Tuesday, August 31, 2010

Walking with Integrity

This past weekend, my husband helped a neighbor pick up a moving truck to get their belongings to their new house. The "For Sale" metal sign was still swinging in the front yard. Our neighbor had hoped to find a buyer before moving instead of resorting to becoming a landlord, an unappetizing option to him and his wife.

"My friends told me to just stop making payments on the house," he confided. But this neighbor would not. It seemed dishonest to him. And it is.

In the last 3 years, it has become increasingly more common to walk away from debt. What used to carry with it a social stigma is becoming more accepted , and in some areas, in vogue as a "sophisticated" option. This greedy practice has unfortunately made its way into LDS households. I am saddened whenever we, as a people, become one less way different than the world.

“The ideal of integrity will never go out of style. It applies to all we do. As leaders and members of the Church, we should be the epitome of integrity.”

(N. Eldon Tanner, in Conference Report, Oct. 1979, 121; or Ensign, Nov. 1979, 82).

We all desire to be free from debt, but some of us are doing it at the cost of integrity. True freedom from debt involves developing the habits and character necessary to become powerful over its bondage, not sneaking away from it.

"'Everybody’s doing it' is often given as an excuse. No society can be healthy without honesty, trust, and self-restraint.
"He is dishonest who buys more than he can reasonably expect to pay for. This is defrauding. He has little honor who fails to pay his honest debts. It would seem to me that every luxury one enjoys at the expense of a creditor is not wholly honest. … It is not always dishonorable to be in debt, but certainly it is to ignore debts.
"The theft of pennies or dollars or commodities may impoverish little the one from whom the goods are taken, but it is a shrivelling, dwarfing process to the one who steals."

“Chapter 12: Integrity,” Teachings of Presidents of the Church: Spencer W. Kimball, (2006), 124–34 (my emphasis added)

Instead of walking away from responsibility, let us walk with integrity. Shunning our responsibilities to debtors makes a mockery of the repentance process. Even if we find ourselves in debt due to irresponsibility, there are proper ways to get out, but as is always the way of repentance, prayer, sacrifice, and restitution are required. Do not attempt to correct sin with sin.

Let us be more diligent in avoiding the self-justification that is creeping into our flock. Let us be honest in our dealings that our conscience may be clear and our characters strengthened. May we be examples of righteous living in public and in private.

Friday, August 27, 2010

Frugal Friday: Oatmeal Variety

A typical weekday breakfast at our house is oatmeal. I boil oats, and add cinnamon, diced apples, and raisins. Other times, I add cinnamon and diced peaches. OR I add cinnamon and whatever berry I have. (Yes, always cinnamon. It's good for your blood vessels: lowers cholesterol and blood sugar!)

Oatmeal is so much cheaper than boxed cereals and so much better for you. It helps maintain or lower cholesterol, avoid blood sugar spikes that trigger insulin reactions and encourage storage in fat cells, and keeps your belly feeling satisfied longer. (Wait-- didn't I just say something similar about cinnamon?)

When we had our three foster children, I heard complaints when I introduced this unsugared breakfast option to their diets. The following is how I got them happily eating oatmeal and gradually adjusted them to the non-sweetened version. (This works with adults, too!)

(This bowl is of sweetened oatmeal alone.)

Never waste your money on serving the instant flavored oatmeal as is. It is never filling alone and usually people will make TWO envelopes of the stuff to experience a momentary satiety. But it's flavored with so much sugar and artificial stuff! How to minimize the damage?

  • Boil water enough for 2 servings of regular oats PLUS whatever the instant oatmeal requires.
  • While the water is boiling, pour one packet of instant oatmeal into a bowl and wash or cut whatever fruit you want to add.
  • When the water has come to a boil, pour some of the water onto the instant oats, and put the saucepan back on the burner.
  • Add the dry oats required to prepare 2 servings.
  • Lower the heat to medium and cook for 5 minutes.
  • During cooking, add cinnamon (I just shake it in, but it's usually about 1/2 teaspoon). If you add your fruit now it will be soft. You might want that if using apples, may not want that if your berries are already soft. Then, you would add them when cooking is over.
  • When the 5 minutes have passed, remove sauce pan from heat, dump in the fruit if you have not already, and dump in the instant oatmeal that has been sitting in a bowl.
  • Mix well.
Now, you have a sweeter oatmeal to get your picky eaters accustomed to oatmeal. Eventually, you will be able to spread out the one envelope of the "fake stuff" thinner and thinner and go to plain oatmeal with fruit and cinnamon.

I started out this experiment using one packet of sweetened oatmeal to 1 serving of regular oats, and then graduated to one packet per 3 servings. I typically use the 1per3 ratio when I become bored to tears to do another apple/raisin breakfast and I have only a mediocre fruit on hand (like strawberries that aren't properly ripened).

