Archive - January, 2007

I’m not taking any more exuses!

After much consideration, I have decided to implement a "no excuses" policy for all financial counseling.

I am THROUGH with hearing people who are making $100,000 a year saying that they can't afford to save for retirement.  I am THROUGH hearing people who are making $50,000 say that they just don't make enough money to save for their children's college.  I am THROUGH listening to people who are making $45,000 say that they can't give any money to their local church.  I am THROUGH listening to people who make $200,000 a year who have a pile of debt and say they just don't make enough money to be debt free.  I am THROUGH hearing the lame excuse that "they have had to do without for so long that they just are not willing to wait anymore".

BOO to you!  Down with you!

I am implementing the "No Excuses" policy because:

  • I know people who make less than $25,000/year who are debt-free except the house, are saving money every month, and will pay off the house within the next decade!!!
  • I see the $150 cable bill, the house payment that is twice as large as any financial planner would advise, the $300/month of dining out and an unwillingness to change any spending behavior.  Someone has to deliver the bad news that something has to change in order to win financially!
  • Excuses are just lame ways to avoid the FACT that ALL of us have misbehaved with money!  I have been there, and I came up with the best excuses known to mankind!
  • It is time to face reality and make the hard decisions!  Nothing changes until someone decides that the "pain of same" is worse than the "pain of change"
  • You can do this, and excuses will just delay the actions that are necessary to win.  I don't want you to have to deal with the stress another SECOND!  I want you to have a plan that will help you win financially.  Excuses just delay that from happening!

What decisions do you need to make?  Is that HUGE boat payment worth it?  That HUGE house payment?  That HUGE car payment?  Those HUGE car paymentS?  Is the HUGE dining out bill worth it?  Is the STRESS worth it?

I believe it is NOT worth it!  I am on a CRUSADE to help others out of the "keep up with the Jones'" mess!  Won't you join me?

Oh yeah, I just want to say it again …  I know people who make less than $25,000 who are debt-free except for the house, are saving money every month, and are going to pay off their house within the next decade.

Compound Interest Calculator – Investing

For those of you wanting to calculate your own investment future value, you can go HERE!

Have you looked at your credit report?

By law, you are allowed to view your credit report once per year.  You can obtain your FREE credit report at www.annualcreditreport.com

It is FREE once per year!  At the end, they will ask if you want to see your FICO score for somewhere around $6.  You are NOT obligated to do that!  Just decline it and you will obtain your credit report from each of the three credit reporting agencies – Experian, TransUnion, and Equifa.

You will be able to print it out as well.  You NEED to do this at least one time per year.  Statistics show that over 50% of credit reports have errors on them.  Go get a copy of yours and ensure that it is accurate!

Want to send me an e-mail?  Click HERE.

There is no substitute for direct observation!

My life has been impacted greatly through education and learning.  I remember a specific article I read from the Harvard Business Review about Toyota.  Now, in case you have not noticed, Toyota has it going on in the automotive world.  This particular article was discussing how Toyota develops its people.

There was a single line in this multi-page article that just blew me out of the water!  It just reached up and smacked me around!  I love it when I learn something!

What was the line?  It said "There is no substitute for direct observation!"  They explained that when they hire a new engineer, they would take them to the manufacturing floor and make them stand in one spot for an entire day.  Why?  Well, there is no substitute for direct observation!

Have you been there?  Have you had the person who had NO CLUE come tell you how you should be doing your job?  Isn't that annoying!!!  By ensuring that their employees are directly observing the process, Toyota helps ensure that people will know what is going on.

Have you observed what is going on with your finances lately?  What about grocery shopping?  Instead of complaining about how much is spent at the grocery store, maybe it would help for you to actually go along with your spouse for a trip or two.  There is no substitute for direct observation!

Have you participated in the budgeting of your family's finances?  Instead of wondering where all of the money is going and having NO CLUE, how about directly observing the process?

What about obtaining insurance, preparing a will, investing, eliminating debt?  If you don't get in the game, you will be that annoying know-it-all who actually knows jack crap about what is going on.  We know who you are! 

