Years ago after I was first married, I went to get some financial training. I had been your typical starving student who was able to live on the just a few hundred dollars a month. But now I needed to make a real living. With a new wife, a new home and a new baby, my financial world had changed dramatically.
I enrolled in a course and learned about four areas of my money I needed to target. It really only took me a few minutes to assess these areas. "Let's see a modest house payment, one car payment, a couple of vacations a year, health insurance and life insurance, some money for car maintenance and yes, there's Christmas and birthday presents.” I added it all up and just about fell over. I had never made that much money in my entire life. It seemed like a fortune, but it was an incredible reality check. Indeed it gave me a very concrete goal to shoot for. I knew the living I needed to make.
I've always been mindful of these four targets. Managing your money can be very complex, but you can really cut through the fog if you focus on just these four areas. Let me share these secrets with you right now (and let me tell you that we can do this type of money management for you through Turning Point Stewardship. If you like the ideas here and want someone to implement this plan for you and your family give us a call today and speak with Tim Enos (800) 296-5899 x207.)
1) DEBT RETIREMENT AND WEALTH BUILDING
It's often been said that - the secret to creating wealth is living on less than you make and investing in saving the difference. If you are to earn only $25,000 a year and you work for 40 years you will make $1 million. Of that million dollars a huge chunk goes to taxes and a mortgage with interest. Don't let the rest of it go to things like credit card debt. You can work your entire life to pay off credit card debt or you can save your money and have your money start working for you, rather than you working for it.
Over the years, my wife Debbie and I have done a good job of staying out of credit card debt and saving money. One of the best ways to save is to do it automatically. Yes that's right; have it taken out of your check every month. Its human nature to spend what is in front of you so the money you save needs to be taken out of your check ahead of time.
We have had the good fortune of being able to pay for our cars with cash. We have saved huge amounts of money by not having to pay interest on auto loans. It's not hard to create a savings account just for a car purchase. And then there's the mortgage. Making extra payments on your home mortgage can drastically reduce the number of years you have to pay off your home. I'm happy to say that we're just a few years away from having our home paid for free and clear.
2) SAVE TO PAY
This area of your financial money management is the place where most couples stumble. Pay close attention to this area and you will avoid a lot of pain and heartache. Save to Pay is the category that includes all your regular monthly expenses. This includes things like:
I counseled a couple one time who said "we had a financial emergency". I asked them what that was. They said, “Our car broke down, and we had to pay to get it repaired”. Of course, that's not a financial emergency - you know your car is going to break down - you just don't know when. Many couples don't plan for these expenses. When it's time to take a vacation or buy Christmas presents they don't have the funds set aside and end up using a credit card - winding up in debt.
We like to automate our finances to avoid these problems. Putting away $100 a month in a vacation fund will of course give you $1200 for vacations for the year. You can do that with many areas of save to pay. If you don’t want to mess with it - give us a call and we can put this together for you!
3) PAY AS YOU GO
This area includes all of your regular monthly expenses. I don't find it nearly as hard to manage as the save to pay category. This includes things like your utilities, your cell phone or cable. Many of your insurances are paid on a monthly basis. It might include a car loan, your mortgage maybe your gardener, and certainly tithing and it's possible to automate many of these areas as well too.
4) CASH
So what should you pay with cash?
We buy:
Periodically, it's a good idea to track your spending and know exactly where you're cash is going. Apart from this, I like using cash because I don't have to track every penny that I spend. If for instance, you have a allowance to go out to eat, spend it and you don't have to track every penny. We also spend less when we use cash as opposed to credit cards. When you run out of cash for the month, you need to stop spending. This is the old envelope method of managing cash.
So that's the four targets for financial freedom. If you would like more help, give us a call at Turning Point Stewardship, and we can make financial success a reality for you!! Speak with Tim Enos at (800) 296-5899 x207 or visit us at www.turningpointstewardship.com
We
do, however, speak a message of wisdom among the mature, but not the wisdom
of this age or of the rulers of this age, who are coming to nothing. 7 No,
we speak of God's secret wisdom, a wisdom that has been hidden and that God
destined for our glory before time began.
I Corinthians 2:6
It
is written: "I believed; therefore I have spoken." With that same spirit of
faith we also believe and therefore speak
II Corinthians 4:13
On
the contrary, we speak as men approved by God to be entrusted with the gospel.
We are not trying to please men but God, who tests our hearts.
I Thessalonians 2:4
Jonathan,
David's uncle, was a counselor, a man of insight and a scribe.
I Chronicles 27:32
Ahithophel
was the king's (David's) counselor.
I Chronicles 27:33
"To God belong wisdom and power; counsel and understanding are his.
Job 12:13
And
I will ask the Father, and he will give you another Counselor to be with you
forever - the Spirit of truth.
John 14:16-17