The B Word! BUDGETS!!!!!!

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Well my friends, thanks for reading my blog the last couple weeks! This has been really fun to get started with and I certainly get to reflect back on how I'm doing on this journey with my wife and children and I also get to hopefully inspire others as I change myself and family.

As I stated in my last blog post we are going to talk about Budgets. (I'm going to capitalize the word Budget, because I want to drive home the importance of a using a Budget.) 

ONE OF THE LEADING CAUSES OF DIVORCE ARE DUE TO MONEY FIGHTS AND MONEY PROBLEMS. (Not communicating or miss-communicating. Talk to each other, you did it once, do it again!)

I think Budgets are misunderstood, and a lot of people think that if they create a Budget, they can't do what they want with their money. 

Have you ever been in between pay periods and want to go buy something or do something as a family and you look at your bank account and only see a few dollars in the bank and wonder "Where did all of our money go?" I HAVE AND IT ISN'T FUN, IT'S DOWNRIGHT DEPRESSING!

After my wife and I read the Total Money Makeover by Dave Ramsey, I decided we are getting on a Budget. With my employer I am able to go to the company intranet website and see how much my paycheck will be, this is nice because as a family we can sit down and have what Dave call's a "Budget Committee Meeting". This is a meeting where we can plan, sit down, and TALK CALMLY about what bills need to be paid and where the left over money is going to go. IF YOU DON'T TELL YOUR MONEY WERE IT IS GOING TO GO, IT WILL DISAPPEAR! (I know your shaking your head up and down right now, if your not you've beat the statistics, congrats!)

I'm going to describe two Budgeting techniques that are commonly used. 

The first is what I call the ZERO DOLLAR ASSIGNED BUDGET.
- This is where you will sit down with a sheet of paper, and assign each and every dollar a category. For Example!
 Paycheck = $2,500.00 (all figures are arbitrary and for example only, adjust accordingly to your needs.)

Tithing - $250.00 (Tithe means 10%, In the Bible we learn about Christ's followers paying a tithe. I'm a firm believer in the concept of tithing.  I believe God gave me this money, I can give a bit back to him for large blessings in return. If you don't tithe, that's your belief, but you can give to a charity instead.)
  
Mortgage/Rent - $1,000.00   

Food - $300.00

Utilities - $ 150.00
(Notice I Budget for the necessities of life, Shelter, Food, Utilities before anything else? I then get to the other things in life.)

Insurance - $40.00

Car Payments - (If you unfortunately have a car payment) $300.00

Fuel for Car - $150.00

Phone Bill (Cell Phones/Landlines) - $150.00

Auto Repair Fund - $50.00

Credit Cards (If you have this evil) - $50.00

Clothing Fund (kids grow out of clothes more than adults) - $30.00 

Pay Yourself Fund - $30.00

Now you will see, we have assigned each and every dollar a category. The next paycheck you will have different categories, like:

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Medical Prescription / Co-pay Fund

More Credit Cards if you have them

School Lunch Fund

Appliances / Furniture Fund

Christmas Fund

Birthday Fund

(Each person's wants and needs are a little bit different, but the basic concept is the same.)

You will notice I have a Pay Yourself Fund, some might be wondering "What the heck is this?" Ahhhh, let me explain. Has your significant other came home with a new blouse, or a new gun, or whatever their addiction is and you think to yourself  "We can't even buy milk for the cereal, and you go out and buy a new blouse?" THIS IS THE FUND WHERE YOU EACH GET A CERTAIN AMOUNT OF MONEY TO SPEND ON YOU, NO QUESTIONS CAN BE ASKED BY EITHER PARTY AS LONG AS THAT PERSON HAS THE MONEY THAT WAS ASSIGNED TO THEM.

Pay Yourself Fund is my favorite fund, because I no longer go into the gas station to buy that Coke or Reese's Peanut Butter Cups. I find it is so much harder to part with that money, and if I want to save for Cowboy to build me another Cowboy Hat (check out his website at www.cowboysclassichatco.com ) I can save that money for just that reason and no questions are asked. HOW FUN IS THAT? (IT'S A PARTY TO YOURSELF!)

Next you will notice the AUTO REPAIR FUND. How often does the car break down? Not very often, but when it does your having the "OH CRAP, HOW AM I GOING TO AFFORD THIS?" moment. How often do you plan for your car to break down? Same answer, not very often. If you plan for it and you have the funds saved up that repair will be paid for before it happens. It's an awesome feeling, trust me it's worked with my family.

Okay, the second Budget is the ENVELOPE BUDGETING SYSTEM! I love this one!

This system was used a very long time ago. I tried to trace the origins down, but was unsuccessful. The nearest I could find, was back before credit cards were used people would actually save for things, yes I know that sounds crazy, but it actually happened!

What people would do and my family and I do now, is we take the paycheck and stick the CASH in the envelope assigned to the categories for example:

The Tithing envelope would get the amount assigned in the Budget meeting

Mortgage/Rent Envelope would get it's assigned amount

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Food Envelope would get it's assigned amount.

ETC., ETC.

Once that amount in the envelope is spent, it's spent. IT'S GONE!

There might be times where you have to adjust your different categories for different reasons, for instance there is a case lot sale at the grocery store and SO YOU COMMUNICATE WITH YOUR SPOUSE and say "There is a case lot sale at the grocery store, I am going to adjust here so I can have some extra money for this case lot sale".

When you start your budgeting you will find that the amount allotted for Groceries isn't enough or it might be too much. It will take a few month's to get it right, but keep pushing through. DO NOT YELL AT YOUR BUDGET MEETING, talk calmly and YOU BOTH MUST AGREE! Men, let her have the say so on the Groceries Budget amount, especially the groceries. (She will think your king of the world if you do this.)

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Life will be much more enjoyable when you live on a Budget, much less stressful and certainly not as depressing. A BUDGET IS NOT A PRISON CELL!

BOOK RECOMMENDATION

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THE RICHEST MAN IN BABYLON

BY: GEORGE S. CLASON

When I was about 13 years old, I remember my brother Trent coming home from school saying we needed to read this book called The Richest Man In Babylon. He said his religious instructor told them they should all read it, I remember him buying this book and I saw it one day on our bedroom floor and tried reading it but never got past the first 5 pages for some reason. (probably because I wasn't a reader back then, although I probably should have been.) About a year and some odd months ago, I picked up this book and it's set back in time, and gives phenomenal stories about how to achieve personal financial success and some great tips anybody can learn from. I certainly wish I would have read it at such a young age, I'd probably be millions of miles from where I am at today.

This is a quick read, and can be finished in a couple of hours. Most libraries have this book, if not they can get it for a nominal fee for you or you can get it on your kindle or nook to have forever and read again and again as I have.

FRIENDS I HOPE YOU HAVE AN AMAZING WEEK AND YOU COME BACK NEXT WEEK! (Next week's post will be postponed by a couple of days!)

COWBOY UP AND 
 FIRE YOUR DEBT