Telling your money where to go
“The simplest definition of a budget is
"telling your money where to go.”
― ---Tsh Oxenreider
I realized after taking with someone about their finances and giving them recommendations that at sometimes it can be a major challenge to implement. The lifestyles we are accustomed to living become routine. What works for me when I implement any new discipline is to focus on the small success. This celebration of any positive movement also works for me in the areas of finances, prayer, personal and spiritual growth, and relationships. That list seems to encompass all areas of my life!
When I retired my wife and I had worked with our financial planner for years to achieve our goal. I can remember at my retirement dinner telling everyone with enthusiasm, “It’s A Wonderful Life,” because I had achieved my lifelong goal. We were also eagerly anticipating several major trips planned the year of retiring.
Retirement was everything I dreamed it would be. Then a year later our country experienced the worst financial crisis since the Great Depression. That event greatly impacted our investments. At the same time our rental property needed major repairs and we had just purchased a new car. Because of the lifelong discipline of working with a budget, I could more readily adjust and balance the income and expenses to accommodate the unexpected turn of events.
That is why I encourage people of all ages to establish a realistic budget. It is also important to celebrate each success, each accomplishment, otherwise it is not a rewarding discipline.
When I made the adjustments in our fixed and flexible income and expenses, I created additional money to pay off the loan on the improvements to the rental house and the car. I made a weekly payment instead of monthly and that accelerated the payoff of the loan. The lady at the bank commented, “You are really serious about paying off this loan!” I told her I have a plan and I enjoy seeing it work because once this loan is paid off this money is going back into our travel budget. I always kept the end results in mind and the opportunities that would open up once I accomplished my goal.
I receive a welcomed encouragement from what I call “my fan club of readers” of my postings. I realize I am preaching to the choir because many already practice what I share. If you are a reader that is already having success with any discipline, especially the area of finances, I would appreciate your sharing this posting with those who may benefit by implementing this tool for living a life of abundance. I will be glad to email anyone interested in the excel format I use for my budget.
“The secret of getting ahead is getting started. The secret of getting started is breaking your complex overwhelming tasks into small manageable tasks and starting on the first one.”
Over the years I have encouraged those interested in reducing the financial stress caused by credit card debt to establish a prosperity budget to manage their finances. The first month of a new year offers the best time to start this practice. Many people who have contacted me for guidance in establishing this practice but unfortunately allowed the necessary discipline to discourage them. Others who have implemented the practice are free of the financial stress that many are experiencing after the spending frenzy of holiday shopping.
The yearend statistics have been released showing the average spending for Christmas last year was $1,000 per family. Many charged these purchases and it will take five months to pay off the credit card. Christmas for the both of us has always been our favorite holiday celebration. From the very beginning of our marriage we started a Christmas savings so that we could fully participate in the spirit of the season debt free. Included in that savings was money to reach out to a family that was less fortunate as part of our overall tithing.
The way I set up our budget is to put all expenses into two categories: the first includes fixed expenses, house note, insurance, taxes, utilities, etc.; the second category accommodates flexible expenses i.e. entertainment, travel, monthly personal allowances, Christmas savings. This process has worked for us throughout our 51 years of marriage and has made it possible in retirement years to enjoy life on a fixed income.
For those who have charged on credit cards during the holiday season now is the time for affirmative action. This will help you pay off debt faster and prepare a 2019 Christmas savings budget. The first month of every year I review our budget and evaluate possible changes to best meet current needs and goals. If you are currently addressing Christmas expenses, the amount initially used to pay off credit card debt could, upon completion of payment of charges, become your monthly “payment” to create your 2019 Christmas budget.
For many of you this may seem to be a complicated and overwhelming challenge. Just break it down to a weekly goal and it becomes attainable. If you are in the national average category of spending for the holidays, just reduce current expenses by $20 a week and you will have a year-end Christmas budget of $1040. If you think this is an unrealistic goal just drive by and observe the long lines at the drive-up windows of Starbucks or Chic-fil-A. If everyone in those lines would change those habits just two days a week, they would create their $20-a-week savings.
If you know someone that is interested in having a debt free Christmas, you may want to share this blog posting.
“You become what you digest into your spirit.
Whatever you think about, focus on, read about, talk about,
you’re going to attract more of into your life.
Make sure they're all positive.”
― Germany Kent
Last week I wrote about the importance of having an itemized budget. I strongly believe this is beneficial to living a life of abundance.
Shortly after that posting I experienced a major mental pitfall that can happen when I must reduce the amount of money in a few of the non-essential categories to cover unexpected expenses. In these circumstances I can easily fall into speaking like I am coming from lack or the “poverty consciousness” clicks in. This is especially true when the reductions affect the monthly allocation to two of my favorite budget items, entertainment and travel.
When I start feeling sorry for myself the negative self-talk begins. “I do not have enough money to travel as much as I’d like. I can’t eat out quite as often, especially at fine dining restaurants. I have to think twice about those theatre tickets!” This type of self-talk will only attract more of “less” in my life.
