Hope for your financial life and beyond

How to Love Paying Bills and Going Christmas Shopping

paying billsThree weeks ago I’m standing in Target crossing off the list Christmas gifts we had already purchased. My wife, who had been looking at some kid clothes, comes up to me and says, “I’m having so much fun Christmas shopping this year!”

Amazed at her enthusiasm I said, “Who are you and what have you done with my wife?”

After giving me the duck face, she replied to my quip, “It’s just so much more fun when you use cash when paying bills and purchasing the.”

That comment was in my top 5 moments from this past Christmas. Knowing our money management system was enhancing our relationship and making such an emotional impact on my wife was priceless.

If you are wondering how we had the cash to pay for all our gifts, it’s not because we allocated that much more in our December budget than normal. We started saving for Christmas in January, using a tried but true concept known as a sinking fund.

The Sinking Fund Theory to Paying Bills

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Ending the Money Fights (Part II): Relationships Blossom When Couples Budget

This is part two of three on how couples can resolve the constant fighting over money.

Men's Shoes

My breakthrough occurred while shopping for these.

Last week I outlined how communication is the first step to ending the money fights in a relationship. Unless couples share their values, goals and feelings with one another, they will continue to bump heads over how their money is spent. It’s inevitable. When couples don’t share the same vision the relationship falters.

When my wife and I began to seriously and openly talk with one another about money, our financial life began to change. However, the unity didn’t result from us just talking about it. We knew there had to be an action step, something that would cement the ideological bonds that were forming through our discussions. That step came in the form of a joint commitment to prepare and live on a budget.

Ugh…budgets…I know the feeling. Unfortunately many people have had terrible experiences with them. This leads them to create excuse upon excuse as to why they don’t need to prepare one. They are essential though, if couples are going to have a breakthrough. I know in our lives, the budget did more to move us forward than anything else.

Step #2: Work on a Budget…Together

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4 Reasons Your Budget Isn’t Working

budgets that workSo, the budget doesn’t seem to be happening for you each month? Can’t figure out how to do budgets that work?  Well, take heart. At least you are trying. That’s more than can be said for a good portion of the human race who just make excuses for why they don’t want to attempt one.

If you are having trouble, that’s OK. Budget success doesn’t happen overnight. It took my wife and I six months of making adjustments and having emergency budget meetings before ours began to settle down and become consistently stable from month to month.

Budgets That Work

This I know with complete surety, developing a quality budget changed our life. But it wasn’t without some missteps along the way. In those early days, I found these four things wrecked our budget every month.

1. We left items out of our budget

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Can We Ever Step Off the Gas With Our Finances?

Sit at home or enjoy lifeI love competition. Better yet, I love to win. Doesn’t matter if it’s a marathon, a card game, or playing Horse with my 10-year old son in the driveway. (He hasn’t beaten me…yet.) I want to come out on top.

This competitive spirit also works its way out when I prepare our monthly budget. I love seeing if I can reduce the prior month’s spending amount for each budget category, thus being able to save more. I know, it’s a little sick. I’ve made budgeting into my own personal can-you-top-this contest.

Some may like that I’m this intense. After all, isn’t this level of passion necessary to win with money?

Well, yes…but not when the kids go naked because you haven’t purchased clothes in six months. That’s a little too intense. (Disclaimer to grandparents, family and friends and DFCS: Just using hyperbole here. No kids are actually going without adequate clothing in our house.)

The issue though is valid to consider.

When can we loosen the reigns on the budget? Do we have to drive hard all the time? When can we take our foot off the gas just a little bit? We free spirit spenders want to know.

My answer may be frustrating and seem like a cop-out. [Read more…]

Budgeting Series, Part III: How to Make a Budget

Income - OutgoingsYou’ve come to this post for a reason: to get control of your money. You are tired of making excuses and are ready to make a giant step towards being financially healthy. I applaud your courage because the journey you are about to embark on is not for the faint of heart.

The first few real budgets my wife and I put together were a disaster. We had some long “discussions” about how much money should go in each category and we were always changing numbers in the middle of the month for things we had not anticipated. I thought we would never get it right. But we stayed the course with it, through the trial and error, and eventually we figured it out.

The best part is – now that we have figured it out – doing a monthly budget is pretty easy. So there is hope.

In this post, I’m going to walk through the steps of how to set up a budget. By the time I’m done, you will have the basics to begin setting up an effective budget.

But before I get to the nuts and bolts, there are a few ground rules about budgeting. A budget’s effectiveness will be lessened if these principles are not followed:

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Budgeting Series, Part II: 8 Reasons Why People Don’t Do A Budget

$1000 Budget PigIf you are reading this it’s most likely because you have at least a passing interest in this financial tool we use called a budget. That’s a good thing because, as I noted in Part I of this series, even though money is an inanimate object, it exercises tremendous power in our lives. So it’s crucial that we utilize a budget to help us gain the upper hand with our money.

Even though budgets are vitally important to our financial well-being, most at some point in their working life have lived without one. Seems silly doesn’t it…that we would willingly choose go budget-less if they are so helpful?

There are a variety of reasons someone may choose to live without a budget. I’ll start by sharing why I chose not to have one for many years. I didn’t do a budget because…

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Budgeting Series, Part 1: I Have No Hand, But Am Gonna Need It

Image at FreeDigitalPhotos.net

Image at FreeDigitalPhotos.net

Welcome to the Luke1428 budgeting series. It’s a prerequisite for every personal finance blog to talk about budgeting, so here’s my shot at it. I’ll be dealing with many aspects of the budgeting process over the next few weeks, so buckle your money belts and lets figure out how we are going to save, pay some bills, and discretionary spend to our hearts content.

At its basic level a budget is a spending plan. Or if you prefer a cash flow plan designed to give you an idea of how money is circulating through your household on a month-to-month basis. Think of it as how your total monthly income covers your total monthly expenditures. Sounds like a big elephant to tackle I know.

It would be easy to jump straight to the how-tos and what-fors of budgeting but I’m going to go a different route in Part #1 of this series and attempt to answer the sickest question ever devised by mankind. It’s the question every parent LOVES (ha-ha) to hear from his or her inquisitive child.

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Drawing a Line in the Sand – A $37 Decision

drawing a line in the sandA couple of weeks ago, I had a not so great day at work. Nothing really dramatic happened, it was just one of those long days where everything seemed to be a little off and annoying. After work, things didn’t get much better.

I had to stop at the bank and then was supposed to meet a contractor at one of our rental properties to discuss some repair work. Something came up after school (which often does for teachers) that did not allow me to leave as soon as I had hoped. I’m a stickler for being late to appointments, so this didn’t set well with me.

At the bank we had to wait in line at the drive thru for 10 minutes to make our deposit. That’s unusual but they were shorthanded for some reason. Needless to say, I’m feeling the pressure to arrive at my appointment on time.

At this point, I encountered one of the strange oddities of life.

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