Budgeting

The key to any budget is organization.  The more organized you are, the better you will be able to attack your budget.  So, lets keep it simple and lets make a budget!


Mini Post-It Notes:

I could be a walking advertisement for these little things.  If I don't write it down, it is forgotten - some days I'm lucky if I remember my name!  Use these to stick to cabinets, doors, your purse/wallet, and your dashboard - wherever you need to be reminded of something.  I told you this was basic, but it gets better.

Calendars:
I have a calendar just for bill paying and a regular calendar for events.  When you get your bills in the mail, take out your bill paying calendar and write the name of the company and the amount due on the Friday BEFORE the due date (not the delinquent date - THE DUE DATE).  I pay my bills on Friday, but you can obviously make it whatever day of the week that works for you.  It is best to do this the day you receive the bill and then keep your unpaid bills in ONE place (a junk drawer doesn't count).  On bill paying day, pull out the bills listed in your calendar.  If you pay your bills on line, it is still necessary to do this on the same day each week and to know what bills are due when.  In fact, if you pay on line, it may be even more important because you won't have that piece of paper to remind you that a bill is due.  It may take a few months to get your finances on track enough to do this (especially if they are well overdue when you begin), but over time, you should be able to pay your bills this way.

January through December "List":
Make a "list" to hang where it is easily accessible (mine is inside my kitchen cabinet door).  List the months of the year and under each one, upcoming things or events you will need to have money for.  These things are not bills, but are birthdays, anniversaries, mother's/father's day, baby showers, etc.  Mark down the item and the approximate amount of money you want to spend - always over budget.  Make an envelope for each event such as:  Riley's birthday, $40.  I like to take $10 per week out of my budget to put in these envelopes.  So, at $10 per week, in 4 weeks I'd have the $40 for Riley's birthday.  I then check it off and start saving for the next item on the list.  This way I am ahead and not scrambling for a last minute gift with no money in my budget. 

Groceries:
Obviously clipping coupons is an excellent way to save money at the grocery store.  There are tons of valuable sites and blogs on this subject and worth subscribing to.  However, it is also very helpful to make out menus ahead of time.  This will save time at the grocery store, time in the evening figuring out what to make, and ultimately save money because there will be less impulse buying at the store.  I like to have several meal plans already made up that I keep in a binder so that when I am preparing the menus for the week, I have some ideas already on hand.  Again, nothing fancy, just some favorite recipes in plastic sleeves in a binder.   I like to make my grocery list in order of the isles of the grocery store to further save time and help to keep me focused.  Impulse buying adds way too much to your bottom line. Trying generic or store brands is another great way to lower your bill.  Often there is no difference in quality or taste.  It's also very helpful to set aside a certain day and time to do your shopping so that you can stay organized. 

Extras:
Going along with grocery shopping is a little thing I like to call "extras".  Things that you use often, buy two to start.  This may, at first, cause your finances to be tight, but in the long run it will save you time and money.  This would apply to things like:  ketchup, mayo, mustard, chocolate syrup, coffee, shampoo, soap, toothpaste, laundry detergent, fabric softener - things like that.  Here's the principle:  Let's say you scrape the last bit of mayo out of the jar - normally, that would be the end of it or you would make an extra trip to the store.  This way, you pull out your extra jar of mayo; finish making your sandwich; add mayo to your shopping list; and put the extra mayo back on the shelf as an "extra".

Process of Elimination:
With today's economy, we are looking for ways to stretch our budgets.  It would be a good time to evaluate what we have and ask ourselves if there is something we spend money on that could be eliminated such as:  satellite/cable TV; extras on your phone bill; eliminating your land line; switching your cell phone company - things like that.

Lower Rates:
Check around for the best rates - comparative shopping pays off.  Things like health insurance, auto insurance, trash pick up, internet, and credit cards.  In fact, sometimes calling your credit card company and telling them you are thinking of switching your balance to another company unless they lower your rates can work like a charm - providing of course you have been a good, long term customer.

Be Thrifty:
It pays to visit your local thrift store of course.  Anything from household items, clothes, and furniture can be bought at very low prices.  Garage sales and flea markets provide fun and bargains as well.  Of course, if you subscribe to some great decor blogs you can purchase all kinds of things to remake or upcycle.  Doing it yourself will be both thrifty and satisfying.  

"Floating":
Large bills of any kind are hard when they come due.  Therefore, it is best to break them up.  Things like your house payment, car insurance, car payment, etc.  The best thing to do is to take your payment and the time it is due and divide by either two weeks or four weeks depending.  Put that amount of money aside or "float" it in your checkbook.  In other words, you deduct it from your checkbook balance like a deduction, but you don't actually spend it.  I use an "up" arrow in my checkbook to "float" something.  Let's say you divide your house payment by 4 weeks.  If your house payment is $1,200/month, you can put $300/week aside in your checkbook.  When it is time to pay your house payment, use a "down" arrow to denote that the money you "floated" is now being added back to your balance like a deposit.  Now, instead of having to come up with $1,200, you only need to add $300 to the money you have "floated".  I keep record of the "floated" funds on an index card that I keep with my checkbook. This same principle can work for events like vacations.

