finances

Attitudes For Successful Money Management

Attitudes For Successful Money Management

Attitude of Successful Money Management

Do you really need to learn money management or do you need to learn a new attitude about your money? Where did you learn your ideas about money? Probably if you’re like most, you learned what your parents taught you. Maybe your spouses’ money habits and concerns have rubbed off on you. Most importantly, how will yours rub off on your children? Before you can teach money management to your teen, what do your words and actions say? If your children use the same techniques for money management in 20 years, will they be headed toward success or disaster? Maybe it’s time you rethought this love/hate relationship with your old friend, money. Maybe it’s time you adopted some successful attitudes; such as:

Have A Attitude of Gratitude

So often, as parents we give our children this line when there are complaints about what’s for dinner, who got what toy or got to sit in which seat. We say, “Stop complaining and be grateful for what you have,” or something to that affect. If it’s become rote, more than likely what you’re really saying (which is what your child is hearing) is “Shut-up and stop complaining,” which amazingly enough, doesn’t sound grateful at all, does it? The way we teach our children to be grateful is by being thankful for what we have and expressing it regularly; and no other topic comes to mind so regularly as money. Are we thankful for our good health and yet whining about our paycheck or our taxes? The more grateful we are for what we have, the more we’ll have to be grateful for.

Have a Attitude of Respect

We’ll spend time teaching our kids to respect their elders, respect our rules and have respect for themselves, but too often respect for money gets pushed aside. There seem to be 2 schools of thought, neither of which are respect; fear or disregard. If the budget rules your house with an iron fist and every penny is squeezed, you are passing down a fear of money to your child. If money is so scary that it controls even Mom and Dad, the most powerful people in the universe, it must be bad. Total disregard of the finances is just as bad. A lazy attitude of, “Oh the mortgage will just be late and I have no idea how we’ll pay for the credit card, but we’ll stop thinking about that once we go shopping,” teaches disrespect for money, which will translate into lack of money later in life.

Be Joyful

Money is fun and if you’ve forgotten that, let me remind you. There was a time; maybe a long time ago, maybe you were still a child that you suddenly “came into” some money that you weren’t expecting. There it was, a whole $20 and you couldn’t believe how great it was and started right away imagining all the cool stuff you could buy with it! Why should you give up that joy as an adult? Spending money is fun and when you give with love and an open heart, not only is it fun but you are making abundance possible in your life. Spending money begrudgingly and reminding your children and spouse about how much they “cost you” every time you leave the house not only stops the abundance coming into your life, but makes you a killjoy.

Show Interest

How much do you really know about money? We all know that in order to have a good relationship with our spouse, we have to communicate. We have to find out what makes them tick. We have to get to know them. We know as parents that we need to know our child’s interests and spend time growing those talents. We are successful at what interests us because we automatically take the time to find out more. So wouldn’t that apply to our money as well? How can expect to have a great relationship with your money if you don’t know the first thing about it? When the only time you spend with money is that dreaded day of the month where you grip the checkbook, hope for the best and pay the bills, how can you really know what makes your money tick? Get involved with your money and invest the time in finding out more. Get your family equally involved with the finances. If one spouse handles all the money, the other one should still know the essentials of what this family is doing with finances. Your family budget, the one your kids know exists but never find out why or how it works, is a “family” budget. Take the mystery out of your money and spend time with it.

Understand the Value of Money

Understanding the value of money goes beyond, this is $10, it’s worth $10. How you value yourself and your personal values in life are expressed through your value of money. Are you spending every waking moment in a desperate attempt to keep up with the Jones’s? Are your kids always dressed to impress even though they’d rather be just comfortable? Is it not good unless it’s the most expensive? These are all ideas that scream, “I am not enough, not valuable without money.” Is that what you want your children believing later in life? On the other end of the spectrum we have those that never buy anything new, their house is in desperate need of repair, their children live in hand-me-downs and they’re not satisfied unless they got “it” the cheapest that they could get. They even love to brag about how little everything they own cost. Are you really being frugal or have you taken the “we don’t deserve nice things” and made it a lifestyle? Are your feelings of self-worth controlling your money habits? And if so, what kind of value are your children seeing?

