I Was Broke. Now, I'm Not! Joseph Sangl on Personal Finance

moving

2006-11-07T11:45:00.000-05:00

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Humility

2006-11-06T08:41:00.000-05:00

Ever done something embarrassing? Something that made your face flush? Something that makes your "flight" defense mechanism kick in?

Sorry to bring up old memories, but I just had this happen last evening.

In delivering a welcome at my church, I managed to completely forget the end of the welcome and (in keeping with my high enthusiasm) proceeded to enter complete discombobulation time. It was redonkeykongulous!

I am OK with everything I said, and I am confident that it came from the right fuel. However, it was not what was planned.

A new level of humility has been achieved in the life of Joseph Sangl!

Ever had anything happen humiliating with your finances?

Bankruptcy? Collections calls? Bounced checks?

You can recover! It will refine you.

BUT IT WILL NOT DEFINE WHO YOU WILL BECOME if you resolve to make it better!

I resolve to make the next welcome better!

Facts that will change your life

2006-11-02T08:22:00.000-05:00

$100/Month
If you invest $100/month for 40 years and receive a 12% return for those 40 years, you will have invested $48,000 but it will be worth $1,176,477!

Time Matters
If you are 25 years old, you have forty years to invest. If you do not start investing until you are 45 years old, you may have only twenty years to invest. To reach the same $1,176,477 in twenty years, you will need to invest $1,189.26/month!

15 Years
If you finance a home with a fixed rate $100,000 mortgage for 15 years instead of 30 years, you will pay $63,944 less in interest and own your home 15 years earlier!!!

Working Together
If you refuse to work with your spouse on financial decisions, you will miss out on one of the greatest way to unify and divorce-proof your marriage! Money fights are the number one cause of marital strife. By working together, you will have unity on this subject instead of conflict!

Negotiate Everything that costs over $300
Prices are negotiable. If you save 10% on every purchase over $300, you will be able to save a substantial amount of money every single year. Negotiate purchases on vehicles, insurance, appliances, houses, video cameras, computers, hotel rooms, vacations, ... The list goes on. You do not have to be confrontational. Just ask, "Is that the best you can do?"

Practical Tool - Time Budget

2006-11-01T08:07:00.000-05:00

This is for those few people who feel like their days are out of control busy.

Most of my posts have been related to finances. Today, I want to focus on another item that continually impacts people's lives - out of control schedules.

I believe that there are many similarities between out of control spending and out of control schedules.

Similarities

Time AND Money are both finite. You know that there is a limited amount of money under your management. There are also 1,440 minutes/day under your management.
Both get out of control by adding additional expenses/activities over time. Eventually, it spirals out of control. It creeps up slowly.
Time and Money get out of control though good intentions. You agree to let your child participate in a second sport. The dinner invitation is accepted even though it was your one night home that week. In the act of doing good, people will tend to ignore or reduce their concerns of the impact on time and money.
When Time OR Money is out of control, you will feel like your schedule and money are managing you instead of you managing them. This is backwards, and the feelings you have when this is the case are miserable!
They can both be brought under control! INCOME - OUTGO = EXACTLY ZERO works for time just as well as it does with money.

So what can you do? What should you do to bring your time under control?

Force it to fit the equation: INCOME - OUTGO = EXACTLY ZERO

I have developed a time budget (i.e. - a weekly calendar). When my schedule has reached the out of control point, I utilize this form to regain control. Just as I do with our financial budget, I sit down with Jenn and prepare this together. When we use this form, we generally put it together one week ahead of time.

Remember INCOME - OUTGO = EXACTLY ZERO. Spend your time wisely!

What was the moment for you?

2006-10-31T08:41:00.000-05:00

I am interested in hearing what it was that made you start to take control of your personal finances.

For me, it was when I learned the simple fact that INCOME - OUTGO = EXACTLY ZERO.

I had been through 20 years of formal education including 6 semesters of calculus and advanced calculus. I understood that stuff (back then, anyway), and yet I could not make my money behave.

The moment that I SAW the simple math on paper for my money, I was equipped to manage my money more effectively.

Since that day, the savings account has grown, debt has disappeared, and the stress of paycheck-to-paycheck living has left forever. My marriage is better than it has ever been because of the simple fact that we have removed the number one cause of marital dischord from it - money fights.

So, what was the tipping point for you? What made you take action?

Please e-mail me at josephsanglblog@yahoo.com with that "moment" that made you take action to manage your money well.

Just a few days away from making a bad decision.

2006-10-30T08:14:00.000-05:00

I remember a few years ago, I had the opportunity to purchase some land.

It was about 22 acres of farmland with some drainage creeks through it, but it sounded like a good deal.

I wanted to do this deal. The thought of becoming a land owner was really appealing to me. After all, God stopped making land a long time ago. Plus, it would be really cool to say, "I'm a land owner." and "I am an owner of land."

I approached my wife about buying this land. Oh, man! If you are a married man, LEARN this lesson - ALWAYS seek your wife's input on decisions!

She asked a really tough question, "Where are you going to get the money to buy it?"

I told her that I wanted to borrow the money. I showed her how we could turn this into a pretty profitable investment.

The problem? My assumptions were all wrong. What I thought could do with this land, I could not. As we went through the numbers and as Jenn asked more questions, it became very clear that this would be a major negative financial event in the lives of Joe and Jenn.

I was just a few days away from making a bad decision, but I was able to avoid it by getting Jenn involved and putting the facts on paper.

What decision do you need to get your spouse involved in today?

The challenge of continually learning.

2006-10-27T09:57:00.000-04:00

I have spent the last three days at a conference having my mind stretched. I have to admit that it is difficult sometimes to endure mind-stretching teaching/learning experiences.

I believe that it was Thomas Edison that said, "I love to learn. I am just not sure that I like being taught." Why would he say that? I believe that pride might be at the source of it all. We love to be in the know, but it also happens regularly that we are too prideful to admit that we do not know.

I know that I need to continue to learn. Not just in finances, but in all areas of my life. If I do not continue to learn, I will not grow and develop and accomplish exactly what I was put on this earth to do!

Here is what I have been doing recently to learn:

Reading a book on personal finances - specifically on marriage and money
Reading a book on leadership - specifically on being a leader of leaders
Attending the leadership conference I am currently at
Sitting in small group discussions to discuss personal financial management
Hanging out with other leaders - not to necessarily discuss leadership
Writing thoughts out on paper - really helps to develop ideas/thoughts
Prayer - Taking time to reflect
Reading the Bible - There is a reason this is the world's all-time best-seller. The plot is amazing!
Attending home groups - doing life together

What have you been doing recently to learn?

Challenges

2006-10-26T09:19:00.000-04:00

Why do many people view challenges as a negative?

"Man, I just do not know how I am going to handle all of these people in our house at Thanksgiving!!!"

You are getting to spend an awesome time with your family and friends!!! That is a POSITIVE in my family!

"Man, I just don't know what to do with this project. I have never really done something like this before."

You are getting to learn and grow!!! How awesome to be able to do something new and challenging!

"Man, I just do not know how to get control of our finances. We have never been able to control them well."

You are gaining control of the number one cause of marital strife! How awesome to be able to work with your spouse and learn and grow together!!!

Enjoy challenges!!! They are your opportunity to learn and grow. Life without variety and a hint of mystery grows bland VERY quickly.

Characteristics of those who fail financially

2006-10-25T09:19:00.000-04:00

As I see persons who have failed financially, I have seen at least one of the following characteristics:

- A failure to recognize that emergencies will occur (car breaking down - they break down!; Christmas - It really is in December! People will get sick!)
- A life-controlling issue - addiction to gambling, drugs, alcohol
- Lack of HOPE
- Unwilling to change their behavior
- Lack of medical insurance!
- Lack of a plan
- Unwilling to work together with their spouse
- Uneducated about financial topics

All of these items can be addressed. There is HOPE! You can put together a plan!

I see miracles taking place!

2006-10-24T08:33:00.000-04:00

I have always bent toward the optimistic view of life. OK! OK! OK! I really point directly toward the optimistic view of life!

I believe in people's ability to accomplish exactly what they were put on this earth to do.

It has earned me the title of Mr. Quixotic. You can see the definition here.

Dictionary.com defines quixotic as being "caught up in the romance of noble deeds and the pursuit of unreachable goals; idealistic without regard to practicality"

Why? Because I believe in people! Because I believe that people are empowered with something called COMMON SENSE! Because I have seen miracles taking place in the lives of people!

I have seen marriages being restored! Guess what? I see thousands more being restored!

I have seen HOPE restored! Guess what? I see thousands more have HOPE restored!

I have seen financial situations being miraculously transformed! Guess what? I see thousands more have the same thing happen!

I have seen people begin to pursue their dreams and passions and not being denied. Guess what? I see thousands more doing the same!

I believe that when a person is able to work in their sweet spot - that one thing that turns work into a crusade - their soul is set on fire! It's effect on others around them is undeniable! I love working - strike that - CRUSADING along side people who are doing exactly what they were made to do.

If that makes me QUIXOTIC, so be it. I just happen to believe that the unrealistic will become reality!

Great ideas mixed with passion will catch fire!

2006-10-22T16:17:00.000-04:00

Have you ever saw a successful business and wondered why it became successful?

Take Chick-Fil-A for example. A great product! I LOVE their chicken sandwiches! I LOVE their cole slaw! I REALLY LOVE their sweet tea!

It is a great product!

Do you think that the chicken sandwich would have been known to many if the persons behind the product were not passionate about it?

Here is a hint:

NOOOOOOOOOOOOOOOOOO!

Are you passionate about what you do? Guess what? If you are not, people will be able to tell. They will see it in the way you talk about it. They will sense it in the tone you use. They will recognize it by the way you carelessly refer to it.

However, guess what happens when you ARE passionate about what you do? People notice! They can tell in the way that you obsess over it. In the tone you talk about it. By your enthusiasm! It's serious! It's because you are passionate about it!

Well, guess what? I am passionate about helping people with their personal finances! Whether it is someone who is in complete crisis "I'm about to declare bankruptcy"-mode or it is someone looking to tune up the management of their money, I am PASSIONATE about helping them take it to the next level!

I am living, eating, breathing, sleeping, and dreaming about this subject! It is something that I can not get over! I once lived on the B-R-O-K-E side of personal financial management. This is where over 70% of Americans are living TODAY!!! In the world's wealthiest nation, THIS SHOULD NOT BE!!!

As Americans, we should be able to tell ourselves NO! occasionally. We should be able to be wealthy! We should be able to GIVE, SAVE, and SPEND far more than we are currently able to, but we just cannot deny ourselves!!!

Come over to my side of the fence. Welcome to a world where you manage your money instead of letting your money manage you! Welcome to a world where you can focus on doing that thing that you were created to do! Welcome to a world where you can channel resources to causes that you passionately believe in!

Manage your money instead of letting your money manage you!

What an idea! I am passionate about it.

If great ideas mixed with passion really do catch fire, then an INFERNO is on its way!

Bring it on!

You can't ever go back.

2006-10-17T13:00:00.000-04:00

You can't ever go back.

No matter how much you want to, it is just not possible. The time has passed. The event has passed. The words were spoken.

You can't ever go back.

As a result, your relationships will accumulate more and more memories. Hopefully, many of those memories are happy ones. Sadly, there will also be sad ones.

Understand this: You can't ever go back.

If you do NOT understand this and if it is your expectation that every single one of your friends is perfect, you will be a very depressed individual! Since you can't ever go back, the inevitable truth is that memories will build onto each other.

Since you can't ever go back, it means that you need to learn FORGIVENESS and FORGETFULNESS. Your spouse may have done something that impacted you negatively in your finances. Forgive them! You may have done something that caused you to lose a lot of money. Forget about it! Request forgiveness and move on!

If you do not learn that you can't ever go back AND that people are not perfect AND that your spouse and friends will have some more less stellar moments in the future, you will become a very disgruntled and disillusioned person.

Learn to forgive. Learn to forget. Learn how to move forward TOGETHER!

You can do it! I believe in you!

What do you need to do about this TODAY?

Enthusiasm changes everything!

2006-10-17T08:32:00.000-04:00

I love being around enthusiastic people!

You know people like this. They are so excited about everything in life. They want to solve world hunger in the morning and then boil the ocean in the afternoon.

OK. They may be a little unrealistic (or a lot), but I love it! I love being around them! They pump me up! The energy is contagious. It spreads. The positive, can-do attitude is awesome!

When I work around enthusiastic people who believe deeply in the cause they are fighting for, it challenges me to step up my game. It reinforces the passion I have for my life: "To help others accomplish far more than they ever thought possible!"

I am enthusiastic when I say, "I believe in your ability to manage your money and prevent your money from managing you!".

I am enthusiastic when I say, "If you can do first grade math, you can manage your money well!"

I am enthusiastic when I say, "You CAN be debt-free!"

I am enthusiastic when I say, "I believe in you!"

I am enthusiastic when I say, "You really can reach a day where you do not have to worry about how to pay the next house payment and car payment!"

I believe in you! I want you to win!

I KNOW that there will be some pain as you force your money to behave, but the pain will be short-term if you attack it enthusiastically!

Here is a thought: If you attack your debt today and put together a plan to become debt-free, what day will you become totally free of debt?

So what if it takes as long as 10 years (usually it takes 1.5 to 3 years to become debt-free except for the house)? How old will you be then? 43? 37? 62? You will still have a LOT of life left to live, and it will all be free of the stress created by the way you currently manage your finances!

YOU CAN DO IT!

So you really want to help someone ...

2006-10-16T09:06:00.000-04:00

In the finance classes that I teach, we have small group discussion time after the lesson. It is an AWESOME time where the class has an opportunity to talk about the good things that have happened with their finances and also the not-so-good things.

As a small group discussion leader, I have learned more from sitting in these discussion groups than I ever would have learned sitting through a finance conference somewhere.

Do you know why? Because people are being real. People are allowing themselves to be transparent so that someone else can learn from the pain of their experience.

As our classes have grown, I have had a need for more small group discussion leaders. When I ask some potential leaders, I have invariably received the response, "Oh, I could never help them with their finances. I am just now getting control of mine!"

You do not know how much I love that response! Why? They are being real! They are humble! They are in EXACTLY the right spot to be an excellent small group discussion leader! They have BEEN THERE, DONE THAT and that allows them to really help someone because they can meet them where they are.

So you really want to help someone ... ? Be authentic, be real, meet people where they are, listen to them, and exude HOPE at all times!

To all of the persons who have been involved in a small group discussion - you KNOW exactly what I am talking about.

To all of the persons who have been involved in a small group discussion led by me - first, let me apologize :), second, THANK YOU for letting me learn from you! I rejoice in the opportunity that I have had to potentially help you!

Many days before I go to work, I play the piano. I sit down and play the song "If I Can Help Somebody". No, I am not making this up! You know why I play this song? Because I LOVE sharing something that has changed my life with others and seeing it help them in real and tangible ways.

