Our World Has Turned Upside Down!

Our world has forever changed. This is my opinion, but I think it’s a safe assumption. Our lives are literally upside-down. What used to be unacceptable is now acceptable and vice versa. We can’t go anywhere we want. We can’t find TP at the grocery store. We can’t discern when this market free-fall will stop. But what we CAN do, at least here in the state I live in, is order alcohol to be delivered with your take out food!

Our world is a little crazy, but it doesn’t have to be scary. This post is a collection of random thoughts I’ve had about our “new world” of COVID-19.

Random Thoughts on Our Financial Situation

Since this is a personal finance blog, here are some thoughts about how this is affecting our money.

We have seen a lot of stock market volatility. I mean, it’s a roller coaster and it tends to take our emotions with it. We are now in a Bear Market territory (more than a 20% loss). After years of the Bull, we have all been lulled into thinking that things will always be great. They won’t. In fact, downturns normally come every 5-10 years. In the possible 25 or so years left in my investment horizon (my mom is 98, so who knows how long I’ll live) I could see 5 significant market downturns. It’s part of life. It stinks, but we’re all in the same boat. And, if you are positioned correctly, it can be used to your advantage.

There are some great resources on this subject of market volatility. One is J. L. Collins’ book, “The Simple Path to Wealth.” In this book, Jim explains market volatility and how to calmly ride it out. Also, one of my favorite bloggers, Fritz Gilbert at The Retirement Manifesto has written a post about our current Bear Market. He explains how this Bear can be used to your advantage. Check it out: “The Benefits of a Bear Market”

The market always recovers. It looks like you’ve lost a LOT of money. Remember, you haven’t “lost” all that money if you don’t sell. Please don’t panic sell and lock in your losses. There are numerous posts and articles about buying when the market is down. Stocks are basically on sale. This can be an advantage if you have the resources to do that. If not, just sit tight.

Do you have a financial game plan? If you don’t have a financial game plan, you need one. Just like every NFL coach, you need to have a plan before the game begins. These are best done before a crisis when you’re not panicked or fearful. Given our circumstances you do need to have a plan for the next few weeks. Then when our lives go back to normal, you should get serious about a long-term plan for your money. One bright side to these shaky times is we’re getting a great education on what to do for our future.

If you already have a financial game plan, has this market downturn changed your personal risk tolerance? If so, it may be time to reevaluate and tweak your plan.

Some of us have prepared well, some of us were living paycheck-to-paycheck and as a result, life is scary. If you are prepared, think of ways to use your resources to help someone else who may have lost a job or is struggling. If you are in the paycheck-to-paycheck group, this has probably caught you off guard and you’re not sure what to do. It’s time to make some hard choices.

Your first priority is the essentials: Food, shelter, utilities and transportation. We’re mostly staying in, so expenses will probably be lower without much effort. You may need to cut everything down to the essentials. Remember, this won’t last forever.

If you have lost your job, don’t let your pride or your fear keep you frozen. Some industries are suffering and others need workers. Check with the grocery stores. They are hiring in my area. They need stockers and delivery drivers. Also, other retail, like pharmacies, may need drivers. Check with Amazon or any large distribution warehouse. They may not be glamorous jobs, but it could be a paycheck for a while.

Do you have an emergency fund? If not, this may have opened your eyes to the need for one. A lack of an EF is one of the things that took Stephen and I down financially in our dark days. My upcoming post of Why You Need a Budget talks more about an EF. It is like an insurance policy against life’s “Oh, $#@&”.

Are you sitting on more debt than you’re comfortable with now? This may be another life lesson to come out of our current circumstances. Debt elimination may need to rise to the top of the priority list. Interest rates have just been lowered. This means you can possibly refinance a car, mortgage, or student loan. You’ve got time on your hands and it could be worth real dollars, so check it out!

It may be smart to cut back on your spending temporarily. We’re kinda being forced to do that. Since we are self-quarantining, we are cooking more at home and not going out for any kind of entertainment. Also, some of our events have been cancelled. It all helps reduce the strain on our budget for a while.

Look after your older neighbors, help out where you can. If you’re in a position to do so, tip big on your take-out order. Think of creative ways you can help your neighbors while still practicing social distancing. Check on older or more vulnerable neighbors who don’t need to be getting out. If you know anyone in Assisted Living/Nursing Home/Hospice, call them. This isolation will leave lasting scars on a person who may already feel forgotten. If you have the resources, give to your local church’s needs fund. They will be ministering to out-of-work congregants. Also, give extra if you can to the general fund. Some churches are already seeing a 30-40% drop in giving.