(This bowl is of regular oats mixed with cinnamon, sweetened oatmeal, and chunks of fruit.)

"It's just me, why would I make 3 servings of oatmeal?"

Oatmeal keeps well for several days. I make a big batch, eat some, serve some to my toddler, then store the rest. The next morning, I put a serving into a bowl, break it up a little, microwave it, and then mix it up. It tastes just as good and sometimes even better because the fruit and cinnamon flavors have marinated into the oats.

This is a simple way to save money on breakfast AND feel fuller than on a bowl of cereal or a bagel on the run AND help maintain healthy blood cholesterol levels AND be better sustained with energy through the morning!

Wednesday, August 25, 2010

Where to Find Money

"And where will I get this 'saved' money?"
-Steve Martin, Saturday Night Live skit "You Shouldn't Buy Stuff if You Don't Have Any Money"

Have you started adding to your emergency savings fund? You can save it in any old savings account at your bank. I keep mine at INGdirect.com, but it doesn't matter where you keep your money or what savings rate you get. Just start your fund!

Here are some places where you will find money to get your $1,000 beginning Emergency Fund. ($500 if your income is $20,000 or less)

Tip One: Adjust the budget

If you had any leftover money in your new budget plan, it goes directly into your new emergency savings. Look over your budget again. What can you reduce in your budget to free up money for your savings account?

Here is a list of suggestions to get you thinking:
  • Can you reduce your cell phone plan? Your cable plan? Your internet plan?
  • Will you cut your land line?
  • Can you get equal payments set up on your utilities? What would the payments be? Is this a good time to set it up, or should you wait until winter?
  • Can you (or your spouse or children) car pool to work or activities?
  • How much in treats will you cut down in your grocery shopping?
  • Will cut down or cut out eating out and drive-thru's? Will you take a packed lunch to work?
How much did you free up? If married, remember to take the new plan to your spouse.

Tip Two: Sell stuff

Almost everyone I know has thousands and thousands of dollars hidden in their house via the stuff they have. Money is all around us.

"Not enough to get my $1000 (or $500) within 3 months!"

Faith, my dear, faith. You will be surprised how $5 here and $20 there quickly add up to $500 and beyond! Especially in this country, abundance is everywhere!

Here are some ideas to get you thinking about what you can sell:
  • clothes, shoes, jewelry
  • CDs, cassettes, DVDs, computer parts, electronics
  • extra vehicles, timeshares, art, extra dinnerware sets
  • costumes, Christmas accessories, handcrafts, baby stuff, kids toys, pets and their accessories (oh, yes, I did go there!)
  • extra furniture, knick-knacks, gifts you received that don't fit your lifestyle, items from old hobbies, tools, unopened skin care
  • books, textbooks, baby gear no longer needed
  • etc. etc. etc. Girl, you know what you've got!
Here are some places you can sell your things:
  • KSL (local online classifieds), Craigslist, eBay, yard sale, half.com, amazon.com, Facebook

Tip 3: Generate extra income

If you (or your spouse) already have a full time job, ask for overtime. Or get a part-time job.
If you are at home with small children, create your own part-time job.

Remember, this isn't a permanent situation. It's just to fund your emergency savings and free yourself from debt. So, make sure ALL money coming from the new source are going to those specific purposes. This will keep a temporary situation from becoming permanent. If you keep skimming off the new money to do fun stuff, you will be working extra longer than you need to.
  • newspaper delivery, pizza delivery, UPS
  • restaurant server
  • babysitting, dog walking
  • dinner preparing
  • lawnmowing, housekeeping
  • participate in research interviews
What else can you come up with? If you keep your eyes and ears peeled, you will recognize money is everywhere!

Tip 4: Direct surprise money

Apply job raises, unexpected money, and tax refunds to your new savings account. If you are using the cash system, make it a goal to have leftover money in your envelopes and apply what's left at the end of the month to the savings account.

Tip 5: Start a tip jar

Set out a change jar where you put all money found in the car, in furniture cushions, in pockets emptied out during laundry time. Deposit the contents of this jar into the bank.

I've briefly touched on the different places you can find the money for your beginning Emergency Fund. I'm sure you will find other places I have never thought of. I once read about a family who set a challenge for themselves to find an extra $1,000 in one month. A big chunk of their money came from finding aluminum cans and collecting the change for turning them in for recycling in their area! Be creative!

"What if it takes me longer than 3 months?"
Will you feel a little safer 6 months from now if you have $1000 in an emergency savings account? I think you may.

Get started! You will finish sooner the sooner you start.

Monday, August 23, 2010

Start an Emergency Fund

"Gradually build a financial reserve, and use it for emergencies only.
If you save a little money regularly,
you will be surprised how much accumulates over time."