Financial Advice to Married Persons

2006-10-12T11:10:00.000-04:00

Financial Advice to Married Couples

o Work TOGETHER on your finances!
o Discuss all major purchases BEFORE making the purchase.
o Share ALL FINANCIAL INFORMATION with each other.
o No financial secrets.
o If you work TOGETHER, it will make you stronger.
o Avoid the trap of debt
o Some couples shell out thousands just for their marriage!
§ It is nice to have a great wedding, but to go into debt to do it?
§ Is it worth it?
o After many couples get married, they attempt to get everything that their parents have:
§ House
§ Furniture
§ Cars
§ Boat
o As a result, the first thing they have done as a couple was to strap themselves down under a weight of payments.

o Develop a plan for your future. Make your financial plan support your future plan!

o I recommend that a newlywed couple WAIT at least one year before making any large purchases (> $1000).

o SAVE money for emergencies.
o When you have no savings, every little thing that happens wrong to you (car problem, appliance problem, medical bill) becomes a financial emergency.
o Financial emergencies lead to STRESS.
o With 3 – 6 months of savings JUST SITTING THERE, these “financial emergencies” will not exist and therefore the stress will also not exist.

o SAVE money for the future!
Ask the following questions:
o “Is the fact that you are going to retire someday unknown?”
o “Is the fact that your children are going to college someday unknown?”
o “Is the fact that your children are going to get married someday unknown?”
o “Is the fact that you are going to purchase a house someday unknown?”
o “Is the fact that you want to go on a nice vacation to Hawaii someday unknown?”
o “Is the fact that you want to buy a nice boat someday unknown?”
o “Is the fact that you want to own a nice car someday unknown?”
o “Is the fact that you want nice furniture someday unknown?”
o NONE of these questions are unknown, yet many of us NEVER EVEN BOTHER TO PLAN FOR THEM!!!! The result of NOT PLANNING? They either go ahead with these goals and incur a TON OF DEBT OR they are unable to realize their dreams and instead live a lifetime of “woulda, coulda, shoulda” regret.

o Pay cash for purchases.
o Saving money takes time.
o Time allows you to truly understand if you really want that item
o It also allows you time to learn what a good deal is for that item

o Hold each other accountable.
o When one of you gets the “I want this!!!”-itis, the other can calm you down!
o You are stronger TOGETHER.
o Remember: ISOLATION = DESTRUCTION

o HAVE FUN WITH THIS!!!
o Managing your money can be fun. Done correctly,
o It allows you to support VERY WORTHY causes that you strongly believe in!
o It allows you to save more than you ever thought possible.
o It allows you to spend more than you ever thought possible.
o It allows you to give more than you ever thought possible.

Your plans.

2006-10-10T10:09:00.000-04:00

Do you have plans for your life?

Do you have things you want to accomplish during your lifetime?

What are you doing about them?

Are they written down?

Have you written out a step-by-step plan on how to achieve these goals?

How much will it cost you to accomplish these goals?

I have found that when individuals are able to establish a direct link between their finances and their lifetime goals, they become rabid animals in pursuit of financial freedom!

Why is this? It is because they have a CLEAR REASON for why they are pursuing debt freedom! This is powerfully motivating!

If I pay off our debt, my wife can do what she has always wanted to do - stay at home with the children!

If I pay off our debt, I can quit the job that I am not passionate about and pursue the career that I am PASSIONATE about even though it generates less income!

If we invest money every single month, we will be able to retire by the age of 50 and start that children's mountain camp that we have always dreamed of!

If we have no debt, we will be able to go on a paid-for vacation every year.

If we invest money every single month, we will be able to leave an inheritance for my children.

If we invest money every single month, we will be able to give $100,000 to our local church.

When you have a CLEAR REASON that is WRITTEN down, POWERFUL things happen!

The new school.

2006-10-09T08:27:00.000-04:00

I was sitting in a open-house/dedication ceremony for a new school recently. This new school replaced a school that had been built in 1929. It looked just like a WWII bunker.

The speaker said, "A round of applause for so-and-so for the architectural design."
CLAP! CLAP! CLAP!

"A round of applause for so-and-so who led the construction effort."
CLAP! CLAP! CLAP!

"A round of applause for the staff of the school."
CLAP! CLAP! CLAP!

"A round of applause for so-and-so who arranged the financing."
CLAP! CLAP! CL ...

WHAT?!!!!

Now the last school was built 76 years ago!!!! And we had to FINANCE the new school?!! We were using TAX PAYER money to pay interest on a note for a new school when the last school was built 76 years ago!!!

This should not be! At what point in time did we figure out that we might have to replace the school someday?

Do you know that if the school had invested $3.69 per week into an investment, there would have been enough TO PAY CASH for the new building?

Instead, the school and the taxpayers are burdened with the debt.

It's time to start saving for the replacement of this school!

Do you want your children to manage money the way you do?

2006-10-05T08:50:00.000-04:00

Are you satisfied with the way you have managed your personal finances?

If the management of your personal finances was placed on trial before a jury of Your Parents, Jesus, and Your Spouse, would you be found "Guilty - of wanton mismanagement" or would you be found "Outstanding - teach your children and others about how you have done this"?

Now, if someone seven years ago would have asked me the question "Would you want your children to manage money the way you do?", I would not have known how to respond. The reason? I did not have children at the time.

Now that I am a father, it MATTERS A LOT to me! I mean, look at the other alternatives for her to learn money management from!

Congress? Give me a break!!!
The President? Give me a break!!!
Credit card companies? Wow!
Banks? Here's a clue - Banks are FOR-PROFIT organizations!
Schools? They don't even teach how to balance a checkbook anymore!

I do not know about you, but I want to be a GREAT EXAMPLE for my daughter to follow. In every way! Not just in personal finances, but in every way! I am passionate about this!

It was EMBARRASSING when I truly took the time to look at our financial situation in 2002 and analyze how I was really managing our money.

I was not:

working with Jenn to develop a budget TOGETHER
asking for her advice on many of the purchases I made
stopping the spending when the money ran out
telling myself "NO!" to my childish "I want this!" wants

Today, I am willing to sit on trial before a jury of My Parents, Jesus, and My Spouse because THIS MATTERS TO ME!

Systematic Savings & My 529 Plan

2006-10-04T09:21:00.000-04:00

"My how the time flies!"

"Was it really 4 years ago that we last talked?"

"Our 20 year high school class reunion is THIS YEAR?!?!!"

Time has remained constant, but as we grow up we get so busy that it really does appear that time flies by!

It was almost 7 years ago that my daughter was born. WOW! I can not hardly believe it. In just 11 years, she will be off to college. UNBELIEVABLE!

Wait a minute ... Off to college ... Have I started saving for that?

The answer for us is YES!

Here is what we have done to save for her college. We started up a 529 College Savings Plan. It was VERY EASY. I went to our local bank and asked to open a 529 College Savings Plan.

Facts about the 529 College Savings Plan I am involved in:

They required a mere $50 minimum amount to open the account.
Additional future contributions were required to be at least $25.
They ZAP my bank account once a month with an amount I have told them to deduct.
The money is invested in mutual funds that I have selected.
The money is put in AFTER-TAX, but I am able to withdraw the money (principal PLUS interest) TAX-FREE for my daughters qualified educational expenses.
I am ONLY allowed to contribute $298,770 to this account at this time (I suspect that this will pay for college :) )
Qualified expenses included tuition, fees, books, supplies, equipment, room and board.
If I withdraw the money for non-qualified expenses, the interest earned is subject to income taxes PLUS a 10% penalty.

Do you know how easy it is to contribute a monthly amount to savings when you do not have to do anything? No writing checks. No on-line bill payment. Nothing. It is removed from my checking account automatically, and it is deposited into the 529 account automatically. It is then automatically used to purchase additional units of the mutual funds I have selected.

How sweet is that? Here is an example of what has happened to my 529 plan since it was started in 2003.

Money - Do you have enough?

2006-10-03T08:40:00.000-04:00

I have recently read a book that has rocked my world. The book is titled, "The Soul Of Money", and it was written by Lynne Twist.

Lynne asks a tremendous question. Do you have enough?

Thought 1: There is NOT enough money for everyone
There are many people who believe that there is simply not enough money for everyone, so they hoard all of the money they possibly can.

"At least I have some for my family", they justify to themselves.

Thought 2: There is enough money for everyone
These people have an entirely different mindset. While they may even have tremendous wealth, they are not caught up in the "keep up with the Jones'" trap. They give HUGE amounts of money away to causes that they strongly believe in.

"I have enough for today" is their thought.

Do you know people caught in the trap of Thought 1? There is never enough. They have 3 cars, but they really NEED this other car. They have 2 houses, but they really NEED this one more. They have a closet FULL of clothes, but they really NEED some more.

This does not apply to just extremely wealthy individuals! There are people caught in the same trap who are in PILES of debt. They are supporting their lifestyle with credit. I have seen that come crashing down approximately 100% of the time!

WHY?!!!! WHY does someone allow themselves to get caught in this trap? What exactly is enough? Will they ever get to enough?

The answer becomes real clear to me. I have enough for today. I am able to give more than I thought possible. I am able to save more than I thought possible. I am able to spend more than I thought possible.

I have enough.

Thanks, Lynne Twist, for writing a book that made me ask myself the question.

Seek Understanding

2006-10-02T08:14:00.000-04:00

Do you understand everything you have purchased over the years?

Your VCR? How to set the time on it??!

What about all of the functions on your cell phone? I only know one person on this planet who knows everything about his cell phone. He is a certified cell phone junkie.

What about your computer? Can you use it well?

What about your car? I discovered just four months ago that there is an extra cup holder in our car. The problem? I have owned this car for nearly 10 years!

All of these purchases cost money. They cost YOU money. Yet, I would be willing to guess that many of us who have purchased these items do not understand FULLY how it works or all of the features it offers.

Why? Why do we refuse to take the time to understand how these products work? One reason is that we care only about a few features and the rest really do not matter to us. That's OK. However, you will never be able to fully utilize that product until you fully understand what it has available.

What are some personal finance items you have purchased that you do not understand?

Insurance?
Mutual Funds?
Company Stocks?
Repo?
Government Savings Bonds?

New Rule: When it comes to YOUR MONEY, never purchase anything you do not understand fully! While the learning process about the product can be boring, tiresome, awful, terrible, or horrible, you will prevent being "taken" on a rip-off financial product. The cost can be huge if you do not fully understand the product you have purchased.

Example: For a 35 year old, Whole Life Insurance for $100,000 can cost you around $100/month. You can get the same amount of coverage in Term Life Insurance for about $10/month! That is $90/month cheaper! That is $1,080/year cheaper!

I have learned this lesson the hard way. Think about the personal finance products you currently have. Do you understand each one of them?

There is POWER in writing things down!

2006-09-28T16:16:00.000-04:00

Have you ever told someone that you would do something, and then forgot to do it? That has happened to every one of us.

I remember going to visit a customer that had experienced a quality issue with one of our products. I had a belief that we had not been notified in a timely manner about the quality issue. I was WRONG. This customer pulled out a book and rattled off at least 10 times that he had contacted our team about this exact issue! He had NAMES. He had DATES. He had TIMES. He had the Greenwich Mean Time in which he had contacted them. He had EXACTLY what he had relayed to each individual. There is POWER in writing things down!

By the time he had gotten to relaying to me the fourth call he had made, I really was not interested in hearing any more! I just wanted OUT OF THERE. Why? Because I did not have it written down. My team had not written it down. As a result, we had seriously inconvenienced a customer, and we had look foolish doing it. There is POWER in writing things down!

With this blog, I embarked on a journey to write about personal finances. I wanted to help others improve their own personal financial situation. The end result? I am personally learning more about finances. Why? Because I am writing it down!!! There is POWER in writing things down!

God had approximately 40 authors WRITE THINGS DOWN. Why? Because there is POWER in writing things down!

Write things down! Use the POWER!

Have you saved money for Christmas gifts?

2006-09-27T17:11:00.000-04:00

Christmas is only 89 days away. Have you saved any money for it yet?

Christmas should not be an emergency. It happens EVERY SINGLE YEAR on the EXACT SAME DATE. December 25. EVERY YEAR.

When you fail to plan, Christmas becomes an "emergency", but it should not be that way!

When you plan your spending for Christmas, you will spend less money. Just as when you complete your monthly budget and spend every dollar on purpose, on paper, before the month begins, a spending plan for Christmas will ensure that you spend within your means.

Christmas Fund - Christmas Spending = EXACTLY ZERO

By the way, when you have saved up the money for the gifts and avoid incurring debt, Christmas is so much better!!!

Practicality

2006-09-26T18:20:00.000-04:00

Practicality: adj. adapted or designed for actual use; useful

How long does it take for you to determine that something is practical?

I remember a time when I burned some photo files to a CD to take to Wal-Mart for developing. When I got to Wal-Mart, the photo machine would not recognize the files because the disk had not been "finalized". Now, I am not sure why a disk needs to be "finalized", but I was VERY IRKED that I could not print my photos. As I have dealt with burning CDs, I have determined that they really are not very practical. They are very susceptible to scratching. They have lots of format types.

To put it simply, burning CDs sucks.

Why do I say this? It is not very practical!!! It fails to produce the expected results regularly!!! AND I have found a better way. I LOVE my memory stick. USB plug and play. Holds a ton of files and is very user friendly. It is more practical.

When it comes to finances, people want practicality. They do not want to hear about a financial tool that works some of the time. They want to hear about a financial tool that works all of the time.

My goal is to create and design financial tools that work ALL OF THE TIME.

Managing personal finances is not for sissies

2006-09-25T18:27:00.000-04:00

Like anything worth doing, management of your personal finances takes effort. It takes time. It takes knowledge. It takes want-to. It takes motivation. It also takes HOPE.

If you are like 70% of Americans who live paycheck to paycheck and have NO extra money in savings, it takes a lot of effort just to make the decision to do something different.

I must say, it amazes me how many people will not change their financial behavior simply because of the amount of effort it will take to get their financial affairs in order. They would rather live a life that is tied to money, being in debt, and the stresses related to paycheck-to-paycheck living than expend the effort necessary to win with their finances.

I believe that each person possesses the capability get their financial house in order. I believe that each one can learn how to manage their finances successfully.

Are you willing to expend the effort to turn your financial house around? To make it better? Or are you going to put up with paycheck-to-paycheck living because it is "just too hard"?

Moving Costs - If you ever move ...

2006-09-21T07:57:00.000-04:00

Moving costs money.

Surprised?

Here are some questions (answers below):

How much does it cost to rent a one-way 26' box truck for 5 days and unlimited miles?
How much does it cost for boxes?
How much does it cost for the fuel to get from point A to point B?
How much does it cost to rent a car tow dolly?
Have you thought about furniture pads?
How much does it cost to get your old house ready to move out of?
How much does it cost to get your new house ready to move in to?
If you are selling your home, how much does it cost?

One-way rentals are FAR more expensive than returning the rental to the spot you picked up the truck. General costs for a one-way rental is between $1,300 and $2,500.
Boxes. Wow. Moving boxes that you purchase run anywhere from $150 - $500.
Fuel? Depends on the average gas prices. 26' box trucks get HORRIBLE gas mileage - between 4 and 7 mpg. If you get a diesel, you can expect to get between 8 and 12 mpg.
A car tow dolly will run you around $200
Furniture pads are very cheap. Around $10/dozen. Get at least two dozen more than you think you will need.
Depends greatly on the condition of the home. If you've maintained things well, it could be $500 or less. If you haven't maintained things well, it could be a LOT more.
Depends greatly on the condition of the home. If you negotiate effectively, you can have the house handed over in great condition.
If you use a realtor, selling fees on a home generally run between 4% and 7%. If you sell your home yourself, you can do it for somewhere around $1,500.

