Definition of resolution: A resolution is a resolve or determination: to make a firm resolution to do something.

Definition of goal:The purpose toward which an endeavor is directed; an objective

I think may of us set a new year resolution for ourselves without setting goals that will help us make changes. Without setting goals our resolutions are meaningless. You might as well not make resolutions if you don’t plan on setting goals as well. The best goals to set are small ones. For some of us we need to make each goal very small.

If your goal is to start your journey toward financial freedom I encourage you to set yourself some goals. If you are struggling with managing your money then maybe your first goal should be to find out how you are spending your money.  Or if you are struggling with spending too much maybe your goal should be to set a budget for yourself that will work for you (Dave Ramsey’s budgets are really easy to follow).

The year of 2009 could be the year that changes your life direction if you set resolutions that have goals attached to them. I for one will be making resolutions but will be focusing more on how I will fulfill my resolutions by setting small goals that will lead to success.

I wish you a Happy Successful New Year!

~Mona

I did really good before Christmas.  I resisted overspending before Christmas to undo some of the damage on the after Christmas sales.  Listen to me rationalize again… it’ll save me money next year when I don’t feel the compulsion to by Christmas ornaments.  In the end, I didn’t blow that much money, but I hate it I hadn’t planned to blow some money.

We’re going to go through FPU again starting in January.  We’re going to play close attention to the insurance and annuities portion of the classes, and hopefully gain some more gazelle intensity.  Looking back over last years resolutions, we’re lightyears ahead of where we were then, or even 6 months ago when I was thinking of leaving J because I couldn’t take it anymore.  I’m such a perfectionist that I’m going to cut myself a break.  My resolutions next year will be to spend cash, spend cash, spend cash.  We need to plan for this because getting to the ATM is something we don’t do if we don’t make the time.  Some of my [over spending] over the last 2 days was in cash, but when I ran out, I whipped out the plastic. Ca Ching.

Here’s fishing you Financial Peace in 2009.

Why oh why do I fall away from what I know works? It doesn’t require copious amounts of energy. But what’s comfortable, or “the way I’ve always done it” is hard to let go of, even if it is making us miserable. I know, it doesn’t make an ounce of sense. Before Financial Peace, I was not so blissfully ignorant of how better my financial life could be. I assumed it would be hard to be responsible. The truth is that it is in fact so simple that my ignorance is hard to swallow when I must confess to irresponsible financial behavior. Less stress is the result when you have an accurate and truthful screen capture of your financial life. It is hard to let go of the bad financial habits. We are absolutely light years of where we were when our minister first said the words “Financial Peace” in a sermon last January. Now at least I know better and have a little disappointment- even shame- when I don’t name every single one of the dollars in our income and outgo. I know now that I can blow all my hard work in one shopping trip, and that shopping trip might make the difference in how long it takes us to break free from Financial Peace. Dollars that are being frittered away because of poor planning aren’t going to pay down off our dept.

I hate balancing the checkbook. I hate paying bills (if you do like it, you’re weird). I spend more energy dreading doing the tasks than it requires to do them, and since starting Financial Peace, it’s never as bad as I feared. I’ve been conditioned to think the worse. But the truth is that the lessons really are sinking in, and one day of less than perfect (not necessarily bad) choices doesn’t throw it all away. I’ve just got to break the budget forms out again and sit down and have our budget committee meetings. We need a Financial Peace Check-up. It’s been our 3 months (actually a little less )or 30k miles.

There are a number of ways to get back on track. The easiest for me is to go to Dave’s website and do some reading. Today I read of How to Become a Stress-Free Shopper. There’s nothing new learned because the steps to Financial Peace are consistent and Biblically based. It isn’t a gimic, or membership dues. In fact, it is possible to take Dave’s advice for free. Check the books out from the library, download the budgeting forms for free. His radio shows and TV show is also free. The FPU course is reasonable, and it’s a lifetime membership. It’s necessary for hard heads like me to have accountability. I can’t begin to quantify the stress that we’ve let go of since making the commitment to start the program. I’m grateful that now, with Dave’s help, I have the common sense to know when I’m making bad decisions and can be responsible and accountable to my self. I have the fundamentals that are important to our financial plan, and must be in place in order for us to obtain Financial Peace. How long it takes us to get there is dependent on how well we stick to our plan.