Stay home as much as possible. This will not only help the general population, but it will help our local small business owners and our over-stressed healthcare workers by helping to end this ASAP. Staying home is what we can all do now. Between the day I started writing this post and the day I have published it, most large cities have instituted a Shelter In Place order. Please stay home unless it’s an emergency or to go to the grocery store.

Hard Choices, Easy Life. Easy Choices, Hard Life.

Jerzy Gregorek

My next post will have a few thoughts on what I have personally learned during this market downturn. See you soon!

The Cards We’ve Been Dealt

(Saturday March 21, 2020. This post was written almost a week ago and many thing have changed in the last week. I will be writing another post soon about what our world and our lives look like now. This is already somewhat out of date, but the sentiment is still valid.)

This post is a combination of a couple of Facebook posts I have written recently concerning the state of our world right now…or The Cards We’ve Been Dealt. I apologize if this is a repeat of something you’ve already seen.

There won’t be a lot of financial stuff in this post. From time to time, I will write about things affecting more than just our money. Although, what is going on around us is definitely affecting our money.

A Little Preview of the Next Post

Before I get into this, let me assure you I will get back to writing about money. It’s been a while since I posted, and I’ll tell you right up front, you will not see my posts coming through on a consistent basis. Us bloggers are supposed to post every week or 2 weeks at the most. That’s just not happening in my life! Retirement, hobbies and my family obligations just don’t give me a nice, smooth predictable schedule. And that’s OK.

My last post was about budgeting and included a sample budget spreadsheet. The next post will be about the WHY of doing a budget and then one on some of the HOW’s of doing a budget.

Now Let’s Get Back to Those Cards We Were Dealt

I’m writing this post on Sunday, March 15, 2020. I was supposed to sing as part of the worship team this morning, but didn’t because I have a cold. The video at the bottom of this post is one of the songs I was practicing this week. It speaks of our Jesus who walk on water, speaks to the seas and stands in the fire beside us.

In the last few weeks, our world has turned upside down. I believe we have seen more changes to our lives (due to COVID-19) in a shorter period of time than in all of history. The effects of this disease fall across a wide spectrum. At one end, devastating loss of loved ones. The other end is personal inconvenience. We don’t know how long these inconveniences will last. We don’t know if one of our own loved oneswill be affected tomorrow. We DO know that nothing can separate us from the love of GOD if we are in Christ Jesus.

Even if you are not a Christ follower, there is one thing you cannot ignore. These things have been predicted. I have a good friend who teaches a class on how the Bible has, with 100% accuracy predicted the future. The Bible talks about the increase in frequency of wars, natural disasters and pestilence. This is not the first disease crisis our world has faced and it won’t be the last. It’s just the one we have to deal with TODAY.

Praying For Each Other

Sunday, March 15 has been set aside as a day of prayer. ( added March 21 – We should be in constant prayer for our families and our world) We all need peace and wisdom in these trying times. I want my Facebook and Website family (some of whom I’ve never met face to face) to know I’ve got your back. I am and will continue to pray for you, for your safety, your wisdom and your peace. I hope all of you who are part of this family will be doing the same. We need each other, even if we have to be socially distant.

Next to the last thought

Watch the video below. The producers asked people to send in their praises and their prayer requests. Some of these are highlighted in a video behind Chris as he sings. You can hear the audio on some, but not all. For most, you don’t need to. It reminded me that my inconveniences are NOTHING compared to what others are facing. The one that hit me the hardest was the young boy, probably about 4 or 5, who is battling brain cancer….FOR THE 3RD TIME! We all need to keep our lives in perspective and be in a constant attitude of gratitude and not fear.

Last thought

As of this weekend, most, if not all, nursing homes and assisted livings are on lock-down. This means no outside visitors. The facility my mom is in has also started a general quarantine of all residents. This means they cannot leave their rooms. So, no activities, no contact with other residents and their meals are being brought to their rooms. This kind of isolation can be devastating. If you know ANYONE who is in a facility, please be diligent to call them…often. Most of our elderly already feel forgotten. This won’t help. And if you have an elderly neighbor who probably shouldn’t be driving anyway, offer your help. Some of our neighbors don’t need to be getting out in their cars every day to go to the store in hopes of finding toilet paper and milk.