Where did you learn to manage your finances?

2006-09-19T16:54:00.000-04:00

It is always an interesting to hear others tell me how they learned about how to manage their finances. There are many sources that combine together to make up the average person's knowledge base for financial management.

Here are some of the sources I have observed/heard/personally experienced:

How one's parents managed their money - This is a VERY LARGE INFLUENCE on one's knowledge of money management - For good or bad
How one's family managed their money - brothers/sisters/uncles/aunts
How one's friends manage their money - For good or bad
Books - I highly recommend "Financial Peace Revisited" by Dave Ramsey, "The Wealthy Barber" by David Chilton, and "Rich Dad. Poor Dad." and "The Cash Flow Quadrant" by Robert Kiyosaki.
TV - This gets a little scary.
Auto Dealers - This is more than a little scary.
Magazines
Newspapers
Internet
School - elementary/junior high/high school/college
Experience - the best teacher of all!
General observations of others
Financial counselors
The Bible - can it get better than this?
Church

Regardless of where YOU get your financial knowledge, always check it against the basic equation of:

INCOME - OUTGO = EXACTLY ZERO

If it sounds too good to be true, it probably is. If it sounds like get-rich-quick, it is get-poor-quick. If it requires someone with 10 college degrees to explain it to you, then stay away from it.

Keep it simple.
Stay the course.
Avoid debt.
Think long-term.
Maintain self-discipline and the power to say "NO!" to yourself and others.
Wait overnight before making a large purchase.
If you have 10 seconds to make the decision, think for the first 9 seconds.

Are you happy with where your finances are today? If you are, pour more coals to what you are doing. If you are not, go obtain some financial wisdom from trustworthy sources.

Wait overnight for that big purchase

2006-09-15T16:44:00.000-04:00

I am selling a house right now. Joy. Joy. Joy.

For most people, a home purchase will be the single largest purchase of anything in their entire life. It needs to be done carefully and with much thoroughness to ensure that it is going to be a good purchase. For most people, waiting overnight seems OK before making an offer on a house.

Is this true for other items?

Let's take a car. How many people do you personally know that one day showed up with a new car, and you didn't even know that they were looking for a car? I mean, the car they were driving was newer than yours and ran better than yours, yet they showed up with a new car. The people who I know that bought a car this way did not wait overnight before making the purchase. I also know that many of them got ripped off and did not get a good deal on the car because they were caught up in the frenzy of the buying experience.

Let's take a hobby. Like scrapbooking. This thing has caught on like wildfire. Ladies are spending money like crazy on this really cool way of displaying the family's photos. The issue happens when the spending happens without thinking and BOOM $300 later you own everything that Creative Memories offers.

How about a boat? What about the RC airplane? What about furniture? What about a high end dog? What about a timeshare?

Think overnight. You will NEVER regret it!

20 years from now ...

2006-09-13T21:21:00.000-04:00

I wrote on February 8, 2006 about what life will look like in 20 years if mismanagement of our finances were to continue. That post is located here.

My question today is this: Have you changed anything to make your life better in 20 years?

Many times when I write in these blogs I am writing to myself. I am working through thoughts that are helping to shape my life at the current time. That was the case for my "What Will You Say In 20 Years" post.

I am here to tell you that I have taken SUBSTANTIAL steps to modify the picture 20 years from now.

Steps that I have taken.

Resigned position in Corporate America to pursue this passion of my life regarding helping others with their personal finances. I am embarking on a CRUSADE against the "I'll always have a car payment" and "I'll always be broke" mentality.
I am reading even more books. Filling my brain with information.
I met with a personal coach on the topic of Executive Leadership. WHAT A GREAT IDEA! It is an opportunity to have a skilled individual who has a vested interest in you as an individual, but no vested interest in the company. As a result, you can bounce ideas off of them without fear of repercussion or retribution. Very cool.

What steps have you taken?

Does God want you to be rich?

2006-09-10T12:36:00.000-04:00

So I was briefly reviewing the web pages that I check daily, and I found this article on www.cnn.com. The question being asked is, "Does God want you to be rich?"

Very interesting question, indeed.

The question is often asked. It is interesting to see it being approached by Time Magazine.

I would like to ask the question another way. Does God want you to be poor?

In financial counseling, I have never personally encountered anyone who became poor because God made it that way. There is this one man I have read about in the Bible. His name was Job. You can read about him here. After all of his wealth was stripped away, he still honored God. In the end, God blessed him even more in the last days of his life than at the first.

I do not know how often God lets individuals become poor on purpose (like Job), but I have seen example after example after example where poor decisions have been made that led to the person or couple becoming financially strapped.

Let me list some "poor" decisions.

A car financed for 6 years with payments that really can not be afforded. Especially when the vehicle insurance, license plate, and property taxes also go up with the new vehicle.
A house with a payment that consumes 50% of take-home pay.
A piece of furniture or a ATV that they could not pay cash for and so it was financed for 4 years at 20% interest.
Not having an emergency fund with at least $2000 in it. How realistic is it to believe that there will never be a financial emergency in our life?
Not thinking about purchases overnight. They are talked in to making a purchase of something they did not NEED by a very talented salesperson. So they bought and now they are paying. (Timeshares are very spur of the moment decisions that are many times a BAD deal.)
Not putting money away for the children's college. If you really do want to help your children out with college, you really should start saving for them. They really are growing older every single day and they will be 18 and headed there before you know it!
Not putting money away for your retirement. The word "tire" is in retirement because someday you are going to be very "tired"! If you do not put away money, you will be working when you are very "tired"!

I could list MANY more ...

I believe that God has given us this thing called "common sense" and this other thing called a "brain". He created us in His image. He wants us to think about things. He equipped us to be able to think about purchases and how we should handle our money.

If we truly stopped and thought about our purchases and our overall money management, we would be able to avoid being poor. We could even achieve wealth.

To get it, we need only understand these three things:

God is in control
INCOME - OUTGO = EXACTLY ZERO
We are the managers of our money. We are in control of where our money goes.

Budget + Retirement Savings = Financial Success

2006-09-07T19:55:00.000-04:00

There are two critical components to a healthy financial future.

These two items are:

Establishing and living by a monthly budget
Saving for retirement every single month

Let me tell you about two situations.

Situation One

I have seen situations where a family has not lived by a budget. They do not spend every dollar on paper, on purpose, before the month begins. They have, however, avoided doing DUMB with 000's behind it. They have some debt, but it is not outrageous. Maybe they have a car loan and some credit card debt.

This family has not lived by a budget, but they have been putting 15% of their pre-tax earnings into a retirement fund (401(k), 403(b), SEP, IRA, Roth IRA, real estate). Every single month. 15% of their pre-tax earnings.

Because this family has avoided signing up for large quantities of debt and has saved systematically for retirement, they will be able to retire with a healthy amount of income.

Situation Two

I have observed a situation where a family has been VERY frugal in their purchases. Never frivolous with their spending. Never turning to debt. They budget every single dollar on paper, on purpose, before the month begins. They live by that budget.

They have, however, forgotten one key line item in the budget: retirement savings. They never were able to force themselves to put away any of their earnings toward retirement. They did not get into the rhythm of putting money towards their retirement every single month.

The result? No debt at retirement, but they are flat broke and totally reliant upon Social Security.

Conclusion

Put money toward your retirement every single month starting this month. Even if it is only $25/month. Do it now! Time is your biggest friend!
Begin budgeting this month! Spend every dollar on paper, on purpose, before the month begins. Live by the budget.
If you do (1) and (2), you will win financially.

I AM SO READY!

2006-09-06T23:07:00.000-04:00

In two weeks, I will pack my bags and head off to my new role at New Spring Church in Anderson, SC.

I AM SO READY!

I am ready ...

to do my part to fulfill the vision cast by Perry last Sunday
to ENABLE the community to be financially free and to be freed to do exactly what they have been put on this earth to do
to EQUIP others with practical tools and skill sets that enable the vision of New Spring Church to be accomplished

I am PUMPED UP! Helping others win with their finances is EXACTLY what I have been put on this earth to do. Being a leader is EXACTLY what I have been put on this earth to do.

Right now is the right time.

Years from now, will you regret your money management?

2006-09-05T12:19:00.000-04:00

Why are you managing money the way you currently are?

Is it because:

you have so little money available to you?
you earn enough to not really pay attention to your spending?
you have an end goal in mind?
your parents managed their money this way?
you do not want to manage your money the way your parents did?
you do not understand how to manage your money?
you become frustrated each time you try to develop a plan for your money?
you have no hope?

I believe that EVERYONE can manage their finances very well. The largest problem that I encounter is a lack of know-how. Once they are EQUIPPED with a workable budget and other key financial know-how, they begin to really experience excellence in the management of their financial resources.

This leads me to two questions:

Why aren't they equipped to manage their money?
Why aren't they SEEKING to be equipped to manage their money?

Why aren't they equipped to manage their money?

I went through 20 years of education. K - 12 (13 years), undergraduate degree (4 years), graduate degree (3 years). In those 20 years of education, I NEVER HAD ONE SINGLE COURSE teach me on HOW to manage my money. I learned a lot about earning money, but NOTHING on HOW to manage it once I earned it. This is terrible! Why haven't they been equipped?

Why aren't they seeking to be equipped to manage their money?

Fear. Despair. It's emotional. One spouse is not interested. Frustration. Too busy. Do not know who to listen to or learn from. It is hard to trust someone with this very personal issue.

My Goal: Let it be known that the help we can provide is trustworthy, above reproach, focused on the issues, developed to be easily understood and applied, and is proven to work.

Why I do what I do ...

2006-08-31T20:02:00.000-04:00

I am sick of seeing 60+ year old people who are in debt up to their eyeballs simply because they were not taught sound financial principles.

Because I went through 20 years of school culminating in a graduate degree and never once had a class on how to manage my money.

I want young people to learn this NOW so they do not do all of the dumb things the rest of us have done with money.

To improve marriages and communication within those marriages.

I believe that I what I am teaching is capable of restoring HOPE where there is NO HOPE.

I believe that being saved from the bondage of debt feels very similar to the salvation experience of being saved from my sins. I want to share both of these messages to all who are helped.

Because I have been there, done that ... and I want others to avoid that and prevent that.

There is no reason people should be living from paycheck to paycheck in the greatest country on the planet.

There is enough money for everyone on this planet. For most individuals, the problem is not an income problem. It is an outgo problem.

There is HOPE.

I believe in people.

I believe that when people are set free financially, they become able to pursue EXACTLY what they have been made to do!

NUMBER ONE REASON
I have been called by God to do this. It is what I have been put on this earth to do!

The power of vision.

2006-08-30T21:47:00.000-04:00

Now time for a story ...

It was summertime during 1999. I was headed out to eat lunch with a fellow engineer. We headed off to Los Hermanos in Clemson, SC (does this restaurant still exist?). Little did I know that this was to be a lunch that would change my life forever.

During our lunchtime conversation, he asked me a question I had heard many times before. "Joe", he said, "If you had a million dollars, what would you do?" Now, I had heard that question asked many times before, but this time I truly thought about it. I had no answer.

It irked me that I could not answer this question. I was very frustrated about it. I was frustrated enough that during that same evening, I shared the question with my wife, Jenn. I told her that I could not answer the question and that I did not know what I would do.

She was surprised and said that I could have at least thought of some vacations we could take. The issue for me was that I truly understood the point of the question. The true point of the question was, "What have I been put on this earth to do?"

I wandered around for the next three years, just wondering. During these three years, I applied myself 100% to the task at hand, but I put myself on alert so I could discover just what I was put on this earth to do.

When I moved back to Indiana in 2002, I finally found it. It was to help others accomplish far more than they ever thought possible. Specifically in the area of their finances. It burns through me to the very core of my soul.

Now, I have been described as slightly energetic in my normal line of work, but I become a passionate, freaked-out, crazed lunatic when it comes to helping others gain control of their finances. This topic brings out an emotion in me that has been otherwise untapped. It is exactly what I have been put on this earth to do.

Now, I have the opportunity to go pursue this calling full-time at New Spring Church. I CAN NOT WAIT!!!

Since I had to wrestle with the question for 4 years before getting to an answer, I am going to ask you:

"If you had a million dollars, what would you do?"

The cliff is behind me!

2006-08-29T22:52:00.000-04:00

I have blogged, talked, preached, spoke, rambled, yelled, taught, and thought about jumping off the cliff of "going and doing this personal finance thing full blast" for the past three years.

I have wrestled with leaving Corporate America and the fine paycheck it provides. I have wrestled with this change in my full-time career focus. I have thought about the "what-if scenarios" for so long that it really seemed to be a dream that would not cease. It seemed as if it could never become reality - due to my inability to jump off of this cliff.

I am officially announcing today that the cliff is behind me! I have jumped over the edge! I am "going to do this personal finance thing full blast". I am going to help broke people become whole financially. I am going to assist others who are doing OK to become OUTSTANDING. I am going to achieve my life's passion "to help others accomplish far more than they ever thought possible."

I have officially resigned from my job and have accepted a position with New Spring Church in Anderson, SC! I am VERY EXCITED to be going back to my home church and do ministry with my friends there. The real estate sign is in the yard. The four week notice is ticking away ... It is TIME. I have been called to do this. It is what I have been made to do. It is time to walk the talk.

You see, when you spend less than you make, you can do exactly what you have been made to do regardless of the income potential. Regardless of the hardship you may have to endure to get there.

True peace is found by doing that which you were put on this planet to do.

New Spring friends - look out! I am READY TO ROLL!

Budgeting (again!)

2006-08-28T20:31:00.000-04:00

I love budgeting. I am a full-fledged nerd. I admit it. That's fine. I am also not broke anymore!!!

I regularly encounter people who do not truly understand what it means to budget. They believe that it is a tool that their spouse uses to control them. They believe that it means they will not be able to have fun anymore. They believe that it will not work. I believe that "they" are wrong! "They" are still broke. I am not anymore. It is because Jenn and I began to budget!

Let me explain what a budget really is.

It is a simple math equation:
INCOME - OUTGO = ZERO

It means that you will NOT spend more than you make:
The equation MUST balance to zero. If it is a negative number, you will be burning through your savings account OR turning to debt.

It is spending your money on paper on purpose BEFORE the month begins:
If you spend your money on paper BEFORE you receive it, you will KNOW the fact that money is limited. You will KNOW that you must reduce your spending in order to avoid debt! You will KNOW that you must reduce your spending in order to pay off debt faster!

It is THE ENABLER for achieving financial peace:
By not overspending your income, you are better able to achieve your family's goals. You will NOT have to work OT in order to pay your debts. You will NOT have to work a second job to earn enough money to pay off your debts. You WILL be able to focus on your family. You WILL be able to focus on doing exactly what you were made to do! You WILL be able to focus on pursuing life to the fullest INSTEAD of having your joy robbed from you!

I was broke until Jenn and I began to budget.

I am at the edge of the cliff ...

2006-08-23T21:44:00.000-04:00

Will I fly? or Will I flop?

I am at the cliff of jumping into what I was made to do. How should I jump? How far should I jump?

I KNOW the answer.

I will jump with 100% of my effort! I will go after that which I was made for! I will not be denied! I will do everything necessary to achieve that which I have been created to accomplish. I will be faithful.

