Is There too Much Month Left at the End of Your Money?

You can find the first three parts of this Financial Preparedness series here, here, and here.

Pretend with me that it’s August 20th.  You head to your pantry to see what you can make for dinner and realize that the pantry is rather sparse.  Since you don’t want to dig into your food storage if you don’t have to, you decide that a trip to the grocery store is in need.  The next day, you grab your phone and check out how much money you have in your bank account that you can use for this grocery trip and you almost swallow your gum when you see that your checking account has a whopping $60.  The next paycheck doesn’t hit until September 1st.  Then mentally you start to recount that you still have to buy gas.  Your youngest child just ruined his last pair of shoes, and then the yearly fee for your Amazon Prime account hits in the next couple of days.

Where does all the money go?!?  How does it go so fast?  There’s too much month left at the end of the money describes the situation perfectly, doesn’t it?

Is this where you live…….e-v-e-r-y month?  Do you want help breaking the cycle?  Or maybe you don’t exist in a perpetual state of what you believe is deprivation because you have money, but you want to learn even better how to save the money you have.  Let’s dive right in.

Is Living Within Your Means The Answer?

Have you heard the saying, “Living within your means?”  I have.  Your “means” is your income.  So, in essence, it’s saying that we should live within our income.  The problem is that when we only live within our income, we have nothing left over for the unexpected.  You know how it is…..Good ole “Murphy” likes to visit when we don’t have anything to cover what his mischief will cost us.   If we only live within our means, we never have anything to give us a buffer if something unexpected hits us.  Get in a car accident and have a deductible?  Didn’t realize it was $1500?  Yea, that’s a hard row to hoe!

So perhaps the goal should be to live under our means and not only within them.  Now don’t panic if you’re already in a hard way.  I can hear some people out there, “Live on less than I do now?!? I can barely make ends meet now.  Live on less?”  Okay.  Take a deep breath, and we’re going to tackle this one step at a time.  Say it with me, “One step at a time.”  You only have to do the next thing in front of you.  And your next thing is……………

What’s Your Why?

So what is the next thing?  I want you to ask yourself WHY do you want to improve your financial situation.  Do you want to have the freedom to give your kids music lessons?  Are financially responsible vacations something you really want to give your kids so they have those memories forever?  Do you want to not stress over where the money is going to come from for your next bill?  Do you want to enable your family to eat more healthfully?  Why do you want to do this?

Have you ever seen Harry Potter and the Prisoner of Azkaban?  You know the scene where Lupin teaches Harry how to fight a Dementor?  Remember Harry fails the first time, and Lupin asks him, what his memory was?  Harry tells Professor Lupin that his memory was the first time he rode a broom.  What does Lupin say?  He returns with something along the lines of, “That’s not good enough.  Not by a longshot.”  Make sure your “Why” is good enough.

There are times that running this blog with all the research and reading and writing that I do to keep it running is overwhelming.  If my “Why” were as trivial as wanting a creative outlet, I would have quit a long time ago.  Make your “Why” worth it.  It will help you through the tough times when you want to give up.

Where Do You Want To Go?

You and your spouse get in a car and start driving.  You pull out of the driveway, turn down the street, and onto a main road a few minutes later.  After about ten minutes of driving, your spouse leans over to you and asks, “Where are we going?”  If you shrug and simply say, “I don’t know.  I just thought it would be fun to drive for a few hours and stop where I want to.”  Well, that might be fun, but you’re not going to get anywhere, in particular, doing that.

If you start your financial journey by meandering around looking for fun, just like in the car analogy, you may have a bit of fun, but you aren’t going to get anywhere fast.  So what are your financial goals?

Do you want to retire at 67 and be able to live comfortably?  Great – what’s “comfortably”?  How much money do you need to do that?  Make sure you are asking the right questions.

Do you want to pay your house off, so at least you’re out from under the payment and interest of your mortgage?  If that’s your goal, how long do you want to take to get there?  What methods are you going to use to get yourself there?

Maybe you want to do something radical and go to the mission field or work for a year abroad for Habitat for Humanity Abroad without soliciting support from anyone.  How much money do you need to do that?  Do you need further education in order to accomplish it?  Make sure you factor in all the ancillary costs.

Or you could be like us.  Our goal is a small self-sufficient homestead.  We have a piece of property in mind even, but we don’t yet have the finances for it.  Even if we are able to afford the land, we’ll need to be able to put a small house and barn on it.  Then we’ve got the animals and other equipment that we’ll need in order to have a homestead.

When I used to do Multi-level-marketing, I was told to create a board with all kinds of pictures of my why or what I wanted to accomplish running that business.  It’s not a bad idea.  Make a collage of pictures of both your why and what your goals are.

Stay Tuned

I’m not going to leave you here.  There’s so much more to talk about, but I don’t want this post to get too long or overwhelming.  Next week, we’ll discuss what to do now that you know your “why” and now that you know what your financial goals are.

What About You?

What are your financial goals?  Do you know where you’re heading?  If you could have the desire of your heart, what would it look like?  I would love to hear!  Leave a comment below and let us know!

Remember, knowledge isn’t just knowing something.  It’s living it!

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