(All is Safely Gathered in: Family Finances booklet)

What was the last unexpected expense you had? Was it big? Was it little? Did it stress you out? Or did it roll off your back?

We women can become so anxious to pay off debt that we often jump the gun and start throwing all extra money to creditors. But what happens when there is an unexpected emergency? The car breaks down? The kids get sick and need to see the doctor? One of the kids jumps on the trampoline and accidentally embeds his teeth into his knee cap making his gums swell faster than Violet Beauregarde? (Told you not to jump on the trampoline during General Conference, little brother.)

When an unexpected expense comes up, some people resort to credit cards. And if this happens when you are in the middle of paying down debt, it is disheartening. Wheels are spinning, but you aren't getting anywhere.

But what if you had a financial reserve stashed somewhere for emergencies? The kids get sick, and you've got the money for the doctor visit. Debt avoided! The car tire blows, and you've got money for a new tire. Debt avoided!

An emergency fund is the second most important step in creating a financially peaceful future. It is your armor against accruing new debt which makes it easier to pay off debt. How's that for peace?

President Gordon B. Hinckley taught: “Set your houses in order. If you have paid your debts, if you have a reserve, even though it be small, then should storms howl about your head, you will have shelter for your wives and children and peace in your hearts.” ("To the Boys and to the Men," Ensign, Nov. 1998, 54)

How much you should you put aside? We're going to start a beginner emergency fund of $1000. If you make $20K or less, aim for $500. After you accrue your beginner emergency fund, you will then (and only then) throw your extra money toward debt pay off. Until then, you will be paying the minimum payments. Remember when I mentioned that in the budgeting series?

"Yes, and I still think you're crazy."

Well, yes, but that's neither here nor there.

"How the heck do I come across $1000??"
I'll tell you on Wednesday.

"Why so much toward savings?"
To cover for most of the little bumps that come along. So, you will not put the unexpected on loans or on credit and end up paying the price plus interest. Who the heck wants to pay $68 for a $60 tire? That's what putting it on credit is like.

"Why so little?"
I want you to create a little padding between you and the unexpected but not have you spend so much time on this step that you never get to the accelerated debt-reduction step.

"I had $1,000 saved up, I was paying off debt, and then my lawnmower sent a rock flying through my living room window*. It cost $250 to replace it! What now??"
HOORAY! Isn't it nice to not have the stress of a broken window plus the stress of how to pay for it? Isn't it great that you didn't have to put it on a credit card? HOORAY again! Go back to paying minimum payments on your debts and throw any monthly extra money into your savings account until it again hits the $1,000-mark. Once you get there, go back to throwing your extra money toward your smallest debt. (*"Car windshield" was changed to "living room window" to protect my husband's identity.)

"I already have $1,000 in savings."
Awesome! Then, you can commence with your debt paydown! (At this point, when I mention debt, I am referring to debt NOT including the mortgage.)

"I have more than $1,000 in an emergency savings."
If you have debt, take the excess over $1,000 and use it to pay off your smallest debt.

If you have no debt, go ahead and keep growing your emergency savings until you have the equivalent of 3-6 months' of expenses.

L. Tom Perry suggested, "One of the better ways to simplify our lives is to follow the counsel we have so often received to live within our income, stay out of debt, and save for a rainy day." (“Let Him Do It with Simplicity,” Liahona, Nov 2008, 7–10)

Your mission, should you choose to accept it, is to have your beginning savings completed in 1-3 months.

"WHAT?? $1,000 (or $500) is a LOT of money!"

Yes, it is.

See you Wednesday!

Friday, August 20, 2010

Frugal Friday: High-Speed Discount

Internet is not a necessity, but it sure feels like it! Paying bills, contacting friends, sending documents, placing orders... it is so great to be able to do it from home and fast.

I hate paying for internet though. Every year, when I total expenses for taxes, I always cringe when I see we pay nearly a thousand dollars a year for internet connection. Where I live there aren't many options for internet provider, so I can either go with the local phone company (which I'd like to avoid as much as possible after experiencing terrible customer service with them for years prior) or with the big guy hi-speed internet provider. This month, I noticed my bill went up by $7 from the amount I was already considering a reason to switch providers.

I called our provider and simply asked this: "I noticed my bill went up from last month. What other alternatives do you have for me?"

Immediately, the customer representative told me he would move me up to the next highest speed for only $30/month for the next 6 months. I verified this was not a contract. All I needed to do was unplug my modem and then reconnect it.

There ya have it. Asking nicely saved me $35 a month for the next six months.
I thanked him, hung up, and made a note on my Google Calendar to remind me to call the company again within 6 months to downgrade the speed or to ask for another good deal.