6. An Attitude of Confidence

Obviously if you are married with children, fear of the unknown doesn’t really faze you. You walked down the aisle despite what the statistics told you that the odds were. You had children and are raising them in the face of awesome odds. Look at you – you’re doing it! So why, when we’re brave enough to face the challenges of marriage and parenthood, do so many of us figure that money is totally out of our control. We can trust God with our kids, but money is up to fate, luck and maybe the lottery. We can count on our spouse to be with us through sickness and through health but we can’t count on ourselves to be “good” with money. We’d start that business if we had the money. We’d buy that stock if we had the money. Confidence with money comes from the knowledge that you come from abundance. There is plenty more where that came from. Being bold is the only thing that’s going to take you from struggling to success. Are you passing down an entrepreneurial spirit? Or are you going to whine about all the missed opportunities? Will your kids?

Be Ethical and Honest

Are you honest with your family about the finances? Isn’t it amazing that as a parent, you can expect your child to be truthful about why they got in trouble, and yet cheat on your taxes, feeling somehow that you’re entitled? Why is it that we expect our spouse to tell us every little thing that happened at work that day but what’s going on with the checking account is a big mystery? Do you talk about your salary like you talk about that 6-foot fish you almost caught? What’s your money story? And if it’s not a good one, or it doesn’t have a happy ending, what’s the moral of the story for your kids? If the truth shall set you free, how free are you financially?

When you think about the relationship you have with one of your old friends, or the relationship you have with your spouse when things are going really well, what are you doing to make that relationship a success? Of course you’re grateful for the time the two of you spend together. You have a deep respect for that person and you feel a joy when you are with them that always brings you back for more. You are extremely interested in what they’re doing and find their ideas and feelings to be fascinating. You value their ideas and opinions and love knowing they value yours. You are confident that the future of your relationship is going to be even better than the past. And you would never dream of dishonoring that relationship by being anything less than truthful.

If you became friends with your money, would you need to manage it? Growing a relationship with your money is not only key to your own success, but a vital part of teaching your child to reach for their own financial freedom.

 

Posted by Tom in Finance
Take Control Of Your Personal Finances

Take Control Of Your Personal Finances

I have been working in finances since I was about 18 years old, most of the time I was just guessing at what I was doing. Then one day I woke up and knew that I had learn the in’s and out’s of finances if I was to be successful. I found out early in my career that people that are financially successful at the ones that take the time and energy to regularly budget and plan out their finances. Most of them like myself have taken the time to get a financial education and continue to expand their knowledge over their lifetime.

Some of us go through life with no formal financial education and then there are others of us that have received a education in finances and receiving a education is a primary component of financial success. Here are some steps that will help you gain the financial foundation to help you to be financially successful.

 Mark your calendar to spend a few hours a week on your finances. 
Millionaires spend, on average, 8.4 hours a month managing and planning out their finances, according research by business theorist, Thomas Stanley. To be financially successful you need to dedicate time and energy just like the millionaires do. When I started my career I found out early that it takes dedication and time to regularly plan out my budgets and my road map to financial success. Don’t think it happens overnight like winning the lottery.

Set up a recurring date on your calendar to study your financial road map weekly and dedicate an hour a week just to your personal finances. Take a look weekly at your budget, look at your upcoming expenses and make sure you have the money in the accounts to cover your bills, then pay your bills which should already be automated to your accounts. Take a look at all the transactions for the week to make sure no one is siphoning money from your account and check to make sure that your accounts are accurate. Be consistent with this weekly money date and make it a fun time don’t think of it as a chore.

 

Commit 30 minutes a week to study about personal finances.

There are plenty of reading material on personal finances and financial education. The more knowledge you have the more you will feel comfortable with your finances. Don’t burn yourself out trying to learn everything overnight, break up your education sessions in to 30 minute increments. I love reading about personal budgets and financial secrets, but like  I said there are thousands of topics when it comes to finances.

