Keep Your Money Life Intact
- Spend less than you earn. This should be a no-brainer, but most people just don’t adhere to this idea. When I was a newlywed, my boss told me, “You should live on Brent’s salary and save yours.” I thought he was nuts. But I will tell you it was the best advice we never followed. Had we taken his advice, we would’ve been in much better shape early on.
- Debt is a four-letter word. When we don’t save and pay cash for items other than a mortgage, we will pay much more for what we buy. Sales prices will quickly be added to in a hurry. Why do you think we get discounts for using credit at department stores? The odds are in their favor that we won’t be able to pay it off before we incur interest.
- Budget, budget, budget! This is the only way we can live within our means. We have found that the best way to do this is through a software program. There are many programs from which to choose. Do a Google search and you’ll have more information than you ever dreamed. We have successfully used Quicken for years, but there are other programs that may offer options that are better suited to your situation. We can pay bills, budget, keep track of what we spend, and even download our spending into TurboTax, making tax time just a little easier.
- The 10-10-80 spending plan. Ten percent goes to savings. Ten percent goes toward giving to charity. Budget and spend the rest. My daughter is excellent at this plan. When she started babysitting at twelve years of age, she put together a spreadsheet on the computer that charted her progress. She’s been faithful to it ever since. She gave 10 percent to our church and other needy causes, then put 60 percent into her savings, and spent 30 percent on fun stuff. She was able to do this because we were taking care of her needs. Once she became an adult and is now taking on more financial responsibility, she has new percentages that include her car and school expenses, but even now she still gives 10 percent to charity and 20 percent to savings.
- Don’t spend; invest. Typically we look at money as something we spend rather than a tool used to invest in our futures. When we have this slightly different perspective, we tend to be more proactive in proceeding wisely with our money. When we have goals and dreams for our futures and then view our money as the means to meet them, we are much less likely to let our money slip through our fingers.
It Can Be Better
Are we destined to always struggle with our money? How much is enough? Will there ever be enough? Like Ted, does your husband feel the pressure of providing for the family yet feel as if the debt gets bigger as the hopes grow smaller to ever reach your goals? If so you’re not alone. Unlike most relational things, there actually is a formula to solve our financial woes.
I recently heard two cop wives talking about their finances. They were both on the same money plan and were comparing notes.
“Where are you in the process?” asked Barbara.
“We are now debt-free, except for the mortgage,” Eve said with a smile.
“Wow! That was quick!”
“We had a lot of things to sell,” explained Eve, “Then we took the money and paid off debt. We found a renter for our big house, and now we have a down payment on a smaller home in a better community. It’s all been working out very well. We don’t have to count on Ben’s overtime anymore. How about you?”
“We have about a year and a half, and we’ll be debt free. We’ve whittled our expenses down to the point that we have extra money each month that goes toward paying off our credit cards. It is so freeing!”
The plan that Barbara and Eve were speaking of is Dave Ramsay’s “Total Money Makeover.” His book of the same name shares a simple yet smart plan to get out of debt as soon as possible and then use your money to build wealth in smart ways. Brent and I took a money class shortly after we were married. The class was called Master Your Money, by Ron Blue. We learned some great principles for managing our finances. More recently we read Ramsay’s book together. His ideas and principles were very timely.
Whether you choose Dave Ramsay, Ron Blue, or something else, the point is to have an agreed upon plan. If you are currently in a difficult place financially, there is hope. Get creative. It’s amazing to watch your money make the shift from burden to delight as you get spending under control and see it grow. It’ll be one more thing under control in your law enforcement life. And that makes a huge difference!