When it comes to getting a better deal on your internet connection, there's no need to be angry or to fake threats about canceling. Find out the deals of competing providers. Then, call your own provider and ask them what alternatives they have. If they can't deliver, politely tell them because they cannot find a package that fits your budget, that you will be canceling your subscription and moving your internet to XYZ.

Competition makes the global market turn. You have a say in it.

Wednesday, August 18, 2010

The Easiest Way to Stay Within Budget

Every so often, someone asks me how we stay within budget. My answer is always the same.


Whatever I can put on automatic payment, I do: mortgage, utilities, insurance. But when it comes to haircuts and groceries: cash. Sticking within your allotment is not a complicated thing, but you have to be willing to try something different than what you have been doing.

With cash, there is no end-of-month marathon to reconcile checkbook and bank account. I used to spend a couple hours at the end of the month going through the bank statement to add up everything that fell under "groceries" or under "gasoline" to see if we stayed within budget. Now, at the BEGINNING of the month, I pull out cash from the bank, mark it on our budget, and divvy up he bills among categorized envelopes.

See? At the end of the month, I don't have to do anything with the online bank statement except make sure the automatic payments went through and that there are no unauthorized charges. This takes about 10 minutes to do.

When it comes to using cash, the hardest thing is to get people past their excuses for NOT using it.

"I'm afraid I will lose the money!"
I'm a girl who constantly loses her keys and wallet. Ask my husband. I'm on my third set of house and car keys, and I've replaced my driver's license twice. I've been using the cash system for a few years and have lost my cash exactly zero times. How is that possible? Simply, I do not carry the cash with me at all times! Most of the time, the money is sitting at home in a drawer. I carry it with me only when I am going to the store or the hair salon and then I bring it back home.

I don't go jogging with it. I don't take it to the gym. I don't take it to church. I don't take it to the park. The reason why people lose their sunglasses/keys/ID is because they tend to carry these things everywhere.

"I get rewards from my credit card."
Not as many as your credit card gets from you. There have been studies done demonstrating that consumers spend 12-18% more when paying with plastic than with cash. I have also come to similar conclusion from my personal experience. Even with the debit card, I found myself many times at the end of the month exclaiming, "Oh my gosh! I can't believe how much I spent on groceries!"

People with this excuse to not use cash think they have found a financially sophisticated way to beat the system. Trust me, the credit card companies are not dumb enough to give away more money than they get you to spend.

"Yeah, but we keep track of our debit/credit purchases on paper, so we know how much we're spending."
With plastic, even if you are tracking your purchases, you are less likely to put something back once you're at the register if your total goes over your allotment. Likely, you will just say, "Oh well, it's only $XX more."

I came across this excerpt from an old "Ensign" article. Notice that this is before the common usage of debit cards. One might think that checks are an even safer form of payment as it usually involves keeping pretty close tabs on your running balance via the checkbook register.
"One solution: Use checks only to pay bills that you send through the mail. For all other purchases, use cash. Or don’t use a checking account at all; pay bills with cashier’s checks or money orders. This is the norm in many countries. In Japan, for instance, personal checks are rare. Perhaps this is one reason the Japanese have one of the lowest levels of consumer debt and one of the highest levels of personal savings in the world. Using cash prevents bounced checks and service charges. It also keeps you from spending more than you have." (Jack M. Lyon, “‘How Many Loaves Have Ye?’,” Ensign, Dec 1989, 36; emphasis added.)

"It's too complicated."
Not so much. Try it. Use cash. When you run out, don't buy any more.

Once in a while, I hear someone say that they have used the cash system in the past, but it didn't work for them. What I usually discover in talking with them is they jumped right into carrying a dozen envelopes to pay for every possible category. I recommend starting out on the cash system with ONE envelope. I suggest that one envelope be the "Groceries" category since it's the category in which most people easily overspend. Use cash for just that. Do it for three months. You will be surprised how much money you save each month! I usually end up with money left over, and obviously, I never go over the budget for that category.

If you are one of those rare persons who tracks what they spend AND puts stuff back at the checkout when they hit their budget allotment AND never carries a balance on their card, stick with what is working. But consider the cash system. When you visually see money leaving your hand, you may find you actually spend a lot less than you used to and end up creating your own cash-back reward.

Monday, August 16, 2010

Her Price is Far Above Rubies

Whew! What a week! I felt a little lot overwhelmed about the lesson I was preparing to teach yesterday for Gospel Doctrine. But now, I can relax. Until two weeks from now, that is.

In my studies, I came across this little jewel that describes additional virtues of womanhood. I regularly hear women who feel, oh, so unqualified to strengthen their financial muscles. I suppose it's much like how I felt so unqualified to teach a lesson on wisdom yesterday. (Me, the woman who often partakes in a lunch of foot sandwich.) However, feeling unqualified does not mean we do not have the capacity to learn to do a difficult thing.

