American Cravings: Money
Filed under: Blogging, Christianity, Money, Practicals of Life
The typical American household has $38,000 in debt. 71% of Americans say debts are making their home lives unhappy. The #1 reason couples list for getting a divorce is money. We need to learn to say “no” to ourselves.
Learn to Delay Pleasure
As a people we have forgotten how to delay pleasure. We must have everything now. We are living in a microwave generation. We are addicted to stuff! Come on, admit it. We all enjoy stuff, especially new stuff. For guys it may be the latest laptop or iPod or some tech gadget we just really “NEED.” For gals, most women just love to shop. Getting those essential shoes that go with that outfit that you bring home and add to the 30 or 40 other pairs you have in your closet, or maybe its clothes. But we of course have to have it now, when its “on sale” because of course it will never go “on sale” again.
My wife and I were trapped in this boat until about 8 months ago and I wish that I would have known about this earlier so now I’m telling you in hopes that it will help you as much as it has helped us. We were about $35,000 in debt and we considered ourselves to be pretty fruegal with our money unless we needed something. Then of course we just went and got it because we considered ourselves fruegal people that deserved to get something right away if we needed it. We would never really save for anything and didn’t have a budget or even see the need for one. We then started listening to this guy Dave Ramsey and the things he said really made sense. I also linked the need for a written out budget for each month with the desire to have a focused life since I write out my schedule weekly.
In the last 8 months we have paid off most of our debt and when we sell our house and move to KC we will be completely debt free (besides our mortgage). We have a monthly budget and my wife and I sit down once a month for our monthly budget meetings and tell our money what it is going to do this next month.
7 Steps to Financial Freedom
Below are the 7 Steps that we are currently implementing or in the process of implementing in the future in order to have financial freedom.
- $1,000 to start an Emergency Fund (This is has been great because when an emergency comes up, you don’t have to put it on credit cards. Also remember that this is for REAL emergencies, not just impulse “I have to have this” buys)
- Pay off all debt using the Debt Snowball (Get mad, kill debt!)
- Three to six months of expenses in savings (This is to build the rest of your emergency fund - don’t touch this money except for in emergencies)
- Invest 15 percent of household income into Roth IRAs and pre-tax retirement
- College funding for children (We may skip this step because both Stephanie and I worked through college to pay for tuition or got scholarship help. I enjoyed the experience I was given actually having to pay for my own college because then I appreciated my education more)
- Pay off home early (I can’t wait until we are able to do this!)
- Build wealth and give! (Invest in mutual funds and real estate) (When you are at this level the ability to give money away will be even greater when you are at the 1st. We are called to give whatever season we are in, but I am looking forward to when we are at this level)
We need to make sure that our view of money isn’t distorted. It is the LOVE of money that is the root of all evil, not money itself. We need to look at our lives and find our satisfaction in life in God, not in “stuff” and things that we can buy. Here are some other helpful tips that I use in my life to help keep God first in my finances and keep control over my money, so it doesn’t control me.
Helpful Forms
Other Helpful Tips
- Avoid the worship of stuff, learn to delay pleasure
- Give money away! Ask God where and GIVE!
- Live Substantially BELOW Your Income
- The Borrower is the Servant to the Lender, so BEWARE
- You MUST Save Money
- Learn where to find great buys, learn to negotiate and have patience
- When you agree on spending, You will experience an Incredible UNITY in your marriage
- Teach Children to work, spend wisely, save and GIVE
- Be strong enough to help others and strong enough not to (Learn to help others help themselves)
- Listen to Your Spouse’s Council
- WRITE OUT A BUDGET and Stick To IT (Tell your money what to do each month in advance)
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May 29th, 2007 at 10:36 pm
I can’t say that I fall into the typical woman category of loving to shop, but I do know a thing or to about impulse buys. It’s been hard learning to delay my desire for instant gratification, but the payoff has been worth it.
Getting out of debt is Gods plan for every Christian. I will never own another credit card in my life and I pray I will never have another car payment. I want to be a good steward of the money God has given me so that I can give liberally to others.
May 29th, 2007 at 11:09 pm
great, great post. Natalie and I recently completed the Financial Peace University class at church, and it was really great. We’ve paid off a couple of credit cards and have two more cards and my car before we’re debt free. We’re shooting to be debt free no later than the end of next year.
We had a small emergency that our emergency fund helped take care of with cash (fuel pump went out), so, we’re back to building that up. I was quite frustrated with that little ordeal. I’ve learned, don’t buy American, cheap and craps out quickly (Chevy specific, in my case). But I’m thankful to GOD it was there. I can’t wait to be financially free.
My sister just got married and she started her class tonight. I had been pounding it in her head for her and her husband to take it and I guess it worked. I think every young person should apply these principals in their life before they’re married so that the transition is a lot easier and smoother.
Nat and I really enjoy doing this, although I’m the Impulse Nerd who likes to eat out a lot.
My sister’s wedding:
http://youtube.com/watch?v=uhteSJJEnX0
May 29th, 2007 at 11:18 pm
[...] Compelled By Reality » Blog Archive » American Cravings: Money [...]
May 30th, 2007 at 9:23 am
Great post, Adam! I’m still stuck at step 1 because every time I get close to that $1,000 mark, I seem to encounter an emergency (car, house, etc.). But I’m determined to stick to it and keep going. And at least I had the money to take care of the emergency, rather than relying on credit cards.
Writing and sticking to a budget is absolutely essential! Otherwise, the money just kind of slips out and all of a sudden, you’re stuck wondering where the money went and whether or not you can afford another tank of gas before payday. Or maybe it’s just me…
May 30th, 2007 at 4:33 pm
The biggest point in what you said is
“Teach Children to work, spend wisely, save and GIVE”
I should have given my children more guidance and teaching in this area, but learned learned about Financial Peace and how to get it late in life. If we teach our children how to delay gratification, we have done them a great service.
I recommend the course to everyone, especially anyone struggling with debt and fighting about money.
May 31st, 2007 at 10:43 am
The Dave Ramsey class and books and resources are awesome!
I too am stuck on step one but I’m so determined to be debt free again. I got there a few years ago, everything except my student loans and it felt good. I was able to self-publish a book and start a small business. But as I’m prone to do I jumped out there and tried to take it to the next level before it was time and used credit cards to do it thinking I could pay them back. Then I found myself out of work for 6 months and back in the hole I just climbed out of.
I’m with Stephanie, I’m done with plastic. Cash is so much easier to deal with. I budget it, I spend it, and when its gone I’m done. Credit cards feed into the impulse thing because it tricks you into thinking you can spend money you don’t have and pay it back later. But I can testify that the borrower is a big time slave to the lender.
Young people beware of those pre-approved envelopes in your mailbox.
June 15th, 2007 at 4:47 am
[...] In my journey in managing the finances I have been given, there have been a few things that have helped along the way. One is the war I have started against an enemy I call debt; Creating a strategy to attack it and keep attacking until it begs for mercy (see this post for more info on that strategy American Cravings: Money). [...]
June 18th, 2007 at 3:23 am
[...] with our finances. I’ve talked about a few of things we’ve done on this blog such as: Attacking Debt and having a financial plan as well as my recent post on Creating a Zero-based [...]
July 14th, 2008 at 1:31 pm
[...] American Cravings: Money [...]