Started At 50 Made the Cut! A Review from Wealthtender

A few times a year, Wealthtender publishes a list highlighting Finance Blog Startups to Watch. The 2019 list is out and Started At 50 has been included as one of the Startup Finance Blogs to Watch – Class of 2019!

According to Wealthtender, “With more than 2,000 personal finance blogs in the U.S. alone, it can be difficult for newer blogs to stand out and their creators to get noticed.”

“But with millions of people looking for help with money matters on the internet everyday, new finance blogs sharing the diverse perspectives and unique life experiences of their founders play an important role extending the reach and impact delivered by the personal finance community.”

“Wealthtender is committed to raising awareness of up and coming finance blogs and celebrating the success of their owners as they grow through the startup stage to reach new milestones and help more people achieve their financial goals.”

21 Personal Finance Blogs that have been launched in the last year are highlighted. The focus audience of these blogs has a wide range – women, educators, government workers, physicians and married couples to name a few. And, of course, all 21 are focused on Personal Finance skills and education.

I want to share the article found on Wealthtender’s website, Finance Blog Startups to Watch. Check out some of these new startups. You may find something new and interesting for your FI journey.

I am honored and humbled to be recognized in this way. The trajectory my website has taken is not something I could have accomplished on my own. The support of my many friends and readers and the grace and strength of my Heavenly Father has catapulted me far beyond what I had planned. Thank you!

Financial Basics Part 3: Let’s Do a Budget

Do you get to the end of the month and say, “Where did all my money go!”? Are you living paycheck-to-paycheck. If you are, you’re not alone. Around 70% of Americans live paycheck-to-paycheck. I did for a long time. In fact, I not only didn’t save anything, but I didn’t have an emergency fund. I was one emergency away from disaster financially. And then disaster hit! That’s when my husband and I sank into the darkest days of our marriage. I never want to be there again. And, I don’t want you to be there, either! I’d like to help you get out of that pit or never fall into it.

Is the “B” word a dirty word for you?!

This post is going to show you how to do a budget. I know, the “B” word is a dirty word for some folks. Like the assignment to add up all your debt in the post How Do I Get a Handle on My Money, putting together your budget will take some time and effort. It may bring some heartache and frustration. It’s like starting to exercise. It’s not pleasant at first, but it will be worth it if you stick to it!

How do you start?

The first step to putting together your own Monthly Budget is to look at your monthly inflows and outflows of money or your Monthly Income and Monthly Expenses.

Gather Your Income Data

First, you will need to gather all your monthly income sources. This will be your monthly paycheck (take home) and any other income source you have, such as side jobs, dividends or even alimony.

Gather Your Expense Data

Next let’s look at your expenses. This will take some time, so be patient with yourself! Write down everything you spend throughout the month. There will be lots of categories.

As with the Net Worth Statement, you can track these categories and their corresponding numbers with pencil and paper, or I have created a Monthly Budget Spreadsheet. The spreadsheet has columns for 6 months, and you can expand that as needed. You may want to change the headings from Month 1 to Jan 2020 and so on. The picture of the spreadsheet can be found below, and the link to the actual sheet is below that. Again, the spreadsheet is protected and you will need to make your own copy.

Giving and Savings First

Let’s look at those expense categories. For me and my family, Tithing/Giving is always at the top of the list. We believe in the Biblical principle of “first fruits” giving. This just means we give first and budget what’s left. For us, right behind giving is saving. Have you heard the term “Pay Yourself First”? This is a basic concept in saving for the future. (unfortunately, one I did not do for a long time!) Again, it is the idea of do your saving first and live on the rest. Or Pay Yourself First and then pay everyone else!

You may not be Tithing/Giving and Saving yet. Don’t worry. Both of these concepts are VERY important, but they can be addressed when you have a clear picture of where you’re money is going every month. Saving and Giving are like a muscle…they can be developed with exercise.

Other Expense Categories

Next, let’s look at the other categories. Start with the big ones like mortgage/rent payments, food and car expenses. You will also need categories like insurance payments, cell phone, utilities, cable and internet. Anything that you pay monthly needs to go on this list. And don’t forget those pesky subscriptions. Netflix, Pandora or anything that is automatically paid on your credit card.

The next step is to add categories for things that happen seldom or once a year like birthday and Christmas presents. How about printer cartridges and school pictures. There’s also car repairs, vacation and property taxes. These are not spent monthly, but they need to be considered. Take some time to think about how much money you normally spend in these types of categories in a year’s time, divide it by 12 and add that amount to your list of expenses.

