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My husband and I recently discovered that there is a university for Financial Peace.
We are in desperate need of an education.
Actually, it's not a university per se. It's more of a course that you can take over 13 weeks to help you get your finances and spending in order and revolutionize the way you see and treat money.
It's a cash-based system.
It's a reality check.
It's a God-send. ...literally!
Rylie and I have been married for almost 13 years (Yay, us!). Somehow in all those years, we never made it to a Crown Financial class or in depth finance summit about how to do our finances. However, we are both pretty intelligent people. We've gotten into a bit of credit card debt, but we've been able to get out prettily quickly and easily (except for the last three years which have been brutal.)
We have a budget spreadsheet in Excel. We use Quicken. We're slightly poor right now with only one of us working outside the home. So I tend to watch our bank balance pretty carefully.
Until I didn't.
Over the course of one weekend when our credit union upgraded their services online, a series of unfortunate events occured to make this an epic fail of cataclysmic proportion. A double-paid bill here, some unlogged receipts there, two months of unreconcilied bank accounts way down there, and a failure to keep an eye on that bank balance led to over $250 in NSF bank fees. I was horrified when I logged on and saw the damaged. I scrambled around for any available funds to transfer to cover the damage.
Bye-bye kids' checking accounts. See you later "fun money" accounts for me and husband. (And this is also where I should say that we have not done a good job of saving for any emergencies or "rainy day" items -- so there was nothing to pull from there.) Bottom line is that I had to swallow my pride and ask my parents for a loan until payday, which was a few days in the future.
But it was still only barely enough. Plus, I realized that if one particular check were to clear, we'd be toast. I went back to scrambling and scrounged around to find any loose change or things I might be able to take back for a refund. I took in our recycling and deposited that $5.72.
It was terrible. I actually had a stress stomach ache, which I'm normally not prone to getting. It usually takes a lot to get me unsettled for any length of time. But, this had me stomach tied up like a pretzel.
Rylie and I sat down together that night, and as we untangled the damage and started to see where we went wrong, we realized something had to change and fast! Our budget obviously was either inaccurate or not being closely followed...or both. Not having a savings fund was killing us as item after item broke down in the span of 6 months and the repairs mostly went on a credit card. This was not working.
I had heard of Dave Ramsey and knew vaguely that he had some sort of company that dealt with getting on track with your money. So, I googled him and realized how little I knew about it. I quickly stumbled upon his Financial Peace University class and signed us up.
We're just starting out in the class (at this point, we've only finished week 2), but we are starting to grasp his baby steps: setting up an emergency fund of $1,000; saving and setting aside 3-6 months of salary; and using the envelope system.
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The envelope system is not a new concept to us. We've done it here and there over the years during times where we felt like we needed to reign in our spending. However, I now realize that we didn't perhaps go all out with it by allocating each and every penny every month and sticking to that...or at least reallocating it around from envelope to envelope as needed.
However, the idea of going to the bank and withdrawing all that cash and then sitting down and allocating it to paper envelopes (split between my husband's wallet and mine), and then thinking about the hassle of having to make adjustments if I called him to pick something up from the store and his grocery envelope was empty...blah, blah, blah...it made my head hurt.
Also, I have heard quite a few stories lately of people having their purses or envelope system wallets stolen -- thereby losing a huge chunk of their monthly money. That would give me a heart attack.
So, I was thrilled when I read about an online "virtual envelope system" called Inzolo. It works just like the paper envelope system. However, it's all online in one place. You can access it and see balances and make adjustments from any computer or even your smartphone. You can use your debit card and then upload the transactions from either your bank's online banking site or from your own Quicken program.
No envelopes of green backs tempting others to steal them.
No running off to the bank several times a week to stand in line with 4 crazy bored children.
Best of all, it's free with one bank account and a maximum of 15 "envelopes." However, we have a LOT of categories to save/spend, so we are opting for the paid service -- $7 per month up to $177 for a lifetime subscription.
(Sidnote: Your first month is free...you can try it out for 30 days and see how it works (or doesn't) and then decide if you'd rather go back to paper envelopes or take the plunge. Btw, I'm not getting paid for this endorsement; I'm just really excited about it!)
So, this past weekend, we sat down and allocated Rylie's paycheck across all of our envelopes, imported transactions from Quicken and started minusing out those expenses.
Honestly, it's astonishing to see how quickly that paycheck gets eaten up by the categories we fund. However, it's equally astonishing to see how that nebulous "safety buffer" line-item I had been using in our old budget was being sqaundered by not having a specific place to go.
The hard part now is seeing it all in black and white -- knowing we both have access to the information and know where we stand so that there's no excuses anymore -- seeing how squeaky our planned budget really is and realizing that any spur of the moment or unplanned for expenditures could potential be a huge issue of disobedience and a lack of discipline.
I mean...really...it's no fun to submit to a budget -- especially one that doesn't leave a ton of room for fun stuff. It's much like committing to logging all of my food intake for the day and sticking close to that goal. Going hog wild on a dessert buffet isn't that smart of an idea when I am trying to lose weight. And neither is walking into Target without a list and firm budget.
I don't like discipline.
I don't enjoy receiving it. I don't enjoy giving it. I don't enjoy enforcing it on myself.
But I know it's good for me and it's good for my children.
I choose discipline because it's necessary.
One of things I had to do over the last few weeks of financial stormyness was to apologize to God for being so undisciplined and a rotten steward of the money He's entrusted to us. No excuses...no whining about our one income or health insurance premium increases....just an apology for screwing up so royally. I fully allowed myself to feel and experience the pain (and consequences) of that disobedience. (Notice I didn't say, "shame," because I know that God loves me, and while I might feel badly about my choices, I don't feel condemned or shamefull.)
Another thing we both felt compelled to do was to stand up one Sunday morning when the pastor asked anyone who was struggling financially to do so to receive prayer. We both really didn't want to do it. There weren't a lot of people standing. Our friends were there. They would see us, and maybe even...pity us? We didn't want to be the "Financially Struggling" poster children. But, just as those thoughts crossed my mind, I shoved them back out.
Pride has no place where a miracle is necessary.
Who were we fooling anyway? God knew all about it. We knew all about it. It felt like we should stand as a way of crying out to God for help and coming clean about our irresponsiblity.
It felt a bit conspicious. C'mon...I know there are some of you out there who don't obey the "head bowed with no one looking around" part of those types of prayers (and actually a friend told me later, "I saw you stand up. I was too chicken, but that's us too"). But more than that awkwardness, I felt better. I felt lighter. I felt cleaner.
It wasn't our "dirty little secret" anymore.
Actually, it never was to begin with.
God always knew.
He patiently waited for us to realize it and make things right with Him and the money He instrusted to us.
So, we're on the path to recovery.
We're not perfect. This is going to take some serious hard work to put that money aside for savings, dig out of the debt, and do things better from here on out. We have people in our lives who will hold us accountable to make these changes and to think things through better. We don't want to live a life that is strangled by debt like so much of the "civilized world."
As Dave Ramsey says,
"If you will live like no one else, later you can live like no one else."That's what where we're headed....this should be an interesting journey.
But at the very least, my stomach has unpretzeled and I actually feel like God whispered in my heart that "everything is going to be okay." Even (and especially) though it may look grim on paper. I finally feel that measure of peace I've been missing.
And that makes it an education worth undertaking.