Dress yourself in this passage from Proverbs 31. Wear it, allow it to mold to you, and twirl in it if you'd like!


10 ¶ Who can find a virtuous woman? for her price is far above rubies.
11 The heart of her husband doth safely trust in her, so that he shall have no need of spoil.
12 She will do him good and not evil all the days of her life.
13 She seeketh wool, and flax, and worketh willingly with her hands.
14 She is like the merchants’ ships; she bringeth her food from afar.
15 She ariseth also while it is yet night, and giveth meat to her household, and a portion to her maidens.
16 She considereth a field, and buyeth it: with the fruit of her hands she planteth a vineyard.
17 She girdeth her loins with strength, and strengtheneth her arms.
18 She perceiveth that her merchandise is good: her candle goeth not out by night.
19 She layeth her hands to the spindle, and her hands hold the distaff.
20 She stretcheth out her hand to the poor; yea, she reacheth forth her hands to the needy.
21 She is not afraid of the snow for her household: for all her household are clothed with scarlet.
22 She maketh herself coverings of tapestry; her clothing is silk and purple.
23 Her husband is known in the gates, when he sitteth among the elders of the land.
24 She maketh fine linen, and selleth it; and delivereth girdles unto the merchant.
25 Strength and honour are her clothing; and she shall rejoice in time to come.
26 She openeth her mouth with wisdom; and in her tongue is the law of kindness.
27 She looketh well to the ways of her household, and eateth not the bread of idleness.
28 Her children arise up, and call her blessed; her husband also, and he praiseth her.
29 Many daughters have done virtuously, but thou excellest them all.
30 Favour is deceitful, and beauty is vain: but a woman that feareth the Lord, she shall be praised.
31 Give her of the fruit of her hands; and let her own works praise her in the gates.

Tuesday, August 10, 2010

Create a Budget: Step 9 -- LAST ONE!

The first step to financial health is to create a budget. Here are some mini-bites to begin creating a budget that works and you can live with.

9. Screw Up!

Ever heard anyone say, "We were on a budget and then __(insert surprise and expensive event)__ throwing it all off!"

Yeah, that's called real life. In the next three months, your budget will learn to flex with it. I expect you (and/or your spouse) to screw up the plan here and there. I tell you this so you won't be disheartened when it happens. This is normal. When you screw up, it means that you are at least working the budget concept.

When you hit a glitch, THIS IS GREAT! You are testing it out and trying something new. Like an infant, you get up to get to a toy and trip and maybe cry. Will you stay on your bum crying and promise to never allow yourself to fail again?


You will keep working it until your little budget legs get stronger and you develop confidence in your balance. (ha ha)

For he will give unto the faithful line upon line, precept upon precept; and I will try you and prove you herewith.

Doctrine & Covenants 98:12

Your budget will fail for about 3 months as you adjust for behavior. Surprises will still come up, and you will find that you spend a lot more in groceries than you anticipated. But have hope; three months is enough time to learn some tips and tricks I learned along the way. For now, just get up and walk!

This is the end of the basic "Create a Budget" series. In the coming weeks, I will post tips to help you see money in a different light and make the budget adjustment hurt a little less.

Monday, August 9, 2010

Create a Budget: Step 8

The first step to financial health is to create a budget. Here are some mini-bites to begin creating a budget that works and you can live with.

8. Take It to the Spouse
This whole time, you've been doing this budget on your own. If you are married, this is now where you call a budget meeting.

Dum, dum, DUMMMMM!

Perhaps that's the soundtrack of your past money discussions with your honey. I'm hoping to make them more Hallelujah!

Orson Scott Card wrote in “Family Finances” (Ensign, Jun 1978, 13):
"Couples who handled their finances successfully seemed to have several things in common: communication between spouses, reasonable expectations, willingness to budget, and rejection of debt."

"'I had never been involved with the finances,' one woman said. 'My husband made all the decisions, and I never knew what was going on. So imagine my surprise when all of a sudden I found out we were on the verge of bankruptcy!'

"In this case, the husband had simply believed that men were supposed to handle the money. He wasn’t very good at it, though, and his wife was! So they decided that she would balance the books; they began discussing every purchase, every payment, and deciding together—and with their combined wisdom and mutual self-restraint they were able to avoid bankruptcy after all.
Card continues:
"Talking things over between husband and wife is not a guarantee that nothing bad will ever happen financially. But it is a guarantee that one spouse or the other won’t be shocked when something goes wrong, won’t be resentful when belt-tightening is needed, won’t fritter away the family’s financial resources. And when both spouses have agreed on the way the money should be spent, there can be few quarrels over what 'you' did with the money."