Let’s Do the Math

At this point, if you’re doing this on paper, add up all your Monthly Expenses and then subtract that from the Total Monthly Income. If you’re using the spreadsheet it will do the math for you.

Look at the number at the bottom or Total Monthly Income minus Total Monthly Expenses. Is that number positive or negative? Are the Expenses greater than the Income or are they less? If they are less, great! The difference between Income and Expenses can be called the Gap, and we will talk in a future post about how to grow that gap. This is what will allow you to save for the future.

Are your Expenses greater than the Income (or the number at the bottom is negative)? This is what some would call a “Dumpster Fire”! This requires some immediate action. Look at your expenses and see what you can trim TODAY! See where you can cut in order to get the bottom number to zero.

Having Zero at the Bottom

Speaking of the bottom number being zero, my instructions on the Monthly Budget Spreadsheet say the bottom line number should equal zero. The reason for this is if you have trimmed your spending down to be less than your Income, there is excess or what I called earlier, the Gap. This Gap is where you can start saving! If you have a Gap now, great! This amount can go in the Saving Category at the top of the list of Monthly Expenses. This should bring your bottom line to zero. This method of budgeting is called a “Zero-Based Budget”

Give Yourself A Break!

This is NOT an easy task if you’ve never done a budget. In fact, it takes most people about 3 months to get the hang of it. You’ll forget categories, you’ll over or under estimate what you spend. One month will have a minor disaster that has to be handled. It’s OK. Give yourself a break. Just DON’T GIVE UP!

What Does Your Spending Say?

Now that you have done your first Budget, what do you see in it about yourself. Remember the “10 Things That Make Me Happy” list? How does your spending align with what makes you happy? Or stated another way…How does your spending align with your priorities and what you value? There may need to be some changes made to your spending to align it with your values.

Wrapping It Up

If you’ve never done a budget or it’s been a while, spend some time this week gathering your data. Use that data to create a current budget for yourself and your family and then see what it’s telling you. Let it guide you to evaluate what areas of your life might need some tweaks. Don’t be overwhelmed by thinking LOTS of major changed have to happen all at once. There’s a phrase coined by Brad and Jonathan at ChooseFI. It’s called the “aggregation of marginal gains”. That means if you continue to stack small changes, eventually you’ve made Big changes. Think about what small changes can be made over the next 7-10 days.

What Does God Say?

But he who listens to me (wisdom) shall live securely, and shall be at ease from the dread of evil

Proverbs 1:33

Looking Ahead

In the next post, I’ll talk about why do a budget and some tips on how to use it.

Monthly Budget Spreadsheet

Link To Monthly Budget Spreadsheet

Assigmnent and Key Takeaway

Assignment – Download the Monthly Budget Spreadsheet (or get a pencil and paper). Gather all your income and expense numbers and fill in all the categories with YOUR numbers. Add or delete categories as needed.

Assignment 1 – Evaluate the bottom line. Is it positive? Great! Is it negative? See what you can change today to bring that back to zero.

Assignment 2 – What can you improve over the next 7-10 days to help your GAP.

Key Takeaway – Evaluate your budget in light of your “10 Things That Make Me Happy” list. Your spending should reflect your values and priorities. If it doesn’t, what needs to change to bring those into alignment?

Personal Finance Basics Part 2: Figuring Out Where You Are Right Now

Thanks for hanging in there with me on my short absence. My mom is doing better and things have stabilized for now.

This post will be a continuation of the previous post titled Personal Finance Basics Part 1 – How Do I Get a Handle On My Money. In this previous post I talked about what FI means, how to calculate your FI number and then gave you 2 assignments.

  1. Add up all you debt (I mean ALL of it)
  2. Make a list of the 10 things that make you happy

If you haven’t done these 2 things yet, stop here and do them now.

Your “10 Things” List

Were there any surprises on your “10 Things” list? Did you have a hard time making the list to begin with? You may not think you deserve to be happy or that happiness is just not within your reach. I want to tell you that these ideas are false. You can be happy.

I’m using the term happy, but really, this is joy…joy in the Lord. I’ll write about that in a future post. God gives us all we have and His desire is for you to experience joy.

May the God of hope fill you with all joy and peace in believing, so that by the power of the Holy Spirit you may abound in hope.

