Let’s face it. Finances can be a mystery. Terms, interest rates, mortgages and loan conditions can all be confusing. But you can demystify money matters. We asked Personal Finance Coach Dominique Broadway, founder of Finances Demystified & The Social Money Tour, to help us do just that.
TNJ.com: What are the top 3 myths people have about money?
Dominique Broadway: The idea that it will all work itself out at some point, that they should close their credit cards when they pay them off and that their credit score goes down when they check it themselves.
TNJ.com: Top 3 mistakes people make about money?
D.B.: Ccompletely ignoring their finances, living beyond their means and taking on more debt than they can handle.
TNJ.com: What are the financial issues most people find confusing?
D.B.: Most people are confused with their credit score, credit reports and just overall the actions they take in their day-to-day lives that are negatively or positively impacting their scores.
TNJ.com: Why is it important for people to understand finances?
D.B.: Since money and your finances are things that you have to deal with your entire life, it is key to have a clear understanding of where you are financially, but also where you want your finances to go.
TNJ.com: What are the positives of understanding finances?
D.B.: When you have a clear understanding of your finances, the overall stress about the uncertainty of your money is reduced. This understanding also provides you with clarity about how much you can afford to spend, when and if you will be able to retire and what it truly takes to bring any of your dreams to reality.
TNJ.com: What are the negatives of not understanding your finances?
D.B.: When people do not understand their finances, there is typically a lot of stress and anxiety that follows when they think about their finances. Not truly understanding your money, for most people, will cause them to never build wealth. They live paycheck-to-paycheck for their entire lives.
TNJ.com: How can you demystify finances yourself?
D.B.: To demystify your own finances and have a clearer understanding of your finances, you first need to take inventory of where you are financially. How much money are you bringing in? How much debt do you really have? What are your monthly expenses? To learn more, you can check out various books and websites that can provide more insight on how you can manage your finances effectively. One of my favorite free apps is mint .com that allows me to manage my finances at all times for free.