blog www.willyouberichorpoor.com and a growing Twitter and Instagram following @moneymindcori.