When we married we made the “tough” decision to avoid debt as much as possible. The following principles reflect how Drew and I do the whole “money” thing, and we’ve been debt-free for nearly 6 years (of course, we haven’t purchased our first home yet – so go easy on us):
Budget. Our budget is a necessary evil. If we didn’t have one we wouldn’t be able to monitor our spending. We wouldn’t save as much money. And we DEFINITELY wouldn’t give as much away.
No window shopping. Seriously. We don’t stroll the mall for fun – it’s like torture because either we can’t afford to buy it, or we will buy it and not be able to get groceries the next month.
If you don’t have it, don’t spend it. This rule leads to a much greater chance of us saving money. We save up money for those new shoes before buying them. Only in emergencies will we pull out the credit card to cover an expense that we don’t have the money for.
“Do I really need this?” We ask ourselves this question whenever we make a purchase – large or small. an honest answer to this question can cut down on grocery spending, eating out, clothing, household items, etc… Of course, we continue to purchase things that we might not really need… Let’s say that it’s becoming obvious that I’ve had the same purse for over a year. It’s time for a new one. Instead of spending $70 dollars on a new purse, I’ll spend $25 – ’cause “do i really need a $70 purse? Especially if it’s going out of style in 2 years?”
I’ve saved this post for a few months, waiting to talk about this during our “DO Something” series. I think it’s important to evaluate (and re-evaluate) our resources, so we can have a better grasp on HOW we are using what the Lord has blessed us with.
So, let’s talk about it: how do master your money?
Great post! My wife and I help teach the Dave Ramsey Financial Peace class.
We were able to quit sounding like children using the words we ‘NEED THAT’ great stuff!
Great question.
We use this plan of attack:
1) Budget: We have a big budget meeting once a month and plan out the next 4 pay periods. Everything in is zeroed out. Every dollar is assigned some where. We budget EVERYTHING, even our “fun” money. Then each week we have a smaller “adjust” meeting to make sure we’re good.
2) Envelopes: It sounds elementary, but we needed to break bad spending habits, so everything except for 2 recurring subscriptions goes into envelopes. We pay cash for most of our bills. Since doing this we’ve seen an increase in the amount of money we actually have available at the end of all the bills to go into debt reduction and savings. We pay cash for everything, gas, bills, groceries, haircuts, etc.
3) Discipline: we try and help each other out without lording it over each other. One of the hardest things for me to do is say no to my baby when it comes to splurging. I’m not wasteful, but I do like to see her smile. At the same time, I love her enough to be strong and disciplined now, so that we can enjoy debt freedom and financial security later. Plus, we really want to GIVE above and beyond what we do now and we feel like when we free up this debt we have, we’ll be able to be more of a blessing to people.
Great post!
#3 – Russ. That’s a good one! Drew is the same way. He doesn’t like to say “no” to me… But sometimes he will, for all the right reasons!
All I can say right now is “OUCH!” I think I just got take out back to the woodshed by the Holy Spirit.
~Cheryl
The best thing to do is to tell your money where it will go instead of letting it tell you. Plan where every dollar that you have or take in will go and then stick with it! Being debt free and planning is worth it! I would never have been able to leave my job, sell my house, and take an almost 100% cut in pay to listen to God and plant a church if I didn’t start 20+ yrs ago. I had no idea that this was where I would be today, but what’s cool is that I am! Be ready for your call…
You also have to check out http://rethinkmoney.org and download the monthly/weekly spending plans, debt payoff, investment tools—they are all great and made for people like all of us, not financial wizards!!
amen to the budget! we had some mentors who allowed us to use their budget to create our own when we were engaged, so we’ve lived off of one since day one and it’s been so critical to us financially. and it’s helped us really prioritize how we spend our money. we are religious about keeping receipts. it only takes 10 minutes max each week to enter them in the computer and then we always know what our current spending is in relation to the budget.
