Thankfulness

We have come to a point in our financial journey where we are back on track - for the most part. Our summer vacation, which we did not budget for, was our down fall. We had a lot of fun but used our credit card to finance it all. Then when we returned, we had a few set backs. We chose to use our credit card for gas and groceries until we could get back into the "black".

I know all of the die-hard Dave Ramsey fans are telling us that we should have cut them up long ago, and they are right - to point. Although we used our credit cards, they also helped us get to a point where we can live on cash again. Yes, credit card debt gets a lot of people in trouble but it also helps get people out. I think there needs to be discipline when it comes to anything.

The other thing we have done to get back on track is around food. We went "shopping" in our freezer one week and found an entire weeks worth of meals frozen. That really did not shock us but made us realize that keeping track of what we have in our home already is part of stewardship.

We have also started freezer cooking. This also helps with how busy we are with both working full-time. It is a large upfront cost but well worth it. We made 18 meals from www.whoneedsacape.com around Canadian Thanksgiving (mid October). Near the beginning of December, we were still finishing them up. We did not use them on Mondays (we have our Bible study group and bring something separate) or on the weekends. We have done a second batch with 40 meals. They have saved many nights. Prep the food in freezer bags, take them out the night before, throw it in the slow cooker in the morning and supper is done when you get home. It sure has saved us from eating out or unhealthy on many of those nights. Twice a year we also buy 1/4 beef from a farmer in Saskatchewan. I am proud to say we did budget for that.

It is now Christmas and we have used our credit cards for our shopping. It is now maxed out and we have made a plan to pay it off in the next year. Mark from YNAB posted a blog post a few weeks ago about setting a REALISTIC goal for the next year. We have done that and I believe we have a good plan going forward. Having goals is not something we are very good at but it is a promise we have made to each for the coming year.

We may also be facing a challenge. My husband is a contract technical writer and he was just informed that his current position, where he has been for a year, will be reducing his hours to two days a week in 2014. He has been applying but has not been offered a new contract. We have also planned, or started to plan, for that. It is something we should have planned for months ago.

This year, or almost full year, of using YNAB and taking a good look at our finances has been very eye-opening. We are very, very thankful for all we have talked about and learned. Here's to 2014 and more improvements in our financial journey.

We're in the BLACK... for a couple of days

Wow! It has been a challenging month! Finally "manning" up and looking at our budget and where we are financially has been difficult. 

We have spent a lot of money this month on bank fees. Our bank charges $5/day for overdraft - and unfortunately, we have been in it a lot this month. It has taught us, though, how important it is to try and stay where we are.

How have we climbed out? As I said using our overdraft a bit, paying minimums on credit cards, buying minimal groceries, keeping up on our bills, and eating what food is already in the house. If you are struggling, I challenge you: look in your freezer and cupboards. What is already there? Do you have leftovers that you have stored away for a "rainy" day? This is the time to use them. If you are not making a list when you buy groceries... DO IT!  That will save you from buying more than you need. Those are a couple of things that we did and it has definitely helped a lot.

We won't be completely out of the red for a few days but it is definitely looking brighter!

Impossible... Or Not!

I was reading today on my friend Stephanie Warnock's blog - www.faithhasnolimit.blogspot.com- and she has a post about contentment.

I started to journal  about that and I ended up thinking about how it feels impossible for us to be out of debt. That lead me to the story of Mary and Gabriel in Luke 1:37. That verse reminds me that nothing is impossible with God - even our finances.

You see, I want everything NOW. I hate the word process! I don't want this to be a process, I want it to be instant. I want instant gratification - just like when I spent the money. That is not how this works though. It is a process. It is learning discipline - another word I do not like. 

We will go through this though. We will get through it. We will be debt free... Someday.

Here's to the process... Sigh!

Slacking Off

It has been a very long time since I have written anything on our blog. I have thought of it many times but it has not happened. So what's going on, you might ask...

Budgeting is hard work and it SUCKS at times. We were just hanging out thinking this budgeting thing was easy. Well it's not. I was thinking "I know this" and my husband admittedly was burying his head in the sand. 