Ask for advice from successful people that you know.

Talk to mentors, ask successful people to help mentor you. Seek out advice from people you know that are successful in business. Most of these people have made the mistakes that you will want to avoid, this is why it is best to get advice from them so you do not go through the same troubles that they have lived through. Take their advice to heart and make sure you thank them for sharing their information.

Gather information and put it to work for you.

Now that you have studied some different ideas and asked successful people for advice. Take these things that you have learnt and try them out for yourself. As you have done your research you have seen that there are lot’s of examples and strategies out there on the web, you need to look at these examples and strategies and see which ones best fit your finance goals and give them a try. If you try something and it does not work, don’t get discouraged look for something else that will fit your goals and keep looking till you find the one that best works for you. The key is don’t give up.

Hire a professional.

If at the end of it all you are still not comfortable about your finances then hire a professional to help you get your financial affairs in order. Sometimes we all need that helpful hand from a professional just to get started on the right track, and then there are those that just don’t have the time to dedicate towards their finances.

Conclusion.

Where ever you are in your financial path remember it takes dedication, time, energy and continued education to be successful with your finances. To be a master it takes a person to devote the time and practice consistently to sharpen their skills. If you devote the time to study and commit the dedication to honing down your skills with your finances one day you will be a master of your financial success.

 

Posted by Tom in Finance
Money Management Tips For Your Finances

Money Management Tips For Your Finances

Money management for your financial dreams

Money management is so much more than a few simple math equations and then you’re done. Math does play a part in money management but also does discipline and emotion and goal setting. The simple rule of money management is to spend less money than you bring home and to invest the leftover money wisely. If everyone lived by this simple rule then there would be no financial issues in families.

I remember when I was young (a long time ago) some of the greatest advice that I received was, take $20.00 a week and put it into some investment that compounded interest and forget about it till you’re ready to retire. At the time I thought wow $20.00 is a lot of money, this is money that I play with I cannot do that. To this day I kick myself in the rear-end for not taking that advice to heart. If I would have followed this simple piece of knowledge at the time I would have over $50,000 plus interest in my nest egg.

Of course I was a lot like other young people in my generation, I did not listen to wise old men and I took every penny I made and wasted it on foolish items. Today I wish I would have listened to people that were wiser than I was at the time and not have followed my emotions and wasted my hard earned money on foolish items.

The past is the past and I need to only look at the future now since I am fifty plus years old and I want to retire in ten years.


Obstacles get in our way.

About twelve years ago I had a major setback in my financial situation that was a wake-up call for me. My wife at the time wanted to have a new life and asked me for a divorce. Going through a divorce is a life and financial changing experience that I wish on no one. If you are not psychologically, emotionally and financially prepared then it will be like getting hit over the head with a baseball bat. Divorce can put you in such a financial tailspin that it can ruin your life for many years.

This was a difficult time for me, but God had other plans for my life and he took me out of that situation and today I am able to help others that are in that same boat that I was in. Since that life changing curve ball that I was given, today I am writing and teaching others how to reset you’re financial goals and take steps to get you back on the right path to financial freedom. Let’s now take a look at a couple of steps that you can start with to get you started.

Be Content.

First you need to understand that you will not find happiness in materialism and spending money on things you do not need. You must stop believing that money buys happiness. I remember the days of bringing home $25,000 a year and how I wished I could bring home $50,000 a year, I would so much happier. Well when I did hit that goal of making $50,000 I was no happier than when I brought home $25,000.

 

You need to learn to be happy with what you are given each day, when you make more money and you are not content you will not find happiness. There are no shortcuts and secrets to be financially set. What you need to do is learn how to mentally be happy with what has been given to you and learn to live within your means.

Learn to say no.

Learn to say no, every parent has problems with saying no to their kids, especially when it comes to purchasing back to school items and when it comes to the holidays. Right now is the time of year when families are running around and purchasing items for their kids to go back to school and I am hearing horror stories of families spending hundreds of dollars for new clothes and equipment like tablets, computers and new cell phones to go back to school with This is absolutely crazy. There is no need to purchase these items and go deeper in debt just to make your kids happy. You need to learn to say no, our parents did and we survived and so will your kids.