In our family, I am naturally the one who enjoys dealing with money math. However, David and I still gather together to review our budget and discuss whether we want our money to take a different direction. As good as I am with money, David always has something insightful to say and helps guide our family's direction. I am so grateful that he is my partner in so many ways! However, it wasn't always like this...

We didn't have a successful budget for the first few years of our lives together because we kept disagreeing

yelling at each other about how to set up a budget, what to do with it, and who should do it.

Today, many moons later, we get together for 15 minutes once or twice a month to review the budget and discuss new business. Occasionally, we go longer because we're sharing dreams with each other or brainstorming new solutions.

"(W)hen a husband and wife work together to manage their finances, they become unified in an important effort to set their home in order. They also prevent difficult challenges. Some of the most serious problems in marriage arise when financial resources are not managed carefully and in the best interest of the family.
(“Lesson 8: Managing Family Finances,” Marriage and Family Relations Instructor’s Manual, 35)

Here is your homework! In this step, you are to ONLY review the spending plan with your spouse, not to argue about bills and whose fault it is and who is not making enough money and what size box you'll need to live on the street or whatever.

Tell your spouse you would like 15 minutes of his time to look at a revised plan. If you'd like, make some cookies or set chips and salsa at the table to meet. (It's a date!)

His job is to look at each line item and make sure you haven't left anything out. And tell him he MUST change at least one item.

"WHAA???? I've put in all this hard work and gone through each step meticulously and now he's going to change it and mess it up????"

Listen, honey.
1) This will get him to look at the entire budget.
2) You want a budget you can both live with. If he doesn't like it and goes behind your back to buy something off the radar, what good does your budget do in creating traction for you?
3) He can change it, but the total must not change the bottom line, which is zero. That means if he adds money to one category, he has to figure out what other category will be reduced until the budget zeroes out.

Turn off the TV. Put the kids to bed. Set the treats out. Start your budget date with a prayer. It doesn't hurt to invite the spirit of God to keep things calm and clear!

Start out by telling your honey how much you love and appreciate him and tell him how much you love that he loves you and appreciates you. Then, slide your revised spending plan over to him. Don't explain it to him, just give it to him. Ask him to look it over.

If he immediately says, "Looks fine," restate that you would like to have him look at each line and change at least one thing in the plan.

If he says, it looks great and he wouldn't change a thing, don't chicken out. Insist that he change something -- anything-- as long as the balance is still zero. When he finally gets the courage to change a thing or two (and yes, it does take your sweetheart courage to do so), DO NOT FREAK OUT. You may disagree with it, but you already got most of your way when you wrote the budget. So, when he makes his changes, smile and say, "Thank you for working out a budget with me. You don't know how much this means to me. I can't wait to see how this works out this month!"

Sometimes, I hear a woman complain that she would like her husband to participate in the budget more, but when the poor guy pipes in with his opinion, the wife tromps all over him and his "irresponsible" suggestions. If you want your husband to participate more, you've got to make these budget meetings SWEET and SHORT in nature. You must.

And then you're finished. Agree to this budget, kiss, and promise that if something comes up during the month, you will meet at the table again with this print-out and move numbers around to accommodate the surprise until the budget again totals zero.

Put the print-out somewhere where you can both access it regularly, and finish the cookies and chips before the kids figure out you're having a party.
Work together to manage your finances. Cooperate in establishing and following a budget. Discipline yourselves in your spending, and avoid the bondage of debt. Wise money management and freedom from debt contribute to peace in the home.

True to the Faith, [2004],97–101)

This step takes 15-45 minutes, depending on whether you are baking cookies.

Friday, August 6, 2010

Frugal Friday: Organizing Coupons

How many times have you clipped or printed a coupon thinking with the intention to use it only to find that when you got around to it, it had expired the month prior, or even more gut-wrenching, the day prior?

Yeah. Never happened to me either. This week.

If you want an easier way to find the coupons you need when you need them, here's an idea!

Take a sheet protector and a sewing machine, and do this:

It's as easy as deciding how you want your sheets sectioned off, marking the lines with a pen and ruler, and sewing over the marks.

To do the "three-section" page, I:
~ mark the lines
~ sew along the top of the sheet to close off the opening
~ sew two over the horizontal marks I made earlier, STOPPING at about a quarter inch from the right side of the sheet
~ cut a thin strip off the right side to create openings for the new sections

To do the "four-section" page, I:
~ mark the lines
~ cut the pocket holes for the bottom sections in only one layer of the sheet protector
~ sew over the lines

Use these to organize your coupons by aisles, expiration dates, or categories. Then, put them in a binder with your grocery mailers, and you'll be ready to plan your shopping trips!

Thursday, August 5, 2010

And life goes on...

The last two steps to 'creating a budget' will be posted this coming week, so that I may actually continue attending to my children today!

