Overextended much?

Lately I’ve found myself a bit overextended. I’ve started too many projects and I’m finding it difficult to juggle them all and keep them all going. Each website I’ve created requires a considerable amount of time to update and maintain. I thoroughly enjoyed the process of creating them, but once created, the maintenance and upkeep on all of them are not so enjoyable.

I am thankful that these projects have not tied up a lot of money. It’s stressful enough to be overextended with my time… but it would be worse to also be financially overextended as well. If I started several websites and sunk a lot of money into each of them, then I would be under a lot of pressure to make sure each of them was successful and turn a profit at some point. Essentially, each website is its own mini “business” and I can spread my efforts amongst all of them or just one at a time.

A friend of mine told me “I’d rather be 100% done with ONE thing… then 10% done with each of TEN things.” I wish I had headed that advice long ago.

So how does all this relate to your finances? Do you find yourselves juggling too many services, memberships, and clubs. Do you spend too much time volunteering for your kids school functions, organized sports, and other enrichment?

We know some folks… We call them the “Soccer” family. That’s because all three of the children are enrolled in Soccer. Because they are all different ages, they have to attend practice at different times and their game schedules are hectic. On a typical weekend, the parents have to attend FIVE games in 2 different stadiums. Maybe that’s normal for some… but to me that’s being overextended.

Others are overextended with debt. They are juggling credit cards because they have too many. It’s a tough spot to be in and the pressure is enormous. Quite often people in this situation spend more money on things just to feel better, meanwhile they are adding to their debt level.

Solution:

Find ways to simplify your life. Take a look at how your time is being spent? Do you ENJOY all of it? If not, why do you continue to do it? Take a look at where you’re money’s going. If most of it is being spent on debt, isn’t it time to start taking steps to eliminate it so that you don’t have debt anymore?

In my case, I’ll need to discontinue building new websites until I complete the ones already in motion. Working on them one at a time until they are all completely done.

What’s got you overextended?

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The Joy of Saving for your Vacation.

My wife and I have never been on a cruise. We know many people who have been on several cruises in their lifetime and they have enjoyed them very much. I think it would be great to take a vacation and enjoy each others company and escape reality for a while. The beaches, the ocean, the resorts, it all sounds wonderful. So why haven’t we gone yet? Well…to be honest…we just haven’t saved up for it yet. But it’s on our list though!

Right now, we have “other things” we’re saving for. Just recently we saved up the money to build our kids a huge playground in the backyard. We did the saving, we did the building ourselves, and now the kids can enjoy it to the fullest. We enjoy watching them play on it with their friends and we can bask in the fact that it’s all paid for.
But before we even built the playground, we were excited about it.

You see, once you start saving…once you put that first dollar in the jar (or the savings fund), the anticipation and the excitement can begin.

We’ve done this for a while, so when we say we’re going to save up for something, we MEAN it! Right now, we’re excited about the theme park passes we’re planning to get before the summer starts. We’ve been building the excitement in our kids about the parks we’re going to. We are ACTIVELY saving up for this right now, because it was the next thing on our list. We can keep the excitement going on and on until the day comes for us to buy them. Then we are really going to enjoy ourselves. The best part of all, is that we won’t be coming home from the theme park wondering how we’re going to pay for it all…because we already did!

Contrast that with a family who doesn’t save. Using the theme park example, the parents decide to take the kids to the theme park on impulse. They say “Surprise kids, we’re going to the Disney World!”. They go the following weekend and they pay for everything on credit. When they get to the theme park the worrying begins. The kids are having a great time, but the parents are scratching their heads wondering “how much ARE we spending?”. The father says “Let’s just go with it…we’re here to have fun!” but the mother just isn’t too sure. They can try to forget about the growing cost…for a while…but in the back of their minds they know reality is coming back soon, and this realization STEALS the joy they could be having in this moment.

I don’t know about you…but I don’t want to be worrying about money WHILE I’m on vacation! I’d rather know that the trip is already paid for and that the spending money for souvenirs, pictures, food, snacks, hotels, and transportation have already been paid for in advance. That way, I can lay back, watch, and enjoy my family having the time of their lives. When I get home…I don’t have to worry about the post-trip blues. Yes, I still have to come back to reality, but the adjustment won’t include a credit card bill!

