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.

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