Tuesday, August 3, 2010

Create a Budget: Step 7b

The first step to financial health is to create a budget. Here are some mini-bites to begin creating a budget that works and you can live with.

There's money left in your budget after subtracting The Essentials, Debt Minimum Payments, and The Extras. I'm addressing this here because we cannot move forward until every dollar in the budget has a name. Can't have money "just floating around" there or it will "just float" on out of there.

You will allocate the leftover based on this:

1) "We have debt."
The extra will go to an emergency savings account until the balance is $1,000. (If your income is $20,000 or less, save until the balance is $500.)

2) "We have debt and already have $1,000 in savings."
The leftover will go toward your smallest debt.

3) "We have no debt."
The extra will go to an emergency savings account until the balance is $1,000. (If your income is $20,000 or less, save until the balance is $500.)

4) "We have no debt and already have $1,000 in savings."
The extra will go to an emergency savings account until the balance is equal to 3-6 months of expenses.

Have money leftover and your scenario is not listed above? Leave the question in the comments section.

Monday, August 2, 2010

Create a Budget: Steps 6 & 7

The first step to financial health is to create a budget. Here are some mini-bites to begin creating a budget that works and you can live with.

6. Add the Negatives
Your basic living expenses have been taking care of. HOORAY! I hope you really took the time to delight in your blessings.

The second priority after basic living expenses are the debts you owe.

I usually hear groans at this point. We sometimes see our debts as these uninvited mosquitoes, forgetting that we at some point thought they were good ideas or would bring enjoyment. It is no fun paying for something we consumed long ago.

Discussing steps to financial freedom, Elder B Wirthlin had this to say about debts:
"(H)onor your financial obligations. From time to time, we hear stories of greed and selfishness that strike us with great sorrow. We hear of fraud, defaulting on loan commitments, financial deceptions, and bankruptcies."

"We are a people of integrity. We believe in honoring our debts and being honest in our dealings with our fellow men."

(Joseph B. Wirthlin, “Earthly Debts, Heavenly Debts,” Liahona, May 2004, 40–43)

President Joseph F. Smith added:
“In the time of prosperity … get out of debt. … If you desire to prosper, and to be … a free people, first meet your obligations to God, and then … to your fellowmen.” (Gospel Doctrine, 5th ed., Salt Lake City: Deseret Book Co., 1939, pp. 259–60.)

I just realized I forgot to address debt when you were listing your categories and their amounts. So, right now, make sure that the amount listed next to each of your debtors is the minimum payment.

"Minimum payment? But --"

Yes, minimum payment. List only the minimum payments, NOT what you have been paying. For brevity's sake, I won't go into the logic at this point. Don't worry. I will cover debt reduction in future posts.

Go through them all: car loans, student loans, payday loans, family loans, credit card balances, medical debts, IRS debt, wherever you owe money. Minimum payments.

Now, how much money do you have left per month after essentials and debts?

This step takes 1-10 minutes depending on how many debts you have and whether you need to look up what the minimum payments are.

7. Zeroing Out

How much money is left in your monthly income after accounting for essentials and debts? If none, I will cover how to account for this in a later post. If some, let's move forward.

The prophets have counseled for decades to spend no more than we earn.

"There may never be a more favorable time than now for most people to get their financial house in order so far as debt is concerned. Yes, let us live within our income. Let us pay as we go. Let us 'pay thy debt, and live!'" (Ezra Taft Benson, “Pay Thy Debt, and Live,” Ensign, Jun 1987, 3)

Third on the list of things to address in your budget is pretty much everything else, "The Extras": luxuries, cable, internet, kids' activities, clubs, services, pets, etc.

THIS IS THE HAAAARD PART because the world advertises to create the lifestyle we want at all costs, even if means putting it on "the convenience" of credit so we can PRETEND to afford the lifestyle we live. Some of us have become adjusted to our current lifestyles, so cutting back to what we can actually afford will feel dreary. But dreariness is that the lifestyle never was ours to begin with. Not that it won't ever be ours, but we desired it and falsified it before the time was right to own it. We were pretending. Now, we have arrived at a crossroad at which we can choose again to live in honesty.

Using an Excel sheet will make this section technically easier, but not necessarily emotionally easier.

Here's the goal: You want to end up with zero.

"WHAT??! And have nothing left???"


Remember, you are already taken care of. You have your essentials covered, you have your debts covered, and you are getting started on an emergency savings account (even if it's as little as $2 a week at this time). With all this in mind, zero is not scary. Create a lifestyle within your means.

"Zero" merely means that every single dollar of your income is accounted for at the beginning of the month, not at the end of the month when you are scrambling through receipts.

1) Start with your income.
2) Subtract "The Essentials".
3) Subtract the debt minimum payments.
4) Subtract "The Extras".
5) The total should be zero.

