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Sunday, November 17, 2013

Goals of Financial Freedom

I wrote this post as a guest blogger awhile back. She had been inspired by my spending smart post and asked me to write on that topic for her readers! I hope it can encourage some of you as well to look more into Dave Ramsey's spending smart plans...I've never gotten any "kick-backs" from Dave (although I def would take some!) or any type of incentive for writing this post. I just truly love the Total Money Makeover book!


I've always been a bit of a "school nerd" and totally love managing our family finances (seriously!). I am also a natural Type-A personality and LOVE to have a plan and am very goal oriented. When I first read Dave Ramsey Total Money Makeover I knew I'd found the perfect plan for me! Much like when I first found Babywise and knew it would be a fabulous route for me to take as a parent, Dave has provided me with a purpose in our family's financial planning.

In the book, Dave lays out seven SIMPLE steps to follow in order to obtain financial freedom. Like most people, I like to have a long term goal but it can also stress me out to think about the "big picture" so I appreciate having smaller goals as well. Typically it can take 7-10 years to get through all seven steps. That's the BIG picture for sure! But looking at the steps one at a time is a fabulous short term goal to keep us motivated!

Before even beginning the steps, we had to sit down and come up with our budget. ALL of the money we spend vs what we bring home. My husband is self-employeed and works on 100% commission. Obviously, it's tough to know an exact amount that he will be able to bring home each month. By sitting down and working everything out, we were able to come up with a GOAL for my husband each month of what he needs to make with his work (I'm blessed to be a stay at home mom and any added income I bring in we don't count in the budget for the family). I was worried that knowing an exact amount would cause him more stress, but in fact he's LOVED it and is the type of guy who enjoys competition and knowing he has to make a certain figure each month only pushes him to make more just to prove to himself he can do it ;)

Since setting up our monthly budget I've been SO happy with how it's been going. We track all of our expenses using a Budget App on our phones and Ipads and we put more thought into everything we spend before we actually spend it. Before implementing the Dave plan we didn't communicate very much about our financial situation. Hubby made the money. I paid the bills with it. It's true that knowledge is so powerful and communicating about our finances has been a positive experience! We are so much more on the same page and both of us feel much less stressed! It's also FUN to find creative ways to save money and to have anticipation for things in the future by saving for them first. We went to Italy last year and had all the money needed for the trip in our savings account which allowed us to enjoy the trip even more because it was already paid for! We even ended up with over $1,000 left in the fund because we didn't spend it all!

I believe there is a balance in everything. Yes, we have long term and short term financial goals. Yes, we are working on spending less, spending smart, saving more. But we also want to still do things that are important to us. Travel is VERY important to us both so we sacrifice in other areas (like we eat 90% of our meals at home and rarely eat out! Also our kids mostly wear clothes from consignment sales and I only shop the clearance, clearance rack for myself!) in order to allow us to travel. We also keep strict budgets on our travels in order to save money. We are all about quantity of trips over quality. A couple bugs in our hotel room? Okay by us :) We probably will never know what it's like to stay at a Disney Resort or have the Disney Meal Plan because we always find a cheap place near the parks to stay and bring our own food in the parks with us!

 My babies and our purpose for becoming financially free!

While managing our finances has already benefitted our marriage in so many ways, it's also benefited our children. My mom would often tell the story of me as a toddler and how we'd go shopping together and when it was time to check out I'd tell the cashier "charge it!" My parents never really included me in much of their financial conversations and I honestly, even as an adult, don't know much about it. I want that to be different for our children. While they don't know how much money Daddy makes or specifics about things, they know that God calls us to be good stewards of our money and that we have long term goals in mind. 

When we go out to eat we are careful with what we order and I usually bring my kids milk and some snacks and such. Now that our daughter is a toddler and eating larger portions, the kids are sharing a kids meal. At first our son struggled with this and didn't like sharing his food like that. But I explained to him that we have to be smart with how we spend our money and that we are so blessed to even get to eat out and that he needs to appreciate what he has. It has been a great lesson for him! Since we don't eat out often, it makes eating out a special treat and something the kids enjoy more and appreciate at a great level since it's not the norm for them. 

Occasionally our son will ask for things. When we go to Disney, for example, it's hard not to be bombarded by a million toys and to want them all! We explain to him that the experience of being at Disney is the magical thing and that he doesn't need toys and such in order to have fun. When he sees other kids with things we talk to him about how all families are different and how we may have different goals as a family than other families do and that we may have to make sacrifices in some areas so we can achieved those goals. He knows we are working on saving up for a van for our family and he is SO excited about that! We will talk about how we may not get to have that toy or go do such and such but that we are saving for the van and that by sacrificing now, we will get to have the van sooner. 

When Daddy leaves for work and the kids are sad to see him go we talk about how Daddy works hard so we can have our home, so Mommy can be at home with them, etc. We also pray as a family and thank God for our financial blessings and ask Him to help guide us towards financial freedom. Our children see us give first to the Lord of our earnings and whenever our son sees money he will often say "We need to give that to God!" 

I don't ever want our children to have any financial concerns as I do feel that's an "adult topic" but I try to incorporate positive lessons about spending smart whenever I can! I want them to know how to make wise financial decisions from a young age so that hopefully they can start spending smart from the first dollar they earn :)

I cannot recommend Dave Ramsey's Total Money Makeover enough! It's a must-read for every family for sure! I have our plan hand written to refer back to often and am so excited to keep knocking out our debts and to have financial freedom!

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