Tick. Tock. Tick. Tock.

The time is near.

Time to jump.

Life is so good!

2006-08-22T23:30:00.000-04:00

When you have financial peace, you are able to more fully experience life. You are not bound to a paycheck-to-paycheck lifestyle. You are not in the rat race of earning the money and then turning around and handing it right back out.

Here are some key items I have noticed are different when you achieve financial peace:

Clearly understanding of "how much is enough"
Able to focus in on what you have been put on this earth to do
Reduced stress in life
More aware of the pain that others in financial bondage are experiencing
Looking for the OPPORTUNITY to give to worthy causes
More focus on making a difference with your life

What are you doing to achieve financial peace today?

There is a cliff in front of me ...

2006-08-21T23:22:00.000-04:00

Should I jump? With or without looking?

Perhaps I should study it a bit.

If I get close to the edge, will I have the opportunity to bail out?

How far down is it?

Will I risk a broken leg or will it be death?

I'm scared. My legs shake. My nerve is almost gone. I feel weak. I feel out of control.

There is a decision you know that you KNOW you need to make about your finances. Stop studying it and MAKE IT HAPPEN!

How do you know when it is time?

2006-08-17T22:02:00.000-04:00

I was reading this article the other day. David Bach presents five signs that may be telling you it is time to move on from your current role or job.

I would like to think through this in a little more detail.

It is not surprising to me that nearly half of the people in this nation do not enjoy their jobs.

It is also not surprising to me that nearly every person on this planet wishes to accomplish something great with their life. They want to make a difference to somebody, somewhere. It is a feeling, an urge from the deepest part of the soul, that we have been put on earth to do something with our lives.

This urge is unique to the human race. When was the last time you saw your cat pulling out his surveying equipment to build a bridge across a river so that neighboring cities can visit and conduct commerce more easily? When was the last time you saw a cow pull out his saw and build a house for his fellow cow? It has been awhile since we saw a monkey go to outer space to find out where we came from. I can tell you that this monkey DID NOT WANT TO GO!

(The first four monkeys on rockets to outer space died!)

Anyway, we humans have an inner desire to accomplish something. Something that is beyond ourselves. Something that we cannot deny without serious frustration, sadness, anger, or other strong emotion.

So why do we allow ourselves to work the vast majority of our lives doing something that is not what we were put on this earth to do?

I put forth this simple reason - It is because we are broke.

According to a Bankrate.com nationwide poll, less than 4 in 10 American adults have an emergency fund to fall back on in the event of a financial disaster.

Here is something I am discovering. Many of the jobs that focus on helping people have a better life do not pay enormous wages. These jobs are sponsored by charitable organizations who want to pour as much of their financial resources into the actual helping of people. They do not generate substantial amounts of revenue so they simply cannot compete with the corporate paychecks. They do offer, however, a tremendous opportunity to make a huge difference for our fellow man.

Question of the Day
If you had six month's worth of expenses saved up and had NO payments, would you continue to do what you are currently doing?

If you had six month's worth of expenses saved up and had only a house payment, but no other payments - no car payment, no student loan payment, no furniture payment, no boat payment ... no payments other than your house, would you continue to do what you are currently doing?

What is that THING that you really want to accomplish with your life? What is that THING that just lights up a passion in you that you just cannot shut up about it? That makes you feel most alive! That makes you KNOW that you are making a difference?

Get debt-free and GO DO IT!

Term Life Insurance

2006-08-16T22:37:00.000-04:00

Term Life Insurance is a great deal!

30 year-old male - preferred rate - 20 year level term insurance - $500,000 coverage
$255/year

30 year-old female - preferred rate - 20 year level term insurance - $500,000 coverage
$235/year

Want to know what the current rates are for your age? Go to here to obtain an instant quote WITHOUT HAVING TO ENTER YOUR NAME OR INFORMATION!!! There is a spot for you name and phone number, but you do not have to enter it!

Why is term life insurance a great deal?

It transfers risk from you to the insurance company
It is cheap! Very cheap relative to cash value, universal, or whole life insurance
The premium stays the same for the entire term of the insurance.

You need to have 8X - 10X your annual income in term life insurance. Even if your spouse does not work, you should also have term life insurance on them. Imagine how much it would cost to replace the work they currently do while maintaining your household.

Insurance agents will push you to get whole life, cash value, or universal life insurance. They sell them with the savings component built within it. It is not that they are horribly terrible products (OK, maybe they are HORRIBLE), it is the fact that they are VERY EXPENSIVE when compared to the cost of term life insurance.

GO GET TERM LIFE INSURANCE!!!

Money saving ideas

2006-08-15T21:21:00.000-04:00

Pay bills annually.

Life Insurance
Auto Insurance
Gym Membership
Internet
Subscriptions

Negotiate any large purchase

Automobiles
Boats
House
Surgery
Video camera
Computer
TV
Furniture
Jewelry
Vacation Trip

Sleep at least one night before making a large purchase.

Consult with your spouse before making a large purchase.

Drive your car for at least 250,000 miles and 10 years.

Take your lunch to work.

Let your employer pay for your college degree.

Don't smoke.

Exercise.

Avoid stuff-itis. Ask yourself the question, "Why am I buying this?"

Are you giving?

2006-08-14T23:09:00.000-04:00

I remember being taught to give as a child. I was taught in two ways. One way was each time that I earned a little bit of money, I was taught that I should give 10% of it away. POWERFUL STUFF! The other way was when I saw my parents give money away. EVEN MORE POWERFUL!

Giving allows you to put wind in the sails of your dreams. It allows you to invest in those things that you care the most about. It enables you to understand that your resources are able to accomplish far more than you alone could do. You could fund a homeless shelter so that they can feed the down and out. You can give to the Red Cross to help others in the most desperate times of life. You can give to your local church where one can learn about the hope of the world. You can give to individuals who are down on their luck. You can give to friends who are struggling financially. You can give to friends who are serving as missionaries to the most hopeless parts of the world.

You can't give, however, if all of your money is being sent to Capital One. You can't give to the things that matter most if you are in debt up to your eyeballs. If you can't get your budget to balance and every single dollar is spent on your debt, you can't support the things that you are most passionate about.

When you have financial freedom, you are able to give more than you ever thought possible. WOW! This pumps me up! Paying bills doesn't pump me up! Helping others accomplish far more than they ever thought possible is what pumps me up!!!

Who are you giving to? I challenge you to give to someone today!

Who should you listen to?

2006-08-10T18:49:00.000-04:00

Who should you listen to?

If you are broke, should you listen to a broke person's advice on how to handle money?

If you are overweight, should you listen to an overweight person's advice on how to lose weight?

If you are out of shape, should you listen to an out of shape person's advice on how to become physically fit?

If you do not know how to read ... How are you reading this? :)

Who are you listening to for financial advice?

I am listening to Dave Ramsey.

I also listen to David Chilton.

Robert Kiyosaki is great to listen to.

Most of all, I listen to my wife, Jenn.

News and Notes

This is my 100th blog post!!!
Melea now has enough in her college fund to pay for a year of college!
The fully-funded car fund may be spent soon.
Debt is dumb. Figure it out!
I almost have a "ZERO" on my FICO ("I love debt") score. One open credit account - our home mortgage. I can't wait to make it go BYE-BYE-BYE. My goal is to have a ZERO for this score. Why do you need a great FICO score? TO GET MORE DEBT!!!

People need help!

2006-08-09T22:05:00.000-04:00

You have friends that need financial help! You have family members that need financial help! You have co-workers that need financial help! You may need financial help!

The financial help I am speaking of is not the act of giving away money. It is the act of teaching them key personal finance skills. It is teaching them how to put together a monthly zero-based budget. It is teaching them to use an envelope system, putting their cash into envelopes for key expense items and spending only what is in the envelope. There is no trip to the ATM when the envelope runs out of cash, there are creative meals from the cupboards. It is teaching them the lost art of saving so they can pay cash for their purchases. It is teaching them to say "NO!" to debt. It is teaching them the 8th wonder of the world - compound interest. It is teaching them to have a will. It is teaching them to have insurance - health, term-life, auto ... It is teaching them to demand a better deal. It is teaching them to have control of their spending habits.

It does not happen overnight. They will screw it up. They will struggle with some items that were easy for you to deal with. They will breeze through other items that were hard for you. They may grow weary of the process, but in the end it will be worth it all. You will have helped to equip them to do exactly what they were put on this earth to do! You will have helped their marriage. You will have changed their children's entire future!

Who could you help out financially this week? Go spend three hours with someone who needs help. This week!

Why?

2006-08-08T22:41:00.000-04:00

When I meet with financially distressed people, they are invariably downhearted.

Why?

How far we've come!

2006-08-07T22:11:00.000-04:00

I remember the days of frivolous spending. I remember it like it was yesterday. We were spending money that we did not have. We were generally unable to tell ourselves "NO!" to anything that we wanted. It was OK, we told ourselves. We had good jobs. We were college educated. We deserved it. I mean, we lived through our four year (5) vacation ... uhhh, I mean college, where a twenty dollar bill made you RICH!

Well, with that thinking we managed to live from paycheck to paycheck for six years. We even had the joy of running up our credit card bills three separate times! WOW! The joy of spending our entire tax refund on paying off credit card bills for items we ... well, we could not remember what we had bought with those credit card charges.

Flash forward to today. We have been debt-free except for our house since February 2004, but I have recently had a flashback that had all-too-real feelings associated with it.

Let me explain ...

We live in a sandy soil area. If you do not water your grass thoroughly at least once every two days, your grass will wither away, and you will be left with a nice dirt patch. We have heard that dirt patches reduce your home's value, and it certainly reduces your home's appearance. It reduces your home's appearance even further when Mr. Lawn Boy himself lives next door with THE PERFECT MANICURED LAWN. He literally mows the grass every 15 minutes. It is ridiculous how wonderful his lawn looks.

I explained to Jenny that having a dirt patch is a very good thing because we make Mr. Lawn Boy's yard look that much better. Crickets ...

Bottom Line: We decided to install an irrigation system for our lawn this year. We had not saved money specifically for the irrigation system, but we could tap into our new used car fund to pay for it. We reasoned that we could repay the new used car fund over the next few months.

So we did it. We installed the irrigation system. With money we borrowed from our own new used car fund. We BORROWED money FROM OURSELVES! I thought that this would feel OK. I was wrong! It is bad enough to be in debt to someone else. TRY BEING IN DEBT TO YOUR "NEW USED CAR FUND"!

We truly felt like we were in debt. We have recently repaid our "New Used Car Fund" back. WOW! I am glad I am not in debt to ourselves anymore. The feelings were scary!

I got to thinking about this ... How far we have come! When we actually feel "in debt" to our "new used car fund". In old days, we would have taken the money out of a savings fund, but would never repay. Now, it was repaid right on time.

It was a good decision for us to get the irrigation system, but I realized yet again just how bad it feels to be in debt.

How far we've come. How far we've come.

Do NOT give up HOPE!

2006-08-06T21:50:00.000-04:00

I have seen financial situations that have left me reeling. I have left counseling sessions feeling the weight of the world on my shoulders. What unbelievable messes we humans create for ourselves!

For some reason, many of us have been convinced that because the banks will loan us money, we must be in good financial condition. Because we can get a credit card, we matter. Do not believe this lie!

I have seen over $100,000 on credit cards. I have seen houses financed to over 125% of the highest potential selling price. I have seen budgets that include $300 in bounced check fees. I have seen budgets where the expenses are twice the income. I have seen debt loads that are seemingly insurmountable. I have seen families spend more money feeding goats than feeding themselves while driving themselves into utter poverty. I have seen families lose all of their possessions to repossessors and foreclosure - ALL of their possessions.

Still, I do not give up hope!!! I believe that most of these situations are recoverable! If the family could just say "NO!" to themselves! If the family could see the damage being wrought on their relationships by living in such financial conditions, they would RUN 180 degrees away from the direction they have been headed in.

I choose HOPE for these families that I meet with. I believe that Dave Ramsey is exactly correct when he says that finances are 80% emotional and 20% head knowledge.

Do NOT give up HOPE.

An update on Rummage Sales

2006-08-06T21:47:00.000-04:00

OFFICIAL CONCLUSION: RUMMAGE SALES REEK!
Special Note: If you are going to attempt to have a rummage sale and you live in the countryside, forget about it! You might as well donate all of your items to Goodwill or put them into a consignment shop. If the items are small and easily shipped, you might use Ebay.

For the amount of effort put forth into preparing, presenting, and cleaning up the rummage sale, the reward was quite limited.

Rummage Sales

2006-08-03T13:16:00.000-04:00

We are in the middle of the first day of a three day garage sale. WOW! I did not know how much work it was to prepare for one of these things.

I have eagerly told people to "have a rummage sale" in order to free up some quick cash and pay off some smaller bills. This will many times help people gain the traction they need to get to a balanced budget.

I will still tell people eagerly to sell stuff and have a rummage sale, but I will do it with a more deeper understanding of what that truly means. It takes effort.

That's OK. It takes effort to get out of debt!

Updates on the garage sale will appear over the next few days.

Any tips for making a garage sale more of a success?

Financial Stress

2006-08-01T12:20:00.000-04:00

Do you know what it is like to experience financial stress?

Financial stress impacts family relationships - marriages, parents with children, children with parents, siblings. Financial stress impacts friendships and business partnerships. It can forever destroy your relationship with your spouse.

Why is this?

The way you manage your finances tells a story. It tells a story about what you value, about what is important to you, and about who is important to you. It can also tell a story about what you do not value, about what is unimportant to you, and about who is unimportant to you.

If you spend a majority of your money paying bills for debts (car, house, TV, credit cards, student loans, furniture, boat, lawn mower, etc.) you have signed up for, then it tells a story that having stuff might be more important than saving for retirement.

If you spend everything you make and live from paycheck to paycheck, it could indicate that you do not value security more than you value not having to take time developing a spending plan.

If you give away a pile of money to worthy causes, have taken the time to develop a spending plan that works, are saving for retirement, college, and other notable expenses, and are regularly reviewing your spending habits ON PURPOSE to understand opportunities for better management of your money ... it tells me that you are weird and value others and your future more than you value stuff.

Go look at your spending. Does it line up with your values?

By the way, "you" can insert "me" or "I" everywhere "I" have listed "you" and "your" in this diatribe. :)

Car problems?

2006-07-28T12:19:00.000-04:00

My car's water pump went out. What a pain! I had to wait in the Wal-Mart parking lot while calling the dealership to get it in for repair. It was smoking hot. I was smoking hot at my broken car. Combine it together, I was in flames. Cost of repair? My frustration and <$200.

This same car's power steering went out a few years later. What a pain! We had to drive the car in to the dealership for repair. Have you ever tried to drive a car without power steering when it is supposed to have power steering? We average 15 - 20 mph for the 10 miles to the repair store. Cost of repair? My frustration and $193.89.

This same car's fan switch broke. It would only operate at the high speed setting. What a pain! We played a seemingly permanent game of "Freeze Out" for one summer. During the winter, it was a game of "Burn Up". We finally broke down and had it fixed. Cost of repair? Our frustration and $20.

Then this same car's AC broke. It would not blow out the really nice cool air that I like during the summer. Cost of repair? My frustration and $600.

