I had the opportunity to speak at NewSpring Church yesterday!
The streaming video is available HERE.
It was great to be able to share my story of finding out why I was placed on this Earth!
Another New Tool: The Mini-Budget
A Mini-Budget is used to spend irregular income such as tax refunds, bonuses, and inherited money. It can also be used to budget for a home project, wedding, or other event.
Here is how it works – let's say you are going to be having a wedding. Lord knows how much money we can spend on a wedding! The average is OVER $20,000! It strikes fear into every dad who has a daughter. It strikes TERROR in every dad who has daughters!
Anyway, let's say the budget is $20,000. SPEND THE MONEY ON PAPER FIRST!!! You are MUCH MORE LIKELY to stay within the budget if you actually think through the expenses IN ADVANCE!
So you pull up the Mini-Budget form (link is later in post) and spend the money on paper FIRST.
You can see that the $20,000 has been spent 100% on paper. The chances are GREATLY INCREASED that this family will not overspend on this wedding (if you call $20,000 not overspending – ouch!).
See how it works? GREAT! What do you need to budget?
Get a copy of the MINI-BUDGET tool HERE.
Budget-busting expenses
Need help in overcoming budget-busting expenses? You know the big ones – Christmas, the quarterly insurance premium, the annual property taxes, etc.
Here is a simple way to smooth out these large expenses.
In the example, you can see some certified, bona-fide budget-busting expenses. Wouldn't you agree with me that a $450 or a $950 hit in a single month's budget would BLOW UP a budget? ABSOLUTELY! To eliminate this peak-and-valley, feast-and-famine style of living, take the time to list out all of your KNOWN, UPCOMING expenses and their associated annual cost.
In the example above, the annual budget-busting expenses total up to $4,400 per year.
Divide this number by 12 months, and you arrive at $367/month. If you save $367 EVERY SINGLE MONTH, you WILL be able to absorb these budget-busting expenses without the huge headaches that you may currently be experiencing!
Don't believe me? Ask anyone with a Christmas fund or a home mortgage escrow account! These are really nothing more than budget-buster smoothing tools! Why? Because mortgage companies and businesses have realized that if the costs are not smoothed out and absorbed monthly, the chances are unlikely of you having enough cash on hand when the bill arrives otherwise.
Who Joseph Sangl is learning from …
Dave Ramsey – 7 Baby Steps to Financial Peace – Never seen any better method!
Robert Kiyosaki – Cash Flow Quadrant – ESIB – The letters are so cool!
John Eldredge – Wild At Heart – Psychological analysis of men
God – He is absolutely in control!
Perry Noble – My pastor is the greatest pastor in the world!
Mike Yoder – Acts 2:42 will never be read again without thinking of Mike
Paul Marshall – Hero of mine
David Chilton – Compound interest became my friend at age 12
David Jolley – Wow – Huge help in a crunch!
Make money by fixing up a house & selling it
If you have been paying attention at all to the finance world, you know that it is important to have a diversified portfolio.
You do not want to have all of your eggs in one basket – such as having a majority of your money invested into a single stock.
Well, I believe that I have a well-diversified portfolio through a variety of mutual funds. The issue is that all of these investments are impacted by global/world/regional events that may or may not have anything to do with the mutual funds I own.
This is why I own a house. It is an investment that helps my financial portfolio become more diversified.
I have owned quite a few homes, but the home I now own is the first older home I have purchased. This house was in some dire need of structural improvements AND decorative updates.
However, I bought this house at a discount because of all of the issues with it. It was NOT move-in ready.
Here is a list of problems that it has/had:
- Dog pee all over the carpets
- Dog damage from climbing on window sills, digging up the yard
- Rotten floor
- Leaking roof – several spots
- Sagging roof
- Old appliances
- Wood paneling with horrible wallpaper all over it
- Leak damage on the walls/ceilings
Now, I am the son of a home builder. I know a little bit about working on houses. I will tell you that this is my first attempt at updating a house myself. As a result of this project, I have developed a short tip list for you should you consider doing this.
Tips
- If you have no clue about updating houses – do NOT do it unless you have a pile of green portraits of Ben Franklin that you want to donate to others.
- Have a contigency fund for the problems you will discover as you fix other known problems
- Get help when you get in over your head
- Don't move in to the house until you have fixed the structural issues. It is so much easier to complete a major project when you are not living there!
- Develop a budget for the projects and HOLD TO IT! Be realistic on estimated costs!
- Cry when you need to. It lets some of the frustration and anger out.
In the end, you will have a nice house for a good price and have some good ole sweat equity built up!
Gain more $
On-Line Savings Accounts
On-line savings accounts are paying 4.50% or more on ordinary savings accounts!
Capital One – 5.00%
HSBC – 6.00% on new money until April 30th. NOTE: They only allow you to deposit $2,000,000.
ING Direct – 4.50%
Invest In Funds That Require Smaller Amounts to Open
American Funds – $250 to open; $25 automatic monthly deposits required (I love automatic!)