Here is where the BUTs usually come out.
"But what about my cell phone!"
"But what about TV!"
"But what about date nights!"
"But what about internet access!"
"But what about my kids' karate/ballet/swimming/piano lessons!"
But! But! But!

I'm not saying these MUST be cut out; I'm merely pointing out they are not as important as we make them out to be. Don't let your BUT get in the way of financial peace! We have become so accustomed to certain services and possessions as a regular part of life, that we don't realize they are still luxuries. They are not essential to life or to providing for our families. I know this because there are people all over the world who have not ever had cable, or Netflix, or landscapers, or ballet and they are still breathing, eating, and living.

"But what about paying off my debts!"

You will pay off your debts, but first we must put a system in place to avoid future debt. We're getting there, girl!

"What if my balance is not zero?"

If there's money left over, you will allocate it to something specific. (Determining what that "something specific" is will be covered in the very next post- PROMISE!)

If there's a shortage of money, you will reduce or eliminate something on the budget. (Someone somewhere just panicked.) Here's a hint: You will reduce or eliminate something that is NOT on the Essentials List. A lot of people fall into the trap thinking they can save their premium cable channels by cutting down bare-bones on groceries, but by the end of the month, they "fall off the wagon" and charge a credit card with necessary groceries or with eating out, throwing off their financial goals. Then, they're convinced that budgets do not work for them. (If you're a woman who has on the menu sirloin and lobster every other night, then, yes, common sense calls for a reduction in food spending.)

Depending on your mindset, you may think this step is fun or you may think this is scary. Regardless, it must occur. If this is fun, giggle with excitement the whole way through. If this is scary, think of yourself as the bravest person in the entire world because you are conquering what most people avoid!

OK, it's time to decide where your money will go, where your heart is, and where your treasure will be!

This part can take 10 - 60 minutes, depending on whether you are using Excel formulas to do the running math for you or how attached you are to The Extras.

We're almost finished with creating the budget!
There are two more mini-bites in the "Create a Budget" series.

Sunday, August 1, 2010

Experiment Update #3 (FINISHED!)

And we did it with 56 cents still left!
Lesson here: Just because the money is there, it doesn't mean it HAS to be spent. I think I will transfer that amount to my retirement account.

I realized dry beans taste better in recipes than canned beans. Dry beans aren't THAT hard to prepare and don't take as much time as I remembered. I re-learned an appreciation for snacking on raw celery (with peanut butter, of course!) and baby carrots. I rejoiced in Brussels sprouts. They were my undepletable basket of fish and loaves. I kept shredding them into eggs, sauces, soups, and stir-frys and they still lasted me through the entire challenge!

Here's a list of some of what we ate (some of these, MANY MANY times):
  • Chicken stir-fry (one chicken breast feeds 3 of us, shredded Brussels sprouts, carrots, frozen corn or mixed veggies)
  • Shrimp stir-fry (same, but with a handful of shrimp)
  • Turkey burgers (leftovers from a BBQ we had previously hosted, lettuce and cherry tomatoes on the patties, fresh corn on the side)
  • Bodega beans (dried pinto beans, onions, brown rice)
  • Soup with rice (canned soup with lots of brown rice added)
  • Potato soup (homemade, with potatoes, broccoli, corn, ham from food storage)
  • Scrambled eggs (with chopped peppers, onions, and shredded Brussels sprouts)
  • Homemade yogurt with blueberries
  • Oatmeal with fruit chopped in
  • Whey-protein enzyme shake
  • Tuna casserole ("regular" style and a Southwestern style made with salsa)
  • Linguini (or rotini) and pasta sauce
  • Whole roasted chicken (which after the first night yielded leftovers to make the following:)
  • Chicken picadillo (delicious new recipe we will be adding to our rotation!)
  • White chicken chili
  • Homemade chicken pizza

Every meal included a salad. As we ran out of vegetables, the salads varied. One of the nights, my husband made a salad of lettuce and blueberries.

Looking for fresh
I realized fresh produce means a lot to me. As the end of the month neared, I asked in a local online group if anyone had a fruit tree that I could help harvest. Unfortunately, the one who responded directly to me has a plum tree that won't be ready to pick until a week from now, but -hey- that helps for next month's groceries! The other person announced publicly that their peach tree was ready, and they got hit with lots of takers. I was not first, second, or third in line.

This $21 challenge unearthed a lot of my resourcefulness and increased my appreciation for Google. Experimenting with frugal recipes has been an awesome experience and has increased in me wisdom in managing foods. You better believe I will be a lot more aware with our grocery envelope!

Yesterday, I celebrated successfully completing the challenge by picking up a Bountiful Basket for August. Here's to an awesome month coming up. HOORAY!