Archive - April, 2006

It is important to know these facts

Mortgage Interest
If you have a mortgage for $150,000 at 6% interest and it takes you 30 years to pay off, you will pay a total of $173,757 in interest. If you instead pay off that same mortgage in 5 years, you will pay a total of $23,995 in interest. By paying off the mortgage early, you will save $149,762 in interest!!! Even if you pay it off in 15 years, you will still save $95,916 in interest! WOW!

When you purchase a house, it should be a GOOD thing. If you overextend your ability to pay off early, it could become much less than a good thing.

Home Purchasing Tips
– Pay at least 20% down to avoid Private Mortgage Insurance (PMI)
– Ensure that the monthly payment does not exceed 25% of your take-home pay
– Check out the costs of owning the home – property taxes, homeowners association fees, maintenance fees, average utility payments, homeowner’s insurance, etc.
– Do not buy if you do not understand the area. It is important to learn about the area in which you are purchasing before you make an offer.
– ALWAYS have a professional complete a home inspection. It will cost around $300, but it is well worth it.
– If you have to have a mortgage, make sure it is a fixed rate mortgage with a term less than 15 years (to save all that interest!).

What does being debt-free mean to me?

It means that I can help others.

It means that I do not have to worry about paying my bills.

It means no big money fights with my wife.

It means my wife can be a stay-at-home mother.

It means that a doctor bill, car repair, or high natural gas bill does not create a financial crisis.

It means that I can save money for upcoming known expenses.

It means that I can do exactly what I am made to do without having to worry about the pay.

It means that I have true peace.

What does being debt-free mean to you? What would it mean to you?

How much is enough?

When will you have enough? Is it when you finally own your home? How about when you finally get to purchase that awesome boat? What about a vacation home? What about when you own your own business? What about when you own a farm? Is it when you hit $1,000,000 in the investment account? What about $10,000,000? What about $100,000,000? What about $1,000,000,000?

It is said that John D. Rockefeller, billionaire oilman of the early 20th century, was asked how much money was enough? His response? “Just one more dollar.” WOW!

If you make money the object of your full attention, you will never be satisfied. Money at its very best enables you to help the less fortunate and accomplish great things for others. Money at is very worst leads to brutal deadly conflict.

Choose today to view your money as a resource. You have been hired as its manager? If you are the manager of your money, would you fire you? Make the choice to help others. Make the choice to wisely consider the opportunity cost of using your money. Make the choice to be a manager of resources. Do not allow your life to be driven for “just one more dollar.”

How much is enough for me? I have clothes, food, shelter, and transportation which puts me in the top 1% of the world’s population. I guess that means that $6.90 is enough for me.

Did you buy something with a credit card today?


Is it because it is a Tony Stewart credit card?
OR is it because you did not have the money?

Is it because you get airline miles?
OR is it because you did not have the money?

Is it because you get free hotel points?
OR is it because you did not have the money?

Is it because you get “free” gift certificates?
OR is it because you did not have the money?

Is it because you get “free” merchandise?
OR is it because you did not have the money?

Is it because you are worried about identity theft?
OR is it because you did not have the money?

I challenge you to NOT USE your credit card for the next 30 days. Force yourself to say the world’s most powerful wealth-building word “NO!”. Just 30 days. You have tried your way and stayed broke. Try my way for 30 days. Write out a budget tonight. Spend every dollar on paper on purpose before the month begins. Live by that budget. You will start to win.

Why do you want to be financially free?

Do you ever wonder why I write so much about becoming financially free?

I want to become financially free because I believe that I am a better person when I am not living paycheck to paycheck. I believe that I am a better husband when I am not worried about where the money is coming from to pay a past due bill. I believe that I am a better father when I am not juggling payments from week to week to prevent a check from bouncing. I believe that I am a better employee when I do not have to struggle to make it to the next paycheck. I believe that I am a better employee when I do not have to hold four jobs just to make ends meet. I believe that I am better able to accomplish God’s specific plan for my life when I am not bound by debt. I believe that I honor God when I practice good stewardship with the resources He has given me to manage. It clearly states in Proverbs 22:7 that the “borrower is servant to the lender”. When you are a servant, it changes who you are!

I believe that I am better able to give to worthy causes when I am financially fit. I believe that I am better able to focus on accomplishing my life’s work when I can focus on the task at hand without worrying about a check being able to clear. I believe that I free up more time when I can pay all of my monthly bills at one time. More time equals better opportunities to be a better spouse, father, and leader.

I truly believe that being financially free is not about money. My financial situation is an outcome based on a set of inputs. If I am financially free, it means that I am effectively managing the resources within my control. If I am not financially free, it means that I am not effectively managing the resources within my control.

