Let’s face it … navigating our finances isn’t always easy.

How can it be?

Money is woven into almost every aspect of our lives. And it has the power to change someone’s life for the better as well as for the worse.

And because money is such a FELT item we use everyday, we emotionalize it.

This is part of the reason why it’s been said that personal finance is 80% about behavior and only 20% about numbers (head knowledge). We underestimate how much power we have to influence our financial situation simply by focusing on our behaviors and mindset around money.

But even if we know that money is laced into our everyday lives, and even if we know that we can help our financial situations by focusing more on our behaviors, that still doesn’t seem to offer any real guidance for those struggling with very real financial issues.

So how do we overcome those obstacles?

Well, the first thing I want to do is identify what I mean by “financial progress.”

Here’s an exercise: If I ask you, “Are you making financial progress in your life,” what would your answer be?

Statistically, most will say no. But even if you answered yes, I’d like to share a quick story with you.

When my wife and I were living in Florida, my car was making a strange sound (you know, like those sounds demonstrated on those AAMCO commercials). So I took it to our mechanic, Randy. When I got to the shop, Randy jumped into the car and said, “Okay. Let’s go for a drive.” While driving, he asked me to identify the strange noise. I made the mistake of asking him to instead just tell me what he heard.

Randy’s response was what caught me off guard, but is also why he was such a great mechanic. He said, “No. I can hear a hundred different things that I could probably go in and fix. But you’re the one who drives the car and knows what kind of sound feels wrong. So it’s more important for me to know what you hear as being wrong so I can better identify and fix the issue.”

So as soon as I heard the sound, I identified it and Randy went to work. We came to discover that one of the two side-mounting bolts for the engine had completely snapped, putting anyone around the vehicle in danger. Had I not identified the specific sound that made me feel uncomfortable, Randy would not have been able to go straight to solving the issue.

The same goes for our money and whether or not we are making financial progress. At the end of the day, we have to be the ones to identify something being/feeling “wrong.” As a financial coach, I can look at someone’s finances and suggest multiple changes. But that isn’t teaching. That’s telling. And I’d rather teach you how to identify and solve your financial issues.

The second thing we have to do is identify the obstacle.

Now, I haven’t seen every financial obstacle out there, but I have seen a lot. And I’ve noticed that there are four main categories which these types of obstacles fall into: Personal, Purpose, Predicament, and Plan.

We will start to see financial progress in our lives when we are able to create a synergy among all of these types; however, as most of us know, trying to do too much at the same time is going to be overwhelming.

So, the key is to make it all more digestible for our brains as well as for our emotions.

You know the old saying, “How do you eat an elephant? One bite at a time.”

And that’s exactly what I’m going to help you do here.

Below is an image of my framework for this “Financial Puzzle.”

Now, let’s break it down so we can solve it.

The middle line simply represents where you are right now and the more financially empowered version of you in the future. The circle in the middle represents the obstacle(s) you are facing in order to make financial progress.

Above the line, you’ll see two quadrants - Personal & Purpose.

Below the line, you’ll see two more quadrants - Predicament & Plan.

These four quadrants represent the categories for which your financial obstacle will fall. The reason this is important is because by understanding which type of obstacle you’re up against, you can then develop a plan for how to overcome it.

Lastly, before I dive in any further, I want to point out the bubble at the top. “Lift.” Remember when I told you that we emotionalize money? We have to respect how we feel about money if we want to encourage healthy and positive financial progress. So when we focus on Personal and Purpose-based solutions, we will feel more of an emotional lift in the way we perceive our financial situations. This isn’t to say that working on a Plan isn’t going to move the needle for you. It will most definitely move you forward (as shown in the diagram); but you’re going to feel more of that positive “lift” when you add Purpose-based solutions to your overall plan.

Remember: eventually, each of these sets of solutions will be working together. We just need to start small so we don’t get overwhelmed. At the end of the day, the goal is to start.

More than likely, you will find that you fall into a Personal or Predicament obstacle first. So let’s go ahead and define what those kinds of obstacles look like.

These are going to represent those intangible excuses. It’s more of an internal obstacle. Maybe you have a fear of failure. Maybe you have a lack of confidence. Perhaps you have a lot of self-doubt.

Another key word for this obstacle is “excuse.” And please don’t think I’m attacking you if you feel this way. What I’ve noticed in my coaching practice is that most people who face Personal obstacles have very limiting beliefs about themselves. For most of my life, I had felt the same. I would tell myself I’m not good with money; when in reality, I just didn’t understand money.

Having this kind of financial obstacle can be emotionally deflating and leave us feeling very lost; because, we need to be more vulnerable in order to not only identify but also solve this type of issue. Working on ourselves while also aligning our purpose will yield great results.

These types of obstacles represent the tangible reasons for someone not making financial progress. (Notice: I didn’t say “excuses.”) When it comes to personal finance, each and every person’s situation is going to be unique. And that means that each and every person is facing different sets of challenges.