There is NO SUBSTITUTE for direct observation!

Keep the Main Thing the Main Thing

Have you ever been involved in a big project?  I mean a big project!  One with large quantities of work, assignments, people, and deadlines involved?   If you have been associated multiple projects like this, I can virtually guarantee that you have experienced the "mired-in-the-details-I-have-no-clue-about-what-is-going-on" leader.

This is the type of leader who, when leading a project to solve world-hunger, will spend fifteen days determining what type of tablecloth to have at the fund-raising dinner.

This is the type of leader who, when leading a project to build a new school, will spend seven days figuring out the number of brick it will take.

Most of the items that the project leader focuses on ARE important, it is just not important for them to figure it out!

I believe that all people have been stuck in the details at one point or another.

Examples include:

  • Polishing up the entire house for Thanksgiving dinner, but forgetting to put the turkey in the oven.
  • Making sure the children are delivered to and picked up from school on time, but never taking time to see how school is going.
  • Obtaining that huge promotion at work, but neglecting the entire family for three years to get there.

I see a great example of this in the Bible, Acts 6.  The widows were being overlooked in the daily serving of food, and the disciples were being asked to attend to the widows.  Was feeding the widows important?  Absolutely!  However, what was the Main Thing for the disciples?  Tellling others about Jesus!  So, what did the disciples do?  They selected seven trustworthy individuals and put them in charge of serving the widows.

The disciples said it so well …  "It is not desirable for us to neglect the word of God in order to serve tables."

Are you keeping the Main Thing the Main Thing?  Have you been distracted from the ultimate reason you have been put on this earth  It is time to refocus!

Ideas for Saving Money

  • Cash a $5 bill every time you go to the vending machines at work.  Save the change.  If you go to the vending machines three times in one day, cash a $5 bill every time.  Save the change.  I have a friend who become debt-free using this very technique!
  • Use cash envelopes for any budget item that is subject to impulsive spending.  For me, my impulsive spending list includes groceries, restaurants, clothing, entertainment, and blow money.  By pulling out the budgeted amount and placing it into the envelope, I will not spend more than I budgeted.  Period!  This is a key reason that Jenn and I became debt-free.  By the way, we saved over $200 PER MONTH by putting our grocery money into an envelope.
  • Have your insurance rates quoted every two years.  Get at least one quote from an independent insurance agency.  Many people can save $200 – $500 per year!  Consider raising your deductible and driving more carefully!
  • Make it automatic!  If you begin investing $50/month and need to write a check every single month to make that investment happen, there is a big chance that you will not invest $50/month.  It will be too easy to say, "I'll make two deposits next month, I need the $50 for something else this month."  By making it an automatic draft, it will happen without a question and without any action taken by you.  You will be amazed at how fast this can add up!
  • Get rid of the huge, honking car payments!  Sell the expensive car with the big payment!  Drive a beater!  I know that this is not "cool" and it is not "your style".  My question is this, do you want to be stylish and broke with a bad case of stuff-itis or do you want to be wierd and actually have money to pay cash for things.  Listen, I love a nice car, but something is out of line when it is robbing you of your ability to give and save money!
  • Don't go to Aruba for vacation.  Go to the local campground!  Again, I love to travel to nice places, but something is out of line when you have not saved a dime for retirement and are taking really expensive trips.
  • Share items.  If you need a drill, borrow one!  If you need a saw for a small, two-day job, borrow one!  If you are going to cook a whole pig, don't go buy the pig cooker - borrow/rent one!  If you want to go fishing/skiing, rent a boat!  It is so much cheaper to rent a boat for the 5 times you actually go fishing/skiing than it is to pay for the payments, insurance, storage fee, winterization, summerization, breakdowns, frustrations, etc.
  • Refuse to buy anything unless you have the cash on hand to do the deal.  By making this commitment, it will prevent you from making a bunch of dumb decisions!  I can tell you this, when Jenn and I established this rule, it really helped us out when we experienced bad cases of stuff-itis!