I want to accomplish my life’s passion statement – “To help others accomplish far more than they ever thought possible!” – To do this, I must be financially free. If I am not financially free, I will not be able to focus on helping others. Yes, it has meant sacrificing personal wants. Yes, it has meant delaying pleasure.

But it is not about me! It is about achieving what I was put on this earth to do!


To better understand anything, it is always very helpful to read some books about it. For personal finances, it is no different. I recommend that you read at least 4 books a year about personal finances. I do understand that I am a nerd about this subject, but I believe that if you want to free yourself up to focus on your life’s true passions, you need to be financially free. You will not just trip one day and become financially free. It requires continuous learning, a written plan (your budget), stated goals, and mutual commitment with your spouse to achieve them.

Reading books is a great way to learn! It helps to expand your knowledge about personal finances. It enables you to review case studies of others who have had different life circumstances. It challenges your paradigms.

If you are looking for books that have helped shape my personal finances, here they are. Happy reading!

The Wealthy Barber by David Chilton
– I read this book when I was twelve. Great book that really drives home compound interest!

Financial Peace, Revisited by Dave Ramsey
– Practical guide to becoming debt-free complete with the tools/worksheets necessary to achieve it!

The CashFlow Quadrant by Robert Kiyosaki
– Makes you want to run out and start a business!

The Bible by God
– Makes you want to use your financial freedom to help the poor and less fortunate and reach the lost!

Helpful Personal Finance web sites

Here is my list of helpful Personal Finance web sites:

1. Dave Ramsey’s web site
– Dave is a HUGE hero of mine!

2. Cheapskate Monthly’s web site
– Their monthly newsletter helps keep you motivated to save!

3. CNN’s Personal Finance web site
– I don’t agree with everything they tell you, but it is very informative!
– I really like their on-line classes about personal finances 101 classes

4. Yahoo’s Personal Finances web site
– Good info – poor page layout

5. USA Today’s Personal Finance calculators
– I really like the one that tells you when you will be a millionaire

I hope these sites help! I challenge to constantly learn more about your finances. You will either know what is going on with your money, or you will be wondering where it all went. Choose to learn.

Unexpected money

If you have a detailed financial plan (a monthly zero-based budget) and you receive unexpected money, you will know exactly where that money can be put to good use. If you do not have a plan, there is a good chance that the money will leave you quickly.

Marketers understand our ability to impulse purchase when we receive unexpected money. To ensure that an unexpectedly large tax return is not used elsewhere, car dealerships will do your taxes for you if you use the tax refund as your down payment. Lottery winners are approached by many who have a “great deal” for them. Those who receive an inheritance are suddenly offered “opportunities” that did not previously exist. If a large company gives out bonuses every Christmas, the employees are all marketed to by the local stores and businesses to get them to spend the bonus at their store.

I believe that if we receive an unexpected money and there is no plan, then it is not going to be a financial help to us. It will only allow us to acquire more junk that we will later sell at a yard sale or give away to Goodwill. If we do have a plan (a monthly zero-based budget), we will improve our chances at gaining financial freedom.

Do you ever receive unexpected money? Do you have a plan?


Today is a day to observe human behavior.

Have you ever met someone who is so excited about some new thing? This new thing could be a new friend, a new girlfriend, a new boyfriend, a new car, a new house, going to college, a new boat, football season tickets, on and on and on … Anyway, they are sooo excited about this new thing.

How do you know that they are excited? They talk about it all of the time. They speak more rapidly when talking about it. Their voice changes when they talk about it. They are more animated when they speak about it. They let everyone they know about this new thing in their life. They are pumped up!

Flash forward six months. Gone is the excitement. Now, that new thing is not as enticing. It is part of their life now. It may not even be a part of their life anymore. If it is still in their life, it may still be nice, but it certainly does not get the level of attention it was getting when it first became part of their life.

Why is this?

Now, I have to apply this to personal finances.

I have seen people learn the financial principles necessary to win (emergency fund of 3 – 6 months expenses in savings account, saying NO to debt, become debt-free, save for retirement and college, and budget monthly). They put together their first monthly budget. They are so excited! They tell everyone about it. “This budget is working!” “This is awesome!” “This is fantastic!”

Flash forward six months. Gone is the excitement. They have stopped budgeting. They have not been able to control themselves and have went and bought a new truck with 100% financing. They are right where they started. This REALLY IMPACTS MARRIAGES!!! I have seen married couples who cannot even talk about finances anymore because one or both of them knows beyond a shadow of a doubt that they have just deepened the hold that debt has on them. Proverbs 22:7 says that the “borrower is servant to the lender”. I have seen the servants. They have no hope. Hope is what sets fire to the human soul. When that hope is lost – the end.

