Hope for your financial life and beyond

6 Signs You Are Living Above Your Means

September 2, 2022 by 3 Comments

Let’s face it. We live in a fast paced, consumer friendly, debt-driven society. Spending money has never been easier.

above your meansThat might be why more than 60% of Americans deal with credit card debt on a daily basis. Access to credit has never been more available to the general public. Unfortunately, it is a main reason why living paycheck-to-paycheck is an unfortunate reality for nearly half of Americans.

However, that reality doesn’t have to be inevitable. Your situation can improve with some quick refinements to your spending habits. I’ve done it before and so can you. You don’t have to live above your means.

It does come down to a simple choice. But first you must be able to recognize that you have a problem. With that in mind, here are a few warning signs that may indicate you are living above  your means.

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The Ultimate Guide on How to Make the Best Monthly Budget

July 8, 2022 by 13 Comments

I’ve written a lot over the years on how to make a monthly budget. It’s really been important to me because creating and successfully living on a budget turned our life around. My wife and I would not be where we are financially had we not admitted the problem and took the time to learn how to budget.

So I’ve decided to pull all my knowledge about doing a monthly budget into one post. And I’ll tell you right now, it’s going to be a long one. But it’s also going to be really helpful. If you are new to budgeting, struggling with budgeting or a veteran at budgeting, you’ll learn something from this post that you can apply right away.

To help with organization, I’ve divided the post into several segments. Here is what you can expect to find:

  • monthly budgetWhat are budgets?
  • The real reason you need a monthly budget
  • Why people resist budgets
  • The one tip that started our success
  • The basics expenses of a monthly budget
  • What percentage to spend in each budget category
  • How to make your monthly budget zero-based
  • What to do with the left over budget money
  • Why your monthly budget isn’t working
  • Three helpful strategies for spending
  • Budgeting resources that work

With that as our outline, let’s get started.

What is a Budget?

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Filed Under: Budgeting Tagged With: ,

It Is Not a Sin to Buy a New Car

February 17, 2022 by 49 Comments

Is it ever OK to buy a new car? You won’t find many people in the personal financial space advocating that practice. Why? Because a car is a depreciating asset, meaning that it goes down in value over time.

buy a new carHow fast do cars depreciate? Figures vary based on the make and model of the car and market conditions. But most estimates say that cars depreciate around 20% the first year, and 15% more each year in years two through five. So you can expect a new car to be worth around 40% of its purchase price after 5 years of ownership.

So looking at those numbers, this should be considered the cardinal personal financial sin. Anyone considering buying a new car instead of a used one runs the risk of being called a foolish, image-conscious over spender.

Used car purchases always outpace new car purchases. But still, data from 2020 shows 14 million new light trucks and automobiles were purchased in the United States.

So, is it really a big a deal to buy a new car? A large segment of society doesn’t seem to think so.

I’ll answer my own question by saying “It depends.”

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Filed Under: Spending, Vices Tagged With: , ,

5 Money Saving Questions to Ask Before Buying Christmas Gifts

December 15, 2021 by 12 Comments

My wife and I never go shopping for Christmas gifts on Black Friday. I don’t care how good the deals are the crowds are just too much for us. We are more Cyber Monday or wait until the last minute type of people.

christmas giftsBuying Christmas gifts is always fun for us though because we love to spend money on the people we care about. It’s become even better recently since we’ve learned how to save money throughout the year to spend at Christmas. Now all of our Christmas gifts are paid for in cash and we never see a credit card bill come January.

While we all get excited about spending money on the people we love, it can get seriously out of hand. What happens in December can have short and long-term financial consequences if you don’t keep your spending on Christmas gifts in check. So here are five simple questions you should ask yourself as you buy Christmas gifts for those special people in your life.

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Filed Under: Spending Tagged With: , ,

Secret Advice For Teenagers Who Love to Spend Money

August 29, 2021 by 18 Comments

You know who you are – a teenager who loves to spend money like it’s going out of style. You spend money faster than it takes a Snapchat to disappear. Money comes into your hand one minute and flows out like water the next.

spend moneyAnd you like it that way!

If that’s you, I have some special advice today. It’s unusual, maybe even secret advice. I’m pretty sure you’ve never heard any adult say this to you before. In fact, your parents may hate me for saying this because it might go against how they have instructed you to handle money. So I’m actually running a big risk here.

But before I reveal this big secret about spending your money, you have to promise me something.

The promise I’m asking you to make is to read this entire post. You are going to love what I have to say about spending money,  but you can’t take it as stand alone advice without understanding the bigger picture. As they say, the devil is in the details. So I’m asking for five minutes of your time to help you avoid a huge potential failure when spending money.

Ready for the big, secret advice? OK, here goes…

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Filed Under: College, Kids and Money, Spending Tagged With: , ,

How to Prioritize What’s Important When You Make a Budget

August 11, 2020 by 17 Comments

I remember the first time my wife and I really tried to make a budget. So many expenses were coming to our mind it was difficult to prioritize which ones were most important. We messed up many things in that first month’s budget and felt really frustrated at our effort.