Then I got into two fender benders - both my fault - and we had to rent a car AND pay for the deductibles on our insurance. For all of that, we did not budget and pulled out our MasterCard again. I was also buying a few things online with my Visa. In other words, racking up the credit card debt again. Then we went on vacation - which we did not budget for and put it all on plastic again. 

It seems like we have fallen back into our old patterns. We are now in our overdraft for a few months, temporarily, and we have credit card debt to pay too.

That is very difficult, and a bit depressing, to admit. We were both bound and determined this year was going to be different - and it was for a few months. Then "unexpected" things caught us off guard. I don't know if we should have used our emergency fund for the repairs and then built it back up. We also had an $8000 payroll debt that we had to get a loan out for and pay back - which we have.

It just seems like we are behind the 8-ball again. We have committed to each other that we are going to "meet" once a week to discuss our budget. We have not done that - and that was wrong. If you are in a relationship, discussing your money issues together is vitally important, in my opinion. If you can't discuss your finances with that person then who can you?

So, our new plan is to meet once a week, get back into the "You Need A Budget" and "Dave Ramsey" podcasts and bogs. As they say in the YNAB world, it's time for a Fresh Start.

Stewardship

Stewardship:
1. the position and duties of a steward, a person who acts as the surrogate of another or others, especially by managing property, financial affairs, an estate, etc.
2. the responsible overseeing and protection of something considered worth caring for and preserving

From Dictionary.com
I have been contemplating this topic for a couple of weeks now. Being raised in an evangelical church all of my life, I have only thought about stewardship as related to finances. For the purpose of this blog, that is what I will be focusing on but I also wanted to draw your attention to the definition so you, as well, can look at all areas of your life and see if you are being a good steward with what you have been given.

As I previously posted, Steve & I both make good money so we could not figure out why we were so in debt. What were we doing wrong? We are one full month into using YNAB and it's been very enlightening. By making and (here's the important part) sticking to the budget, we have managed to seriously cut down on random spending, take care of our bills and get to paying down our debt - thank you Lord! We are also living completely on cash which is a whole 'nother experience.

What does all of this have to do with stewardship? Everything! We have been looking not only at our money but also at our resources. Are we using all of our groceries each week or are we throwing the fresh produce out? Could I look at starting a small container garden to help offset costs? Can I quit whining about not being in a detached home in the 5 years that we planned on (I seriously need to work on that one)?

We have been very blessed and as a born-again Christian, God commands me to be a good steward. As Steve and I spoke more about why we are going onto this journey, he came to the conclusion that it is not just about money but about stewardship. It's taking a "big picture" approach to not just our finances, but also to the other areas of our lives that impact - and are impacted by - our finances. It's about recognizing just how blessed we are, and being content in the place God has set us in. And it's about living (not just setting) an example to our girls of how freeing it is to live responsibly.

Awareness

Where did all my money go? I had more at the beginning of the month but none now, why? Where did all my money go?

This is one of the most important questions to answer, in my opinion, when you start on a journey like this. That is one of the main reasons why we started to do this. My husband and I both have full-time jobs and make good money at them. So why were we not able to make it through everything each month?

Enter YNAB. Yes, I spoke of this in the last post, and I apologize, ok not really but I will speak of it again and again and again.

The biggest difference is when you are allocating your money. Knowing what you have and what it has to be spent on is an eyeopener. Instead of thinking "Oh, I just got paid, I have money for this, that and that other thing over there", the mindset changes to "I just got paid, and after taking out the bills, mortgage, car payment, grocery money, gas money, etc. etc., turns out this and that I can pay for now, but whoops! I don't have money for that other thing over there after all."

Whether it's an envelope system that you physically put cash into, a budget spreadsheet where you fill in the numbers, the concept is pretty similar: take what you have, determine exactly what NEEDS that money has to spent on, and go from there. We are becoming fans of the YNAB system, which has you looking ahead only as far as your next paycheque. If you get paid on the 1st and the 15th, your budget each month is basically split into two halves: what your money needs to do for you from the 1st to 14th, and what it needs to do from the 15th to the end of the month.