And It is not just kids that we need to be saying no too, it is us adults also. Many of us want to purchase new adult toys even when there is nothing wrong with what we have now. We need to be looking at cutting expenses and not getting deeper into debt just because we want something new. If you have the cash and you really feel the need to purchase that item them go for it, but do not purchase the item on a credit card or use money that will be going for another bill, only purchase the item if you have spare money laying around.

Use technology to your financial advantage.

When it comes to saving for your retirement use technology to help you stay on track. Computerize you savings and retirement accounts, when you set up monthly payments to come out of your check to go directly into a 401k account or some other savings account you will not miss the money since you don’t see it come from your paycheck. I set my retirement account to come directly out of my earnings and I was amazed at how quickly that account grew over time.

Computerize your spending habits in order to keep track of where you are spending money. Using software like bill pay will help identify where you are spending your money. At the end of the month take your statement and look it over to see where you have wasted money. Take for example, how many times did you go to Starbucks to purchase coffee, how many times did you purchase fast food during the month, and etc. Software like bill pay can shine a light on where you may be wasting money.

Take action now!

Nobody cares about your money and your future more that you do, so don’t procrastinate on getting your retirement started or work to get out of debt. Another thing is; don’t make excuses and blame other for your financial situation. Your financial condition may not be entirely your fault, but stop complaining and fix your situation now. You have the brains and no-how, take your expertise and fix what needs fixing with your finances.

Passion

Make money management a passion, when you do this it will give you the motivation to keep working harder to save and get out of debt. A wise person once said “”I like entrepreneurs who decided to solve a pain point that affected them personally,” says Vasu Kulkarni, Courtside Ventures. “The conviction to solve a problem is always stronger when you are passionate about it, and generally that tends to stem from issues that you can relate to personally.”

If you goal is to build for your retirement or get you and your family out of debt, take time right now to light the passion in your home with your family to be as passionate about this as you are. The larger the support group you have the stronger you will be to break your goal.

 

Posted by Tom in Finance
Why Must You Be Financially Literate

Why Must You Be Financially Literate

Why you must be financially literate

Usually April is Financial Literacy month but we are going to take a look at it now since we are a little over halfway through the year. Financial literacy is not just knowing and understating how to manage your personal financial matters but actually taking what you know and putting it into action. To be totally financially literate you need to understand how to manage debt, do financial planning / budgeting, and learn profitable ways to save the money you earn. Learning these principles and applying them is what is needed to gain financial confidence and financial independence.

To be financially literate.

There are several steps for a person to have financial literacy which include key skills in making and keeping a budget, track your spending habits, learn simple ways to pay off debt, and plan for your future. Being educated in these areas from a financial expert can be very beneficial in achieving your financial goals and give you and your family peace of mind and financial confidence which leads individuals to be self-sufficient.

How financial ignorance can affect you.

Based on a report by National Financial Educators Counselors Council in an article that was published in Cardtrak.com the lack of financial knowledge is costing Americans more than $2.3 trillion dollars over their lifetime. The lack of knowledge cost people money, bank charges, high interest, credit card debt, losses on investments and it can hurt you from getting your dream job if your credit is poor. Also based on this report, financial ignorance affects all ages and demographics levels. The lack of knowledge can lead to owning large amounts of debt, which can lead to poor credit, bankruptcy, and or foreclosure.

Now I am not close to being financially perfect myself. I have had money troubles in the past and at one time I was close to living out of the back seat of my car. This was the wakeup call I needed to get my act together with my finances. I have worked extremely hard in the past ten years at applying financial principles and strategies to get myself out of debt and get ahead of the financial curve and become financially independent.

Here are a couple of excellent resources on how to become financial literate:

Rich Dad Financial Education

Financial Literacy

PBS – Financial Literacy

A statement that I read not too long ago makes perfect sense. “The key to building great wealth is having great knowledge to act on and great wisdom to know which course of action is the best”.