This same car has a broken adjustable passenger's front seat, has crayons, food, and other items crushed into the back seat from our child, has a squeaky belt, has a very loud rattle in the dashboard panel, and the tape player does not work so well.

Oh, did I mention that this car has over 200,000 miles on it? We have spent an average of $600 to repair and maintain this vehicle each year. That is $50/month. I MUCH prefer the occasional frustrating repair and our $50/month cost than a $400/month car payment and still having to repair and maintain the vehicle.

THINK about the cost. If you are frustrated with your car, that's OK! However, before you go run out and buy a new car and acquire a pile of debt, consider the overall cost of that decision.

By the way - I love my car. Payment free for over 5 years!!! I am hoping to get another 100,000 miles out of it.

Lack of understanding can cost you big time!

2006-07-26T22:39:00.000-04:00

Do you understand insurance? Life insurance? Auto Insurance? Health Insurance? I know that it is certainly NOT the most interesting subject in the world, but if you do not take the time to truly understand these products, it will cost you big time.

Rules for purchasing insurance:

Do not just "take an insurance agent's word for it!" Truly seek understanding of the product! If you understand it, you will be able to make a good purchase that you will KNOW is a good purchase.
If you are speaking with an insurance agent, and you start feeling like you are being "sold" on a product - LEAVE IMMEDIATELY!!! Use Donald Trump's words - "You're fired!" Complete with the New England accent if you wish. You do not need to be sold on an insurance product, you need to understand the insurance products. Once you understand the products, you will be able to make a sound decision.
Obtain at least three quotes from three different companies. Ensure that at least one is an independent company that is able to surf your insurance needs among many different companies. Competition makes prices go down. When prices go down, you will get to keep more of your money.
Do not cancel an existing insurance product until you have obtained a replacement. Do not cancel your auto insurance before you have obtained auto insurance from another company. Do not cancel your life insurance before you have obtained alternative life insurance from elsewhere. A gap in coverage is ripe territory for Mr. Murphy to show up.
Do not allow your insurance to be combined with another financial product. For example, cash value life insurance is both life insurance and an investment in one product. The problem with these types of products is that the fees are tremendous. Purchase your investments and insurance separately.
Send out your insurance occasionally for quotes. You want to ensure that your rates are remaining competitive with the open market.
Ask for a better deal. Insurance is a service product. Service products are negotiable.
Be careful of purchasing insurance from a family member or a good friend. You may have your judgment impaired because you really want to please and help them.

Again, a boring subject. If you kept reading all the way to the end of this article, I am impressed! You can save a lot of money on insurance by employing these tips.

I am motivated!!!

2006-07-25T22:16:00.000-04:00

I want to do something with my life! I want to help others accomplish far more than they ever thought possible! I want to make something happen! I will not accept status quo. I believe that tomorrow will be better than today! I believe that I can help make tomorrow be a better day for others. I will not wait for my ship to come in. I have found exactly what I have been made to do in life, and I plan to pursue it with abandon.

You too can make tomorrow better! What skill or talent do you have that you can share with the world to make it a better place? Who could you impact today and make their life nicer? Do you know what that skill or talent is? Here's help. What is that one thing that just makes you want to wake up at 4AM every single day and say, "Let's go!!!"? What is that one thing that you could talk about all day every day and not grow weary of? That's it!!! Go do something with it!

We can talk about financial peace all day long, but the whole entire point of obtaining financial freedom is to be able to do EXACTLY what we have been made to do. REGARDLESS of the income potential. REGARDLESS of the naysayers. REGARDLESS of what your broke friends and family think. REGARDLESS of your comfortable life and ability to just lay back and put life on cruise control.

Make it happen!

Why people do stupid things with money.

2006-07-24T21:55:00.000-04:00

Why do people do what they do?

Why does someone buy a brand new car and finance 106% of it (sales tax and all!)?

Why does someone go to college and finance it 100% with student loans while obtaining a degree in basket weaving?

Why does someone take a very expensive vacation to Hawaii and put it 100% on their credit card?

Why does someone withdraw all the equity out of their home to start a new business?

It happens every day! Look around! You can see it! You may have to only look into the mirror to see someone who has done one of these financially horrendous items. That is as far as I have to look!!!

Back to my question. Why?

Possible Answers
1. No plan. They wanted to spend the money on the item, but they did not plan for the expense. Consequently, they only money available when the purchase was made was very expensive debt money.

2. No control. They wanted it! They wanted it now! They did not want to wait. No! Must have item ... Must have item now ... Will be emotionally scarred for life if item is not obtained now ...

3. Not willing to face up to the fact that the item may not be available for them at this time, so they buy it anyway hoping that "the money will come from somewhere".

4. Talked into it. See #1, #2, and #3. You've seen it happen. The friends start talking about it. The friends are going on the vacation. The friends have the new car. Your friends are going to college and are not having to work while there. Justification is found through others' circumstances.

If I were to attempt to sum the reasons that people do stupid things with money, I would say it is because they were ignorant of the COST of those major financial decisions. If they truly knew the COST of those decisions, many tears of sorrow and regret and many money fights with their spouse could be avoided.

Taking it to the next level!

2006-07-20T22:10:00.000-04:00

I have a friend who helps coordinate the personal finance course with Jenn and I. This friend is in charge of delivering cost saving ideas after the intermission.

She has been doing this now for about 6 weeks. All I can say is , "WOW!" I have seen an entirely new level of financial discipline. This week she brought in three boxes of pencils with each box containing a dozen pencils. "How much did I pay for these pencils?", she asked. "How much? Come on, how much?"

One of the class members ventured, "$1.00?"

"Nope! Less."

"Fifty cents?", another tried.

"Nope! Less."

"Ten cents?", a class member asked bewilderingly.

"Nope! Less."

"Five cents?", was asked cautiously.

"Nope! Less. I paid one penny for each box. They were so cheap that the store could not even charge me tax."

This lady has brought in a fine art painting. "How much?", she asked. After a series of guesses, we arrived at ZERO. She had checked the painting out at the library!

I am discovering that there is an entire new level to managing your spending! Don't tell me you can't do this! Don't tell me you can not live on your income! All you have to do is control your own self!

You may be saying, "THIS WOMAN IS A WACKO!!!"

I would say you may be right, but she isn't broke anymore.

I choose to be wierd. Why? Because normal in America is BROKE! I am NOT doing BROKE anymore!

Can I get a witness?

Home mortgage interest deduction a good idea?

2006-07-19T22:12:00.000-04:00

Absolutely! If you have a mortgage and are paying interest, it is very important to take the mortgage interest deduction.

One thing I have heard commonly stated is the statement that "I do not pay off my mortgage early because I do not want to lose the mortgage interest deduction." I believe this saying was initiated by banks :) Here is why. Look at the example below.

The Mortgage Interest Deduction
Let's say you paid $5,000 in interest on your mortgage last year. By taking the deduction, you effectively reduce your taxable income by $5,000. You receive back the tax rate on that home mortgage interest deduction. If your tax rate is 30%, you get back $1,500 (30% of $5,000). The bank gets to keep the $5,000 you paid in interest. Uncle Sam gets 30% of your taxable income which is now $40,000 because you were able to reduce your taxable income by the interest you paid. The total net OUTGO from you to Uncle Sam and the bank is $17,000!

The Paid-Off House Scenario
Well, you are living life pretty good in your debt-free condition! So, now you no longer pay interest to the bank (sorry!). This means that you will be taxed on the full $45,000. If your tax rate is 30%, the total net OUTGO from you to Uncle Sam is $13,500!

$3,500 LESS OUTGO from you to someone else.

So that is why I believe that the banks started the statement, "I do not pay off my mortgage early because I do not want to lose the mortgage interest deduction." If you do pay off your mortgage, the banks will not get any of your money!

THINK and you will prosper!

Save at the dentist ...

2006-07-17T20:41:00.000-04:00

A lady who went through the personal finance course that I coordinate told me of her trip to the dentist.

The dentist told her that she needed a crown. The cost of the crown was to be $650. She told the dentist, "I am paying cash. $250!" The surprised dentist responded, "$325."

What a deal!

What a thought! You see, the dentist is performing a service. A service is negotiable. When you are paying cash out of your own pocket, you are more apt to question the fee.

It makes one stop and think about the impact of 100% payment insurance. It doesn't make the patient pay out of their own pocket, so they are less apt to question the fee.

Go out and ask for a better deal!

The 8th wonder of the world ... compound interest!

2006-07-12T22:07:00.000-04:00

If I can get you to do only two things related to your personal finances (and I want you do far more than two things!!!), I would plead for you to complete a zero-based budget every single month, and I would beg you to start investing NOW to enjoy the awe-inspiring results of compound interest!

If you invested $1,000 per year at 10% interest for 50 years, you would have $1,163,909!!! If you only had 40 years, you would only have $442,593.

I say "only" with a smile, but let's think about it. By starting your investing 10 years late, you have forfeited the miracle of compound interest for that time period, and it COST you $721,315!!! WOW!

If you are already enjoying the benefits of compound interest, you are smiling now. If you are not already investing, time is ticking away ...

How to pay for your next car.

2006-07-11T21:13:00.000-04:00

In conversation with a friend recently, he mentioned that he is starting to check out the new cars because he is going to be buying a car in three years. He has owned his current vehicle for seven years. His goal is to keep it for ten years. NOTE: This is how you win financially. Buying depreciating assets sparingly. Do not buy a new car every single year.

Anyway, I asked him if he was planning on paying cash for it. The answer was an uncertain, "No." It was almost quizzical. It was like, "Who pays cash for a new car?" or maybe "How would I pay cash for a new car?"

Here's how! YOU HAVE THREE YEARS!!!

Take the expected purchase price of the vehicle in three years. Let's say that it will be a $20,000 vehicle. You have 36 months until you will be purchasing the vehicle. Divide the $20,000 by 36. You need to save $555.56/month in order to have $20,000 in cash three years from now.

IT IS THAT SIMPLE!!!

You may be saying, "Joe, there is NO WAY I can save $555.56/month for each of the next 36 months!" My answer? THEN YOU CANNOT AFFORD A $20,000 CAR IN 36 MONTHS!!! I bet you will get a raise between now and then. I bet you will get a tax refund between now and then. I sincerely hope that you will be paying off your consumer debt between now and then.

Listen - If you really want the $20,000 car in 36 months, save $555.56/month. We don't do debt around here.

IT IS THAT SIMPLE!

Celebrating 36 months of budgeting!!!

2006-07-10T22:35:00.000-04:00

We started to get our finances under serious control in January 2003, but it was not until June 2003 that we started to really win financially. Would it surprise anyone that June is when Jenn and I started budgeting monthly?

I love budgeting. I am the free spirit. The spender. And I am telling you that I LOVE budgeting. Why do I love budgeting? Let me tell you the reasons ...

Jenn and I actually TALK about our finances at least once each month! This means that we also talk about the birthdays of nephews and nieces, brothers and sisters, parents. We talk about upcoming events and plan out our schedule accordingly. We talk. Very cool.
Budgeting has made our marriage better. With the systematic reduction of our debt, we were able to secure breathing room in our finances. With the systematic building of our 6 month emergency fund, we have been able to really secure breathing room. This means we can greatly reduce the chance that we will have an issue with the number one cause of marital conflict - finances. What an investment!!!
Our budget gave us great hope. There is nothing like seeing a zero-based budget balance to zero! It means that all of the bills are going to be paid, on-time, and we will not be turning to debt to make up the difference! It gave us HOPE that we can retire some day instead of just getting tired.
Budgeting is going to be THE THING that enables Jenn and I to do exactly what we were created to do regardless of the cost. The act of budgeting every month, before the month begins, and spending every dollar on paper, on purpose has strengthened our self-control and self-discipline. We have learned how to "Just say NO!!!" in so many ways.
Budgeting has made us win financially. We are so much better off today than the days when we had two incomes. Why? Because we grew up and put together a plan - our budget!

Happy budgeting!!!

Avoid Stuff-itis ==> Pursue Self-Control

2006-07-09T14:53:00.000-04:00

Do you ever see something that created a "I really want that!!!" feeling inside? Maybe it was a jetski, or a new type of shoes, or a new car, or new furniture, or ...

We all have! For me, one of those things was a brand new Honda Odyssey minivan. I remember it well. It was 2001, we had a one year old baby with plans for more, and this new minivan just captured me. You might be asking me, a minivan?!!? I know. I know. A minivan. I used to be cool. Anyway, I priced out this minivan. I really wanted this minivan. I wanted the one with the DVD player (not very common then), the 16" aluminum allow wheels, the deep dark red metal-flecked paint, leather, and an awesome sound package. For only $30,000, I would be able to drive away in this new car.

Jenn is the saver. I am the spender.After many talks with Jenn, we decided not to buy it. This was before we really became serious about our finances, but even this seemed outrageous to her. I recently came across the annual budget that I had developed to try to convince her that we should purchase this new vehicle. The budget is $10,270 PER YEAR short!!!

Review of the budget is comical! In my attempts to make the budget balance, I had written in the costs that we could reduce. Let's see, auto insurance (right, with a brand new $30K vehicle), cable TV (an annual savings of $600), internet (savings of $264), groceries (right ... with a new baby), miscellaneous spending ... It is really enlightening to look back and see how bad "stuff-itis" had captured me.

We did not purchase the Honda. A review of Kelley Blue Book's estimated private party value for this vehicle in good condition shows $12,620. Additionally, if we would have followed the financing plan I had established, we would not yet be done making payments!!! WOW!!!

I am glad I had a great wife who forced me to pay attention to what this would do to our family's finances. Instead of still being in debt, we have been debt-free (except for our house) since February 2004 (31 months!!!) and the house debt is being exterminated. I will take that trade any day of the week!!!

Avoid stuff-itis. Pursue self-control. You will win financially.

Someone needs to do this ...

2006-07-06T21:48:00.000-04:00

Here is a list of "helpful" companies that exist solely to "help" people.

Check Into Cash
Cash Advance
Extra Payday
Cash America
Axcess Cash
Payday OK
PayDay USA
Advance America
Check Smart
Check 'n Go

Let's see how helpful ...

Check Into Cash states under their "Our Standards" link that "A payday advance is a responsible, dignified choice for short-term cash needs" and "Customers understand the value of convenience and the growth of payday advances reflects a broader national trend toward increased convenience and customer service."

Under Check Into Cash's "How It Works" link, the claim is stated "If you sometimes run short of cash between paydays, for any reason, let Check Into Cash be your safety net. It takes just a few minutes."

I cry out, "BULL CRAP!!!" and "THAT IS UNACCEPTABLE!!!"

The FACT is that these companies charge OUTRAGEOUS amounts of FEES and INTEREST. They are only interested in ripping off poor people and keeping them poor. Annual Percentage Rates range anywhere from 250% to 500% on these loans. OUTRAGEOUS!!! This is NOT helping people.

Someone should do this ... Open up a store next to every single one of these RIP-OFF, HORRIBLE financial institutions. That store's name should be something like "It's Like Free Money!" or "Cash Advice" or "Keep Your Payday, OK?" or "Be Smart, Not Check Smart". Inside, there are highly trained, highly capable financial counselors that will meet FOR FREE with each person who walks into the door and helps them understand the true cost of a cash advance loan. That person would then offer FOR FREE to help them develop a budget and hold them accountable to that budget. Additionally, monthly follow-up visits are conducted FOR FREE to help them gain control of their finances.

