The Financial Dojo Yellow Wealth Belt™ is the next level up from the entry-level White Wealth Belt™. As the holder of a Yellow Wealth Belt you are like a seed that is experiencing the warmth and energy of sunlight for the first time. You can now feel the rays of useful financial knowledge seeping into your consciousness.
Yellow Wealth Belt™ (YWB)
Your growing confidence should be enhanced by what you’ve learned and applied from the White Wealth Belt mini-course. A strong commitment to increasing your wealth is slowly taking hold.
If you are new to this web site, you should also read through and complete the White Wealth Belt mini-course before proceeding with this one. The courses are linked. And by doing this, you’ll also ensure that you establish a rock solid foundation for achieving your financial goals.
The purpose of this mini-course is to further enhance your wealth-building knowledge so that you can reach the next Wealth Belt level, which is Green. However, before proceeding too far, you should take the Yellow Wealth Belt Test below to make sure you’re in the right place.
When you have completed this course, you’ll have a firm sense of which additional articles and content you should review on this web site to speed your progress.
Take the Yellow Wealth Belt™ Test
Answer the nine questions below to determine if you meet the minimum requirements for this belt. If ALL of your answers are “yes”, you’re in the correct spot. You can then go full steam ahead with this course. Conversely, if any one of your answers is “no”, then your status is White Wealth Belt and you should follow and implement the action steps in that course.
Spending Mastery Questions:
- Is your FICO Credit Score 680 or higher?
- Are your total monthly debt payments less than 45% of your total monthly gross income (pre-tax)? (See Note 1)
Note 1: Your total monthly debt payment/commitment is comprised of the amounts you pay on all the loans, contracts, leases, and agreements you’ve locked into. Examples of this would be your mortgage (principal, interest, taxes, and insurance), credit cards, student loans, car loans, apartment lease, homeowner’s association fees, furniture financing, remodeling loan, legal judgments, child support, alimony, etc. So, it does not include basic living expenses such as utilities, groceries, car fuel and maintenance, etc.
Saving & Investing (S&I) Mastery Questions:
Calculate the grand total of all your outstanding debt obligations, excluding your home mortgage or rent. Of this total, determine how much of it will be paid off over the next 2 years. Now answer these questions:
- If you were to pay off that 2 year debt amount today, all at once, would you still have a cushion of at least $5,000 in your S&I accounts?
- Is it safe to say that at least 50% of the money you have available to pay off the 2 year sum is held in saving and investment (S&I) accounts that would not be subject to early-withdrawal penalties by the IRS if you had to use those funds?
Congrats! At this point in the test, you have achieved Yellow Wealth Belt™ (In Waiting) status. You can become a full blown Yellow Wealth Belt ninja by successfully completing the final Knowledge Mastery Questions below.
Knowledge Mastery Questions:
- Have you reviewed our Orientation & Overview guide?
- Do you know the 4 elements that make up the CALM Approach?
- Have you read and completed the personal growth exercises specified in the Puzzle Box Paradigm? (See the Action Steps at the end of each section)
- Have you calculated your retirement money goal?
- Have you perused the White Wealth belt mini-course?
If you answered yes to ALL test questions, congratulations, you are now an official Yellow Wealth Belt holder.
The possession a Yellow Wealth Belt™ means that you know the importance of establishing a good credit history, reducing expenses, and increasing your savings and investments. These are the bare minimum tenets for building long-term wealth. But the problem right now is that while you know these things, you need time to work your way through some past mistakes and challenges.
So in this mini-course, you will learn more ninja strategies (beyond those taught in the White Wealth Belt course) for increasing your FICO credit score, eliminating debt, and saving money for the future. Specifically, I’ll cover FICO credit score boosters, the 8-step credit dispute strategy, ways to reduce expenses, and how to establish a Roth IRA. Let’s get going.
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