Let Them Eat Cake

Almost four years ago we started picking up the pieces of our financial wreckage. We had made so many bad decisions and compromises for so long, that it was hard to get traction in the area of financial freedom. In some places we needed to make a complete 180 degree turn from what we had been doing to what we should be doing. In other areas, more subtle change was required. As we picked through the broken pieces we started forming them into a mosaic of freedom and hope; a mosaic we aren't yet finished with. But how do we keep going? Sometimes, its easier than you think.

 

For almost four years we have been working on paying off all of our debt. At first there were plenty of wins because we had a lot of smaller debts. We would pay off a store card and two months later pay off another card. Now that we are in the home stretch, the wins have slowed down. The few remaining balances we have are pretty large. All the things we had to sell are gone. We do a few things on the side, as we are able, to make a little extra money. Otherwise our only way to pay off debt is through our income and a plan. 

Shortly after we started paying off debt I thought it would be a good idea to have a tangible way to celebrate when we achieved a goal and could close out one account. It had to be something fun; something we could all participate in, even my five year old daughter. But it also had to be cheap because I didn't want to celebrate paying off a debt by creating another. After we had paid off our first debt, it hit me at the grocery store. When we sat down to dinner that night, I pulled out three forks, laid a blanket on the floor, and opened a strawberry cream cake. We had had one once before and they were fantastic. Over the next hour we ate cake right out of the packaging till we got sick and watched The Ballad Of Little Joe, my daughter's favorite VeggieTale. Total cost, $8 ($6 when it's on sale). That strawberry cream goodness became our debt free celebration, and we have had several since. Most recently, I have added a small triple chocolate cake on the side; a desert for our desert.

Over the next year, maybe a little longer, we will have three more cakes. Even though there will be lots of months between paying off these last three debts, I'm reminded to keep plugging ahead with the plan not just when we do our budget, but also when I walk through the bakery department at our grocery store. 

My daughter asks all the time how close we are in paying off a debt. I want to believe its solely because she wants us to be debt free, but it think at least a part of her wants cake. 

 

What are you doing to recognize and celebrate the victories along the way?

-Kevin

Better Than I Deserve

A few years ago I had decided to quit my job. It was a fine job in many ways. It was flexible. The pay was good. But something I hadn't expected began to happen. As Thursday became Friday I would become more upbeat and begin to enjoy things. As Saturday became Sunday I sounded more like Droopy the Dog than myself. My goal was to get to the weekend. Every year I achieved my goal 52 times. But it never lasted. This wore on me and my family. I was dissatisfied. So after some thought, discussion with my wife, and lots of prayer, I gave six months notice. In June of that year, I was done. No job. And it felt great. At first.

I had a plan. I wasn't going to sit around and do nothing, of course. Over time things started to undermine my plan though, and I began to wander aimlessly from day to day. Six months in I started missing my goals to have some things done.  My confidence began to fall apart and I didn't know how to get it back. I was failing. This may sound conceited, but this was new to me. In the realm of tasks and the "doing of stuff," I had never failed before. Why was this different?Then it hit me. I had defined myself by my job, my accomplishments, by what I could do, and I didn't know how to live apart from that. Who was I? I would spend the next several months figuring that out. 

It had been eight months since I had an income and Alesha's business was a sporadic income generator at best. So I needed to make some money. Through some friends I got connected with a small business owner who needed some help. But it wasn't what I had in mind. I had managed multi-year, multi-million dollar projects that were responsible for accounting for billions of dollars annually. I had spent four years in college and had a double major in business and computer science and a minor in economics. I had led multi-national teams. And yet there I was, picking up trash in a parking lot, watching the sun come up. Painting someone else's house, feeling the breeze on my face. Shoveling mulch, laughing with people I barely knew. I started helping Alesha with her business. I put a roof on a house and set up a bookkeeping system for a friend. I spent time with my daughter and sought counsel from those who were in front of me spiritually. We figured out how to live on 25% of what I had been making. We even took a vacation, the first in eight years. Eventually, slowly, I got back into the swing of a regular job and haven't looked back. 

There are lots of things I still can't explain or haven't figured out yet, but I'm taking the time to work on it. Getting ahead is no longer the ultimate goal, being known is. I want my wife to know me, and vice versa. I want my daughter to know me, and vice versa. Most importantly I want to know Jesus better because in the end I'll know me better.

I was more intent on improving my financial situation and accumulating bigger and better "stuff" than on improving my relationships. I'm all for, and promote, sound financial practices. But it's not the be-all end-all. When we come to the end of our days, the only thing we'll be interested in is our relationships, not our stuff. Why wait till then to regret what you didn't do when you can do something about it now?

