Blessed finances

Right now a lot of people are worried losing their jobs or facing financial difficulties with the state of the U.S. economy.  It’s scary when your main source of income dries up!  When Ray lost his full-time job over two years ago, we went through some really hard times. Not fun!  During that time, I learned some valuable lessons on finances. God used financial expert Dave Ramsey to help us begin climbing out of the dark pit we were in for so long.

Dave knows what he’s talking about. In his 20’s, he had real estate worth over $4 million, but got heavily into debt. For three years he and his wife Sharon went through financial hell, being sued and going bankrupt (with a new baby and a toddler). He then read everything he could on finances, interviewing rich people (who kept their money), and this deep searching led him to look into his own heart and repent. 

 Using successful people’s advice and Biblical principles, he and his wife Sharon got totally out of debt, now have financial security and great wealth, and Dave is teaching millions of others through his Financial Peace University and The Total Money Makeover books and courses.  His courses teach seven “baby steps” to achieve financial freedom. 

Dave says living right is difficult, but not complicated. Being debt-free and wealthy will relieve a lot of stress in your life, will enable you to live in obedience to God as a good financial steward, and will give you the means to help and bless others!  Contrary to popular belief of some Christians, money is not a sin. It is the love of money that is a sin.  (1 Timothy 6:10) In the Bible, many great men of God were extremely wealthy, like Abraham, Jacob, King David, and Solomon. God wants to bless His people!  Dave’s methods are not a name-it, claim-it, get rich, hype scheme, but use practical, common-sense, Biblical wisdom.

Ray and I began applying Dave’s principles, and are on our way to becoming totally debt free. For the first time in 16 years of marriage, we are not overdrawn in our checking account every month, with bounced check charges eating our income, living for the next paycheck. Our rent and utility bills are paid on time now.  Right now, we are working on rebuilding our savings (baby step #1), with the goals of becoming completely debt-free , establishing solid savings, education and retirement funds, and enjoying  our lives more (it’s no fun being poor!).

 Here are some financial freedom tips I learned from our difficult time two years ago, and from Dave’s book, The Total Money Makeover:

