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12 Steps to Staying on Budget and Living Your Best Life

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As we close out January, many have been looking at how to get a healthier grasp around their budgets.  How to budget and what should be included are really considered as the credit card bills from December’s Christmas spending come in.

Those with kids are trying to figure out a way to better teach kids what it means to have a budget and that can be quite a difficult conversation.  For basic starters, check out this blog on 6 Steps to Taking the Fear out of Finances.  For those who want to dive a bit more, we are going to look today at the 10 steps my family uses to make and stay on budget while living our best life.

My husband and I both grew up in families where money was tight.  We did not get the newest and greatest things as they came out.  We ate meals at home and brown-bagged it to school.  In college, having to pay for it entirely on my own, I was no stranger to Ramen noodles.  During this time, I learned the value of food closets because I often needed them to eat so I could pay my school bill.  I worked six jobs and went to school full time.  I graduated with my bachelor’s degree entirely debt-free and my graduate school loans were paid off two years early.  Other than our house, we are entirely debt-free.

Though we are not financial gurus, we do know a thing or two about how to budget and have fun.  Here are some of our takeaways:

1. Make a budget: This seems basic, but you would be surprised how many do not actually do this.  There are three easy steps to doing this:

  • Look at the past: The best way is to take the bank account statement for the last month (three months is best) and really look at each transaction.  How much do you pay in bills?  Do these fluctuate (like utilities) or are all flat rates?  How much do you spend on gas? Food? Phone? Subscriptions? Entertainment? Once this is done, you get a good idea of not only where you are spending your money, but where your values are.
  •  Look at your income: How much do you bring in a month? Is this more or less than what you spend? 
  • Start with bills: Whatever subscriptions and plans you pay for and don’t use – close the accounts.  Next, always start with bills.  Ensure the income pays those first.  Next, have a line item for food, entertainment, giving, savings, and emergencies.  Allot your money as needed.
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2. Make a Wish List:  In an instance “click here” to check out with the one-click world, it is easy to spend more money than you think faster than you think. Instead, make a wish list (especially for those big-ticket items).  Take the time to research the best options.  If not an emergency (which you have been saving in the budget), take a month or three and see if you really need it or it was just a momentary want.  If the latter, you just saved money.

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3. Eat out less: I love food.  I say that all the time.  But eating out is not only costly to my waistline it is costly to my bottom line.  Eating out with friends and family for special occasions is fine (budget for this).  But, in general, we try to eat out less than once a week.  We eat better, feel better, and our bottom line stays in the black. This is also great for keeping up those new year’s resolutions and ensuring they work for you.

4. Buy second hand: Growing up second had got a bad rap.  Clothes bought second-hand would label you as poor or ugly.  In reality, that Nike hoodie your friend’s parent spent $60.00 on, my parent got looking brand new for $500.  So many places now make it easy to buy gently loved secondhand clothes, tools, games, décor, and so much!  Brand names even now have a “gently loved” section you can usually get a great deal on when you need to.  Check out Craigslist, Poshmark, and Marketplace to get started.  We once got a $5,000.00 elliptical machine (used times by the owner) for $500.00. 

5. Use what you have: Instead of going to the store when you need an item for a recipe, plan your meals ahead.  Don’t have the time?  See what you have in your pantry/fridge that can be used as a substitute.  So often there are quick fixes already in our home that make great meals.  Eat leftovers.  Re-purpose old toys, clothes, and furniture.  We turn our thinned towels into towels used when we work on the car or clean the garage.  We reuse fabric.  There are so many options.

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6. Look for Deals: Coupons are great! I am not an extreme couponer, but I know some people who are.  I know a family who has not spent more than $5.00 on groceries for a family of four in three years.  Coupons are great a way to stay on budget.  Many museums, zoos, and aquariums provide discounts to certain groups and even free days to enjoy and see if you want to come back.  Some will even discount the price of admission depending on how many hours are left in their business day. We use these free and discount days often.  We have seen some great culture this way.

7. Wait:  Seeing a movie in theatres is great fun! But it can also be greatly expensive.  Add in the price of admission, a drink, snacks, and popcorn and you for a family of four you are looking at close to a car payment!  For these types of activities, wait till they come to streaming or DVD.  Then you can view them at home in your comfort and have spent a fraction on the snacks while still enjoying family time.