What are some of your financial goals that will help you to become financial literate and independent.

 

Posted by Tom in Finance
7 Items That Can Ruin Your Credit

7 Items That Can Ruin Your Credit

7 Easy Ways To Ruin Your Credit

Some the biggest financial mistakes I made were when I was in my 20’s and 30’ that set me on the road to financial disaster. I was young and dumb and I had a good paying job, credit was no problem. I was receiving credit cards daily in the mail so it was no big deal filling my wallet with these cards. If I wanted something I would go out and purchase it or if I did not have the cash I had the plastic card to pay for the item.

After I matured and received a job handling loans for lenders I got a great education in how credit and loans worked. There are many items that will affect your credit, there are a few things that can have a positive effect on your credit score but there many things that have a negative effect and many things that you have no control over.

Having Good Credit

In today’s world your credit is so important. I am an employer for a large service based company and one of the hiring criteria is having good credit. We will take an application that looks good and if the person has bad credit we will not hire the person. This is just one issue that can hinder your life if you have bad credit. Many things in life revolve around your credit score, one would be amazed at how your life is judge by just your credit score.

There are many things that affect your credit score. Let’s take a little walk down the path and take a look at a few of these simple things that will ruin your life when it comes to your credit score.

Too many credit cards

Everybody is giving away credit cards, these cards are a huge money maker for companies. The last time I was at my dentist and took my dog to the vet they both were trying to get me to take out a credit card with them. Any department store, home improvement store, airlines you fly on and etc have credit cards that they want you to sign up for. Before you sign up for these cards read all the fine print on the contracts. Also take some time and do some research, some of these cards offer some great point reward programs.

Remember that every card you apply for is a loan program. When you apply for these cards your credit report is run and it is scrutinized which affects your credit score. Every ding against your credit drives down your credit score.

Pay your credit card payment on time

While we are on the subject of credit cards remember you MUST pay your credit card payment on time. Do not miss a payment even if it is a one off and say I will pay it next month. If you do this you will be charged a expensive late fee, plus you will rack up more interest. But what is worse is that your credit score will take a major hit and it will show all the times that you made late payments.

Read your email and open all your mail

This just happened last night to my wife and I, my wife was scanning her email and found that our cell phone invoice was due the These companies are saving on postage and administrative fees by sending the invoices by email. If you were to be late with your cell phone bill or utility payments this may show up on credit score and possibly lower your score. Make sure you read all your mail and catch those bills that come in a plain white envelope, read all your email and junk email because with technology these days your bill may be sitting in your email box.

Cosigning for a loan

I highly frown at people that co-sign for loans. First if the person is needing a loan cosigned for then they probably have bad credit for not paying their bills on time. If your child is needing a loan for a car and they have no money for a large down payment then I would wait and make them save their money until they have a good enough down payment for a car loan where they do not need me to cosign for it. I have two daughters that I have turned down cosigning for loans for them, they both have bad credit and it is due to the fact that they cannot manage their finances. It may sound bad, but I am not going to ruin my credit because they cannot manage what they have.

Getting buried in debt

It is getting easy again to finance just about anything. Home and car loans are flying out the door again and money is being lent to people are such cheap rates. Although you may qualify for a home loan and it is not in your budget don’t go out and purchase a home that you know will not fit into your monthly budget. If your debt to income ratio are not inline this will affect your credit very negatively. This negative score will stay with you until you have paid down some of the debt and get your income to debt ratio straightened out.

Large ticket purchases

If you are in the process of purchasing a home while the loan is being processed by the lending institution do not purchase anything on credit until you have closed on the home. Many people while purchasing a home will go and purchase all new furniture and supplies for the home on credit which will have a terrible effect on your credit score. If the hit on your credit score is bad enough you may lose out on the loan for the home. Be extremely careful if you are having a large loan processed, there are many things that can affect the loan, do not add to it with materialistic purchases.