I am fed up with poor people being ripped off. This must be stopped.

Are you investing for retirement?

2006-07-05T12:27:00.000-04:00

Retirement.

What a word.

Ask 100 persons what retirement is, and you will probably get 100 different answers. However, each answer would probably have a similar theme. Each answer would most likely include the theme of "stopping or slowing down dramatically what I have been doing and replacing it with some other activity." Many times, the "other activity" does not generate much of an income. That means that you must prepare for it.

Prepare?!!??! You want me to prepare??!! I can't even force myself to pack one day before I leave on vacation, and you want me to think about something that is going to happen years from now?

YES!!!

Why?! Because I want you to be able to do that "some other activity" some day!!! If you do not prepare financially, your plans may never happen or will experience severe delays. I really want you to be able to do what you want to!

There are many ways to prepare for retirement including: investing in stocks, bonds, mutual funds, rental properties, owning a business, owning real estate, owning intellectual property, writing a great song and selling licensing rights, patents, antiques, precious metals, and 1000s of other ways. The key is to diversify your retirement holdings so that your risk is mitigated. Don't hold all of your money in bonds, stocks, and mutual funds that are focused only on one segment of the market (like all in high-tech). Spread out your investments into many types of healthy markets.

The key is to START NOW!!! If you are 20 and you haven't started, walk over to an investment advisor today. If you are 30 and you haven't started, RUN over to the advisor. If you are 40 and you haven't started, SPRINT over. If you are over 50, for Pete's sake, TAKE A RACE CAR to the advisor's office!!!

See you in retirement!

Back from vacation!

2006-07-02T21:19:00.000-04:00

Well, vacation was awesome! Time spent with family far away from home is great!

I was able to take a lot of time to think. During vacation, I always take the time to ask myself the following questions:

1) Am I happy with where I am in life right now?
2) Will I be happy with where I will be in 5 years if I keep on the path I am currently on?

WARNING: Don't ask yourself these questions unless you really want to know the answers!

As I thought through the questions, one thing stood out very clear to me (again!). I love to teach! I love to teach people tools and skills that immediately impact their lives for the better. Whether it is teaching someone about how to budget for the very first time or how to use Microsoft Excel to analyze data, I love to teach!

I was put on this earth to teach. It is what fires me up. My life's passion statement is "to help others accomplish far more than they ever thought possible".

Game on.

What keeps us from changing?

2006-06-22T23:12:00.000-04:00

Human feelings amaze me. It drives much of our behavior. It appears clear to me that children (certainly my child) do not contain the relationship between their feelings and behavior.

"I am hungry" = "WAAAAHHHH"
"I am sitting in stinky doo" = "WAAAAHHHH"

Even 5 and 6 year olds struggle to contain any of the relationship between feelings and behavior.

"I am hungry" = "Mooommm. (very whiny) What's for dinner? ... I WANT IT NOW!!!"
"I am tired" = Fierce rubbing of the eyes, whining, crying, and immense stubborn behavior

As we grow up, we are constantly being bombarded with "Helpful" ways to contain the relationship between our feelings and behavior.

Depression = Think happy thoughts or take medicine or exercise
Fear = Just do it!
Even if it feels good, it may be bad for you = "Deny yourself"

I am sure that there are many more, but I want to focus on FEAR.

There are many people that I have observed that are in severely poor financial condition. It has been brought on by many bad financial decisions. They go through the 13 week personal finance course that I coordinate. In many cases, I have even personally counseled them. They know the feelings they are having "Fear" of 1) what others may think 2) that they might have to change their behavior.

I find that FEAR paralyzes. Even in HORRIBLE situations, fear can paralyze. It is much like the extremely young child. Fear completely paralyzes them.

Let me illustrate ...

My daughter was recently crying and begging to talk to me. She had been told by a cousin of the same age that there are monsters that just pop up in front of you. In my daughter's words, "It freaks me out, Dad! I don't like it! I'm scared!"

There it is - Fear. It paralyzes.

It paralyzes children. It paralyzes persons in horrible financial conditions.

Only until you bring under control your FEAR of the situation will you be able to make positive change. I am not saying that you will eliminate your fear. I am saying you should bring it under control.

What do you need to do?

I have to ask it again ...

2006-06-21T20:34:00.000-04:00

Is it worth it?

I had a person express to me the importance of them receiving a paycheck because they are living paycheck to paycheck.

This individual has been working over 20 years and is still living paycheck to paycheck.

WOW!

Is everything they have purchased with their money been worth living paycheck to paycheck for 20 years? Balancing each week to pay the bills without bouncing a check?

OUCH!

If you keep doing what you are currently doing, are you going to look back in 20 years and still be living paycheck to paycheck? 10 years from now? 5 years from now? 1 year from now?

Really?

You see, I believe that for more than 95% of Americans the issue is NOT income. It is OUTGO! I believe that you can change your financial future. I believe that I can NOT change your financial future. You will change your financial future only when you have committed yourself 100% to the goal of living beyond the life of "paycheck-to-paycheck".

I can help teach you. I can help educate you. I can plead with you. Your spouse can beg you. Only you can do it!

Personal Finances Made Simple

2006-06-19T19:16:00.000-04:00

Personal finances made simple ...

INCOME - OUTGO = EXACTLY ZERO

Spend less than you make.

Save for a rainy day.

Learn how to tell yourself, "NO!"

Do not sign up for any more debt starting TODAY!

Ask yourself the question, "Is this really worth it?"

Work TOGETHER with your spouse.

GIVE plenty of money away.

Stop caring about what others may think.

Spend cash for all of your purchases.

Always ask for a better deal.

Seek counsel from others who are financially successful.

PRAY!

How old are you and what do you do?

2006-06-15T22:21:00.000-04:00

I was asked the following questions yesterday after teaching a budgeting class:

"How old are you?" and "What do you do for a living?"

From the tone, it was more like - "What qualifies you to teach me about finances?"

I have a question - does age and my full-time career matter? Possibly. However, I believe that what matters most is the answer to this question - "How are you doing financially by using these financial principles?"

If you want to lose a bunch of weight - are you going to seek advice from someone who is really heavy? NO! You are going to speak to someone who has lost a bunch of weight and kept it off.

When I was preparing for my marathon, do you think I sought out persons who were outstanding weight-lifters? NO! I sought out persons who had completed marathons and finished well.

When I sought out financial advice, it was from someone who practices what he teaches - Dave Ramsey. Dave has a set of financial principles that he abides by every single day that simply resonate with Jenn and I. As Dave has stated repeatedly, he did not invent any of these financial principles - they are what God and Grandma say about money. Hard principles like - "save money for a rainy day" and "spend less than you make" and "learn how to tell yourself NO!!"

I also speak to acquaintances and friends who are also doing well financially - not because they earn incredible amounts of money, but because they manage what they do earn very well.

The answers to the questions: I'm 32, I work in manufacturing, and "I Was Broke. Now, I'm Not!"

Make it equal ZERO!

2006-06-14T22:44:00.000-04:00

INCOME - OUTGO = EXACTLY ZERO!!!!

Have you gotten this figured out yet? If you do not make your money obey this extremely simple formula, you will always be broke. Money will always run from you and not to you.

You can do it! Remember that OUTGO includes items like saving, giving, blow-it funds, and vacation funds. When you reach the point that your finances follow this formula, you will start to see financial success that you have never been able to enjoy!

The monthly budgeting session has become THE TIME that Jenn and I use to discuss our future plans. What are we saving for? Why are we saving for it? Where are we headed short-term? Long-term? What are the mid-stream corrections we need to make to ensure that we get where we want to go?

We just completed our budget. Guess what it equals? EXACTLY ZERO!!! It took about 30 minutes to complete. It works very well. Why? Because we agreed long ago to make it a priority, we agreed to follow the budget as it is written, and we both know why we are doing it.

I love budgeting!!! Go ahead and say it - I am a NERD!!! But as the title of my page states: "I was broke. Now, I'm not!!!"

A rant on changing ...

2006-06-13T20:05:00.000-04:00

I was working with my leadership coach today and during our discussion, he stated something that was profound to me.

He stated that when it comes to making change happen, incentives work, fear may help, but making it part of a cause really makes it happen.

Let me break it down as it applies to personal finances.

Incentives work in helping you change your finances. If you have a 401(k) retirement fund (or something similar like a 403(b)) at work, your organization will many times offer to match a portion of your contribution. Because of this incentive, you company hopes that you may be more inclined to change your finances and contribute toward your retirement fund. The government also provides an incentive to contribute toward your retirement by offering to not tax your money until you begin withdrawing it during retirement. This allows you to utilize the tax dollars to gain additional growth.

Fear helps by driving you toward some other decision just because the other alternative is just so bad. You may have gotten into deep debt in the past. As a result, you nearly lost your house to foreclosure. Fear of that situation may drive you to avoid obtaining debt again.

I propose that really changing your personal finances happens when it becomes part of a cause. If your wife really wants to stay home and raise the children, but you really need to make a change in your financial management to make it happen, you have a cause to fight for. If you really want to pursue a job as a teacher, but it makes way less income than you currently make, you have a cause to fight for. If you want to go to college, but you do not want debt, you have a cause to fight for. If you have a very sick child who needs a lot of expensive medicine, you really have a cause to fight for.

When you have a true cause to fight for, that is what makes true change happen. Why? Because while incentives and fear help drive some change, it is generally temporary because external events are driving the behavior. With a cause, however, an internal desire drives the behavior. When it becomes internal to your very being, change will happen.

What cause are you managing your finances for?

Stop living from paycheck to paycheck!

2006-06-12T21:51:00.000-04:00

A recent study from ACNielsen revealed that about 1 in 4 Americans say that they do not have any spare cash. No wiggle room. No room for an error. No room for an emergency. No room for life to happen.

Question: That new car - is it worth being broke over?
Question: That student loan - is it worth the degree you will receive?
Question: That furniture - is it really so important that you could not save up and pay cash for it?
Question: What would you be able to do if you had cash available to you?

I just completed reading the story in ESPN The Magazine (June 19, 2006 edition) about PGA Tour Pro John Daly. He states that when he showed up to St. Andrews for the British Open Major Championship in 1995, he was in debt almost $4,000,000. He states, "The only way I'd been able to keep my head above water was to turn all my quarterly endorsement income over to the casinos (his debtors), and then run myself ragged by playing all over the world for appearance fees and doing too many corporate outings, all because I needed the money to feed the beast. The British Open saved me. Not because of the winner's purse - it was only ... $200,000 back then. But when you throw in the bonuses from all my sponsors, I took at $1 million-plus haul away from the Old Course. All that went to the casinos."

Paycheck to paycheck even when making millions. It is a VERY SIMPLE math equation.

INCOME - OUTGO = EXACTLY ZERO

OUTGO needs to include savings for emergencies and otherwise unexpected financial needs. If not, you will continue to live paycheck to paycheck.

Living paycheck to paycheck robs you of your ability to dream. It shoots down hope. It leads to depression and despair. It can lead to a feeling of inadequacy. It will force you to turn to debt when any small issue arises. It drives a wedge between husband and wife - between parents and children. It leads to increased stress and high blood pressure. It prevents people from following their dreams. It paralyzes you.

You may think I am overstating this, but I don't think so. I have seen it with my own eyes. I have stared hopeless persons in the eye. I have heard the despair in their voices. I used to live paycheck to paycheck and was in debt up to my eyeballs. No more. There is no house, no furniture, no car, no vacation, no investment scheme, no student loan, no ... NOT ANYTHING that can ever get me to live paycheck to paycheck again. Life is just way too short to spend all of my time worrying about how I will pay this month's bills.

Make a commitment to change NOW!

Need help? Contact me.

Keep investing!

2006-06-08T22:59:00.000-04:00

OK, so the market has went down for four straight days. It has went down quite a lot. Should you stop investing in the stock market?

My vote is no.

Here are my reasons:
1. Dollar cost averaging - this means you continue to invest at a set interval regardless of price. It is like the mutual fund is on sale at a lower price when it drops in value.
2. For well-chosen mutual funds - steady returns over the long-haul (20+ years) - you can look at historical evidence - it is actually verifiable!
3. World demand is growing - China, India, and Eastern Europe are all entering into the new world market stage. All of them want infrastructure such as roads, electricity, utilities in order to have the appliances and other items that help make life easier (dryers, washers, stoves, can openers, etc.). Invest in companies that are on the forefront in these developing markets, and it should result in a handsome return.
4. Just like the marathon I have been ranting about, you are in this for the long haul!

Have a great weekend!

What is Financial Peace?

2006-06-08T00:24:00.000-04:00

I am going to attempt to put together my definition of financial peace. If you have other thoughts, please send them to me or comment on them below.

Financial Peace
- n. a condition where one does not have to continuously worry about their ability to meet their financial obligations; they have financial peace
- adj. a position where one is financially set; that couple has a financial peace mindset
- n. a financial position that allows one to pursue doing exactly what they were made to do regardless of its income potential; because he has financial peace, he is able to pursue his dream of being a major league baseball player even though he never even played high school or college baseball

How did I do?

WOW! More ways that personal finances are like a marathon!

2006-06-05T20:19:00.000-04:00

I know that I have blogged before about how personal finances are like a marathon, but I have to do it again. You see, I have now completed a marathon!

1. Both require endurance.

I started out with a pace group that was very close to the pace I wanted to run the marathon at. The leader of the pace group was running his 148th marathon! He was nailing the exact pace every single mile. How did he do that? Endurance.
I was running with this pace group. Mile marker 5 was great. Mile marker 10 was great. The 1/2-way point of 13.1 miles was great. Mile 15 was great. Mile 17 was good. Mile 18 was OK. Mile 19 was ... miserable. You see, they stuck a 2-mile uphill run in between mile markers 17 and 19. It took a lot out of me. I went from feeling great to feeling awful in less than 20 minutes. By Mile 19, I was walking!
Did I stop? NO!!! After a couple minutes of walking, I felt good enough to run again (some observers may have called it something other than running).
Personal finances DEMAND endurance. You will have great times, but you will also have tough times. Medical bills are going to happen. The car is going to break down. Unexpected tax bills are going to show up. Fuel prices are going to double. In those times, should you just give up? NO WAY! You may not make the progress you were making, but keep up what you were doing.

2. Things will not go according to our planned schedule.

A close friend of mine who ran the race with me had trained diligently for the past four months. He was in great shape. He had completed the extra long runs very well. He passed out from dehydration at mile marker 22 and was unable to complete the race. What a disappointment!!! Or was it? You see, 22 miles was farther than he had ever run before!
If you have a goal of having $1,000,000 in your retirement account by 55, will you be disappointed with having only $800,000 by 55? So what if you don't hit the goal perfectly. In either case, you have substantially changed your life by focusing on your finances early and often.

3. It is GOOD to have friends who are doing it too!

Although none of my friends in my home state were training for a marathon, I did have friends from South Carolina who were training. Just knowing that others were training at the exact same time as I was on Saturday mornings was awesome. Just knowing that we were all going to San Diego to run the actual race was great! It also motivated me to not skip training. Why? I knew that the race would reveal whether or not I had skimped on training. ACCOUNTABILITY - The world's most-despised 14 letter word!
In your personal finances, if you hang out with friends who shop all the time, watch out! If you hang around with people who must have the latest and greatest car, TV, sound system, RV, lake house, vacation, education, ... and they are doing it all with debt ... WATCH OUT! This can seriously damage your ability to stay committed to your sound financial principles! Here's an idea - get them onto a budget. I recommend Dave Ramsey's Financial Peace University!!!