Move up the ladder? Sure. Grow your portfolio and become wealthy? All for it. But not at the expense of what's really important. How are your priorities?

-Kevin

Death to the Quitter!

I don’t want to speak for you, but I know that inside me lives a quitter. I start an exercise program and in the beginning it’s great. I’m motivated. I’m ready to go. And after a few weeks, it gets harder. I can still push myself, but I don’t exercise as long or as hard as I did in the beginning. A couple weeks after that, I’m done. I quit. I still have the same desire as I did in the beginning. I want to be in better shape, or I want my finances to look better. I want to be out of debt. I want to consistently post a blog update… But somewhere along the way desire wasn't enough anymore. Life happened. I got sick. My daughter got sick. I had to travel. My classes got more involved. Something broke at the house and I had to fix it. The TV was on. I fell asleep. The x-box looked lonely. I had to go out to eat that day. The more excuses I come up with the worse they get. I really chose to do that stuff instead of what I have a real desire to do?

I have found that for me, my wants and desires can be long term, but my execution can’t. I want to be in better shape; to be able to do more than 60 push-ups in a minute, more than 20 pull-ups in a minute, and so on. I want to be out of debt. I want to save up to buy a house. But I can’t go from where I am to those goals. I need to shrink them to something manageable, quickly attainable, and measureable. So how does that work

1. Determine what your sustainability is. For me it’s about a month. I can start something and maintain the same level of energy and focus for that long.
2. Determine what’s achievable. Don’t set goals you can’t reach, but don’t make it too easy either. What can I do with a little work in the next month that propels me toward my bigger goals? Can I save $1000 or payoff $1000 in debt? Can I double the number of push-ups I can do?
3. Make it measurable. Better is not measurable. Neither is more. It has to be a number and it has to be a time. 30 days from now I will… and make it something clear that you can know if you did that thing or not. If it’s “lose weight,” make it 5 pounds in the next 30 days. If it’s “better finances”, make it reduce debt by x% (or x dollars) in the next 30 days. Whatever the area is, set a target, and go for it.

Over the long term I’ll quit. I know that. But if I set short term milestones that keep me on a pace to reach my long term goal, I’ll get there. And I’ll have punched that quitter right in the face. I’m going to do it. Are you?

~Kevin

Skills, Talents and Gifts

I love the show Project Runway.  My daughter and I love to watch it.  Sometimes I live vicariously through the lives of the designers on the show.  It looks like it would be a lot of fun to be a fashion designer and know how to make beautiful clothes and live in a large city.  On occasion I have the thought that I could have been a fashion designer if I had not chosen to study accounting.  I can draw decently and I love fashion.  But, being a fashion designer was not what I was put on this earth to do.  I was made to be an accountant and to understand finances.

Through college and my professional work I have discovered a few things about people who work in accounting.  There are few people in this world who understand accounting; it is something that comes easy to them.  Either you understand it or you don't.  There are few people who enjoy accounting.  Either you love it or you hate it.  There are few people who stand in the middle.  The rare group of people are those who understand accounting and enjoy working in it.  I am in that group.

I truly believe that God provided me with a gifting, a talent and a skill set to be an accountant.  I believe that He shaped my path in order for me to be prepared for the work I get to do today.  The body of Christ is made up  of different people who are made to do different things.  God provides us with specific gifts and talents to do what only we were made to do.  He shapes our experiences so that we are prepared to move forward in what He has called on our lives.  We are individually entrusted with specific roles that we are individually made to do.

What is it for you?  Are you working in the area that God specifically designed for you?  Please note that my question is not, "Do you enjoy your job?" or "Are you making enough money?"  I am encouraging you to truly examine what it is that you are doing and consider if it is the one thing that God made you to do.  If it is, fantastic!  Work at it with excellence!  If not, begin the conversations with God about where He wants you.  It could make all of the difference.

What is the specific skill set that God has provided you?

Hard Work

Saving is hard work. If you’re a generous person, it feels selfish to save. If you’re a shopper it feels wasteful to save. If you’re barely making ends meet, saving feels like a rumor, like Bigfoot or the Loch Ness monster. The truth is, saving is difficult and it never really gets any easier. Still, it is necessary.