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8. Plan for Emergencies: Life happens.  Cars break.  Kids see doctors.  Cavities happen.  Without saving, these costs can be costly and harmful to the bottom line.  Instead of dealing with the emergency plan for one. One line item of the budget should be about 10% of your budget solely to be set aside for emergencies.  Then when they hit, you are prepared and way less stressed with the results.

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9. Fill your time with other activities: For those who use shopping and eating out as a way to socialize, I understand how hard this can be.  But it is not impossible.  Instead of shopping or eating when stressed or hanging out, fill the time with another activity.  Work on your new year’s resolution.  Read a book.  Do some art.  Get outside and walk around.  See God’s beautiful handiwork in nature.  Play a board game.  Make up a new game. Talk with your friends and family.  There are so many options that do not involve money and best of all, they grow your friendships more.

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10. DIY: As a military spouse who has been through deployments/TDYs, it is Neuton’s Law that when a spouse leaves, everything breaks. The last deployment I kept a list of everything that broke and had to be replaced from our washer to the shower rack. We have learned to fix things ourselves. There are so many classes and tutorials out there, it is so easy to not only do the fixing for less (sometimes with items you already have). Repairs to the car and house can often be done at a fraction of the cost when you do it yourself. ***NOTE: Do not attempt anything a license professional will need to do unless you are a licensed professional.

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11. Give: When you give, you get.  We take 10% of our budget and use it to give. Great places to give where your money is multiplied are non-profits and churches.  There is so much need in the world, giving just 10% won’t make a huge impact. But if all of us did that, oh what a difference that would make! 

12. Save: We talked about emergencies, but savings should go beyond that.  Want to go to college? Scale Mount Everest?  Travel the world?  10% of your savings should be set aside for these wonderful dreams!  Then when the time comes you have the funds without stress.  You are not taking from your bottom line and, if you have put this in a savings account, you made money on it from interest.  The longer it sits the more money you make.

Staying on a budget doesn’t have to be scary or hard.   When we get back to the basics, things fall into place.  These simple changes will help you stay on budget, strengthen your relationships, and de-stress your life.  Now go out and enjoy your best life!

6 Steps to Taking the Fear out of Finances

October starts this week.  A time of ghouls, ghosts, and goblins.  Kids are discussing who to go as for Halloween – if trick-or-treating is even going to be something they can do.  Fear is abundant as we look at the last quarter of the year, fiscal health for the holidays, and the fear of sickness.  All things scary. 

This month I am hoping to tackle some of the scary things I get asked about when it comes to parenting a special. The number one questions I am asked about is what happened when we found out about the life-changing diagnosis; I recommend checking out The Moment for more on that.

Today, I am going to attempt to tackle one of the scariest things people deal with in life – finances.  This is a constant fear for most, especially as the unemployment rate rises in America. I was blessed to have parents who taught me the value of work and a dollar.  Because of these lessons, I graduated with my undergraduate degree debt-free and paid off my student loans for graduate degree 2.5 years early.

Understanding finances starts young and should be taught in all households.  A good understanding of finances will lead to less stress, less debt, and a healthier economy.

How do you teach finances to children?  It can be hard, especially if you do not feel comfortable with finances in the first place.  So here are six steps we use with our kid to help him understand finances as he gets older.

1.       Talk about it: One of the most common things I hear from young adults is they do not know anything about finances.  And really, why should they? We stopped teaching it in schools and 62% of America is in credit card debt with 62% of credit card debtors as college graduates! I often encounter people who explain their collection accounts, late payments, and bankruptcy due to being “young and immature.”  This is really a claim of ignorance.  If we want our children to be out of debt, we have to teach them from the get-go.  We have to let them know that food they eat costs money, that light they are using costs money, and those clothes they like cost money.  That money only comes from hard work.  There is a balance.  Talk about it.

2.       Teach work ethic: Chores are an excellent way to teach work ethic.  Having chores for as long as I can remember, taught me to balance, allowed me to work multiple jobs in college while going to school time and a half (and having a social life), and how to creatively think through problems. Work ethic will benefit children, families, and communities.  Good work ethic is reflected in showing up on time and completing the task on time the right way with a good attitude.  This should be reflecting in their chores and school work.  Teaching these young will help ensure our children have this ingrained in them when they enter the workforce.  A good work ethic will lead to better opportunities through more recommendations, higher bonuses, and promotions. 