So I have completed my first marathon. It feels good to accomplish one of my major life goals. Life is good ... all of the time.

Motivation happens when there is HOPE!

2006-06-01T21:01:00.000-04:00

I remember playing in a basketball tournament. We were playing terribly. We were being beaten inside and outside. It was really a miserable experience. When the half ended, we were behind and there was little hope.

At the half, our coach told us that if we would come out with intense aggression for the first five minutes of the second half, we would have the potential to come back and win. We were very skeptical. After all, we had just been smashed for the entire first half. We were teenagers, however, so we decided to give it a try.

While it may be a surprise to some, I am a rather enthusiastic and energetic person. We went after the other team with reckless abandon. We played intensely. We played defense like it has never been played before (much better than in the NBA). After five minutes, we had thoroughly frustrated the other team. The other team's fans were frustrated as well. We were motivated by the results of the effort that we were putting forth. In the end, we won the game and the tournament!

Managing your personal finances requires hope. If you have no hope, you will not be motivated to endure through additional tough times in order to achieve future success. This is the number one issue I see in the people I counsel. They lack hope. They believe that they will always have a house payment, always have a car payment, always be in debt, never have enough money to retire, never have enough money to send their children to school, always have to have two incomes, and on and on.

The question is - How does one restore hope? This question is very difficult to answer. I do not have a clear answer to this day, but I do know some characteristics that surround those who have hope and are sufficiently motivated to make positive improvements in their personal finances.

Top Characteristic: They have a role model. A teacher. A coach. Someone they aspire to be like. Someone that they can look to who has been where they have been and experienced what they are experiencing.

They reached a trigger point where they simply could not continue in the current direction they were headed. For some, this is when they have to take out another loan. For others, this is when they have filed bankruptcy. Still others are motivated to change when they want to become a single- income family. It is different for each of us, but when this trigger point is hit, it simply makes us seek to change.

They learned the tools necessary to win. If one has not ever used a zero-balanced budget, it can be difficult putting the first one together. If one has never invested in mutual funds, it can be a very confusing experience to start. If the checkbook has never been balanced, it can take quite a lot of effort to straighten out the mess. While it is often frustrating and time-consuming to learn these skill sets, it is a common thread among those who have made outstanding improvements in the management of their finances.

If you are without hope, I encourage you to think about those who inspire you in the way they manage their finances. Call them up and ask them if you could meet with them. Ask questions that will help you begin to win. Go to the library and get a book or three about personal finances. Look on the internet. There are tons of resources on the internet for personal finances.

Have HOPE!

How a marathon is like personal finances

2006-05-30T22:33:00.000-04:00

Well, this weekend I will be running my very first full marathon. That's right - 26.2 beautiful miles! At least I will be able to run it among the beautiful San Diego streets.

As I have trained for this marathon, I have realized that there are many correlations between this race and personal finances.

1. Both require disciplined focus and regular attention.

You will not just get rich because you want to. You will not run 26.2 miles just because you want to.

2. You must train yourself.

If you do not train yourself to manage your money, you will struggle. Monthly budgets are not an option. I know you do not like to do them. I also did not like to run 17+ miles at a time training for this race, but it was necessary to be able to make it the entire race.

3. This is not a sprint.

I have seen many people (MANY!) that become exuberant about changing their financial situation. They charge into restructuring their lives. I applaud their efforts. I am excited for them. I then see them 3 months later and they are right back doing the bad habits that got them broke in the first place! Why? They wanted to get rich quick. They wanted the result NOW! They forgot how long it took them to get so deeply into debt. In this marathon, if I started out at a dead-sprint I can guarantee you that I would not finish. I must start out with the end in mind. I must understand that a successful race requires commitment and a long-term mindset.

4. Both require a commitment.

I have never despised Saturday mornings until training for this race. You see, this is the time I have had to complete my long runs. I have had to run in 40 degree weather with blowing wind and rain for 17 miles. I have had to run in 90 degree weather with high humidity. I have had to run when I had family in town to visit. I have had to run while on vacation. Why did I have to run? I committed to run this race. I committed to complete this race. Just as I have committed my life to Christ, I must complete this race. Just as I have committed my life to my wife in marriage, I must complete this race. In the same way, I must remain committed to my finances. Without commitment, this whole entire effort to have financial success would fail. It is simple math, but it requires full commitment.

5. The end result is worth it!

I have lost 18 pounds that I did not even know I could lose by training for this marathon. I am the most fit I have ever been in my entire life. I KNOW that I will cry when I cross the finish line. I am OK with that. I KNOW that I am pumped up over what our financial planning has allowed Jenn and I to accomplish. It is enabling us to be able to do exactly what we were made to do. To accomplish EXACTLY what we were put on Earth to do! Truly, the end result is worth it!

Top 3 Things You Should Do Over Memorial Day Weekend (for your Personal Finances)

2006-05-26T08:01:00.000-04:00

1. Spend only what you have budgeted to spend.
2. No budget?!! Budget - and then spend only what you have budgeted to spend.
3. Enjoy the things in life that are free! Family, friends, nature, gardening, and birds are some of the items on my list.

Have a great holiday!

A sign that your financial plan is working!

2006-05-24T21:19:00.000-04:00

A friend was so excited to tell me today that they received their real estate property tax bill and it was $100 less than they had saved up for it! There was not one hint of sadness that the bill was large (it is a fact of life). There was just jubilation that they had $100 extra beyond what was needed to cover the bill.

That is a true sign that your financial plan is working!!! I remember the times when the non-monthly bills would roll around. Bills like my auto insurance which I paid quarterly. It was a punishing time to come up with the funds to pay that bill. I remember it well. I do not like the feelings I have when I remember those times. It was not fun. It was certainly not a time for jubilation.

If you are able to have the entire amount of each non-monthly bill saved up by the time the bill actually comes due ... yeah ... I would say that means you have a financial plan that is working big time! Congratulations!

For those of you who have the less ideal feelings when thinking about those non-monthly big financial setbacks, I challenge you to do this. In your monthly budget (you do have a monthly budget, right?), take the bill amount and divide it by the number of months you have remaining before the bill comes due.

For example, if you have a $400 insurance bill coming due in 5 months, you would divide $400 by 5. This means that you need to save $80 this month and for the next 4 additional months to have the $400 in 5 months. This will really help relieve your financial plan from the "big" hits as it will level out your expenses over each month.

Personal Finance is about so much more than the stock market

2006-05-23T21:59:00.000-04:00

If you pull up the personal finance page of USA Today, CNN, or any other major news group the focus is primarily on the stock market. A large chart may indicate the progress of the market through that particular day. It may even show the progress of the stock market through the past week or month. Maybe even over the past year.

Stock market information is useful, but is it the most important part of your financial plan? I would beg you to search further.

I believe that the stock market (and the potential progress of an investment) is a result of good personal financial management. While I believe it is absolutely imperative that one have a good method of measuring the progress of their investments, it is more important to have a solid foundation for your personal finances.

Here is what I believe is necessary to have a solid foundation for your personal finances:

Husband and Wife both on board
Willingness to change as personal financial condition necessitates
A working monthly budget that is zero-based and is completed BEFORE the month begins EVERY month
A commitment to never do debt again - including cutting up your credit cards!
Freedom from life-controlling issues (drug addiction; compulsive gambling; etc.)
A written goal sheet detailing your short and long-term goals with dates you plan to achieve them. This is developed with your spouse

If you have these items in place, you have what it takes to win. I have had many people enthusiastically try to change their financial future to no avail because of a failure to have this solid foundation in place.

Are you just looking at the stock market without having a sound financial plan? Focus on putting these parts of your financial foundation in place for the next 90 days. You will realize an improved marriage as a bonus!

I have not given up on you!

2006-05-22T13:09:00.000-04:00

For those of you who have yet to put together a plan for your finances ... I have not given up on you.

For those of you who started a plan for your finances, but have been unable to follow through ... I have not given up on you.

For those of you who despise the idea of budgeting ... I have not given up on you.

For those of you who believe I am off of my rocker for spending cash out of envelopes and NOT having a credit card ... I have not given up on you.

For those of you who think that you will never pay off your house ... I have not given up on you.

For those of you who have a spouse who will not participate in developing a plan for your finances ... I have not given up on you.

For those of you who are the spouse who will not participate in developing a plan for your finances ... I have not given up on you.

For those of you who believe that you can never have a savings account with 000s in it ... I have not given up on you.

For those of you who are up to your eyeballs in debt ... I have not given up on you.

I BELIEVE that you can do it! I BELIEVE that your marriage can be strengthened by working together on your financial plan. I BELIEVE that you will be able to give more than you ever dreamed to very worthy causes. I BELIEVE that you can have financial security. I BELIEVE in written plans. I BELIEVE it is your responsibility to develop the plan and follow it! I BELIEVE in you.

I have not given up on you.

Budget time (again)

2006-05-17T22:10:00.000-04:00

Well, it is that time of month again. The time of month where the old budget has to be put together for the next 31 days. Once this plan is established, we will utilize our money exactly as stated on the paper. In a sense, we have truly pre-paid our spending on paper. This is our written plan. It is the reason we have dumped so much debt. It is the reason we have financial peace.

When we first started budgeting, it was tough to get it to balance. There were so many expenses that we realized that we did not have a plan for - especially the non-monthly bills like auto insurance and property taxes.

When we budget now, however, it is a pretty quick process. As we go through the month, we are thinking about upcoming expenses and logging it down that the expense needs to be included in next month's budget. Our average budget session lasts 15 minutes start to finish.

In 36 months of budgeting, we have only had to adjourn a budget discussion 1 time without having completed the budget. How is it that Jenn and I work well together to develop a budget so quickly? We are both engaged and understand that this is the tool that will help keep us accountable to our short and long-term financial goals. By achieving our financial goals, we are positioning ourselves to be able to do exactly what we are made to do - regardless of the income potential of those activities.

So now our new accountability plan is in place and current for the next month. In this plan, we will be giving money away, saving money for retirement and upcoming known expenses, and spending money on great things like FOOD, utilities (yay ...), gas (choke :<{, and other items that keep the household operating. By the way, AS ALWAYS, the budget meets my favorite equation:

INCOME - OUTGO = EXACTLY ZERO

Does yours?

It isn't all about the money.

2006-05-16T21:08:00.000-04:00

Money does not satisfy. Money does not make you happy. Money does not guarantee health. Money does not equal great wealth. Money does not save your soul. Money can not buy great friends.

These statements are often said. These statements are hard to understand when you are broke. These statements become clearer as you attain financial prosperity. It becomes quite clear to the wealthy that these statements are clear.

I believe that it is a spiritual issue. WHAT?!!! I said it. I believe that it is a spiritual issue.

I have seen many broke people that are consumed by their lack of money. Some believe that they can out-earn their spending. These people spend an enormous amount of their time working to "get ahead". In the process, they sacrifice their family relationships and friendships. They tend to become hardened to their world. They want what is theirs.

I have seen financially wealthy persons also become hardened to their world trying to protect what is theirs.

In both cases, I believe that they do not have true peace. They are attempting to put money into a high position in their lives, yet it still will not satisfy.

Money can not truly satisfy the spirit. Money is a means to an end.

So why should I want to help people acquire and keep more money? Why is it important to save? Why is it important to avoid debt? Why is all of this even matter?

It allows you the opportunity to utilize your time to pursue your life's calling! The very thing you were made to do! The exact thing that sets your soul on fire! The passion igniter in your life!

I have just ONE question:
IF YOU WERE DEBT-FREE AND HAD ZERO PAYMENTS, WHAT WOULD YOU BE ABLE TO ACCOMPLISH WITH YOUR LIFE??????? or to ask another way IF YOU STAY IN DEBT AND HAVE DEBT UP TO YOUR EYEBALLS, WHAT WILL YOU BE PREVENTED FROM ACCOMPLISHING WITH YOUR LIFE????

30 minutes to a financial disaster

2006-05-15T21:29:00.000-04:00

Sign observed at car dealership:
"Financing in less than 30 minutes"

Translation:
"Destroy all progress you have made in getting control of your finances in under 30 minutes."

I do not spend little money. When I spend money, I tend to spend it on larger ticket items. Some specific items include airline tickets, hotel, travel, my RC airplane, and vehicles. Before making the choice to make our finances a priority, I would not confer with Jenn. I would just go buy it. Capital One had my slack. I really did think about the cost of the item, and I usually felt I could pay it off that month. I really felt that my spending was under control. The facts show another story. The facts show a large credit card balance that did not get paid off every month. The facts show that what I felt was NOT fact.

I have worked hard to gain control of my finances. Jenn and I have worked together to get out of debt. It has been more than three years since we made the choice to control our spending. Even so, my old spending buddy (my shadow) creeps in with the evening shadows. "Come on, man! Live a little. You can afford it! You can make the payment. Really, man. Just do it!"

You know what? I do not want "Financing in less than 30 minutes" I do not need their financing. I made the choice a long time ago to never do debt again. It may not be 100% fun to live in my world, but I will tell you this - I'm not broke anymore!

Have you made your choice?

I love Microsoft Money!

2006-05-10T21:30:00.000-04:00

How do you manage your finances? In my journey to better manage my finances, I have followed a path that took me from virtually no management at all to detailed management.

I started out by trying to keep a running balance in my head and ensuring that I had a cash buffer in my checking account in case I forgot that I had spent some extra money. That did not work well. I had cash being deposited into my savings account each paycheck, but it immediately moved to my checking account and out of my ownership (I spent it!)

So that was not working, so I migrated to a printed out register. I tracked every single expenditure on this register. This vastly improved my understanding of where our money was going, but it really did not improve our financial situation at all. It just allowed me to understand where the money went. It also helped me out a lot with addition and subtraction skills as I had to write in at least 50 transactions a month and perform the math each time. Yikes! I cannot believe I used the debit card for $1.97 at Home Depot on 11/14/2002 or $5.44 at Wal-Mart on 11/8/2001 or $2.31 at Wal-Mart on 2/27/2000 or $6.04 at Wal-Mart on 11/12/1999.

Well, the printed register and manual bookkeeping really helped me to better understand WHERE our money was going, but it certainly was not helping us keep some of our money. So we migrated to Microsoft Money. Oh baby! This software is sweet! It allows you to understand where all of your money is going. It has custom reports that you can generate to better understand opportunities you have for saving money. Guess what? It did not help us save money. It is the best method we have utilized for management of our finances, but it did not help us save money.

Do you know what helped us save money? Applying the information we were learning about our spending habits. Making changes to our spending habits is what helped us save money. We applied the simple formula of

INCOME - OUTGO = ZERO

OUTGO included Savings. It included saving for known upcoming expenses like life insurance, auto insurance, vacations, and clothing.

If you are looking for a good money management tool, I highly recommend you try Microsoft Money! It will NOT allow you to save money, however. You must apply the information the software provides you in order to save money.

Personal Finances are less talked about than sex

2006-05-09T20:58:00.000-04:00

Read it for yourself.