It's a huge adjustment for people like us who are used to planning a month or more in advance. But that advance planning in a lot of cases is a giant mouthful (actually it's a bowlful). The idea of "what do I need my money to do until I get paid again?" breaks that into smaller chunks that actually fit on the spoon.

And no, it's not "living paycheque to paycheque", it's just budgetting that way. We've been doing this for not even a month and we're already finding that we have money left over at the end of the paycheque.

It's kind of a novel concept.

Start of a Journey

Our family has decided to start on a new journey in 2013. We have decided to finally get control of our money, and especially our budgetting and debt.

OK... let me back up. Our backgrounds are very different, my husband and I. I come from family that lived from paycheck to paycheck, was quite often in an overdraft, and always wanted to "keep up with the Joneses". My husband, on the other hand, lived in a home where they didn't care who the Jones' are and didn't care about keeping up with them - frugality was, and is, the name of the game for them. Needless to say, it makes it quite challenging to find a balance.

I am a HUGE Pinterest fan and a few friends who have talked about Dave Ramsey and how they are living debt free with his help and prinicples. So I decided to check him out. I found a "picture" of his baby step and pinned it to one of my boards on Pinterest.

Please note, I have not been asked to promote anything, nor am I getting paid to speak about any of the products I may mention. I have just found tools have been very helpful for us. They may not work for you but I want to let you know about them.

We decided to get Dave Ramsey's book, Total Money Makeover, from our local library and began to read it. We are not all the way through it yet so I will put a link to his baby steps up and speak to the steps we have begun.

Here is the link: http://www.daveramsey.com/new/baby-steps/

We had a head start. I had already been putting away money into what was supposed to be our savings for a downpayment on a new house, a vacation fund, and many other titles. What it is now, and will continue to be, is our Emergency Fund - which is step 1. We will be finished saving our $1000 this month. WOOT! For some of you, that will be more difficult. What we did is, we set up an automatic transfer every 2 weeks into a savings account on our bank website. That way, I did not see it or miss it - it just happened.

The next step in Dave's plan is to pay off all of your debt with a debt snowball. In essence, it means write down all of your debt from largest to smallest. Then pay off the smallest debt first while making minimum payments on everything else. His thinking behind this is the momentum will build up as you pay things off. When you finished paying that debt off, use that money to carry on to the next smallest debt and continue on.

I have been attempting to budget for years using an Excel spreadsheet but the dollars did not add up. We had to figure out how to change that. Enter You Need A Budget (www.ynab.com). This is an incredible program and apps for both Mac and Android, with the help of Dropbox, to help you look at your money in real time.

My personal challenge, and one of my stumbling blocks, is I am used to budgeting for the month. With YNAB, you put in your paycheque, give every dollar a job (just like Dave Ramsey says) until your next paycheck. You don't look forward or back. If you sync your budget using Dropbox, you can enter a transaction from the grocery store, ATM withdrawl, or anything else and it will update your budget immediately.  There is a cost for the YNAB program and there is both a lite and full version of the apps (I would  recommend the full version - it's only $5). The big difference between the two is the lite version only lets you enter transactions whereas the full version will let you see your budget as well. I have read on the YNAB Facebook page that YNAB is the electronic version of Dave Ramsey's envelope system - works for us!

As we put our incomes and budget into YNAB program, we realized we don't have anything extra to put towards our debt. Therefore, we are doing a Dave Ramsey/YNAB hybrid. We paid all of our credit cards off with our Line of Credit, which maxed it out, then went to our bank to end the Line of Credit and put it into a fixed rate loan. Due to this, we will have the loan paid off in 5 years and then be able to put that money towards paying off our new van - told you we like to spend. We should have everything paid off, except our house, in 5 1/2 - 6 years.

Ok, I am going to stop for now but will continue to journal/blog as the journey goes on. Feel free to join us if you want.