3.       Teach giving: This is essential and often left out of finance conversations. If you don’t want to give money, try volunteering. This is a great way to change perspective and priorities. Financial giving is financially sound. This helps encourage budgeting by helping you shift priorities.  We practice a 10% rule with my son.  It is an easy number mathematically for him to understand.  Whenever he gets money (for work done or as a gift), we immediately take 10% and save it for whatever he wants to give to.  Sometimes it is the church, sometimes it is the zoo, sometimes it is buying a meal for a homeless person.  He gets to pick.

4.       Teach saving: This one is hard for most people in our instantaneous world.  We are gratified instantly in almost all we do in the first world.  We watch as three bubbles pop up on a screen showing a response to our message. We can stream almost any movie and binge-watch entire seasons of shows.  Waiting is not something Americans, and most first-world people, are comfortable with.  Saving is something that can actually financially save you.  To help our little one, we also immediately take 10% of his money and put it into savings. This is what is used for unexpected expenses as adults (the car tire blew out or pipes blew).  This account can also be used to save for vacations, new toys, and special experiences.  Our son is saving toward a trip to Sea World to meet marine biologists and a loftier goal of adding a red panda exhibit to our local zoo. 

5.       Teach taxes: As a political scientist, I find teaching this concept is really difficult.  Taxes are often taken right out of the check upfront, so when you calculate a budget, this number is very important. Taxes are designed to pay for things like that pothole-free street you drive on daily.  Taxes pay for that public library and park you enjoy taking the kids to.  Taxes pay for those firefighters who fight fires so you don’t have to.  Taxes are helpful to each community.  Taxes are paid either upfront or on tax day, but they are paid.  We teach our son this but taking 10% of his income immediately and setting it aside in a Taxes account.  This way, when he breaks something in the house (which is inevitable), the money to fix it is there.  He paid his taxes, so that glass/towel rack/doorknob, etc. he broke can be replaced.  The household tax teaches him about the income tax and where that money should go. A great resource for kids on taxes and finances is Finances 101 for Kids: Money Lessons Children Cannot Afford to Miss.

6.       Teach budgeting: Budgeting is hard.  It takes self-control and patience.  When practiced regularly, it is actually quite easy and helps prevent that dreaded debt we all hate so much.  Teaching our children this valuable tool is life-changing. Budgeting ensures you always have enough money for what you need and those things that are important for you.  It also helps you shoot for a goal.  If your hourly $10.00 job is insufficient, it gives you a goal target for where you want to be.  Below is an excel spreadsheet that we use for our kiddo that helps.  It is filled in with an example. Sometimes seeing the budget in black and white helps change a concept to concrete practice.

For more ideas on how to help kids become the best they can be, take a look at my Facebook page.

10 Easy Steps to Successful Time Management – How to keep your School/Work/Home Life in Harmony

Sometimes it feels like life is a juggling act.  Juggling school and work.  Juggling play dates and cleaning.  Juggling parenting and being a spouse.  Juggling life.

How do we find peace in the chaos? Simple. Time management.

Time management is not a complex theory of life, as some may think.  Time management taking (or not taking) simple steps to make life easier. The continuous use of these simple steps will make you more productive at school, work, and life with an added benefit of decreased stress.

Here are the 10 steps of time management my family uses:

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1)      Allow time for planning and Make a List: Planning can often seem like a waste of time.  But, this small step at the beginning can save you tons of time at the end of a project.  We set a tentative plan for the month/week and modify as our needs change.  Life happens, plans change.  Planning ultimately allows for flexibility. We also use this planning time to make lists.  We love to check things off.  It gives a simple sense of accomplishment and keeps us motivated to move forward when things get complicated.  

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2)      Keep work with you: I don’t know about you, but I always seem to find downtime in my day.  Whether it be while driving or walking to an appointment, or waiting in line, or waiting for a doctor show to a scheduled appointment, I wait. Waiting is a part of life. Knowing how to use this downtime efficiently can be a huge advantage.  We have a choice. We can either scroll through a social media page or we can practice a new language or worksheet, or read a required book, or practice and review your notes for the day (study habits will be in the next blog).