Romans 15:13

And, the idea that happiness is not within your reach is also false. In the next few months, we will work through all the steps you’ll need to get your finances on track and be able to tackle that “10 Things” list!

So, how about surprises on your list. You might have discovered some interesting things about yourself or your spouse. One concept that may have appeared is, not everything on your list requires money or at least not large amounts of money. You may have discovered you can be content and intentional with life and relationships and sometimes, that doesn’t cost anything!

Your Net Worth

Now, let’s put that debt number to work. We’re going to create a Net Worth Statement. This is a simple statement that lists all your Assets and Liabilities. Assets are what you Own and Liabilities are what you Owe. The difference between the Total Assets and Total Liabilities is Net Worth.

Why do a Net Worth Statement

A Net Worth Statement gives you a snapshot of your financial position. This information is useful in creating a financial plan or understanding more about your financial health. I know many people who don’t know how much they owe on their mortgage, how much they have in savings or even where some of their assets are. Don’t be one of those! Be informed about your finances.

How to Create a Net Worth Statement

A Net Worth Statement is easy to create. This can be done with a blank sheet of paper and a pencil or with a spreadsheet. If you are doing this on paper, simply draw a line down the middle of the page, title one column Assets and the other column Liabilities. List everything you own in the Asset column and everything you owe on the Liability column.

You’ll need to gather information about what you own, such as the value of your house and cars, similar to how you gathered all your debts earlier. I had you start with the debts or what you owe first because those are usually more time consuming and it’s a more emotional exercise.

If you are a spreadsheet person, you can create your statement with a spreadsheet similar to the one below. I have created a sample spreadsheet that will give you an idea of the categories you might need. Even if you are creating this on paper, look at the categories for ideas of the kinds of numbers you’ll need to gather.

There are many Net Worth spreadsheets available online. You can use this one or find another that fits your style better. Remember, one size does not fit all!

Plug in all your numbers or list them on your paper. When you are finished, add up the Asset column and then add up the Liability column. Take the Total Liabilities and subtract them from the Total Assets. (or let the spreadsheet do the math for you).

Is your Net Worth number positive or negative. If positive, this is your Total Net Worth today. If the number is negative, we’ve got some work to do!

This is my Sample Net Worth Statement Spreadsheet. If you would like to use mine, click the link below the picture of the spreadsheet, save a new copy for yourself and you are ready to go.

Assignment and Key Takeaway

Assignment – Gather all your financial data and create you very first Net Worth Statement. If you already have one, make sure it’s up to date.

Takeaway – Be informed about your finances. Don’t depend on someone else to protect and track your money.

Looking Ahead

In Part 3, we will learn how to do a Monthly Budget

Life Happens

This is just a short note to let everyone know I’ve had a family issue come up and it will be some time before I post again.

I am solely responsible for my 98 year old mom. She lives back in Texas and, as you can image, her health is a challenge at times. She’s actually doing great for a 98 year old, but as my nurse friend said, at this point there’s no cushion. That is true for their physical state as well as their mental state.

She is recovering and I hope to be back home in a few days. Right now we are navigating what the “new normal” is. I appreciate your prayers and the support I’ve already felt from my FB family.

I’m sure I’m not the only one here with aging parents. In fact, the blog post I was working on when this happened last week was about our aging family and our own aging. I guess the Lord gave me some new material! These are topics that a lot of us are dealing with and, hopefully, we can all learn from each other.

Thanks for your patience and I’ll be back soon.

God is our refuge and strength, a very present help in trouble. Therefore, we will not fear though the earth gives way, though the mountains be moved into the heart of the sea, though its waters roar and foam, though the mountains tremble at its swelling.

There is a river whose streams make glad the city of God, the holy habitation of the Most High. God is in the midst of her; she will not be moved; God will help her when morning dawns. The nations rage, the kingdoms totter; he utters his voice, the earth melts. The Lord of hosts is with us, the God of Jacob is our fortress.

Come, behold the works of the Lord, how he has brought desolations on the earth. He makes war cease to the end of the earth; he breaks the bow and shatters the spear; he burns the chariots with fire. “Be still, and know that I am God. I will be exalted among the nations, I will be exalted in the earth!” The Lord of hosts is with us, the God of Jacob is our fortress.

Psalm 46

Being on the Same Page With Your Spouse

Have you wondered, “Will my spouse and I ever agree about money?! Can we possibly work together to create the life we want or will we always be at odds?” The bad news is…money issues are the primary reason for divorce in America. Good news…there’s hope.