 

Posted by Tom in Finance
Setup Your Finances In Order To Homestead Properly

Setup Your Finances In Order To Homestead Properly

How to finance your homestead

Many people have asked me over the years how I went about setting up my finances in order to homestead properly? For our family we work very hard to live on half of the income that comes into the home. This is not easy for us but we do our best in order save as much money as possible. We pour in a lot of blood sweat and tears into our work instead of hiring things done and this helps us to save money. The other thing that we did that most people hate to think or talk about is budgeting. We will discuss budgeting in more detail in a later episode. Today we will just touch on a few key points of a budget.

The cost housing

Like I have mentioned in another post we live in the nature coast of Central Florida. The housing cost here is much much less than living in other areas of the country and even in the State of Florida. Many people would rather live in a more city type areas like Orlando or Tampa in order to enjoy all the fun and materialistic lifestyle that city life can give them. But living closer to these cities the housing cost would be three to five times higher than where I live now. In order to keep our housing cost down we choose to live here and by doing so we were able to pay off our house and property and live mortgage free. I will admit that there are days when my materialistic mind says let’s sell everything and build a new fancy home, but then I think what would happen if the economy tanks and the banks call in all their mortgages, we would be homeless. Since our home is paid off I don’t have to worry if the country falls back into a depression my family will have a roof over our heads.

Think before you buy

One of the main problems with our country today is the economy. From our government leaders all the way down to the blue collar worker we purchase things on credit. People need to stop pulling out their plastic credit cards and start paying for items in CASH ONLY. If for any reason you need to finance something do some real soul searching and decide if the item is really a need or a want, and if it is a need then try to work out some creative financing in order to keep the interest payments to a bare minimum. Many young people today finance everything that they own, credit card companies play these games with travel points to cash back deals and so on. Don’t fall for these scams, they sound great but they sucker you in with these scams and the next thing you know your credit is maxed out and you will be paying thousands of dollars in interest fees.

Weigh out your needs versus your wants

Do I need a new car or do I want a new car? These are questions that we all need to sit down and decide. The car I am driving has 228,346 miles and it runs great plus I get fifty miles to a gallon. But would I love to have a new car or truck, of course. But what comes with a new car or truck, a payment. I love so much not having any car payments, this money I save in car payments goes directly into the bank. I have friends that have three or four car payments, according to bankrate.com the average car payment in the U.S. is $479.00. Three to four car payments in a household like this would wipe out some families finances if one of the family members lost their job.

Take television, here in Central Florida we have one maybe two cable companies that supply cable television to the homes. The average cable bill according to USA News is $124.00 a month. In our home I purchased a high definition cable antenna and I pay nothing for television. I pull in over thirty television stations even though I live over sixty miles from a big city. That $124.00 a month can purchase a lot of other items that are needs not luxury items.

Eating out is another area that you can save a lot of money. Food is one of my downfalls, I love food and I love to eat out. I have friends and family that eat out for every meal, can you imagine what their food expense is every month. When I go to places like Outback, Olive Garden or etc my dinner bill for my wife and I comes to around $50 – $60 each time. This is such a waste of hard earned money. When I go to the grocery store and figure the cost of the same meal I could save more than half the cost of eating out.

These are just a few things that you need to sit down and decide for you and your family. If you truly want to be homesteaders and put cash away you may need to adjust your family expenses and get rid of some luxury items in order to live on much less and have additional funds for your homesteading projects.

Get the family involved

Homesteading is a family lifestyle. It takes hard work by everyone in the family. When it comes to finances the entire household needs to be on the same page. There needs to be family conversations and open communication with everyone in order to have everyone working towards the same goals.

Budgets

Like I said in the beginning living on half of a family’s income is hard. It takes serious discipline and special planning. If you put your mind to it you can make anything happen as long as you have a plan and stick to it. The key elements that led us to be able to live on half was making wise choices, work to cut out all debt, and being creative. In some future articles we will take a much closer look at budgeting and setting some financial goals.

Related Links:

5 Budgeting Tips

Budgeting ideas for mom’s

Helpful tips for family budget

 

 


Posted by Tom in Budgeting, Homestead