I have personally counseled many who have went this very path. My heart hurts for them. The somberness is palpable. It really is tangible. They have lost hope. Some have lost everything they owned. They know what must be done, but for some reason unknown to me, they cannot make themselves do it. I pray for them now. Lord, help them become free of financial bondage. Restore HOPE to their lives. Help them establish personal discipline to make it happen.

Gain control of your finances

It is time to gain control of your finances. Life is way too short to continue living from paycheck to paycheck. Here are some sure-fired ways to gain control of your finances.

  1. Stop blaming circumstances, other people, or your spouse
  2. Sit down (with your spouse if married) and list all of you bills on paper. For each debt (i.e. student loan, car, house, etc.), list the name of the creditor, the total amount owed, and the monthly payment. For each monthly bill (i.e. electricity, phone, etc.), list the company and the current monthly payment owed.
  3. List all of your monthly payments due THIS MONTH in one column. Total up the monthly payments.
  4. List all of your other money needs this month (groceries, gasoline, baby gifts, stamps, dining out, blow-it money, vacation savings, emergency fund savings) in another column and total them up.
  5. List all of your income for THIS MONTH in another column. Total up the income for the month.
  6. Complete this formula:


The total of this equation must equal ZERO. If it is a POSITIVE number, it means that you have not given each dollar of income a name. You have not assigned all of your income to a category. This cannot happen. Money that is not given a name will leave you. Here is a good place to put extra money – debt reduction or emergency fund savings!

If the total of this equation is NEGATIVE, it means that you are OVERSPENDING your income. This cannot happen. You will empty your savings or turn to debt to cover the negative amount. You will not win if this happens. Instead, go back through your monthly spending and reduce it to cover the gap. You can also boost income if you have overtime or a 2nd job as an option. Either way, this must balance to zero. You will not win otherwise.


I love helping people!!!

I was once broke. Now, I’m not! This slogan is truth to me! I stopped being broke by changing the way I made decisions. When Jenn and I made the decision to stop signing up for more debt, that was HUGE! When you stop adding more debt to the equation, you can actually start reducing your debt! When Jenn and I made the decision that we were going to budget every single dollar on paper, every single month before the month began, and committed to following that budget, that was HUGE!

I AM PUMPED UP because these two decisions helped us get out of debt and gain financial freedom!!!

Now, I get the SHEER JOY of helping others get out of debt. It is so awesome to know that you have tools that can help others restore HOPE to their financial future and to see their eyes start shining again. Hope lights the fuse to life’s passion! Without hope, people check out of life. The great thing about being able to help people is that I have been blessed enough that I do not have to charge for the help. I can do it for free! It is so powerful to be able to offer help to a financially distressed family, and they do not have to pay you anything. I am not selling anything. I am just teaching tools that restore hope, changes lives, improves marriages, and changes their children’s entire future! THIS FIRES ME UP!!!! Are you helping others? Are you paying it forward? MAKE IT HAPPEN! You know someone you could help today. Why not do it?

Personal Finances are hard to do!

It is really difficult to grasp key principles in personal finance. Here are a few.

1) Spend less than you make
WOW! That is really difficult to grasp!

2) Do not buy anything you cannot immediately pay for
TOUGH! Man, this is really hard.

3) Save money for a rainy day
This is just too difficult of a concept for me.

To those who think personal finances are too hard, I agree with you.

We are too good at excuses!

Humans are too good at making excuses. I have heard a lot of excuses lately on why their personal finances are a wreck. It is because of their spouse not being involved, or because the OT on the job has been cut back lately, or because we can’t find the time to do a budget, or because it is hard.

RUBBISH!!! I am calling out all excuse makers now! I know when you are making excuses because I was once a horrible excuse maker. Because of this, I have “excuse maker radar”. I can tell when you hesitate to give me the reason why you have not completed your budget for the last three months. I can sense the stuttering when you tell me that the budget just does not balance. I can hear the sadness when you weakly say that it is too hard.

There must come a time that you decide that living paycheck to paycheck is not acceptable. Until then, I can not help you. You can not help you. Everything I do to help will mount to nothing more than mere words unless you are really ready to make a change!

I am sick of seeing people in debt!!! I am sick of seeing YOU in debt!!! Why are still in debt? You can not accomplish exactly what you were made to do until you STOP THE EXCUSES and actually address the issues! Develop a budget tonight! I do not care who wins the NCAA Championship – turn off the TV and go get your wife and put together a budget!

Question: What will change your life?
A. A win by UCLA
B. A working budget

Make it a priority to get a BUDGET done TONIGHT!!!