I can turn this around by turning the poverty consciousness statements around to affirmations. For example, “I am grateful for road trips I have planned this year. I am blessed living in a city that offers very reasonable fine dining lunch experiences. I love supporting local theatre groups that offer great plays for half the cost of Broadway road shows.”
To help me to shift my thinking I took a second look at a book I read many years ago “Real Magic, Creating Miracles in Everyday Life” by Dr. Wayne Dyer. The following comes from Chapter 5, Real Magic and Your Prosperity:
“Take an inner inventory and see if the following statements are a part of your consciousness.
· There is not enough to go around.
· You must get yours or someone else will grab it before you.
· There are only so many fish in the sea.
· You will never know if opportunity will knock.
If these and similar thoughts are part of your personal inventory, then probably you were taught that you are living in a world of shortage. You have been raised to believe in scarcity. The following five essentials of a prosperity consciousness can help you make the shift.
1. You don’t need anything else to experience prosperity.
2. You cannot create prosperity if you believe in lack.
3. You are not separated into categories. You are at once the seer, seeing and seen.
4. You cannot experience prosperity if you believe you don’t deserve it.
5. Rejoice in the prosperity of others.”
Today I spent some quiet time reflecting on my many blessings. They are so easy to take for granted when everything is going great.
Life occasionally throws us a curve ball and poverty consciousness can slip in. That is the time you will appreciate the resources you have accumulated in your toolbox to assist you in making the shift so that you once again create a life of abundance.
“We must consult our means rather than our wishes.”
I grew up in a family that by today’s standard of living would be considered lower middle class or one step up from being poor. I experienced life with a stay-at-home mom and a blue color hard working father who did not make much money.
My mother was a great manager of their limited income. She did not have the Excel budget spread sheet that I have but I picked up a few tips on some of the categories that were important.
One of the categories was Tithing. Their tithing was basically in the form of service to family. They frequently invited them over to eat, especially a cousin with special needs whose mother and father were deceased. They also extended financial help to those less fortunate regardless of their own needs.
The second category was Saving. A small portion of their limited income was put aside for a rainy day. This seemed to be the thing that came naturally for people of that day because they had survived the depression.
Surprisingly Travel was a budget item even though it did not support luxury travel. We took a family vacation, but the cost was shared with extended family members. These vacations typically involved the rental of a camp on the water, so everyone could swim, fish and catch crabs.
Establishing an itemized budget was the first thing I did when we got married. It has remained a work in progress for fifty years. With that longevity I have evidence that it works. I have given my budget a title of “Prosperity Budget” which eliminates any connotation of limitations. It does allow me to be in control of my finances without debt.
I have offered many people guidance in living a life of abundance by having a budget. One young man that consulted with me before going to college followed my advice and established an itemized budget. He has always used this practice to create a life of abundance and establish a secure financial lifestyle and future. He told me a few months ago that he will retire in 10 years and will have accomplished his projected retirement savings.
I have been told by our grandchildren that the coffee drink they buy cost $5. When I drive by these coffee shops the lines are around the block. That tells me many people are spending at least $5 a day or averaging $100 a month on coffee. If that budgeted money were put into a mutual fund account averaging 8% interest, at the end of 30 years it would amount to a startling $143,000 in savings.
Since retirement we have personally taken two trips to Europe and several trips within the US. People have often commented on our ability to do that amount of traveling on a fixed income. I also tell them it is no great mystery. Travel is my passion and it is a budget item. We plan, save, and then enjoy our vacations!
As I stated before my parents had limited income. My father predeceased my mother. Ironically when my mother passed in 2005 we discovered envelopes taped on the back of the dresser in her bedroom with $7,000 in $100 bills. Some bills were dated 1934 which is when they sold their corner grocery store on Cadiz Street in New Orleans many years ago. When they moved from the city they purchased a small house in Jefferson Parish. Later in life they purchased a double so that my grandmother could live with them. That house I inherited is in an area that is experiencing rapid medical expansion and has grown substantially in value. They accomplished all of this with a limited income and wise management.
Most people resist the idea of budgets. I have heard feedback that it is too complicated…to many categories to post on a spread sheet and keep track of every month. For me it is a habit I incorporated many years ago and it allows me to live a life of abundance debt free. I have the things most important to my wife and me incorporated in our budget: tithing, household necessities, travel, rainy day fund, Christmas savings, entertainment and a few more incidentals.
The easiest way to establish a prosperity budget is to make a list of all fixed expenses like House Note, Insurance Premiums, Car Expenses, Medical, Tithing and Savings. On another page make a list of flexible expenses like travel, entertainment and gifts. These two lists should equal the income sourcing for the budget.
If I can offer any additional help in getting you started on using this practice just send me an email at firstname.lastname@example.org.
In future postings I will discuss how establishing buckets of income streams have worked for me living on a fixed retirement income. Having a budget made this happen for us along with the guidance of great professionals.
The End is near
People in the Hall of Fame tend to clap their hands and say, 'OK, I've done it all,' but for me, it was a new beginning.”
This year has been exceptional because we had so many things to look forward to with the celebration of our 50th Anniversary. Many of these once-in-a- lifetime happenings were made possible by my practicing what I teach to others. That is why I love the week between Christmas and New Year’s Eve. It is a time to reflect on those tools that have worked best and to consider new tools I want to have available for the New Year.
