With governments withdrawing bailout funds and the world economy plummeting more and more each day, gaining control of your personal finances is more important than ever before.

We don’t know how long the coronavirus will impact the world – or when the next crisis might be…

And the crisis facing us today has been a wake-up call for millions–for many of us, a painful wake-up call.

Whether you were fully prepared for this crisis or took a massive financial hit…

Here are 7 personal finance rules to implement today so you can set yourself up for a more stable future.

1. Understand The Role Of Money In Your Life

There’s a concept I’ve used for years, coined by my mentor Mark Ford called “The 3 Buckets” – and it works like this…

Imagine a Golden Well with three buckets placed on the ground in front of it – one labeled ‘Spending’, one called ‘Savings’ and one called ‘Investments’.

The Golden Well represents your cash flow and everything that earns you money – business, clients, real estate, shares, etc.

The role of money is simply to redirect the flow of “gold” from the well to ensure these buckets are filled to the brim throughout your lifetime.

Yes, that’s harder today than it was last year – your Golden Well may be pumping at a slower rate or the COVID crisis may have kicked over your investment bucket into the drain.

But you can’t control what’s already happened. The only thing you can control is your mindset–remaining positive–and your actions–doing the best you can and adapting to the circumstances no matter how “unfair” they feel.

When the economy is flying, and when it’s crashing, your job is to manage expenses while saving and investing for the future.

Let’s take a deeper look at how to manage these three activities:

2. Turbocharge Your Saving Strategy

As a general rule, you should have 3-6 month’s living expenses set aside to be prepared for a worst-case scenario (like illness, losing your job or your business going downhill, or worldwide pandemics).

Whether you’ve been following this simple rule of financial management or not, now is the time to increase your ‘buffer’.

If you have 3 month’s living expenses, try to double that.

If you’re not even close, use the money you have coming out of your well to prioritize financial security in case the worst happens.

If you’re saving 10% of your income, try to turn that up to 15%.

If your income has taken a big hit, try to keep saving the same amount you were before.

Yes, this is hard – in good markets, we all fall into the belief that money is meant to be spent on things that give us a better quality of life.

And you probably have a few hundred (or thousand) dollars worth of self-care and “personal” expenses that you see as ‘essential’.

But let’s be honest…

There’s no fancy health hack, expensive supplement, superfood, or form of entertainment that’s worth the stress and anxiety of living paycheck to paycheck.

What do you think will really improve the quality of your life the most?

Driving your Tesla to Whole Foods and spending $800 on groceries, supplements, and essential oils?

Or sleeping soundly each night because no matter what happens to the economy, you have enough money to keep your family afloat for months or even years to come?

The answer is obvious.

Curb your expenses as much as possible today. Cook your own meals with cheaper ingredients. Skip the expensive lattes and green juices. Drop the personal development subscriptions that you aren’t using.

Be ruthless with your finances to ensure you’re prepared for hard times.

3. Keep Investing (Carefully)

Huge fortunes have been built during times of recession and depression – and once your cash flow is stable and you have enough money invested to cover at least 3-6 months of living expenses…

There are plenty of investment opportunities available if you keep two important factors in the front of your mind:

1. Liquidity

This term refers to the speed at which you can sell your investments for cash.

Things like stocks can be sold in a moment (highly liquid), whereas other classes of investments like houses can take longer to sell.

Some – like bonds or annuities – lock your money in for a certain period of time: You’ll invest $X for a period of months, and you can only get that cash back at the end.

It makes sense that if someone has your money and can’t give it back to you, you deserve a higher rate of return.

If things get any worse than they are right now, you’ll may need extra cash fast. So I strongly encourage you to shift your current investing strategy to focus on highly liquid assets.

With that said, it’s important to consider…

2. How Your Investments Make Money

When you invest in ANYTHING – from a government bond to stocks in Amazon – it’s critical that you understand how the organization you’re investing in makes money, and how risky that revenue model is.

The US Government, for example, makes money from taxes.

That’s a pretty safe business model to bet on. You can be reasonably sure that there will be people in America to tax (and nobody to stop the government from doing it) in the near future.

Amazon makes money by shipping goods to people so they don’t have to go into a shop.

That sounds like a good revenue model to bet on – but we simply don’t know what the future will hold in store or what will happen if state borders will be shut down or supply lines from China cut off entirely.

Right now, that’s a risk that isn’t worth taking. If you’re going to invest, take the time to really consider how the organization you’re investing in makes money – and how the coronavirus might affect that.

And if you DO have money to invest right now, I encourage you to keep the following in mind…

  1. Things are probably going to get worse for most people in the near future.
  2. There’s a pretty good chance that no businesses will make huge money this year.
  3. You’re better off securing a small, but safe, return on your money while maintaining liquidity in case things get worse.
  4. Long-term this conservative strategy won’t make you rich, but your best bet is to not lose money while everyone else is

4. Build Your High-Income Skills

Let’s return to the Golden Well in Mark Ford’s 3 Buckets metaphor:

The source of money flowing through your life.

