Tuesday Tips for Budgeting

- I have some property taxes due this month (home & car), which could be representative of any kind of irregular expense you face.  Insurance premiums, annual dues, taxes, tuition and other things are similar.  One way to deal with these is to divide the total amount due by twelve, and save up 1/12th of the total each month, then pay the bill when it comes.  This helps establish routine and regularity for your budget.

- Alternatively, if you have enough flexibility and room in your budget, you can incorporate them into the budget as they come.  Bill for taxes?  Put it in the budget!  It’s fine to do this if you don’t mind the variability and have the ability to cover it as it comes without messing […]

By |September 2nd, 2014|Money|0 Comments|

The World is Open to You

Saw this quote recently, and loved it.  It’s attributed to David Brooks (not sure if it’s the journalist or the author).

I think it resonated with me because it encapsulated my personal view, which I’ve termed “optimistic realism.”  I’ve been accused of pessimism in the past, because I believe things aren’t as good as they perhaps could be.  But I see my view as simply a realist view – things aren’t as bad as they could be, but they’re not as good as they could be either.  Circumstances are what they are now – they might be good and they might be not so good – but they can be better, if you make it so.

The world we live in has no limits.  You can […]

By |September 1st, 2014|Life, Money|0 Comments|

Where You Should (and Shouldn’t) Save Your Money – Part 2

Check out Part 1 for my recommendations on where to save your money!

Last week, I covered recommendations for where to save money, but there are plenty of places where people save money that aren’t so great.  I’ll try to make quick work of them:

CDs, or “Certificates of Deposit” have been offered by banks for decades, and they have offered a guaranteed percentage rate of interest for your agreement to keep a certain amount of money in the bank for a specified term.  CDs are offered in terms anywhere from 6 months to 60 months, and individuals are heavily penalized on their interest if they withdraw the money before the specified term is up.

The reason these aren’t good investments is that your money is illiquid or inaccessible to you during […]

By |August 28th, 2014|Money|0 Comments|

Tuesday Tips for Budgeting

It’s time to make a new budget for September!  Review your wins/losses for this month, and knock it out before next Monday!

- Budgeting is the tool that enables you to do everything else with money.  You’ll save, invest, and pay off debt more effectively with a PLAN.

- Don’t over-complicate your cash envelope system.  You don’t need 24 envelopes for every possible scenario.  It may take a few months to work out the kinks, but you should be able to settle on 4-8 envelopes to run the cash-based portion of your budget.  We currently use seven (five of which are in our envelope system), aside from our blow money, which goes straight into our wallets.

- The use of cash will do two things for you: […]

By |August 26th, 2014|Money|0 Comments|

Where You Should (and Shouldn’t) Save Your Money

What are you saving for right now?

There are so many things to save for!  How do you prioritize, and how do you save for all of these different things?  If you want to live a debt-free lifestyle, you have to save for no less than the following (in no particular order):

- Emergencies
- Replacement car
- New furniture
- Retirement
- A down payment for your home
- Your family vacation
- Your kids’ college
- That thing you want to do one day
- Annual payments like insurance and taxes
- And much more!

The first lesson I heard from Dave Ramsey, over 7 years ago, was called “Super Savers,” and it outlined three things we save for:

1) Emergencies
2) Long-term goals like Retirement and College
3) Large Purchases

This lesson also referenced one of my favorite verses that […]

By |August 21st, 2014|Money|4 Comments|

Tuesday Tips for Budgeting

- Any amount of money without a plan has the tendency to be frittered away, leaving you wondering what happened to it?  Combat this with a plan.  That’s all a budget is!  Whether it’s a bonus from a big sale, a tax refund, an insurance settlement, an unexpected gift, an inheritance, or anything else, plan for it!

- Even planning to blow it all is better than not planning at all and being frustrated that the money’s gone.  It’s cool if you don’t want to put it in your emergency fund and instead want to blow the whole thing (in some cases), but the point is being intentional about it.

- Sometimes, when you’re frustrated and things aren’t coming together well on the budget, it’s good to just stand up, walk […]

By |August 19th, 2014|Money|0 Comments|

I Can Save You $90,000 With One Question

What color is it painted?  Is it in a good neighborhood?  What’s the school district?  What’s the appraisal?  How are the appliances?  How much acreage is it?  What’s your down payment?  How many bedrooms?  What is the interest rate on the loan?

These are all great questions to ask, but they lack one GIGANTIC question that every prospective homeowner should ask:

What is my mortgage going to cost me?

Let’s take a reasonable example to see how this works best: a $200,000 home, with 10% down ($20,000), meaning you’ll take out a $180,000 loan.

You can take out a 15-year loan or a 30-year loan.  The 15-year has a significantly higher payment, but the 30-year means you’ll be in debt longer.  Which do you choose?

If you were to […]

By |August 18th, 2014|Money|0 Comments|

Tuesday Tips for Budgeting

- When buying a home, you want a payment on a 15-year fixed-rate loan where the payment is no more than a quarter of your take-home pay.  People who buy more than this struggle to do anything else with their money.  People who buy way more than this are what we call “house poor” – they’ve got the house, but nothing else!

- When renting, you can push that 25% housing number to about 30-35% if you have to, but it’s best to stick close to that 25% number.  The reason you can push it a little bit is that when renting you don’t have some of the additional costs associated with owning when you rent – property taxes, insurance, HOA dues, maintenance and repairs, landscaping, etc.

- […]

By |August 12th, 2014|Money|5 Comments|

Why *Legal* Tax Evasion is Good Stewardship [Updated]

(This post has been updated to reflect the latest version, which was not saved properly before publishing.)

Take the deduction, every single one you can find.

Use tax-free and tax-deferred investment vehicles.

Opt-out of Social Security early and often, and take as much housing allowance as you can (for ordained ministers).

Keep your receipts for health-related expenses, written business mileage records, and anything else that proves deductions.

Hire a great accountant.

I’d give this exact advice to anyone looking to save some money on taxes.  Why is it so important?  Two reasons:

1) Paying less in taxes means more money in your pocket (duh).
2) Paying less in taxes is good stewardship.

I wrote a few thoughts on stewardship a short time ago, and I wanted to expand on the topic.  We’ll focus on number […]

By |August 11th, 2014|Money|2 Comments|

“Are You Going To Trust Me?” [video post]

I know not all of you may be into watching/listening to sermons, but I’ve had a number of requests for this so I wanted to share it.  A few months ago I shared a message on trust at my home church, and had a very special guest join me.  If you get the chance to watch or listen to it, I hope it’s challenging and uplifting for you.

Scripture References:

- About half of Psalms (too many to quote!)
- Matthew 6:26
- Matthew 14

By |August 6th, 2014|Faith|0 Comments|