Tiffany Aliche is an award-winning financial educator who is driven by the mission to empower women and provide them with access to tools and resources they would not otherwise be able to access. Through her company, The Budgetnista, she has created a financial movement that has helped over 800,000 women worldwide collectively save more than $100 million, and pay off over $75 million in debt. Moreover, it has assisted them purchase homes and helped transform their approach to finances. Aliche is also the best-selling author of Happy Birthday Mali More, a children’s book on financial education. We spoke with her about wealth building and budgeting during a financial crisis.
What are three things that people need to know about budgeting during the pandemic?
Debt-free does not equal wealth. First things first, in a recession, you want to be cash strong. Normally I’m like, get really aggressive with paying down your debt. That’s great, but if you don’t have savings, and you’re debt-free, and an emergency comes up, you’re going to use debt to help you do that emergency.
Number two: I would say your budget is gonna be your best friend at this moment in time. We’ve always been talking about living below your means and leaning into frugality, at least to some extent, and now more than ever, that needs to happen.
Number three: everybody ain’t broke. I would lean into learning how to invest. The last recession caught me unaware. I was a preschool teacher at the time and I lost my job and I lost my home that I bought for $220,000. It ended up being sold for $150,000. Someone came up. So I wish I had been in the position then to invest, but I didn’t have the knowledge. the acumen or the money. I told myself, I’m not going to be in that position again, so I have been preparing for this day. I am ready to invest because recessions make more millionaires than any other time in history.
What is the importance of maintaining fixed expenses?
Managing your fixed expenses is absolutely the key to living under your means. I think the reason why folks have a hard time with living under their means, is they don’t see the purpose behind it. The purpose of budgeting is not to budget for budget sake; it’s so you have excess savings. The purpose of savings is not to save for saving. Save it so that way you can invest. The purpose of investing is to grow wealth.
Is there any app or tool people can use to help them create a budget?
I have a free challenge called the “Live richer challenge: savings edition.” They can go to livericherchallenge.com. It’s free. I’m the budgetnista too on all social platforms. Go to the budgetnista.com… I always offer free assistance.