Credit Cards:
Simple - don't do it!  If you must, have ONE card for EMERGENCIES ONLY.  Credit card debt is the fastest and easiest way to dig yourself a hole you can't easily get out of.  If you don't have the money, don't buy it.


Tax Refunds:
Providing you are eligible for a tax refund, pay any outstanding bills first before you plan to spend that money.  I know this doesn't sound like fun, but you'll thank me for it later.  See next entry titled "wish list".

Wish List:
Sometimes we get a bad case of the "I wants".  It is best to begin a short term/long term wish list.  If you see an item either large or small and are tempted to get out the plastic to satisfy your craving, put it on your wish list and begin a plan to purchase it.  I have things on my wish list that are both practical and frivolous - it doesn't matter - anything goes.  Just putting it on the list and developing a plan to achieve your goal will help you stay on track and you won't feel like you are letting go of your dream item.

Savings/Emergency Fund:
Everyone should strive to have a savings account.  These are hard to start, especially if you are in debt, but make it a short-term plan (within the next 2 years).  You can do this several ways:  l)  You can save a certain amount per week or per month - say 10%, or 2) You can put in part or all of your tax refund that year and then add to it every year.  If an emergency occurs and you take money out of this fund - always make a weekly plan to re-pay it as if it were a bill until all of the money you borrowed from yourself is back safe and sound.  Once you have a savings plan established, it would be time to look into a retirement plan if you do not have one  (and you should!). 

Merry Christmas:
It is wise to have a Christmas fund that you keep going year round.  Save a certain amount per week either in cash envelopes, "up" arrows in your checkbook, or participating in a Christmas fund account at your local bank.  When Christmas comes around (all too soon), you will have cash to buy everyone gifts without going into debt or using plastic.  This is one of the easiest times of the year to blow your budget, so be prepared ahead of time!

Bottom Line:
All of what you have read so far would be meaningless without the main ingredient.  It's time to talk about where our money comes from and Who it belongs to.  We tend to think of our money, our possessions, and our families as belonging to US.  The fact of the matter is, they are just LOANED to us by God.  If you are a Believer, you may already know this deep down, but have just never looked at it this way before.  If you are an unbeliever or still seeking a relationship with God, this may be new to you altogether.  I pray you will read on regardless - what do you have to lose?  Besides, I haven't shared the most important budgeting secret with you yet - you owe it to yourself to read on.

First, let me give you some examples right out of the Bible regarding money.  You may not realize this, but the Bible is really an instruction book for living - there is no subject not covered, all of the answers are at your fingertips.  Here are some examples:

Honor the Lord by giving Him the first part of all your income (tithe means 10%).  He will fill your barns with wheat and barley and overflow your wine vats with the finest wines.  Proverbs 3:9-10

The purpose of tithing (giving 10 percent of your income) is to teach you always to put God first in your lives.  Deuteronomy 14:23

For the love of money is the first step toward all kinds of sin.  Some people have even turned away from God because of their love for it, and as a result have pierced themselves with many arrows.
1 Timothy 6:10

He who loves money shall never have enough.  The foolishness of thinking that wealth brings happiness!  The more you have, the more you spend, right up to the limits of your income, so what is the advantage of wealth - except perhaps to watch it as it runs through your fingers!
Ecclesiastes 5:10-11

"Will a man rob God?  Surely not!  And yet you have robbed Me".  "What do you mean?  When did we ever rob you?"  "You have robbed Me of the tithes and offerings due to Me . . . bring all the tithes into the storehouse . . .if you do, I will open up the windows of Heaven for you and pour out a blessing so great you won't have room enough to take it in!  Try it!  Let Me prove it to you!  Malachi 3:8-10

That is my challenge to you - let God prove it to you.  Without tithing, my finances would not be where they are today.  I have tested it, believe me.  Tithing 10% of your income is the ONLY way to get ahead in your finances.  God keeps His promises.  There may be other temporary gains, but who better to be in charge of your time, your money, your family than the One who created it all - the One who owns it all anyway?  I know it might sound crazy to live on 10% less than you do now, but that's why it's called  FAITH.  Take the challenge - I do not know of one person who has taken this challenge and failed to see the blessings.

Thanks for taking the time to read this.  I hope that it has helped you re-organize your finances and caused you to think about what God has to say on this subject.  May God bless you on your journey.

Please feel free to comment on how these ideas have worked for you or on other budget ideas you have tried.