I know it’s sounds old fashioned…but saving up for your vacation allows you to have positive anticipation BEFORE it starts…FUN while you are away…and NO BILL when you get back. The alternative is to miss the anticipation stage altogether, go on a trip and worry about money while you are away, and have a bill come in your mailbox when it’s over.

So it won’t be long before we have completely saved up for our theme park passes. We are looking forward to having many great times over the next two years with them.

So what’s next?

Well…I’m anticipating walking up to my wife with sunglasses and a Hawaiian-shirt on saying “Do you know what day it is?? TODAY is the day we start saving up for a cruise!”

Is there something you are saving for right now?

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When you Blow the Budget…

Perhaps one of the biggest examples of not budgeting correctly can be seen in Altamonte Springs, Fl. This building is called the “Majesty” building and it serves as a reminder to all that if you start a project… make sure you have the money to finish it.

This building has been sitting unfinished for more than a decade! What happened? A Christian television station decided to build a building entirely on donations. The problem was they didn’t plan for the total cost of the project and the donations ran out. Now instead of being the Majesty building it was intended to be… it has been dubbed the “Eyesore on Interstate-4″.

Now let’s get personal…

A budget is meant to be a tool for you to use to keep track of your spending. Many times though… people go over budget… people had expenses they didn’t plan for… people didn’t write down everything they were supposed to. When this happens… people… because we’re all human… throw the budget out the window and assume it didn’t work.

So what happened? Did you FAIL because you blew the budget? Are you a bad person because you blew the budget?

No… and No….

The problem here is that emotional response you make when you know that you have exceeded your plan. Was the problem with your ability to stick with the plan? or was the plan UNREALISTIC for you?

So let me make a blanket statement that will put all these questions behind you:

“Human’s are not perfect, nor are the budgets they create…”

Okay.. with that said.. now I’ll go into the nitty-gritty of what to DO when you blow the budget.

First of all… you DON’T throw your budget out… you simply make changes to it.

It’s called “Course Correcting”

If you were on a boat and you were navigating by the stars… you’d get your bearings and steer the boat towards your destination. Every once in a while you check your bearings again… if you’re off course, you change direction and you get back on track to your destination.

It’s the same thing with a budget as in this example:

Let’s say that you started with $500 in your checking account, and you earned about $3000 this month.  You planned on spending only the money you brought in, and still have $500 left in your checking when the month was over.  Unfortunately life happened and it didn’t quite workout that way.

Monthly Budget (August) Estimated Actual Difference
Income $3,000.00 $3000 $0
Tithe $300.00 $300.00 $0
Electric $200.00 $250.00 $50
Water $65.00 $65.00 $0
Food $300.00 $440.00 $150
Gas $100.0 $200.00 $100
Mortgage $1500.00 $1,500.00 $0
Credit Card $100.00 $100.00 $0
Dr. Visits $80.00 $30.00 $-50
Cell Phone $125.00 $125.00 $0
Home Owners Association $125.00 $125.00 $0
Netflix $15.00 $15.00 $0
Entertainment $50.00 $50.00 $0
Clothes $40.00 $40.00 $0

So in the budget above… you went over by $250.00. Now you’re left with $250 in the checking account instead of $500 like you planned. What will you do now?

You make changes in your budget. Set new goals for yourself…course correct. Next month.. try to spend a little less on food and gas. Lower the budget on Dr. Visits from $80 to $30 and budget $50 to go back into your checking account. Hopefully by then end of next month.. you end up with more in your checking than when you started.

So instead of starting all over again. Make changes to the original budget. Add new line items for expenses you forgot to write the first time. Increase some areas and decrease others. After a few months of course correcting.. you’ll end up with a budget that you don’t have to spend a lot of time to maintain.

Happy Budgeting!

If you DO find that you are ALWAYS spending more than you make… then you have a cash flow problem and that takes solutions of a whole different kind!

Feel free to leave a comment. Have you created a budget and stuck with it?

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