Other Items

  • I am including this MORTGAGE CALCULATOR for the person who requested it last night.
  • You can do this!  I believe in you!

I am on a crusade! Won’t you join me?

I am on a crusade to help others accomplish far more than they ever thought possible!  I am on this crusade because my life has been changed because someone else took the time to help me.  My world was rocked because I took note of wise counsel and listened.  While I listened, I actually heard what was being said!  Then, I did the outrageous!  I actually applied what I had learned!

Guess what?  It worked!!!  My savings and checking accounts had always hovered around $4.13.  I was never able to hold on to any money that we earned.  It all just went right back out to pay someone else for something that I just could not resist (and now was usually relegated to storage in the garage or attic).

My life has been changed!  I want the entire world to know about it!  This is life-changing stuff!  Jesus Christ rocked my world through dying on the cross for me.  Guess what?  When I was "saved" from my financial idiocracy (word?), it felt a whole lot like when I was saved by Jesus Christ!  I am FREE!  I am free to pursue the very thing that I have been put on this earth to do!  I am free of the worries related to paycheck-to-paycheck living.  I am free to help others!

How awesome is that?  Won't you join me in this crusade?  Who do you know in your neighborhood or family that needs "salvation" from a financial mess?  Who do you know that you could take the time to teach about "saving for a rainy day" and "spending less than you make" and "INCOME – OUTGO = EXACTLY ZERO"?

What have you got to lose by offering?  If they actually do this, they will NEVER forget you, they will never be the same, and their worlds will be rocked.  Then, when their worlds have been rocked by the kindness you have shown them – they will go tell others about it!  They may even consider a relationship with Jesus Christ as a result of the experience!

I am on a crusade.  Won't you join me?

In other news …

  • I will be speaking in a breakout session of this conference on Thursday, March 15, 2007 at NewSpring Church.  I can't wait!!!

Financial Counseling – Why do this?

Financial counseling.  When these two words are put together it seems to strike fear into the heart of man.  I mean, you are going to reveal your financial situation to someone else.  That can be scary!

Why would it be scary?

A key reason is that a person's financial situation tells a lot about that person!  You may have heard the saying, "Show me your planner and your checkbook and I will tell you what is important to you."  In financial counseling, you are revealing your financial situation to another person and sometimes the way we have managed money has been, well, frightening!

When I was B-R-O-K-E, I was very determined to NEVER share any of my personal financial information with anyone.  NO ONE!  Why?  For one, I was B-R-O-K-E, but I wanted people to believe that I was doing well (it's called living a lie).  If I sought financial counseling, someone would (GASP!) know that we were not doing as well as some may have thought.  OOOOOHHH!  Scary!

It was when I decided to stop putting on airs and really apply God's word to our finances that Jenn and I started to win financially.  During the course of becoming debt-free, we developed a we-could-care-less attitude about our financial situation.  In fact, I am on a crusade to tell our story so that they too can experience financial freedom! 

There is this verse in the Bible that really cuts to the quick on this thing.

Proverbs 1:5 (NASB) – A wise man will hear and increase in learning, and a man of understanding will acquire wise counsel.

WOW!  You should read the entire first Proverb.  It is all about acquiring knowledge.

That is what financial counseling truly is.  It is acquiring knowledge and learning from someone who is winning financially by managing their money God's way.

"A man of understanding will acquire wise counsel."  It just rings in my ears.

Why I am such a big fan of cash envelopes

I am a HUGE fan of cash envelopes because they are a key reason that Jenn and I started winning with our finances.

Here is how we use cash envelopes:

Every month BEFORE the money comes in, Jenn and I work together to spend all of our money on paper.  We FORCE our money to behave by making it follow the INCOME – OUTGO = EXACTLY ZERO formula.  This usually takes less than 20 minutes per month!!!  After we have completed the budget, we figure out how much needs pulled out for the cash envelopes.

How do we decide how much to put in cash envelopes?  Well, it is something that has been developed over time.  We have learned that there are certain categories that we are more likely to impulse on.  These categories are where we are quite likely to overspend if we use the debit card.  As a result, we pull out the amount of cash that we budgeted and put it into a labeled envelope.