Two of the major things we experienced this year were posted on our Dream Board: a family beach vacation and a 21-day European River Cruise.
When I set up our Prosperity Budget each year I list on the spreadsheet the fixed and flexible expenses and buckets of income to source those expenses. Knowing exactly what it takes to live comfortably and debt free allows me to enjoy life to the fullest.
Being on a fixed income in retirement doesn’t offer many possibilities for new income sourcing. That is the reason I have trusted professional consultants to maximize on tax savings and financial planning. It is not always a question of how much money you make but how to maximize the savings by reducing taxes and increasing the rate of return on investments. This year I had posted on our Dream Board the % of return on investments and tax savings I projected using this strategy and it surpassed my projection.
To end the year you may want participate in an event that I have previously shared from my tool box, the Balloon Release. Write down all things you want to release that have not worked in helping you to live a life of abundance. Tape that list to one balloon. On the other balloon for 2018 attach the list of all things you want to bring into your life for the New Year.
I look forward to hearing from you on ideas that you have used with success previously or the new ones you plan on implementing in this New Year.
Happy New Year
Continue Knocking on Doors
"So I say to you, ask, and it will be given to you; seek, and you will find; knock, and it will be opened to you. For everyone who asks, receives; and he who seeks, finds; and to him who knocks, it will be opened.”
At the age of 14, I received training for my first job in sales for which my salary was “commission only.” The lesson I learned at that young age has helped me throughout life in all endeavors I pursue.
The sales manager dropped us off in a subdivision to go door to door to sell subscriptions to the daily newspaper. Each day he would remind us that our volume of sales would increase if we would not pass up ANY house. The odds would be in our favor by not missing a potential opportunity IF we would knock on every door. I took his advice very seriously and by the end of the first week I had achieved the largest volume of sales in our group.
Sixty years later I am still knocking on doors attempting to convince others of the advantages of living life with a positive attitude. There is no commission but I am sustained by my belief that I can assist you in living a life of abundance.
I realize my personal drive for success still motivates me to want to experience that daily. The reality is that life sometimes throws us a curve ball. When I am using tools from my toolbox and they do not seem to be working self-doubt creeps in. I question my ability to sell something to others that doesn’t seem to work for me. It is during these times I have to remind myself that I cannot pass up any doors until I get a “yes.” I cannot allow even a trace of self-doubt to distract me from steadily striving to achieve my goals in life.
The disciplines I have previously discussed such as journaling, creating a dream board, having a success budget, writing affirmations and setting goals can certainly be helpful. However it is critical that a backup plan be in place when things seem to be stalled and not moving forward. I have a SUCCESS folder in which I keep every comment I have received from my postings and all notes on the goals I have achieved. This folder is readily available for my resuscitation on days that nothing positive seems to be happening. Time and again it infuses me with renewed enthusiasm as I am reminded of so many great things I have achieved.
My initial motivation to create my Positive Pops blog was to tell my story to our family, especially our grandchildren. When others started reading it and commenting, my success drive kicked into high gear. I posted a note that one day 1,000 people would view my blog.
Last week my posting was on our marriage of 49 years. Honestly I did not expect this topic would generate as much interest as some of the others. Once again I was reminded that I need to keep knocking and not allow self-doubt to control my potential for success. I just checked to see the number of people who viewed this posting as of today; it is 4724. I also want to thank the large number of readers who commented and shared their personal stories.
This week you may want to make a list of doors on which you plan to knock to achieve the life of your dreams. You may also want to implement one of the disciplines from my toolbox to initiate your forward movement. Do not allow self-doubt to distract or stop you. Remember it takes 90 days for a new discipline to become a way of life.
In New Orleans we just concluded two weeks of parades and partying. Today, the first day of Lent, is welcomed with open arms. Those of us who are retired would burn out if we didn’t get this time of physical and spiritual renewal.
In my childhood years and much of my adult life, my tradition of lent always centered on the practice of giving up something. In recent years I have changed this tradition and now focus on “doing something” that will make a difference in my life and the lives of others. Regardless of whether or not you follow the tradition of Lent I would like you to consider initiating a new practice or discipline in your life for the next 40 days.
Today the one thing I would recommend you consider is creating a Prosperity Budget. In our 49 years of marriage we have always lived with a budget. This exercise may make you feel uncomfortable because for some facing the reality of how money is being spent can be a difficult task. The major categories we use have remained the same. Begin by writing down how much of your income goes into each of the following four categories:
The only variable has been the income stream to finance the budget. Since retirement that income stream has changed but living with this budget for years has allowed us to live a life of abundance without debt.
From my experience living with this discipline of a budget is worth the effort. It has offered Jeanne and me the opportunity to live the kind of life that’s important to us by affording us world travel, many wonderful opportunities to celebrate life with family and friends, and the means to be generous in responding to the needs of others.
A follow-up blog posting will offer ideas on reducing taxes and acquiring the discipline of saving more for retirement.
Since today is the first day of Lent it offers us all a great opportunity to initiate something positive and different in our lives.