Hey Pretty 🤗
Making MONEY MONEY MONEY is of course the biggest perk of our industry, but knowing how to manage it can be confusing. Most of us have a "splurge" purchase or period when we start in the Industry, where we simply were having a good ol' time with our cash- it's a canon event, lol. I bought an Escalade with the first $20K I saved from dancing back in 2009, and whenever I feel like going cRaZY again, I do the math of how much that $20k would've grown to if I had put it in the market instead. That is always very sobering.
It is unfortunate that the American education system fails us in not teaching us the most important math there is- how to manage and grow our own money and wealth. (But I do know the mitochondria is the powerhouse of the cell). And while there are tons of resources out there to learn financial management today, it can be overwhelming knowing where to start.
Working in our Industry also comes with unique issues that many financial mentors don't address- making mostly cash, income that wildly varies, having income from multiple sources such as multiple clubs/ online work/ gifts, and the discrimination we face by banks and payment processors.
This is why I've spent the past year working on a financial literacy series that is SPECIFICALLY for us, and will share all the info I used while dancing to get my finances together, create and stick to a budget, and start saving and investing. I am by far not the most educated person on this and encourage you to seek out books and videos to further your own financial education, but I do hope the insight we share will help those who are struggling to know where to start.
Full lessons will release monthly beginning in mid September 2024, and running through 2025. Each monthly lesson will focus on a topic, explaining what it is, and giving steps on how to actually implement it into your life. There will be written articles as well as videos for each lesson.
To kick the series off, we've compiled a few vocabulary terms that are good to know! Don't worry if any are confusing- we'll be doing FULL lessons on topics such as credit, debt, and investment related terms such as stocks and dividends.
Income: Money received on a regular basis through work or investments
Budget: A plan for managing money over a certain time period by calculating your income, expenses, and spending and planning goals using this information
Credit: An amount of money a Creditor (usually a bank) is willing to loan you to purchase goods and services with the promise to pay it back with interest. Usually related to credit cards.
Interest: The cost of money, in a nutshell. Interest is the portion of money you pay back to a creditor (someone who has loaned you money) that is ABOVE the amount you have borrowed, as a payment to them for allowing you to borrow money. Interest is how most banks and financial institutions make the bulk of their money. Most applicable to credit cards, car loans, mortgage loans, and any other type of personal or business loan one takes out. Often expressed as a percentage rate (lower is better! The higher the interest rate, the MORE you are paying to borrow.)
Interest ALSO plays a part in how much YOU are owed by banks for keeping your money there! Most savings accounts offer an interest rate.
Debt: Money owed to creditors or institutions. Includes credit card balances, any loan balances, and fees owed (such as legal fines, invoices due, tuition, etc.)
Stock: A share of ownership in a public company you can purchase in the stock market, and in return you get a claim on the assets and earnings that the company makes. Stocks can be held as long term investments, or bought/sold more actively as the share price changes. Note that there are tax implications to buying and selling stocks and any type of equity investment! (We will have multiple lessons on this!)
Dividend: The portion of the profits the company pays you for owning shares of their stock. Often expressed as "dividends per share"
Equity: The ownership interest you have in an asset. Stocks are describing as owning "equity" in the companies you own shares of. Also, big investments you use a loan to partially purchase will have "equity" in them- For example, if you buy a house (note the number have been made simple for ease of explanation, the only house you getting for $100k in 2024 is haunted or has holes in the roof *sigh*):
House Purchase Price & Market Value: $100,000
Down Payment: $20,000
Starting Off Mortgage Loan Balance: $80,000
= Equity of $20,000, since this is the amount you actually OWN of the house. Your equity increases over time because of:
1 Year Later
House Market Value: $120,000 (rose $20k)
12 Payments made toward Principle of Mortgage: $24,000
= Equity of $64,000, rises due to the house value going up and the payments yu've paid off towards the balance
I feel the need to mention, given how much we Industry girls love us a luxury vehicle- EQUITY is why buying fancy cars actually sucks for your financial stability.
They are a NEGATIVE equity investment, meaning that the amount you end up owing on them is almost always more than they are worth. When I learned this, I traded in my money green escalade for a Honda Civic, no lie LOL.
Don't worry if any of this was confusing, we'll be coming through with videos and charts for all topics! 💖
If you wanna learn more now, I love the
Bigger Pockets: Money YouTube Channel
and the books
The Mindful Millionaire by Leisa Peterson and
The Psychology of Money by Morgan Housel
Note that Angel Candy is not affiliated with any of these, and these are not affiliate links. These are just resources I have enjoyed and learned alot from!
We can't wait to get into this series and build with you! 