GE Funds – $500 to open; $100 automatic monthly deposits
Find more funds at Morningstar.com – Use their FUND SCREENER
Purchase Property That Produces Income
Rental homes; Rental equipment; Commercial Building Capital Leases;
Anything that pays out cash as residual income is great. Anything that increases in value over time is grand. Anything that pays out cash PLUS increases in value over time is great AND grand!
Learning new things
I love to learn new things! If I learn something new every single day, then my life is very good.
Here are some things I have learned that may help you out:
- Insurance rates are much cheaper when bundled (auto & home; home & life; etc.) and for most people who have priced theirs out within the past couple of years, the savings could be $200 or more per year.
- When you go to a dentist or doctor, you can negotiate the charges. It is a service!!! Many times, you can obtain a substantial discount on the amount you owe after insurance has paid its portion. I have saved 10% twice and 6% once, each saving me $100s of dollars!
- Use the cash envelope for spending categories that we tend to impulse on – groceries, dining out, clothing, spending money, entertainment. We budget a set amount, pull it out in cash, and refuse to approach the bank again for the rest of the month. When the money runs out, we're done for the month! It ensures you will NEVER overspend your budget!
- Buy off-brands at the grocery store. We have saved over $200/month since going to a cash envelope for groceries and purchasing the off-brands. Off-brand milk tastes just like name-brand milk. Off-brand Cheerios taste just like Cheerios. Off-brand Froot-Loops taste just like Froot Loops. Off-brand fritos taste just like Fritos. I'm sticking with my Heinz ketchup, however.
- Wait overnight on any purchase greater than $200. I have not regretted this at all. I have waited overnight on every large purchase, and it has really cooled the jets on some deals I might have made in the past. This is a great way to avoid buyer's remorse! Wait.
- Garage sales, yard sales, rummage sales, jockey lot sales, e-bay – are all great ways to find a great deal.
- Fund some FUN with your tax refund. I always make sure that we fund our summer vacation with our tax refund. This ensures that I am going to follow the budget! If my budget did not allow me to have fun, then it is quite likely that I would not be teaching this stuff! I would certainly be less passionate about it.
- Ask. If you are going to spend a large sum of money on something, ask around for it first. Somebody might have the very thing you are going to purchase and will sell it for pennies on the dollar or even give it to you!
- Swap labor. Help you friend or neighbor on their project and then have them help you out with yours. No money. Friendships are built. Can you say WIN-WIN?
Can someone teach me something new today? Add a comment below!
You have 15 minutes left …
15 minutes left to live.
After all of the living that has been, you have 15 minutes to live.
How will you spend these 15 minutes?
With Family & Friends. That is what I would choose.
Has your financial situation messed up your personal relationships with friends and family? Has it messed up these relationships to the point that you could not spend the final 15 minutes of your life with them?
Why would anyone ALLOW money to control their personal relationships? I refuse to allow portraits of presidents and important figures of American history to control my personal relationships. I value my personal relationships too much.
If someone has stuck you with the bill, forgive them.
If someone owes you money and refuses to pay, consider it a gift.
If you were ripped off, let it go.
The day will come when you have 15 minutes left. Who will you spend it with? Just let it go.
Pain of Same > Pain of Change
You will change your behavior when the Pain of Same becomes greater than the Pain of Change.
I see people in my office occasionally who believe that they will be able to continue to behave the same way and achieve a different result financially.
"Joe, I want to spend $200/month at restaurants, $600/month at the grocery store, $150/month on cell phone bills, $150/month on cable, $800/month on car payments, and $1,300/month on house payments, but we really want to win financially."
"OK. Spend $50/month at restaurants, $350/month at the grocery store, go to one cell phone and save $75, go to basic cable and save $100/month, sell the cars and reduce your payments by at least $600/month, sell the house and buy one that you can afford and save $500/month."
Joe, you are crazy!!! Me? Change? If you do what I have suggested, you will save $1,675! Life WILL be different. The beater vehicle WILL drive different. The smaller house WILL be different. Guess what? You will save $1,675/month!!!
You can now give money away and you can save for college, retirement, and your dreams.
When will the Pain of Same become greater than the Pain of Change for you?
Practical Tool Day
Ever wanted a budget that works? Use the budget form HERE to make it really easy. Remember that you cannot spend more than you make and win financially!
Living paycheck-to-paycheck and want a budget form for that? Click HERE. Not only will you complete an INCOME-OUTGO=EXACTLY ZERO budget for the month, you will also see EXACTLY how each paycheck is spent.
Want to know the day that you will be 100% debt-free? Click HERE to figure it out!
Want to keep track of the money in your savings account? Click HERE.
Want to know what makes up a healthy financial plan? Click HERE.
Take a moment to look through the "TOOLS" portion of this web site to see the additional tools available to you!
Have another tool that you are looking for? Notify me!