I can’t stress enough how important it is to be on the same page with your spouse financially. When you’re not, it’s like being in the same boat, but rowing in opposite directions. You’re together, but you spend a lot of energy and go nowhere.

One of the reasons Stephen and I spent so many years drifting in our finances is because We Didn’t Pay Attention. I kept thinking it would somehow magically all work out. What actually happened was, the more difficult our situation got, the more not being united was a problem. We needed to make some hard decisions and we couldn’t agree.

Getting on the same page with your spouse is possible. Not easy, but possible. Stephen and I struggled with not agreeing on spending, saving or even how to do Christmas! There were many reasons for our divergent ideas.

  • Background – Everyone grows up with different money experiences in their childhood.
  • Personality – Are you a natural spender or a natural saver. There are lots of times when a spender is married to a saver. (That’s not all bad, by the way)
  • Gender Differences – Men look at money as a measure of achievement or a “scorecoard”. Women look at money as part of their security system. When it is not stable, fear can set in. (I experience this!)
  • Divergent Goals – Each partner may have a different idea of what’s important to them.
  • Lack of Goals – You may not have even thought about goals or what you’d like your future to look like.

All of these issues can be overcome.

Money Represents Your Values

Your money and the way you handle it represents your family’s value system. You may not have thought much about that, but now is a great time to start.

For where your treasure is, there will your heart be also.

Matthew 6:21

Dream With Your Spouse

Get a cup of coffee, sit on the deck or take a walk in the park and have a conversation. Just dream. Talk about your dreams and your desires for your future. What do YOU want it to look like? What does YOUR SPOUSE want it to look like? Share your desires for your future with each other. Write them down to reference later. If you made your List of 10 Things That Make Me Happy from the previous post Personal Finance Basics Part 1 – How Do I Get a Handle On My Money?!?, now is a good time to pull that out.

While you’re having this conversation, REALLY LISTEN to your spouse. What do you hear from them that maybe you weren’t aware of? What pain might you be hearing from their childhood? Many of the items I shared above may surface during this conversation. The differences in your upbringing, differences is personality or goals. Have grace and patience with each other. Remember, the end-game is to walk into your future together, hand-in-hand.

I entreat you to walk in a manner worthy of the calling with which you have been called, with all humility and gentleness, with patience, showing forbearance to one another in love, being diligent to preserve the unity of the Spirit in the bond of peace.

Ephesians 4:1-3

Budgeting With Your Spouse

Working on the budget is where the rubber meets the road. If you don’t have a budget yet, you’ll need to start working on one. (If you don’t know where to start with a budget, I’ll be talking about that in a future post) If you have one prepared or you’ve been using a budget for a while, it may be time to revisit and revise.

Usually one partner is a money person or a spreadsheet nerd. Most times the other is not. The one with the talent and penchant for spreadsheets can prepare the preliminary budget, but BOTH partners need to make the final decisions. This will require some give and take. Some negotiation over categories and amounts, but in the end you should be able to determine a budget that reflects your goals and your values.

The flow of money in a household represents the value system under which that household operates.

The Board Meeting

One way Stephen and I softened the harshness of talking money was to schedule “Board Meetings”. Arrange a time and place where you can be away from the kids and other distractions to talk money. We would often have our Board Meetings at our favorite “hole in the wall” Mexican food restaurant. If spending money for this is not in the budget, go to the park or someplace that is meaningful to you.

Being outside of your normal surroundings and away from distractions and things that remind you of stress can sometimes make these conversations easier. Have these Board Meetings as often as you need. Later on, they will become a habit you look forward to.

Side Note: We found this was also a good way to have a “calendar meeting”. Coordinating schedules can also eliminate stress on your emotions and your budget. If you know that 3 nights next week you will be at school functions or games, you can plan ahead for meals and not “run through the drive-through”.

Final Thought

Getting a reluctant spouse on board may be difficult, but it is crucial to your success. Show them why you want to implement changes. Show them how much better your future can be if you don’t just follow the norm.

ChooseFI Ep. 152 Listeners Welcome!

Today is November 6, 2019. My interview with Brad and Jonathan on the ChooseFI Episode 152 aired 2 days ago. My desire for this interview and, really every time I tell my story, is to help others in the same situation and give people hope. I have been overwhelmed and humbled by the reaction to my story!