3)      Be Realistic and Flexible: It is really easy to over commit.  We have to be realistic with our strengths and weakness.  We have to be honest with how long something is likely to take us.  Just as important, we have to be flexible.  Some of the most highly effective people have a “bumper” set in every schedule.  Do not schedule activities back to back.  Include a “bumper” of time to account for meetings/classes going long, traffic, accidents, forgetting your homework/assignment, and needing to head back to the house.  This will ensure you have flexibility without encroaching on others’ time.

4)      It’s OK to say NO: This took me a really long time to learn.  If I am honest, I still struggle with this. It is OK to say, “No.”  You do not have to agree to do everything everyone wants you to you.  You are only human.  Knowing your limits (time, personality, requirements for sleep), are all essential to creating quality products and lasting relationships.  If you do decline, just make sure to do it with grace, and perhaps a referral.  I like to decline with a “Thank you, but not at this time.  Perhaps you can consider So-and-so.  I think they would be very interested,” or “Thank you, but not at this time.  I would be happy to donate my time to next month’s fundraiser/money to the event/set up the flowers to be delivered/etc.”  This simple referral allows the other party to feel heard, valued, and perhaps come back to you for help at another more appropriate time.

5)      Find your productive time: I once watched an episode of Brothers and Sisters, where a political character stated, “I have done more by 8:00 am than most people do in a day.” This really stuck with me; so much so, I changed my entire schedule.  I am more productive in the wee hours of the morning than I am from noon to five.  So, I ensure my workday reflects that productive time.  I learned in grad school no one bothers me between the hours of midnight and seven in the morning.  So, I set up my focus hours then.  As a mom, I do not stay up all night but know I ensure I am at my computer no later than 6:00 am to start work.  Before work is prayer, meditation.  After work, I help with school, and then we do a workout, field trip, or fun activity to wind down for the day.

6)      Create a dedicated work/school schedule: Schedules are so important.  They help keep you organized and ensure you have set time aside to complete the required activities.  Knowing when you are required to work/school (and the prep time for each), helps to ensure you are not double booking, over-scheduling, or ignoring (for those procrastinators) an important task.  The trick is to keep the schedule flexible as needed, but it should be used in the majority of situations.

7)      Budget your time: Budget your time like you would budget your finances.  Track where you are spending time and where you are not using the time to your advantage. This will help you prioritize when is productive, what needs more focus, and where you can rearrange to have more productivity. B a clock-watcher.  If you know what time it is, you have a better grasp of your time throughout the day.

8)      Exercise to clear your mind: Physical movement is so important to both production and retention. Study after study shows a connection between physical exercise and productivity at work.  Some companies are even paying their employees to work out as it increases productivity, decreases stress, improves social connections, and oh, makes us healthier.  For students, exercising after learning a task has been shown to improve memory and retention. So, burn some calories, get stronger, and strengthen your brain and production all in one thirty-minute workout.

9)      Don’t get sidetracked: Distraction is the key to failure. My son is the king of distraction.  I can ask him to put the dishes aware and all of a sudden, I have a robot in my kitchen.  The trick to time management is not to get distracted.  We teach this to my son by using a HIIT timer.  He attaches this to his belt loop and every time it beeps it reminds him a) to be on task and b) that the allotted time to complete the task is diminishing.  To introduce this, we started it as a game.  Now, he uses it for everything from a work out to clean his room.   At work, I use the 25 minute rule. I work on a project without distraction (no emails, texts, or calls) and then can take a break between my next 25 minutes and catch up on all those things.

10)   Get a good night’s sleep: I love sleep. Good sleep.  The body was designed to do some of the most intensive work while we sleep.  Our bodies rebuild and process the day while we sleep.  Sleep is essential to process and retention, but also, for us to have the energy to complete another crazy busy day.  Sleep helps us learn, strengthen our memory, increases our creativity and insight.  Sleep does so much!   (learn more, strengthen memory, increase creativity and insight)

Now that you have some tips, take this quiz on where you are in time management to know where you might want to focus your attention in the future. Create your time-use log. Do it for at least 24 hours. The longer you do it, the more you’ll see where you lose/waste time.