we do one thing that some people might think unwise, but it works if you are really disciplined about it. we do have a credit card that we use for everything. pretty much, if you can charge something, we put it on there. BUT we pay it off completely every month. basically, it serves as a debit card for us. we truly do not allow ourselves the option of keeping a balance on it. the reason we do it? airline miles. plain and simple. when all of your expenses equal miles and you’re living far away, you can see your family a whole lot more often.
giving. we try to do it beyond what we’re comfortable with. it’s loosened our grip on the stuff, if you know what i mean.
thanks for sharing your plan.
on the personal front, we never have really had much money. as the heads of the ministry, we raise funds for thrive africa as a whole — this year our operating budget is over 3/4 of a million dollars! starting last year, at our board of directors’ assistance, we finally began receiving a salary from thrive (after 9 years of ministry). we live on the mission base, so housing/electricity is covered. the ministry has provided us a car and gives us a food allowance each month. but now, on top of all that, we have $500 a month that is our very own. things tend to be VERY expensive here in SA so we don’t shop much; we tend to save up our money for when we are in the states and then we seem like shopaholics because we buy so much stuff. but seriously, i don’t do that on a normal basis!!!
anyway, niel’s always done some stuff on the side (he’s got a great business mind) to help earn extra money for us, which he saves for “big things” – like taking me to sicily next month! (he raised cows to pay for that!)
Mandy, You have a great financial plan, but just how un-American are you? Saving up to buy something instead of just charging it?
That of course is the most important key to long range financial security, saving and not going into debt, except for a home, which is a good long term investment. I have no idea how a family with children can do this.
I would be still working if I had not been debt free when I retired.
I make up a budget in December for the coming year than try to reduce it by 10%. I have a yearly budget, monthly budget and weekly budget. It is important to stay on top of our spending as much as possible.
Ed: UN-american is SO the word for this! I actually have a possible post with the title “The Un-American Dream” re: saving to give away… Interesting! I might go with it!
Rachel: We do the same with Credit Cards. Builds our credit line while not costing us anything. But, it can be tricky. Very tricky.
Great post! There’s nothing like being debt free (:
My husband and I keep track of everything we spend and record our expenses in categories like groceries, gas, rent, starbucks… As the month goes on we are able to see exactly where our money is going and we are able to see where we need improvement.
Keeping track of your money really makes you aware that all those small ticket items really add up. $5 on a coffee here and $10 on lunch there can turn into hundreds of dollars at the end of the month!
I think the biggest thing is that we live in a consumer driven society. We are bombarded by messages telling us that we need the latest hot ticket item. “Buy buy buy!” You need the newest trend so you can feel like you’ve made it.
A couple that we know are up to their necks in debt, just lost their home and yet she went to Nordstrom’s last weekend to buy some $200 boots that she just had to have. I’m like, “Girl, go to Ross already and get last season’s boots for $20!”
Anyways, I think we just need to learn to be content.
@ alece… I want o raise some cows.. I need some money to travel to Harrismith…
I heard they have some friendly people there 
(assistance = insistence)
@ heidi — are you allowed to have cows in your backyard in san diego?
Your resume is amazing! Writer, singer, public relatioins, communications coordinator, movie producer, and now financial advisor. Mandy, you are amazing. I am proud of you. Great advice!!!
Roxx
@alece, I don’t have a backyard, I can’t afford a house. But there are cows in San Diego,(outskirts). I am just thinking of a way to get to my friend house for grilled cheese that’s all.
My husband and I have had to make some hard choices to stay out of debt. For those that are in debt there is a way out.
we do the envelope budget system … so if the money’s not in the envelope (or in our case the excel column for that particular item) we don’t do it or buy it … this is the way I’m able to stay at home with my 3 kids …. we make the sacrifices needed to keep me at home and it is sooo worth it
Great tips! Thanks!
Roxx: LOL! I’d say I MARRIED a financial adviser of sorts. Not me. Not me at all
I’ll show your post to my youngest brother. I’m sure he’s going to learn a LOT from it. And from your guests too!
Hahaha! Thank you, Mandy. You helped me big time.