A heavy-hitting example for this type of obstacle could simply be the amount of debt someone has. As we know, debt payments alone can cause someone financial ruin. That’s why this isn’t an excuse. This is an obstacle you face that is very real and can cause very real problems. Other examples for this kind of obstacle could be income, inflation, or cost of living (location).

When we’re in the middle of Predicament obstacles, if we don’t focus on solutions, we can very quickly slide into a victim mentality. That’s why this obstacle is in the bottom-left; because this obstacle requires the most work. They require facing that obstacle and developing a plan of attack.

Now, let’s move on to the other two obstacles.

To put it simply, a Purpose obstacle is a lack of understanding your “why” or not having any specific financial goals. With any client that I work with, we always discuss these first. The reason for that is because it provides us the most motivation, hope, inspiration, and “lift.” And it doesn’t require as much work as some of the other obstacles do.

If I asked you to think about some financial goals, you may say something having to do with retirement, traveling, freedom, buying a home, etc. These are great. Because once you have the destination, you are better able to plan the route.

At the same time, asking you what your financial goals are, you may describe more of a “why” such as: wanting to start a family, being able to have to have your spouse quit working in order to allow them to be at home full time, desiring to start a business and be your own boss, being able to afford pursuing your dream, not crying yourself to sleep every night because of money, etc.

These goals and “why’s” are what keep us going when times get difficult. So when we’re sitting in a Purpose obstacle, focusing on these will keep us from slipping into a victim mentality and inspire us to work toward solutions that give us the options in life we’re looking for.

And finally,

This is that 20% head knowledge part we talked about earlier. This obstacle simply means that you lack the information needed to know “how” to solve the issue. Facing these types of obstacles tells us that we need more knowledge.

One of the most important tools we use in personal finance is a budget. I was 32 years old when I created my first budget. Sure, I could have defined what it was; but I didn’t trust myself enough to create one (Personal obstacle) nor did I have the knowledge around how to create and maintain one (Plan obstacle).

Other examples of Plan obstacles could be: not having a method for how you’re going to pay down your debt, not understanding how to invest (or start investing), or not knowing to set aside money for taxes from 1099 employment. As you’ll notice, these obstacles require more of a tactical approach.

You see, if we sit in Plan obstacles and do nothing, it usually stems from a false internal belief and would mean that we’d more easily slip into those intangible excuses. But once you know that you’re facing a Plan obstacle, you can quickly learn the information and immediately give yourself more “lift” by focusing on Purpose-based solutions.

Now, you may find that you fall into more than just one of these categories. And let me be the first to tell you that that’s not a bad thing. It just means that we’ve identified what the issue(s) are and can more easily fix it (like Randy).

So now, let’s briefly walk through some high-level solutions.

If you’re facing a PERSONAL OBSTACLE, then remember that’s an intangible excuse. So these are those internal reasons that require us to focus more on internal solutions. You’d want to focus on things like building a positive mindset or a can-do attitude. And overcoming that self-doubt is going to be the key to success here.

If you’re facing a PREDICAMENT OBSTACLE, this is going to be tackling those tangible reasons. And one of the first things we need to do with these obstacles is identify them and actually face them head-on. We need to understand the gravity of the situation and make sure we are not basing our response on our emotions and fear, but rather on facts and our goals.

If you’re facing a PURPOSE OBSTACLE, then you’re having a difficulty having meaningful goals established within your financial progress plan. So we need to make sure we are focusing on our “why” and those meaningful goals (long-term and short-term). This will ensure we define where it is that we’re going as well as ensure we have motivation to get there.

And if you’re facing a PLAN OBSTACLE, then this is where we need to go find the information we need; or, we need to find someone who can teach us what it is that we need to know. We need to be brave enough, and vulnerable enough, to ask the questions. I waited way too long before I had the courage to ask for help. Don’t assume you’re the only one who doesn’t know. I promise you’re not.

I feel confident that by having walked through this framework, you now have a clearer idea for where to start when it comes to identifying and overcoming the financial obstacles in your life.

Now, as you’ve explored the four major types of obstacles on your journey to financial progress - Personal, Purpose, Predicament, and Plan - it's crucial to recognize that it's entirely normal to find yourself in more than one of these categories simultaneously. It is my hope that this awareness will be your first step toward empowerment, much like how Randy and I identified the unsettling noise in my car.

Here's the good news: once you've pinpointed your specific financial hurdles, you can work on a tailored plan to address them effectively. It's all about moving forward in small, manageable steps, much like taking on an enormous challenge one bite at a time.

As you navigate your path to financial progress, remember that it's perfectly normal to encounter multiple obstacles or feel overwhelmed at times. In such moments, consider starting with "why." Clarifying your financial goals and understanding the motivations that drive you can provide the much-needed emotional lift and inspiration to keep moving forward.

Recognize that identifying these obstacles is the first significant step in your journey toward financial empowerment.

You're no longer a passive observer; you're an active participant, steering your finances toward success.

So, as you embark on this transformative journey, remember, you've got this!

Stay Curious,

Kyle