I want to tell everyone who listened or watched, commented and subscribed to my blog WELCOME and THANK YOU!

My goal for this website is to provide a safe place to discuss our financial difficulties or hang-ups. After all, there aren’t many people in our lives we can talk to about money, right?

I also want to give folks a place to talk about what the Bible says about money. God has called us to be good stewards of our resources. This includes, but is not limited to our money. If we steward or manage our resources well, we are in a position to help others. Being generous brings a joy to our lives like nothing else will. We don’t give just to receive back, but I can tell you the giver is always blessed!

I’m going to start my posts with financial basics for anyone who is just starting to get a handle on their money. It will be finance 101 type info. Then I will be exploring other topics like our attitude about money and generosity. I also hope to discuss interesting life hacks, like travel rewards and frugal lifestyles.

I also have a Facebook page, Started At 50. Feel free to leave a comment or start a conversation there.

One again, THANKS and feel free to leave comment or start a conversation anytime. I’m excited about all of us doing this “FI Journey” together!

Till next time…

Personal Finance Basics Part 1: How Do I Get a Handle On My Money

Are you frustrated about your money?  Are you embarrassed that you don’t know how to get a grip on your spending?  Are you totally frustrated with not knowing how to invest? 

You’re not alone.  Most Americans live paycheck-to-paycheck.  If you’d like to break that cycle, you’re in the right place.  I’ve lived at least some of what you’re going through and there’s hope!  If you haven’t read my story, you can read it at Our Story.  We’re going to step through this together.  Ready to get started?

Financial Independence

 I want to start by giving you a picture of where we’re headed.  A vision of what your life can look like when you have your money under control.  I want to tell you about Financial Independence or FI.  Fi means different things to different people, but the technical definition is – When your passive income from sources other than your W2 job can cover your expenses, you are Financially Independent. 

Huh, what does that mean?  What’s passive income?  This is income from a source that does not require you to do work.  This means you’re not trading your time for money like you do at your W2 job.  These sources fall into 3 categories.

  1. Dividends or Interest from investments like stocks or your 401k or IRA
  2. Income from a side job like an online store or a side business you own
  3. Rental Real Estate.

These are things that make you money even while you sleep.  Some folks have become Financially Independent with investments only or rental real estate only and some have a combination of all 3.  It’s your choice. 

How Much Do I Need?

So how much money do you need to become FI?  That’s up to you. The easy way to calculate this is to look at how much money it takes for you to live now.  We’re going to talk through how to come up with that number in a future post.  When you know how much you spend in a year, then that number is plugged into a formula.  This formula is generally called the 4% Rule of Thumb.  Don’t worry, it’s easy.

The 4% Rule (of Thumb)

The 4% Rule, for short, says that you can withdraw 4% of your investments each year and still maintain your principal over time. 

Total Investments x 4% = Annual Income

Another way to calculate it would be:

Desired Annual Income x 25 = Total Investment needed

For example, if you need $40,000/year to cover your expenses in retirement, you will need $1,000,000 in investments.

Woah!  That’s a big chunk of change!

It might sound like a huge amount right now, but I can tell you that with the right tools AND the right mindset, this is totally possible.

Where Do We Begin?

The best place to begin is by evaluating where you are.  Do you know how much debt you have?  I mean Total Debt.  You may have never added up your total debt.  It may be too scary.  You may feel like you’ll be judged by your spouse, friends or family. 

It may not by pleasant, but this is where we need to start.  Pull out everything you owe and add it up.  This will include:

  • car loans
  • student loans
  • mortgage (if you have one)
  • credit cards  
  • loans on toys like boats, 4-wheelers or jet skis

Hold on to your total debt number and we will use in the exercise in Part 2 – Your Net Worth Statement.

Assignment and Key Takeaway

Assignment 1 – Calculate your Total Debt.

Assignment 2 – Make a list of “10 Things That Make Me Happy”. Take some time to think about this. If you could plan your “perfect day”, what would it include? Who would you spend it with? What would you do? Cook a gourmet meal, go on a hike, take a road trip, eat chocolate? It can be anything. Think about what lights you up.

Key Takeaway – Don’t be afraid to take a good look at your debt. The first step in gaining control of your money is to access where you are right now.

Looking Ahead

In Part 2, we’ll look at How to calculate your Net Worth. Until then, Assignments 1 and 2 are your homework. See you next time!

God is our refuge and strength, a very present help in trouble.

Psalm 46:1