While you’re doing everything you can to manage the buckets that your money ends up in…

Now is a GREAT time to work on the skills that keep that Golden Well flowing:

Specifically: copy, closing, speaking, and leadership.

No matter how the world changes after this current crisis, people who have mastered one or all of these skills will have an antifragile financial foundation.

The copywriters who made money with direct mail or long-form newspaper advertorial were still the most qualified writers when Facebook advertising changed the game forever.

A speaker who could captivate a crowd from stage wouldn’t have had any problem transitioning to webinars or podcasting.

The best leaders who built successful companies before Microsoft Teams and Zoom turned the world into a virtual office are still the best leaders.

The flow of money from your Golden Well depends on your skill in copy, closing, speaking, and leadership.

There are thousands of free YouTube videos, blogs and essays about how to improve in any of these areas.

So if you can’t afford to invest in a $3,000 course or certification on one of these skills, be resourceful – study timeless examples of high-converting copy or sales letters, watch incredible speeches, review example sales scripts online and see what makes them great.

We’ve got a LOT more spare time now that our hobbies are banned and we’re locked indoors – so you can either start doing puzzles and binge-watching Netflix, or work on the flow of your well.

5. Consider Investing In Gold

This is an interesting investment opportunity because gold, by itself, can’t become more or less valuable.

Most other investments CAN change in value: Tesla can build a better car, Amazon can lose its supply chains, someone might build a huge factory next to your investment property…

But gold is relatively neutral – and so its values is determined by supply and demand.

The price of gold has historically almost always been constant over the long-term.

One ounce of gold would have bought a Roman senator a really nice pair of robes – and today it’s worth about the same as a high-end suit.

Because it’s so steady, investors flock to it when other asset classes (stocks and bonds) drop or become more volatile.

You don’t want to go all-in here because you’ll be missing out on great returns from other investments when times are good…

But if you look at charts that show how gold prices have changed over time, you’ll notice two massive spikes:

After the GFC of 2008, and when investors first became spooked by the coronavirus in January 2020.

6. Rethink That ‘Spending’ Bucket

Money is a useful tool to help us have a better quality of life.

Now that it’s scarce – and we literally can’t spend money on things that we want to, like weekend getaways or dinner with friends – it’s time to re-examine HOW you use money.

Most things that we purchase give us a diminishing return of enjoyment as we spend more money.

Most people would be miserable if they had to catch public transport everywhere – but a $52,000 Audi SQ5 is not really twice as enjoyable to drive as a $24,000 Golf GTI.

After the initial buzz wears off, you’ll feel pretty much the same whether your TV is 75” or 50”.

And it’s impossible to become truly wealthy if ALL your expenses increase with every rise in your income level.

While you’ve got the time in lockdown, think about where you spent your money last year.

REALLY consider the things you don’t even remember buying, or forgot how much they actually cost.

If you don’t miss them now, you probably won’t mind too much if they never make it back into the allocation of your “Spending” bucket. Use that money to build your saving buffer, or invest in your future, instead.

7. Do What You Need to Do

There’s no getting around it – some people have had their lives turned upside down by this pandemic.

If you’ve been badly affected right now, it’s time to take massive action.

Review your expenses and swing the ax. Cancel your Netflix subscription, stop buying coffee, ask your landlord for a reduction in rent.

If you lost your job and need a quick influx of cash, you can sell almost anything on Facebook Marketplace or Ebay right now – your TV, clothes, bicycle, or furniture has value to someone and might be the difference between financial ruin and survival.

That sounds pretty dramatic – but we’re talking about possibly going broke.

Ignoring that threat (if it’s real for you) is not a good strategy.

You can add your music subscription and cable TV back in later – we’re not talking about a lifetime resignation to poverty. Simply a temporary pivot to free up the financial resources you need to make it through this challenge.

Believe in your ability to figure a way out of your current situation. You have time to improve your skills, there will be more opportunity for you over the horizon.

The last time we faced a global crisis of this magnitude 75 million people died in combat across Europe in WWII.

That’s a permanent sacrifice you aren’t being asked to make.

While the economy fluctuates and businesses struggle around the world, you must keep your long-term focus on big financial goals.

Follow the ‘3 Buckets’ principle Mark Ford teaches, maintain a secure buffer to protect yourself in case the worst happens, continue to invest cautiously in the market (and aggressively in yourself)…

And above all else, be honest about your financial situation and rethink how you’ll handle money when all this is over.

Craig Ballantyne

If you want to double your income, work less, and become the ambitious millionaire you've always wanted to be... Craig Ballantyne is the coach who will help you do it. With more than 20-years of experience as an entrepreneur and five 7-figure businesses under his belt, he specializes in helping "struckling" entrepreneurs get out of the mud and build the business of their dreams. To see if you qualify for Craig's "Millionaire Coaching Program" send an email to support@earlytorise.com with the subject line "Millionaire".