Here are some categories that Jenn and I use cash envelopes for (because these are categories we could overspend otherwise):

GROCERIES

DINING OUT

CLOTHING

BLOW MONEY

ENTERTAINMENT

Think about these categories for a minute.  It is pretty easy to go crazy and overspend these categories isn't it?!  By using cash envelopes, we KNOW FOR SURE that we will NOT overspend.  We will only spend the amount we budgeted!

Guess what?  I have never overspent a cash envelope in 4 years!!!  If I were using a debit card, I can guarantee you that I would have overspent at least 24 of the past 48 months!!!  Why?  The debit card doesn't allow me to keep a running amount of how much I have left to spend for each category.  The cash envelopes? – Yeah, I can just open it up and count.  Presto!  I immediately know how much I have left for the month!

Try it!  If you are nervous, try just one envelope – GROCERIES!!!  It can quite possibly change your life! 

First-Time Budgeting

Wow!  I remember our 1st-ever budget.  My fine bride, Jenn, came into the living room with this scrawled out budget on a piece of lined paper.  She had been trying to get me to budget for the past 6 months or so, but I was not playing along! Surprised

You see, I thought that budgets were controlling, restricting, live-in-a-Maytag-refrigerator-box pieces of trash.  I wanted no part of that!

STOP!  There we were, ME managing the money, with $4.13 in our checking account and our credit cards run up with a balance for the third time!  There we were, 105% financed car, 100% financed truck, and nothing in our short-term savings account.  There I was, B-R-O-K-E, and in COMPLETE DENIAL!

Folks, I can not write it strong enough!  I was B-R-O-K-E and telling my wife, "NO!" to doing something different!  At that MOMENT, something happened to me that changed my life and marriage forever.  I turned off the TV and looked at the budget she had drawn out.  It was amazing!  It actually balanced without incurring any additional debt!

LIFE-CHANGING does not describe the next few minutes.  I moved on into the computer room and started entering the expenses into Microsoft Excel.  As I was putting together the formula to subtract expenses from the income, I realized that all of this time I could have been managing my money with a 1st-grader's math ability.  INCOME – OUTGO = EXACTLY ZERO!  After a few minutes, we had a budget that was EXACTLY ZERO.

My life and marriage have been changed forever because we discovered that a budget is NOT restricting!  It IS controlling!  It is YOU telling your money what to do!  It allows you to pay off debt, save up for known, upcoming expenses, save money for emergencies, and fund your dreams.

The first budget – yeah, it was tough.  Not everything went according to our plan.  I mean, every month we were spending an enormous amount of cash at Wal-Mart and really did not know what we had spent it on.  As a result, month one was a little tough.  Month two – that was a bit easier.  Month three – that was even easier.

Listen to your feelings as I write this next line:  We don't worry about money ANY MORE.  We did something different.  We applied God's word and Grandma's advice to our money and our lives have never been the same.

You CAN do this!  You CAN get through the 1st month's budget!  What have you got to lose?!  Click on "TOOLS" at the top of the page or click HERE to download your FREE budget form and get started!

Top 10 Signs That You May Have A Money Problem

  1. You sold your child on E-bay last week to pay off the dog you bought with 90-days same as cash.
  2. When you plug your expenses into the INCOME – OUTGO = EXACTLY ZERO budget form, INCOME – OUTGO actually equals "Microsoft Excel Gives Up"
  3. Check Into Cash holds a ceremony in your honor.
  4. You have eaten ramen noodles for eight straight weeks, but your pet is eating Eukanuba Reduced Fat dog food for $20.29/bag.
  5. You cringe every time that the phone rings.
  6. When the credit card companies actually believe that you have too much debt and stop sending you credit card applications!
  7. Your hand suffers a 3rd-degree burn when you write a check.
  8. You are afraid to discuss debt with your spouse.
  9. When your child tells you, "Man.  We sure have a whole lot of debt!"
  10. If you can not imagine or remember what it was like to NOT have debt.

