Much Will Be Required

It has been a while since I wrote here. Life has been hectic. Despite being immensely blessed, I have felt immensely overwhelmed instead. As I have struggled with my own circumstances and emotions, I have constantly been delving deeper into the bigger picture. If only mentally, I have been around the world this year, struggling with unanswered questions.

All of these thoughts have expanded onto a bigger scale as the realization that we live in sad times is not going to change. This time of year, I always become disheartened by the commercialism and excess I see everywhere. I have found some relief as I have seen more and more friends at least talking about celebrating Jesus' birth in a fashion actually worthy of our Savior.

Ryan and I have never gone crazy at Christmas, but that is not to say we have done the holiday justice either. I have been confronted with that reality this year as I see American citizens protesting Wall Street and our government going further into debt because it's trying to be everything to everyone.

We are an average family living on a single income in the Midwest. I have stayed home since our first child was born in June 2006, and we have never struggled to make ends meet because we have made a real effort to live within our means. In Winfield, it was easy enough to look around and see countless families struggling to feed or diaper their children. In a global perspective, it is almost unbearable to see how so many live.

I do not want to be the type of "christian" who does not look and act like Christ, but my entire life I have done a darn good job of it. My actions never synced up with my words or even my heart, and this year, right now, that is going to change. Christ will be exemplified in my actions and love for other people so that they may know His goodness and name. I will not look over a $40,000 budget and act like there is not enough money to give more than 10% to my church.

In Franis Chan's book Crazy Love, we are reminded of Jesus' words in Matthew 22:39 to "love our neighbor as yourself." Chan meditated on those words, and it made him wonder what that would look like.  His answer? Only keeping 50% of his church's budget the following year and making a commitment to give away the other 50%! His reasoning? If I love them as much as I love me, then why am I not giving to them as much as I am keeping for myself?

It left me thinking about my 10% which over the last decade has been habitual, not even close to sacrificial. I keep going back to Luke 12:48 where Jesus is quoted saying, "Everyone to whom much was given, of him much will be required, and from him to whom they entrusted much, they will demand the more." Um, that is me, and more than likely that is you too.

Join me in making the decision to serve others as much as myself.

Creating a Budget {Part 3}

Where do the dollars go?

After you've determined your family's Net Spendable Income, it's time to sit down and number crunch.  This is going to happen in two phases.  First, you have to evaluate where your money is already going.  Review your last couple months of receipts to see where you are used to spending your money.  Then, compare those numbers to Crown Financial Ministries' percentage guideline charts to see how you're doing.

The first thing I usually do when I sit down with our new annual budget is plug in any payments that are going to be made no matter what, like my mortgage, estimated/average monthly utilities, cell phone, Internet, etc.

Now I know what I have left over for categorizes like "Entertainment/Recreation" and "Miscellaneous" which contains what I lovingly refer to as "personal maintenance" funds for hair cuts, vitamins and cosmetics.  Within my spreadsheet I use Excel Comments to tag columns that contain more than one item.  For instance my "Housing" column contains both my mortgage and utility payments, so my comment looks like this:

When I scroll over the cell, my little comment pops up which is just a friendly reminder of where that money is allocated.

It is important to be realistic when creating your budget.  Our first budget didn't have "Entertainment/Recreation" or "Clothing" columns in it because that was money that was being invested in things like health insurance and retirement which weren't paid for by our employer at the time.  God regularly blessed us with small gifts of love from people in our lives that allowed us little outings here and there, but for a season, we had to prioritize what was most important for our family and that meant wearing old clothes and date nights on the couch.

So, grab your calculator and determine where your money ought to be going.  Next we will discover how you make sure it gets there.

Creating a Budget {Part 2}

Show Me the Money

Each family will have different things to consider when creating a budget, but one thing we all have to know before establishing any kind of budget is what our Net Spendable Income (NSI) is going to be each month.  Because of the variety of jobs that exist, there is no simple formula for figuring this out.  Some of families, like my own, earn an annual salary making each and every paycheck we receive the exact same.

It's easy for us to know our NSI because it never changes.  Others, however, work hourly, on commission or depend on tips, so it's not so easy to just slap a number into the spreadsheet.  You've got some numbers to crunch first.  You can achieve your NSI in one of two ways: {1} Use last year's total income and divide it by 12 for this year's anticipated average or {2} Decide what the absolute minimum is that you'll make any given month and use that as your NSI, throwing overtime or bonuses into the Surplus column.

In our household, I use the Surplus column for unexpected income like ...