Savings serves as a barrier between you and debt. Debt occurs when we encounter real or perceived emergencies, or when we encounter sales on things we “can’t live without”. You can establish emergency savings and you can save for things that you want or need. The second is always the hardest for me to be honest. Our culture is biased toward the “if you want it, get it” mindset. It’s so easy to get credit still that it feels stupid to not take it. They’re giving you 10% to 20% off of your purchase or 5% cash back, so that’s savings right? No. And I think deep down we know that, but we try to convince ourselves otherwise. On average, we spend 23% more with plastic than we do with cash. So even if you’re the kind of person that pays off your credit cards every month, you’re still incurring more expense than you would otherwise, which is the opposite of saving.

You and I are worth the effort it takes to establish and maintain a healthy saving strategy. Whether you operate by the 10-10-80 plan or some other method, figure out a way to start saving if you haven’t done it before, and then resolve to be consistent. Establish some goals. It’s totally fine to want a new couch or the iPhone 5, just save for them and buy them when you can afford it. It feels so much better to pay for something and have no payments following me home. We bought a dining room set several years ago on credit, and when the table got scratched a few months later I was bothered by having to pay for something that was no longer new or as nice as the day I got it. With payments you can experience buyer’s remorse on a monthly basis. Why subject yourself to that? When your car dies or needs work, it’s already a difficult situation, why prolong it over several months or years with payments. With an emergency fund you just fix it and go on.

Start now. It's not too late to get on the right track.

~Kevin

The Budget... It's an Essential

Establishing a budget is an essential as you travel the road to financial freedom.  At the end of the month do you want your money to tell you where it went or do you want to tell your money where to go?  Dictionary.com defines the word budget as “an estimate, often itemized, of expected income and expense for a given period in the future.”  An accounting textbook defines budget as “a comprehensive financial plan setting forth the expected route for achieving the financial and operational goals of an organization.”  John Maxwell defines a budget as “Telling your money where to go instead of wondering where it went.”  In this blog we are going to define the word budget as “an itemized plan of how you are going to kick the enemy in the teeth in order to get out of financial bondage and live a God-honoring lifestyle that will not only bring financial freedom but financial peace.”

Keep in mind that your budget is not chiseled in stone.  You want to keep your budget flexible and know that it can be changed.  Your money is not the boss of you.  You are the boss of your money.

There are four necessities that you want to use as you build your budget.  These four areas are not negotiable and they are the first things that you pay every month.  They are important because without these 4 areas, you will not be able to handle the other areas of your budget.  The first necessity is shelter.  This area includes everything that is spent on housing, including your mortgage or rent, utilities and insurance.  You must have a place to live.  The second necessity is transportation.  You have a job so that you can pay your bills; therefore, you must have a way to get to your job.  This area can include all costs associated with owning and maintaining a car such as car payments, gas, oil changes and insurance or the expenditures for alternative forms of transportation such as bus fare.  The third necessity is food.  In order for you to effectively perform in your job and make wise decisions, you must provide your body and your family with nutrition.  The fourth necessity is clothing.  You need the necessary and appropriate clothing for your job and for general living.  Keep in mind that as you develop these areas of your budget, you do not have to be extravagant.  For example, in the housing section you may include cable as a utility but cable may be an expenditure that you can eliminate in order to develop other areas of your budget.  Do your best to develop these areas fully and wisely.

One final note about developing your budget…  If you know anything about dieting you have probably heard the advise to not eliminate the one favorite food due to the fact that you are more likely to fall away from your diet if you don’t have something to enjoy.  The same holds true for your budget.  Do not eliminate the one thing that will hold you to your budget.  This could be keeping cable or a monthly clothing option.  Please don’t risk blowing your budget and becoming hopeless because of the one thing that will keep you going.

Go for it and develop your budget for this month or the next month!  You can do it and you will be so glad that you did.  Please send any comments if you have questions or need assistance.

The 4 Essentials While Traveling the Road to Financial Freedom

We believe there are four essentials that you need to establish as you begin to travel the road to financial freedom.  The four essentials are:  (1)  establish financial objectives, (2)  develop a budget, (3)  save for an emergency fund, and (4) track your spending.

The first essential is to consider your financial objectives.  Financial objectives are your target, what you are aiming for.  They can be broad and long term such as having no mortgage in ten years or establishing college savings for your new baby.  Your financial objectives can be specific and short term such as paying off a credit card in six months.  Your financial objectives can be anything  that charts your course to financial freedom.  They set your path and give you direction.  Without objectives, you have nowhere to go.  Prayerfully consider what they are and approach them with knowledge about your current situation.  Our personal financial objectives include getting out of debt in 3 years, completing our Imagine 2 commitment with strength, tithe every year off of our gross income, save as much as we can for our daughter's college education, and save for a 50% downpayment on a new house.

What are some of your financial objectives?