It didn’t deter us however from trying again…and again…and again. Interestingly enough, we found that after several months of trial and error, certain expenses always drifted to the surface first. It was apparent that we were drawn to some spending categories more readily than others because they represented fundamental needs for our family each month.

So what expenses go first when you make a budget? Then how do you determine what comes next? Today I’m going to outline our five-step thought process as we make a budget each month. Hopefully it will give you some direction as you try to figure out how your hard earned dollars will be allocated.

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Filed Under: Budgeting, Spending Tagged With: , ,

How to Enjoy a Life of Guilt Free Spending

July 1, 2020 by 41 Comments

guilt freeI would love to enjoy a guilt free life, especially when it comes to spending money. Have you ever heard the same voice rattling around in your head that I’ve heard in mine? It usually says something like, “Why did you spend that money? That was stupid! You know you shouldn’t have done that.”

If you’ve had that thought, then you know you spend the rest of the day kicking yourself and feeling like you’ve done something wrong. Additionally, some time during that same day might be spent seeking forgiveness from your spouse, which can always be a tense situation. And to top it all off, you will spend the rest of the month struggling to figure out how to make the budget cover your spending decision.

Guilt is powerful. But have you ever stopped to consider why?

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Filed Under: Spending, Vices Tagged With: , ,

How to Make a Zero Based Budget in 3 Easy Steps

January 20, 2020 by 28 Comments

One task that may not be apparent to first time budgeters is to create a zero based budget. My wife and I had tried to make a monthly budget before but for one reason or another, our budgets never seemed to work. Putting this step in place helped us lesson those failures and moved us towards a place of continual success with our budgets.

zero based budgetThe process of putting a zero based budget together is not hard to understand. Like any other budget it does require some planning and attention throughout the month. You might have to tweak some numbers here and there as the month unfolds and life happens. In my opinion it’s the best type of budget to put together as it leaves no room for money to go unaccounted for.

It’s important to have records of where money goes. With records, you have built-in accountability that shows where you spent your money. You begin to see patterns of how you spent your money over time. Then, you can then make changes if those patterns reveal things you don’t like about your spending.

So, let’s walk through the process of how to put together a zero based budget.

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A Beginner’s Guide to Home Remodeling Costs

October 10, 2019 by 87 Comments

The first house my wife and I owned was brand spanking new – right out of the box. We walked in to fresh paint, clean carpets, new appliances and a cute little covered porch right off the back door. Everything was so perfect. We had no home remodeling costs to speak of.

home remodeling costsA few years and two kids later we decided it was time for some more space. So we moved into our second home for our expanding family.

This house was nice and definitely an upgrade when it came to space. But it was not new. It had issues.

The carpet was old. EVERYTHING in the kitchen was dated. The deck was falling apart. And there is no way I will ever forget the rust-toned, orange paint in the upstairs hall bathroom.

Of course we were thankful for finding a home to fit our needs. But we knew changes and upgrades to the home were in order.

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Filed Under: Spending Tagged With: , ,

The 3 Main Advantages of a Debit Card

April 10, 2019 by 23 Comments
advantages of a debit card

Are there advantages of a debit card that makes them better than using a credit card?

Debate rages sometimes in the personal finance world over which one of these payment options is better. I see how both can be used responsibly to assist people with their money management. The key word in that last sentence though was “responsibly.” Of these two options, credit cards by far have the most potential for abuse.

Advantages of a Debit Card

Banks and other financial institutions issue debit cards as a way for customers to access their accounts to pay for goods and services. The card links to your checking account at the bank. When you swipe it at a business, the amount of the transaction is withdrawn from your account to pay the merchant.

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Filed Under: Debt, Saving, Spending Tagged With: , , ,

6 Ways a Monthly Budget Brings Freedom, Not Bondage

July 2, 2018 by 31 Comments

Here is a little test for yourself. When I mention the word budget do you think of the word “freedom” or do you think of the words “constraint” or “bondage.” The word you choose probably identifies your basic attitude about having a monthly budget.

budgetI love budgeting! I know some people think that’s crazy. For them, budgets bring to mind images of people in straitjackets, unable to move. The household budget acts as a restrictive torture device, in most cases forced on them by someone who thinks they know how to manage money better. Budgets can make people feel confined and boxed in.

I’ve been there.

I love to spend money as much as the next person. At one point in my life, I felt like a budget wouldn’t help me accomplish any financial goal. I knew for sure it wouldn’t make me feel good because I couldn’t buy the things I wanted. Budgets seemed difficult to piece together and I frankly didn’t have the time (or want to take the time) to figure it out.

Fortunately, I came around by doing some soul searching and through the gentle prodding of someone close to me – my wife. Eventually, I agreed to give budgeting a three-month trial run.

That decision changed my life. Not only that, it changed our lives. And the best part was, we received something I never thought a budget could possibly produce: Freedom.

In just a few short months I realized budgets produce freedom, not bondage. Here are six ways they can bring the same freedom to you.

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