Well, it is that time of month again. The time of month where the old budget has to be put together for the next 31 days. Once this plan is established, we will utilize our money exactly as stated on the paper. In a sense, we have truly pre-paid our spending on paper. This is our written plan. It is the reason we have dumped so much debt. It is the reason we have financial peace.
When we first started budgeting, it was tough to get it to balance. There were so many expenses that we realized that we did not have a plan for – especially the non-monthly bills like auto insurance and property taxes.
When we budget now, however, it is a pretty quick process. As we go through the month, we are thinking about upcoming expenses and logging it down that the expense needs to be included in next month’s budget. Our average budget session lasts 15 minutes start to finish.
In 36 months of budgeting, we have only had to adjourn a budget discussion 1 time without having completed the budget. How is it that Jenn and I work well together to develop a budget so quickly? We are both engaged and understand that this is the tool that will help keep us accountable to our short and long-term financial goals. By achieving our financial goals, we are positioning ourselves to be able to do exactly what we are made to do – regardless of the income potential of those activities.
So now our new accountability plan is in place and current for the next month. In this plan, we will be giving money away, saving money for retirement and upcoming known expenses, and spending money on great things like FOOD, utilities (yay …), gas (choke :
INCOME – OUTGO = EXACTLY ZERO
Money does not satisfy. Money does not make you happy. Money does not guarantee health. Money does not equal great wealth. Money does not save your soul. Money can not buy great friends.
These statements are often said. These statements are hard to understand when you are broke. These statements become clearer as you attain financial prosperity. It becomes quite clear to the wealthy that these statements are clear.
I believe that it is a spiritual issue. WHAT?!!! I said it. I believe that it is a spiritual issue.
I have seen many broke people that are consumed by their lack of money. Some believe that they can out-earn their spending. These people spend an enormous amount of their time working to “get ahead”. In the process, they sacrifice their family relationships and friendships. They tend to become hardened to their world. They want what is theirs.
I have seen financially wealthy persons also become hardened to their world trying to protect what is theirs.
In both cases, I believe that they do not have true peace. They are attempting to put money into a high position in their lives, yet it still will not satisfy.
Money can not truly satisfy the spirit. Money is a means to an end.
So why should I want to help people acquire and keep more money? Why is it important to save? Why is it important to avoid debt? Why is all of this even matter?
It allows you the opportunity to utilize your time to pursue your life’s calling! The very thing you were made to do! The exact thing that sets your soul on fire! The passion igniter in your life!
I have just ONE question:
IF YOU WERE DEBT-FREE AND HAD ZERO PAYMENTS, WHAT WOULD YOU BE ABLE TO ACCOMPLISH WITH YOUR LIFE??????? or to ask another way IF YOU STAY IN DEBT AND HAVE DEBT UP TO YOUR EYEBALLS, WHAT WILL YOU BE PREVENTED FROM ACCOMPLISHING WITH YOUR LIFE????
Sign observed at car dealership:
“Financing in less than 30 minutes”
“Destroy all progress you have made in getting control of your finances in under 30 minutes.”
I do not spend little money. When I spend money, I tend to spend it on larger ticket items. Some specific items include airline tickets, hotel, travel, my RC airplane, and vehicles. Before making the choice to make our finances a priority, I would not confer with Jenn. I would just go buy it. Capital One had my slack. I really did think about the cost of the item, and I usually felt I could pay it off that month. I really felt that my spending was under control. The facts show another story. The facts show a large credit card balance that did not get paid off every month. The facts show that what I felt was NOT fact.
I have worked hard to gain control of my finances. Jenn and I have worked together to get out of debt. It has been more than three years since we made the choice to control our spending. Even so, my old spending buddy (my shadow) creeps in with the evening shadows. “Come on, man! Live a little. You can afford it! You can make the payment. Really, man. Just do it!”
You know what? I do not want “Financing in less than 30 minutes” I do not need their financing. I made the choice a long time ago to never do debt again. It may not be 100% fun to live in my world, but I will tell you this – I’m not broke anymore!
Have you made your choice?
How do you manage your finances? In my journey to better manage my finances, I have followed a path that took me from virtually no management at all to detailed management.
I started out by trying to keep a running balance in my head and ensuring that I had a cash buffer in my checking account in case I forgot that I had spent some extra money. That did not work well. I had cash being deposited into my savings account each paycheck, but it immediately moved to my checking account and out of my ownership (I spent it!)
So that was not working, so I migrated to a printed out register. I tracked every single expenditure on this register. This vastly improved my understanding of where our money was going, but it really did not improve our financial situation at all. It just allowed me to understand where the money went. It also helped me out a lot with addition and subtraction skills as I had to write in at least 50 transactions a month and perform the math each time. Yikes! I cannot believe I used the debit card for $1.97 at Home Depot on 11/14/2002 or $5.44 at Wal-Mart on 11/8/2001 or $2.31 at Wal-Mart on 2/27/2000 or $6.04 at Wal-Mart on 11/12/1999.
Well, the printed register and manual bookkeeping really helped me to better understand WHERE our money was going, but it certainly was not helping us keep some of our money. So we migrated to Microsoft Money. Oh baby! This software is sweet! It allows you to understand where all of your money is going. It has custom reports that you can generate to better understand opportunities you have for saving money. Guess what? It did not help us save money. It is the best method we have utilized for management of our finances, but it did not help us save money.
Do you know what helped us save money? Applying the information we were learning about our spending habits. Making changes to our spending habits is what helped us save money. We applied the simple formula of
INCOME – OUTGO = ZERO
OUTGO included Savings. It included saving for known upcoming expenses like life insurance, auto insurance, vacations, and clothing.
If you are looking for a good money management tool, I highly recommend you try Microsoft Money! It will NOT allow you to save money, however. You must apply the information the software provides you in order to save money.
Read it for yourself.
When you hear facts like “the number one cause of divorce is disagreement over finances” or “money fights” or “he/she spends all of our money”, you may not think about the fact that personal finances are also less talked about than sex.
You don’t believe me? Let’s think about why this is the case.
1. Personal finances does not require both of you.
2. Personal finances are not as exciting.
3. It is easier to fight when you are TALKING about finances.
4. Finances require the lights be on.
Bottom Line: Stop the childishness. Grow up! Face your finances TOGETHER! When you do, you will start to win TOGETHER. At that point, you can talk a lot about both subjects!