This is very wise esp for such a young’un. Live just below where you could, save the difference, and someday it will set you free.
drtombibey.wordpress.com
Hmmm…. to my mom as well. Hahahahahaha! I love her but I don’t think she’s that great at budgetting.
I’m stingy, so I don’t have much problem about money. Not really stingy, but I keep asking myself, do I really need this? My answer is almost always ‘no.’
I’m disciplined in my spending. Although, of course, there are also times when I give myself a treat: a new dress, a nice lunch with friends, and even short vacations.
My problem is saying ‘no’ to those who borrow money. They think just because I am single, I am already a bank. Waaaa! And just because I don’t go after them, I can already afford not to be paid on time. Double waaaaaah!
Good thing I only lend small amounts, like the cost of five burgers.
Otherwise, I’d be dead. I have a big problem about getting my money back. I don’t know how to say: ‘Can I have my money back, please? It’s three months overdue.’
Sacrifice.
That’s how we’ve done it.
Another thing: Don’t get bitten by the brand bug.
This information was very insightful. I learned how to master my money by making a budget and not spending what I don’t have. Your message is compelling, thanks! Check out slimpundits take on Palin vs. Stalin, http://slimpundit.wordpress.com/
http://slimpundit.wordpress.com/
Your wisdom is compelling. I was hoping to extract a little more information than: make a budget and don’t spend what you don’t have. I was surprised to hear that you’re married, and now it’s pretty clear why you are not a home owner yet.
We have become pretty good at learning needs vrs. wants. Being able to do this makes the biggest difference we’ve found.
Good advice thanks. I guess we just have to ask ourselves is this “Necessary or not” to have.
Slim: Thanks for visiting! Actually, our budgeting philosophy has little to do with why we’re not homeowners. We simply haven’t lived somewhere long enough to buy a house. Believe me, we would MUCH rather put our rent towards paying off a home – investing in something we can sell later. At least then it’s not money down the drain, like renting an apartment. Debt is pretty much inevitable when buying a home. Unless we’re millionaires, there’s not many ways around it. But, in this case, we feel like buying would be wiser than renting, in the long run.
So, we do the whole budget thing, and planning out, and saving. We are trying to figure out how best to save money while also paying up front for school (figuring in scholarships that haven’t arrived yet – oh what fun).
So, I’d like to hear what the hardest thing for you not to buy is. I am actually good about not buying things – except for food and drinks (which is also a health issue). I love Arby’s and Taco Bell, and I am always thirsty, so my money goes out in small spurts – but often.
What is the biggest spending temptation for you? How do you conquer it?
Unfortunately, this is an easy question to answer. Without a doubt, the answer is food/drinks. (ie: eating out, starbucks, etc.) If we cut back on that we’d probably save another $50 each month… Right now, on a “seminary budget” that little chunk of money would go a long way!
Every once in a while, I’ll NEED to go shopping for clothes or whatever. But I’m realizing that even that “need” isn’t as much of a need as I thought.
Here’s another answer as well: Right now I probably spend $250/year on clothes. And usually when shopping, the bug will bite and I’ll buy an item that I don’t need. Relatively cheap item, always, even though I don’t need it. But, going to thrift shops (and/or just keeping the out-of-style clothes that I have) could save all that money!
Many would look at our budget and think we’re living on BARE MINIMUMS, but I know others who (whether by choice or circumstances) survive on much less. It’s possible, when we release ourselves of the grip of greed and materialism.
Thanks for being so down-to-earth, Mandy. We I think, like to think we have a handle on our money … but really, there’s a LOT of work that needs to be done. I e-mailed this post to my husband. Thanks.
Sigh…. I thought I was good at handling money, but then I met this wonderful lady, a true damsel in distress ,got lovestruck and lovesick and now my budget for this year is in ruins.
(
LOL!!!!
I’m SO sorry! We have a way of RUINING men…
I need a budget, but being in photography, you kinda hav to spend money to make money. But I am still trying to get a handle on my spending. Thanks for the tips.
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