When you hear facts like "the number one cause of divorce is disagreement over finances" or "money fights" or "he/she spends all of our money", you may not think about the fact that personal finances are also less talked about than sex.

You don't believe me? Let's think about why this is the case.

1. Personal finances does not require both of you.
2. Personal finances are not as exciting.
3. It is easier to fight when you are TALKING about finances.
4. Finances require the lights be on.

Oh my!

Bottom Line: Stop the childishness. Grow up! Face your finances TOGETHER! When you do, you will start to win TOGETHER. At that point, you can talk a lot about both subjects!

Bankruptcy

2006-05-07T10:49:00.000-04:00

I have always viewed bankruptcy as a disinterested party. It is true that bankruptcies have reached all-time highs. There are always huge companies filing for bankruptcy protection (Enron; most of the airlines; most of the suppliers to GM and Ford). Over the past year, a series of circumstances have really opened my eyes to how awful bankruptcy is for all parties involved.

For the creditors owed, they will not receive the money due them! This is HORRIBLE! They extended REAL MONEY to the individual(s) or company with the clear understanding (contract) that the money would be returned. They are now without the money AND now have little to no chance of recovering ANY of the money. What does this do to the company? For many companies and individuals, it could put them in serious financial conditions. In either case, the money needs to be made up elsewhere. Who makes it up? Those buying the products - the prices are increased to cover the losses.

For the individuals declaring bankruptcy, they KNOW that they are sticking their creditors with the debt. It is not something that they are disinterested in. They feel HORRIBLE about it! It impacts their family. It impacts their marriage. It impacts their relationships with their children. Worst of all - many individuals experience a LOSS OF HOPE! Hope is what sets the human spirit on fire! The individuals and companies can also lose the ability to conduct business with preferred providers as they are now blocked out via contracts, extremely high interest rates, or a unwillingness to conduct business with them period.

The sad thing is that most bankruptcies are preventable!!! It does require self-discipline! It does require spending less than is earned! It does mean that the word "NO!" enters our vocabulary.

If you are in desparate financial shape, go see a certified financial planner BEFORE visiting a bankruptcy attorney. You KNOW what the attorney's recommendation will be.

Are you paying it forward?

2006-05-03T22:33:00.000-04:00

You have had success! You have achieved financial peace. Debt is no longer a part of your life or it is rapidly becoming extinct. The house payment is gone or it is close to leaving. All of your other debts are paid off. You have a budget that is working. The retirement fund is growing. The college fund is growing. The daughter's wedding fund is growing. The new car fund is in place. You have a fully-funded emergency fund.

Congratulations! You are among the few that have been able to tell themselves "No!" often enough to win financially! Great job! Because of this, you have changed your family's future. Your family will have opportunities that many others have carelessly spent away.

Question for you: Are you paying it forward? Are you helping others learn the lessons you have learned? You have family members that need your help. They do not have the financial knowledge you have. They do not truly understand how to get from a debt-laden situation to a financially peaceful situation. You have friends that need your help. They need help setting up their first budget. They need help buying that first house. Your children need you to teach them how to wisely manage money. Are you teaching them?

Take the challenge - teach someone else about how to effectively manage their personal finances this week!

Are you ready?

2006-05-03T00:38:00.000-04:00

So I just got back from the wake of a family member we lost unexpectedly. Fifty years young. Game over.

Do you have a plan? Are you ready? Will those who rely on you be able to continue without you? One HUGE way to ensure that your family can continue on without major life changes is to have term life insurance. It is very affordable. Think about it. If you passed away today, would your family be financially prepared to face the future?

I want my family to be able to focus on the next phase of life without having to worry about how they will make the car payment, credit card payment, house payment, and how they will get by without my income. I have taken care of this by obtaining 20-year level term life insurance equal to about 10X my annual income. It is very cheap. You can check the costs at Zander Insurance. You can either buy through Zander or through your local insurance agent.

Do it today.

It is important to know these facts

2006-04-30T18:56:00.000-04:00

Mortgage Interest
If you have a mortgage for $150,000 at 6% interest and it takes you 30 years to pay off, you will pay a total of $173,757 in interest. If you instead pay off that same mortgage in 5 years, you will pay a total of $23,995 in interest. By paying off the mortgage early, you will save $149,762 in interest!!! Even if you pay it off in 15 years, you will still save $95,916 in interest! WOW!

When you purchase a house, it should be a GOOD thing. If you overextend your ability to pay off early, it could become much less than a good thing.

Home Purchasing Tips
- Pay at least 20% down to avoid Private Mortgage Insurance (PMI)
- Ensure that the monthly payment does not exceed 25% of your take-home pay
- Check out the costs of owning the home - property taxes, homeowners association fees, maintenance fees, average utility payments, homeowner's insurance, etc.
- Do not buy if you do not understand the area. It is important to learn about the area in which you are purchasing before you make an offer.
- ALWAYS have a professional complete a home inspection. It will cost around $300, but it is well worth it.
- If you have to have a mortgage, make sure it is a fixed rate mortgage with a term less than 15 years (to save all that interest!).

What does being debt-free mean to me?

2006-04-25T23:03:00.000-04:00

It means that I can help others.

It means that I do not have to worry about paying my bills.

It means no big money fights with my wife.

It means my wife can be a stay-at-home mother.

It means that a doctor bill, car repair, or high natural gas bill does not create a financial crisis.

It means that I can save money for upcoming known expenses.

It means that I can do exactly what I am made to do without having to worry about the pay.

It means that I have true peace.

What does being debt-free mean to you? What would it mean to you?

How much is enough?

2006-04-24T22:51:00.000-04:00

When will you have enough? Is it when you finally own your home? How about when you finally get to purchase that awesome boat? What about a vacation home? What about when you own your own business? What about when you own a farm? Is it when you hit $1,000,000 in the investment account? What about $10,000,000? What about $100,000,000? What about $1,000,000,000?

It is said that John D. Rockefeller, billionaire oilman of the early 20th century, was asked how much money was enough? His response? "Just one more dollar." WOW!

If you make money the object of your full attention, you will never be satisfied. Money at its very best enables you to help the less fortunate and accomplish great things for others. Money at is very worst leads to brutal deadly conflict.

Choose today to view your money as a resource. You have been hired as its manager? If you are the manager of your money, would you fire you? Make the choice to help others. Make the choice to wisely consider the opportunity cost of using your money. Make the choice to be a manager of resources. Do not allow your life to be driven for "just one more dollar."

How much is enough for me? I have clothes, food, shelter, and transportation which puts me in the top 1% of the world's population. I guess that means that $6.90 is enough for me.

Did you buy something with a credit card today?

2006-04-20T21:10:00.000-04:00

Why?

Is it because it is a Tony Stewart credit card?
OR is it because you did not have the money?

Is it because you get airline miles?
OR is it because you did not have the money?

Is it because you get free hotel points?
OR is it because you did not have the money?

Is it because you get "free" gift certificates?
OR is it because you did not have the money?

Is it because you get "free" merchandise?
OR is it because you did not have the money?

Is it because you are worried about identity theft?
OR is it because you did not have the money?

I challenge you to NOT USE your credit card for the next 30 days. Force yourself to say the world's most powerful wealth-building word "NO!". Just 30 days. You have tried your way and stayed broke. Try my way for 30 days. Write out a budget tonight. Spend every dollar on paper on purpose before the month begins. Live by that budget. You will start to win.

Why do you want to be financially free?

2006-04-19T21:44:00.000-04:00

Do you ever wonder why I write so much about becoming financially free?

I want to become financially free because I believe that I am a better person when I am not living paycheck to paycheck. I believe that I am a better husband when I am not worried about where the money is coming from to pay a past due bill. I believe that I am a better father when I am not juggling payments from week to week to prevent a check from bouncing. I believe that I am a better employee when I do not have to struggle to make it to the next paycheck. I believe that I am a better employee when I do not have to hold four jobs just to make ends meet. I believe that I am better able to accomplish God's specific plan for my life when I am not bound by debt. I believe that I honor God when I practice good stewardship with the resources He has given me to manage. It clearly states in Proverbs 22:7 that the "borrower is servant to the lender". When you are a servant, it changes who you are!

I believe that I am better able to give to worthy causes when I am financially fit. I believe that I am better able to focus on accomplishing my life's work when I can focus on the task at hand without worrying about a check being able to clear. I believe that I free up more time when I can pay all of my monthly bills at one time. More time equals better opportunities to be a better spouse, father, and leader.

I truly believe that being financially free is not about money. My financial situation is an outcome based on a set of inputs. If I am financially free, it means that I am effectively managing the resources within my control. If I am not financially free, it means that I am not effectively managing the resources within my control.

I want to accomplish my life's passion statement - "To help others accomplish far more than they ever thought possible!" - To do this, I must be financially free. If I am not financially free, I will not be able to focus on helping others. Yes, it has meant sacrificing personal wants. Yes, it has meant delaying pleasure.

But it is not about me! It is about achieving what I was put on this earth to do!

READ!

2006-04-18T20:55:00.000-04:00

To better understand anything, it is always very helpful to read some books about it. For personal finances, it is no different. I recommend that you read at least 4 books a year about personal finances. I do understand that I am a nerd about this subject, but I believe that if you want to free yourself up to focus on your life's true passions, you need to be financially free. You will not just trip one day and become financially free. It requires continuous learning, a written plan (your budget), stated goals, and mutual commitment with your spouse to achieve them.

Reading books is a great way to learn! It helps to expand your knowledge about personal finances. It enables you to review case studies of others who have had different life circumstances. It challenges your paradigms.

If you are looking for books that have helped shape my personal finances, here they are. Happy reading!

The Wealthy Barber by David Chilton
- I read this book when I was twelve. Great book that really drives home compound interest!

Financial Peace, Revisited by Dave Ramsey
- Practical guide to becoming debt-free complete with the tools/worksheets necessary to achieve it!

The CashFlow Quadrant by Robert Kiyosaki
- Makes you want to run out and start a business!

The Bible by God
- Makes you want to use your financial freedom to help the poor and less fortunate and reach the lost!

Helpful Personal Finance web sites

2006-04-17T21:38:00.000-04:00

Here is my list of helpful Personal Finance web sites:

1. Dave Ramsey's web site
- Dave is a HUGE hero of mine!

2. Cheapskate Monthly's web site
- Their monthly newsletter helps keep you motivated to save!

3. CNN's Personal Finance web site
- I don't agree with everything they tell you, but it is very informative!
- I really like their on-line classes about personal finances 101 classes

4. Yahoo's Personal Finances web site
- Good info - poor page layout

5. USA Today's Personal Finance calculators
- I really like the one that tells you when you will be a millionaire

I hope these sites help! I challenge to constantly learn more about your finances. You will either know what is going on with your money, or you will be wondering where it all went. Choose to learn.

Unexpected money

2006-04-12T21:32:00.000-04:00

If you have a detailed financial plan (a monthly zero-based budget) and you receive unexpected money, you will know exactly where that money can be put to good use. If you do not have a plan, there is a good chance that the money will leave you quickly.

Marketers understand our ability to impulse purchase when we receive unexpected money. To ensure that an unexpectedly large tax return is not used elsewhere, car dealerships will do your taxes for you if you use the tax refund as your down payment. Lottery winners are approached by many who have a "great deal" for them. Those who receive an inheritance are suddenly offered "opportunities" that did not previously exist. If a large company gives out bonuses every Christmas, the employees are all marketed to by the local stores and businesses to get them to spend the bonus at their store.

I believe that if we receive an unexpected money and there is no plan, then it is not going to be a financial help to us. It will only allow us to acquire more junk that we will later sell at a yard sale or give away to Goodwill. If we do have a plan (a monthly zero-based budget), we will improve our chances at gaining financial freedom.

Do you ever receive unexpected money? Do you have a plan?

Why?

2006-04-11T22:41:00.000-04:00

Today is a day to observe human behavior.

Have you ever met someone who is so excited about some new thing? This new thing could be a new friend, a new girlfriend, a new boyfriend, a new car, a new house, going to college, a new boat, football season tickets, on and on and on ... Anyway, they are sooo excited about this new thing.

How do you know that they are excited? They talk about it all of the time. They speak more rapidly when talking about it. Their voice changes when they talk about it. They are more animated when they speak about it. They let everyone they know about this new thing in their life. They are pumped up!

Flash forward six months. Gone is the excitement. Now, that new thing is not as enticing. It is part of their life now. It may not even be a part of their life anymore. If it is still in their life, it may still be nice, but it certainly does not get the level of attention it was getting when it first became part of their life.

Why is this?

Now, I have to apply this to personal finances.

I have seen people learn the financial principles necessary to win (emergency fund of 3 - 6 months expenses in savings account, saying NO to debt, become debt-free, save for retirement and college, and budget monthly). They put together their first monthly budget. They are so excited! They tell everyone about it. "This budget is working!" "This is awesome!" "This is fantastic!"

Flash forward six months. Gone is the excitement. They have stopped budgeting. They have not been able to control themselves and have went and bought a new truck with 100% financing. They are right where they started. This REALLY IMPACTS MARRIAGES!!! I have seen married couples who cannot even talk about finances anymore because one or both of them knows beyond a shadow of a doubt that they have just deepened the hold that debt has on them. Proverbs 22:7 says that the "borrower is servant to the lender". I have seen the servants. They have no hope. Hope is what sets fire to the human soul. When that hope is lost - the end.

I have personally counseled many who have went this very path. My heart hurts for them. The somberness is palpable. It really is tangible. They have lost hope. Some have lost everything they owned. They know what must be done, but for some reason unknown to me, they cannot make themselves do it. I pray for them now. Lord, help them become free of financial bondage. Restore HOPE to their lives. Help them establish personal discipline to make it happen.

Gain control of your finances

2006-04-10T12:47:00.000-04:00

It is time to gain control of your finances. Life is way too short to continue living from paycheck to paycheck. Here are some sure-fired ways to gain control of your finances.

Stop blaming circumstances, other people, or your spouse
Sit down (with your spouse if married) and list all of you bills on paper. For each debt (i.e. student loan, car, house, etc.), list the name of the creditor, the total amount owed, and the monthly payment. For each monthly bill (i.e. electricity, phone, etc.), list the company and the current monthly payment owed.
List all of your monthly payments due THIS MONTH in one column. Total up the monthly payments.
List all of your other money needs this month (groceries, gasoline, baby gifts, stamps, dining out, blow-it money, vacation savings, emergency fund savings) in another column and total them up.
List all of your income for THIS MONTH in another column. Total up the income for the month.
Complete this formula:

TOTAL INCOME - MONTHLY BILLS - ALL OTHER MONEY NEEDS = ZERO

The total of this equation must equal ZERO. If it is a POSITIVE number, it means that you have not given each dollar of income a name. You have not assigned all of your income to a category. This cannot happen. Money that is not given a name will leave you. Here is a good place to put extra money - debt reduction or emergency fund savings!

If the total of this equation is NEGATIVE, it means that you are OVERSPENDING your income. This cannot happen. You will empty your savings or turn to debt to cover the negative amount. You will not win if this happens. Instead, go back through your monthly spending and reduce it to cover the gap. You can also boost income if you have overtime or a 2nd job as an option. Either way, this must balance to zero. You will not win otherwise.

AGREE TO LIVE BY THIS BUDGET!!!