This week the goal is to figure out: why do we do the things we keep doing? Your financial life is not a series of isolated events - it is a system of repeated behaviors. - If something keeps happening, it’s not coincidence, it’s a pattern that has a cause. - Results (wealth, stress, stability) are lagging indicators of these patterns. 1. Earn → Spend Cycles What to look for: - Income increases → lifestyle increases just as fast (or faster) - Bonuses, commissions, or windfalls disappear quickly - “I deserve this” spending right after earning Step-by-step breakdown: 1. Income event occurs (paycheck, deal, bonus) 2. Emotional response (relief, reward, entitlement) 3. Spending increases (planned or impulsive) 4. Balance returns to baseline or lower 5. Repeat Reality check: - This pattern prevents wealth accumulation even with high income - Do the same for saving and spending cycles. This is where the shadow work becomes really valuable - we can get money to come in - but then what happens to it?

Step 1 - list all your debt! * Credit cards * Personal loans * Student loans * Mortgages * Car loans * Lines of credit * For each one, write: * Current balance * Minimum payment * Interest rate (APR) Step 2 - do the math: - Annual interest cost =Balance × Interest rate - $10,000 at 20% → $2,000/year - * That’s ~$167/month just in interest (before touching principal) Step 3 - Categorize: high vs low interest High-interest debt (typically 10- 30%+) - Credit cards - Many personal loans - Some private student loans→ This is financially corrosive→ It compounds against you Moderate-interest (5- 10%) - Auto loans - Some private loans→ Neutral to slightly negative depending on context Low-interest (0–5%) - Mortgages (historically) - Federal student loans - depending when you went to school

How stable is my financial position right now?This day is about pressure-testing reality. Define “Financial Stability” - Stability = ability to withstand disruption without collapse - It’s not about how much you have - it’s about: Consistency of income Liquidity (cash access) and Exposure to risk Key teaching point:High income ≠ stability Low stress + strong buffers = stability Income Stability (How Predictable is Your Cash Inflow?) Break income into categories: - Fixed (salary, consistent payouts) - Variable (commissions, business revenue, investing gains) Ask: - How many income streams do I have? - What % of my income is predictable vs variable? Simple Stability Scale: - 1 source, volatile → fragile - 1 source, stable → moderate - 2–3 sources → stronger - Multiple diversified sources → resilient Pressure test: - If my main income stopped today, what happens in 30 days? Cash Reserves This is your financial oxygen. Step-by-step: 1. Calculate monthly essential expenses(housing, food, insurance, minimum debt payments) 2. Calculate:Cash reserves ÷ monthly essentials = months of runway

- A liability = anything you owe to someone else - Examples: Credit cards /Personal loans/ Student loans /Car loans /Mortgages /Buy-now-pay-later balances Money owed to friends/family /Business debt List everything - no exceptions - This is not about judgment, it’s about accuracy - Partial awareness = distorted decisions - Include: Current balance/ Interest rate /Minimum monthly payment /Due date - You cannot optimize what you refuse to fully see. You also cannot manifest from a state of fear. Refusing to look at certain parts of our financial life is usually do to fear/overwhelm - which is a contracted state. And we cannot manifest from that state.

What are all of my assets? An asset is anything you own that has real, measurable value today. What counts as an Asset 1. Cash & Cash Equivalents * Checking accounts * Savings accounts * Money market funds * Cash on hand this is your liquidity layer (immediate access) 2. Investments * Stocks, ETFs, mutual funds * Retirement accounts (401k, IRA) * Bonds, treasuries * Crypto * Use current market value, not purchase price Ask: “What could you sell it for today?” 3. Property / Real Estate * Primary home * Rental properties * Land * Use realistic current market value * If unsure → estimate conservatively 4. Business Ownership * Ownership in a company * Cash in the business * Retained earnings * If valuation is unclear: * Use last known valuation OR * Conservative estimate based on profit 5. Other Valuable Assets (optional) * Vehicles (use resale value, not what you paid) * Jewelry, art, collectibles (only if resale market exists)