~Manda

Dave says the same thing when he gives the advice to live your wage. J and I have worked over the last 5 months to create a financial truth. We’ve let go of the things we couldn’t afford. Some days I do miss my van, and I know he misses his truck, but, honestly, they were not ours. We let go of that lie, and created a financial truth. Instead of being behind in our utilities and juggling which to pay. Our utilities weren’t getting paid because we were spending money we didn’t have. We’re fortunate to not have credit card debt. We’re fortunate enough not to have a house that we can’t afford. We still have some decisions to make. My student loans are monstrous. Do I go back to work, or stay at home with my babies. With Dave’s help, we’ve let go of the lie and are living a financial truth. We have that truth to be able to make informed decisions. We’ll be able to consider the cost benefit. Only time will tell which way we’ll go, but as Dave says, prayer does work, and we’ll rely on it to assist us in making decisions. This is a stark contrast to the lies we were trying to perpetrate. It’s less stressful, and more peaceful.

As I listened, I tried to pay attention for something for which to write about for my last post of the month. In lesson 4, dumping debt, Dave says that he knows that he can often identify callers who “have it”, and those that don’t. Those that “have it” are angry, and ready to get out of debt. They find no excuses, have no reason to delay it. They get on board, and they get on board quickly. I would be one of these callers. J would not. He’s a bit more inclined to not own up to things right away. He needs to be knocked around a bit before he sees things accurately, which is why we’re a perfect match. For every bully, there is a wimp.

Our Baby Emergency Fund has a little gremlin that we call Dave Murphy. Any time it gets funded, something happens, and he takes all the money out. We’re 4 months into our Financial Peace journey, and are back to Baby Step 1.. re-again. We’ve had 2 yard sales, we’ve sold a jet ski, cut out our retirement, sold our van, gone to the bare bones for insurance, cut out trash service. We’re still holding onto our cable services. I’m in my final semester of my graduate degree, and internet service is a necessity for us at the moment based on our circumstances. But we have to dig deeper. We have to find a way to get it funded again. We’ve been trying to sell our hot tub, and hopefully, since hot tub weather is nearly here, it will sell. So, I’m going to cut the price again, and all but give the thing away to get our Baby Emergency Fund re-re-funded.

J has a meeting with the manager of the local Domino’s tomorrow. He’s to take in his driving record, and we suspect he’ll be hired on the spot. That will certainly help in getting it funded. We’re also looking to sell Jason’s truck to knock out the 8k debt, leaving us with only one left from the medical bills of our daughter.  My comprehensive exams are next week, and once that is over, I’m going to see about getting a job at Kohl’s as a seasonal employee.  We’re starting to prepare for July. In July, my student loans will come a knockin’. My girls will definitely not graduate from college in debt. Through FPU, I’ve learned about ESA’s, and as soon as we complete Baby Step 3, we’re going to start funding these college funds. Current law allows a 2k year contribution. Our oldest is 2, which seems awful young, but each year we aren’t contributing is a year that her fund will miss out on the compounded interest that would make the 2k per year starting at age 0 until age 18 nearly 200k. There are many steps to get from here to there, but it is important to keep an ear to the ground to be ready, to have a game plan.

One thing that Dave said in the same lesson about those that are going to “make it” is that when your broke friends are making fun of you, you know that you’re doing it right. Some family members have been a little worried, accusing us of joining a cult and such, but I guess I have great taste in friends, because my broke friends are checking out Dave’s books, they’re funding emergency funds. I’m such a convert, so determined to get out of debt as soon as possible, that I’m going to be co-teaching FPU starting in November. It’s offered through my church, but anyone can attend. The next session is going to start on the tail end of a sermon series on debt- in anticipation of the holidays. It is my hope and prayer that my broke friends will join me at least for the FPU. It’s the best $93 I’ve ever spent. 10 years from now when I’ve changed my family tree, and I’m giving like no one else, in the memory of my daughter, I’ll be even more thankful of the small investment. After I’ve co-taught a lesson, then I’ll start teaching my own FPU courses. The lessons learned during the 14 weeks don’t end at the 14 weeks. After listening to the DVD’s (which come with the $93), I’ve learned more, and I know that as I do the course as an instructor, I’ll learn even more. J and I are a bit deficient in the life insurance part. I have none. Nada. Zip. What he has is what is offered at work.

Very quickly, before I close, in speaking of the Holiday’s, I noticed that the Coinstar at our grocery store doesn’t charge if you get an Amazon,com gift certificate from your coins. So, we’re emptying Piggy Banks. We got… ha… $93 out of one. No trips to the mall. It eliminates impulse purchases, and “gotta have its”. We’ve got 2 more to empty so that we can go get plastic stuff for our kids.