New TOOL posted in “TOOLS”!

I am pleased to announce another tool has been added to the "TOOLS" page on www.josephsangl.com!

Our newest tool is a Savings Account Balance – Tracking Tool!

Here is what it is for and how it works.

Ever been saving up for multiple purchases and holding it all in the same savings account?  For example, my family saves up for vacations, car replacement funds, property taxes, life insurance payments, and health club memberships.  All of that money is saved in the same account!  When you look at the account, it is just one balance!  How do you know the amount of money saved up for each category?  …  Let me introduce you to our newest TOOL!

In this example, you can see that for January 2007 this person's savings account has $6,630.  However, just because they have $6,630 available, it does not mean they can just go blow it on a new boat!  It is being saved for KNOWN upcoming expenses.  They actually have a plan!

In February 2007, you can see that the overall balance went up $380 – $100 went to the emergency fund, $60 for Christmas, $35 for property taxes, $50 for the vacation fund, $65 for Life Insurance, and $70 for YMCA.

Make sense?  Oh, yeah!  You have GOT to go get this tool!

Get LIFE INSURANCE!!!

Over the past week I have met with two people who have once again reminded how important it is to have life insurance.

In situation one, a person's spouse passed away at a very young age.  It was a total shock.  However, this couple had a financial plan that they had worked on together.  They also had life insurance.  As a result, the surviving spouse and the two children are taken care of.  They can focus on grieving instead of having to worry about working to pay bills.

In situation two, a person's father passed away at a very young age.  It was a total shock.  There was no life insurance.  As a result, the family struggled financially.  It created a tremendous strain on the family.

Folks, it simply does not have to be this way!!!  Term life insurance is SO CHEAP!  You can go HERE to get a quote.  You don't have to enter your name and address as it requests for you to be able to see quotes for you.  For a 30 year old, $500,000 of 20-year level term insurance coverage is less than $300/year!  If you have a family that relies on you to provide income or care for the family, you simply can not afford NOT to get this insurance!

Do it TODAY!!! 

Phrases that will KILL your plans for achieving financial freedom

"I am so stupid, I will never be able to do that."

"I do not make enough money to win financially."

"My spouse will never do this with me."

"You just don't understand what has happened to me in the past."

"I can't live without my car."

"I needed it." (an obvious WANT)

"I don't want to seem like a nerd."

"My family will think that I am wierd."

Guess what?  You CAN do it!  I would point toward your current financial condition and ask Dr. Phil's question, "What you have been doing …  How's that working for you"

I KNOW that every single person on this earth can have financial freedom.  I KNOW that there is ENOUGH for everyone.  You CAN do this – especially if you live in the richest country on the planet.  All it takes is you!

Automatic

If you are an employee of a business, then there is this magic day that arrives called "payday".  When this magic day arrives, you tear open the check and discover that a large portion of your paycheck has been taken away from you.

What are the takeaways?

  • Taxes – Federal, State, Local, FICA, Medicare
  • Insurance Premiums – Health, Life, AD&D, Disability – short term & long term
  • Retirement contributions – 401(k); 403(b); Simple IRA; SEP; Thrift Savings
  • Savings Accounts – Christmas Funds, Health Savings Accounts, Health-Care Reimbursement Account, Dependen-Care Reimbursement Account
  • Child Support
  • Loan Repayments – 401(k)

My question is this:  Do they EVER forget to take that money out of your check?  For example, have you ever received a check where they forgot to take out the taxes?  Never?  NEVER?!!

Wow!  Why is it that they have NEVER forgotten to take taxes out of your check?

The REASON:  It is IMPORTANT and it is AUTOMATIC!

Here is my challenge to you today.  Until you make investing for retirement, your dreams, and the children's college is IMPORTANT and AUTOMATIC, it will not happen.

If you set up your 401(k) draft, it will be automatic.  Every single time.  Automatic.  Make your investments automatic!  A 15-minute conversation or visit to your investment web site is all it will take and it will make all of the difference on your future.

Make it automatic, and it will happen! 

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