• Dave says don’t even consider trying to keep up with the Joneses, because they’re broke. Our last name is Jones, and I can testify this was true for 16 years!  Dave’s right!
• Your financial mess is not going to get better by ignoring it, or blaming your husband/wife. Take personal responsibility.  As Dave says in The Total Money Makeover, it’s my fault.  Yes, it really is your fault that you’re in the mess you’re in!   Not your spouse’s fault, your kids’ fault, or your parents’ fault.  The blame game will keep taking you around that same defeating cycle of BROKE AND FIGHTING. Financial problems are one of the #1 causes of divorce.
• There is an expression, “Insanity is doing the same thing over and over again, but expecting different results.”  Insanity in finances is living the same way you’ve always lived, but expecting to get out of debt by some “magic cure” like an unexpected inheritance, the lottery (one of my pet peeves), or money falling out of the sky somehow.  FINANCIAL FREEDOM IS NOT GOING TO HAPPEN EXCEPT THROUGH HARD WORK AND SAYING NO TO YOUR FLESH!  One of Dave’s most popular mottos is, “If you will live like no one else, later you will live like no one else.”  Getting out of debt today will enable you to enjoy life more tomorrow!
• Stop fighting over money, and find a solution.  Your marriage is worth saving! Pray for God to help you.
• First, track all your spending. ALL!  When I first started writing down all my spending in a ledger, I was appalled at how much I was spending on coke runs and especially on eating out.  This is a real eye-opener exercise. When it’s in black and white, you can’t blame other people, either. Write down even that $3 purchase at the store for bottled water and gum. This will tell you where your money is going, so that you can start telling it where to go…with the dreaded B word.
• Create a budget, or a spending plan if you like that term better. Aim at nothing, hit nothing. Dave tells you how to create a REALISTIC budget in his books Financial Peace and The Total Money Makeover.  A budget doesn’t mean you can’t enjoy your life anymore, and are a slave to the predetermined figures on your spreadsheet.  
• List every single one of your debts. Write down your agreed upon budget, and write down all your debts, from smallest to biggest!  This will help you to face the reality of your situation.  I have our budget and keep track of everything we spend on our computer, using a spreadsheet. This way we both can see it at any given time. We also use online banking, to help us keep track of our money better. 
• The monthly budget includes a “blow money” account for both you and your husband, decided on in agreement by both of you.  Creating the workable budget is initially the hardest part for a husband and a wife, but it has to be done.  Be an adult, and come to an agreement without resorting to blaming, screaming, slamming doors, etc. If necessary, get a third party involved, like a married couple or a counselor, to help you with decisions on your budget. If my husband and I can do it, anyone can!
• You need a spending category, because you’re going to spend money sometimes.  You just can’t spend  what you used to, and have to be disciplined.  The budget will need to be adjusted each month for that month’s expenses, and allowances are made for emergencies. (This is why the emergency fund is so important.)  Sometimes you will blow the budget, but the goal is to get control of spending, reduce debt asap, and build wealth. I was amazed when Ray lost his job two years ago, how much I could do WITHOUT.  Suddenly, I didn’t have to go to Walmart, the Dollar Store, Kohl’s, the Mexican or the Chinese restaurant, etc.  I learned to just buy what we needed, and save for what we wanted. Amazing concept!
•   Tawra has great recipes for cooking at home and other tips for frugal living at her website Living On A Dime.  You also can find tips for saving money, and other great articles and podcasts at Malia Russell’s website Homemaking 911. The Debt-Consolidation Diva says that if you buy one $2 drink a day six days a week (or one $4 drink three times a week), you’re spending $624 in a year. What could you do with that extra $624?  Put it into savings/investing. Buy a new computer (our current main computer is in the shop).  Put down another payment on your car to get it paid off earlier. Pay off a medical bill. If you stop eating out three times a week (a conservative estimate for some people), you can save $100 and more a month!
• Don’t spend more than you make. And eat at home.  It sounds so obvious, but this is most people’s problems. My area of weakness was going to the store or Sonic for cokes, and eating out at fast food restaurants. Since fast food is terrible for your health and damages your budget, I am trying to cook a lot more healthy meals at home now.  I still go to Sonic for cokes sometimes, but am trying to cut back on my visits there (and cut down on drinking coke, having water instead).  Women usually buy smaller price items for their “blow category,” like clothes, makeup, eating out, etc., which adds up to a lot.  Men tend to blow money less frequently, but buy big-ticket items like tools, riding lawnmowers, computers, technological toys, etc. 
• Save $1000 as an emergency fund to keep Murphy’s Law away. Do whatever you have to in order to build this fund as quickly as possible.  Work extra hours, have a garage sale, sell something big. Dave says this step takes less than a month in most cases, but my husband and I are having a very difficult time rebuilding it that fast, after we had to drain it the first time to move into our new rental house.  Just keep trying to save whatever you can to build the fund, no matter how long it takes, even if you only have $10 a month extra to put in there!  The savings account is to be used only for emergencies, like car problems or a job lay-off. The $1000 is just the first step toward a bigger savings. It is usually the hardest step for couples. Before you begin building the emergency fund, though, be current with your creditors first (rent, utilities, etc.).
• Don’t borrow! Don’t use credit cards! Dave uses a personal debit card and a debit card for his business, but he does not have a credit card. “Building your credit” with credit cards is a myth (in my opinion, an outright lie and a trap by the enemy!). Ray and I do not have any credit cards!  We use our bank debit card for purchases instead.
• Use garage sales, Ebay, Craigslist, etc., to sell items you don’t want or need anymore.  If you have large items like furniture, they often sell fast if they’re priced right.
• I use coupons only if I really need that product. If the coupon says “Save 25 cents” on two giant bottles of a cleaning product that I never use, I don’t cut it out.  The grocery store in town has a savings program, where they use a plastic discount card each time you buy groceries. Recently I saved $25 on my grocery bill by the shopper card. 
• Look for bargains in thrift stores, garage sales, consignment stores, and on Ebay, Craigslist, Amazon, and homeschool online sites. My friend Kelly, who has eight children, is the thrift store queen. She finds name-brand clothing at great bargains for her kids, simply by her patience in shopping for hours, in different thrift stores and at garage sales.
• After you save the $1000 emergency fund, start paying off your debts as fast as possible, starting with your smallest debt FIRST. This sounds backward, but it is called The Debt Snowball, and enables you to attack your debts aggressively and get out of debt faster than if you tried to pay off the biggest debt first. Dave explains this concept in The Total Money Makeover.  When we saved $1000 the first time, I was able to pay off a few smaller bills. What a relief to pay something OFF!  Imagine how you’ll feel when all your debts except your house are paid off! What a feeling of relief and joy!
• Dave says the cure to financial problems is W-O-R-K. He advises people to do whatever they need to do, in order to get out of debt – work two or three jobs, sell their furniture, etc.  He also says you are not too good to deliver pizzas or flip burgers. On page 127 of The Total Money Makeover, he writes, “I don’t like the idea of working one hundred hours per week, but sometimes extreme situations require extreme solutions. Temporarily, just for a manageable period of time, the extra job or overtime may be your solution.”
•  After you build your beginner $1000 emergency fund and pay off your debts, then you can begin the other baby steps like building an emergency fund of three to six months, putting money into retirement and your kids’ college education savings, paying off your house early, and then making your money work FOR you, giving to others, and having fun with your life through mutual funds, real  estate, etc.
• Think business. Think entrepreneur. Renew your mind every day in God’s word. Think big.  Negative thinking affects your success.  Hang around successful people, and learn from them.  Read everything you can about finances, especially books on millionaires. Millionaires have a different mindset from average people. One good book is The Millionaire Next Door. This morning I was listening to international speaker and millionaire Dani Johnson’s cd series, “Foundational Tools Essential to 6-Figure Success In Your Home Business.” Dani has a great testimony, and is passionate, funny, and on fire for God.  She says your success all depends on your relationships, and you reap what you sow. So sow generously!  Be a giver to God and others!  It will come back in amazing ways in your own life!

Dave encourages us in his book The Total Money Makeover that anyone can apply these principles, and they work. It gives you hope that you can overcome your financial troubles, get debt free, and bless others – even leaving an inheritance for your children.  God wants his people blessed. The way to that blessing is wisdom through practical, wise, disciplined steps, one by faithful one. You can read more about Dave’s proven methods at his website here.