• Reward check from our credit card
• eBay sales
• Annual bonus
• Tax returns
• Cash gifts for birthdays and Christmas

So, in my opinion, that is step one in creating your budget because you can't budget money you don't have!

Creating a Budget {Part 1}

Introduction

It's not typical that one would call one's self a nerd with pride, but I am a budget nerd and not ashamed!  There are not many things I can control as a mother of four wonderful and energetic children, but our budget is something that I can control, barring any major catastrophes.

The first thing to remember when creating a budget is to use a format that works for your family.  There are going to be a few of you who will open my Excel spreadsheet which is set-up like my family's own budget, and you'll likely faint due to overexposure to math formulas and calculations!  I doubt anyone will feel it's not detailed enough, though, because I adore details and tend never to leave any out.  I like knowing where each and every penny is going from our retirement contributions to our vacations, so I set-up my budget to reflect those preferences.

My budget is also, shall we say, established.  I have been using it for nearly three years, so I am comfortable with it because I am used to it.  That is to also say, it is set up specifically for my family's stage of financial freedom.  In my next several blog posts, I will go over the specifics of the sample budget I've included below.

{Sample annual budget worksheet for Excel}
Click on "File" in the blue bar just above the document image, then select "Download Original" from the drop-down menu.  I am not sure if you have to have a Google account to use this feature.

So don't freak out, just look it over and close it, write down some questions and ask them so I can incorporate them into my future posts.

Counting Pennies

I am so relieved that more and more people are using budgets.  I am of the opinion that counting your pennies can help alleviate a lot of stress in a home and a marriage.

Ryan and I were blessed from the get-go, and we were able to start our marriage virtually debt-free.  I have to add "virtually" because technically I think I had a $300-ish credit card balance that I'd been eliminating for some time since I had zero-percent interest.  We quickly paid that off, though, and determined from the get-go that we were going to be on the same page when it came to our money.  This took some adjustment as Ryan is a saver and I am a spender, but it did not take long for us to find middle ground which ended up being the dreams we had for our future.  We had a clear picture of our hearts' desires, and we agreed from the get-go that we were going to do things as biblically as possible and acquire as little debt as possible.

First goal: Save enough money to put 20% down on our first home.

At first, we did not keep a formal budget.  We had big plans which included my staying at home once we had children, so we lived off one salary from the very beginning so we would not experience any sort of shock once we lost that income.  Doing this enabled us to save enough money to put 20% down on our first house, just nine weeks before welcoming our first child and becoming a single-income family.

In March of 2008, when our second child was six-months old, Ryan and I attended Crown Financial Ministries' Journey to Financial Freedom seminar at our church.  For the most part, it merely re-enforced what we already believed and practiced, but it did help us to set our sights higher in terms of long-term financial goals.

For example, right before we got married, we had purchased a brand new car with zero-percent interest.  Since we weren't paying interest, we were in no hurry to pay-off the balance of our loan.  After the seminar, though, we agreed that there was no reason for us to hang on to that debt since we had enough money in savings to pay off the loan.  Wouldn't you know, not six months after settling that loan, we learned we were pregnant again and were in the market for a minivan since our sedan would not be spacious enough for our growing family!  We traded in our sedan and used money from our savings account to pay cash for our minivan and determined that the only debt we were comfortable with from there on out was our mortgage.

As it turns out, I am a numbers geek at heart.  I quickly set-up a spreadsheet in Excel that allowed me to keep detailed records of our spending.  Every penny we earned was accounted for and for the first time, we were being purposeful about our savings.  In Crown, they use the Money Map to help you determine where you are on the "journey to financial freedom."  We were blessed enough to start at Destination 5, and we are working hard to arrive at Destination 6 which is paying off your mortgage and funding your children's educations.

For our family, December is the month when we get to sit down and evaluate our budget for the new year and set new financial goals.  As we started doing this, it made me want to share more about it those around me.  I am hopeful to take some time in the upcoming weeks to walk through the basics of the Crown Money Map with you and talk about the challenges and rewards that come with a budget.

I would love to hear more about your financial goals or answer any questions you may have about starting a budget.

Trim a Tree, Trim a Budget, Give Cloth Diapers

There are many things that I love about Cotton Babies, but one of my favorite things about them isn't even the bumGenius! diaper that I have used to diaper all four of my children.  This is a company that believes in changing the cultural standards not only to decrease the impact on our environment, as you will read in their most recent holiday campaign, but to decrease the impact on our finances by showing families that there is an alternative to high-priced disposable diapers!

So this year, I want to take my cue from Cotton Babies and help spread the message: Trim a Tree, Trim a Budget, Give Cloth Diaper ... and I might add, feed a family.