The last thing that I re-heard, not for the first time, but I was like “Oh yeah”, was that Prayer really does work. It does. It does. I’ve no doubt that God led me to Dave Ramsey’s program because I prayed for help with finances. If there are any two people that are a testimony to how much things can change in 14 short weeks, it is us. I can’t even begin to tell you of the denial that I was living in, and of the lengths J was going to hide it from me. After 14 weeks, J and I are caught up on our bills, and are working with one another, not against one another. More importantly, is that Jason has become a Christian. The promise and the proof that he was seeing after doing it God’s way, not only financially, but in every aspect of our lives was the evidence he needed.

~Manda

This morning, J told his boss that he’d be unable to go. We’re okay with it. We were very excited about it 6 months ago, planned the trips we would take while in the San Diego area. But now we’re more excited about the opportunity to be debt free in 2 years. We can’t throw away all the lessons learned in the last 13 weeks for a trip that, as those striving for Financial Peace, those doing what rich people do, can’t afford. If I’m honest, we’re quite proud of our decision. We’re delaying instant gratification and instead walking the path of Financial Peace.

We’re living like no one else, so that later, we can live like no one else [and take a trip to San Diego that we pay for with cash!]

~Manda

Regardless of your FICO score, in order to achieve Financial Peace; QUIT BORROWING. We live in a society of instant gratification. We have a sense of entitlement. We work hard, we need big houses, big televisions, designer clothing, cell phones that have manuals thicker than the phone book of my home town (Marion, Alabama,) and a new car every few years. Count the number of commercials for cash advances, title loans, check cashing… etc. In case you didn’t know, these loans are a BAD idea, no matter what the “emergency” is. These commercials have women with shopping bags talking about sales that couldn’t be missed, young couples waving fistsfull of cash while driving off in a car from the title pawn saying “We even got to keep our car”. Guess what. You just pawned your car. It’s now THEIR car until you repay the loan. The interest rates that these places charge are criminal, and more often than not, you will struggle to pay it back, or you will lose the car. It will NOT be worth it. Payday loans work the same way. Additional loans are needed to pay off the first loans. Quit borrowing. No matter what society, or some marketing team tells you: you can not borrow your way out of debt.

The most alarming to me is cashcall.com. The “whatchu talking about Willis” former child star is crying that he tried to auction his clothes, and even his car, but then Cash Call gave him the money he needed. The rates on these loans are ridiculous, and vary from state to state. The way to stop this kind of indebtedness, is to #1 QUIT BORROWING, and #2, use common sense. As a resident of Virginia, to borrow $1,500 from cashcall.com, after the “loan fee” of $500, I’d walk away with 1k. After 12 months of monthly installments of $159.83 for a total of $1917.96, nearly 100% of the amount I walked away with. If I were to borrow $2600, the loan fee goes down to a mere $75 but I’m paying $216 a month for three and a half years. My total repayment would be $9095,10. The premise of the commercial is that poor Gary Coleman needed to sell his stuff to get money. Despite the message, that’s exactly what he should do! Calling cash call is the dumbest thing that could be done. Even if I needed this loan to keep my lights from being cut off, I’m paying them the equivalent to a light bill for the next 3.5 years, putting myself in additional financial stress for the next 3.5 years. I’m just extending my financial burdens. If you’re getting these loans to buy something you can’t afford, think about what you could have afforded. Think long term.

Desperate times call for desperate measures. When your finally desperate enough you will quit borrowing. QUIT BORROWING. But, they’re going to repo my car. Sell it, don’t title pawn. Sell it for blue book. They’re going to take me to court and get a judgment and destroy my credit. Okay. Since you’re not borrowing anymore, my FICO doesn’t matter to me. Being a mature adult means delaying gratification, being responsible for the consequences of my bad decisions, and making restitution. Continuing to make bad financial decisions isn’t going to save me from a judgment in the future. It will only prolong financial stresses which branch out into every aspect of my life. Ever laid in bed at night and worried about money? In the shower? Do you get a pit in your stomach when you check the mail, or screen calls because you’re tired of talking to collectors? Get out of it. Quit borrowing. Save 1,000 in cash for “emergencies”. Pay yourself first. Pay for your shelter, food, utilities, and transportation. If there is any left over, pay your unsecured debt using the debt snowball. You can not borrow your way out of debt. No matter how cute the commercials, it will only cost you more in the long run. Cut your lifestyle and live your wage.

You can not borrow your way out of debt.

You can not borrow your way out of debt.

You must make hard, common sense choices to get free of the debt you’ve incurred. After you’ve quit making excuses, rationalizing and making the decision to quit borrowing, reevaluate your lifestyle. What about all those necessities you can’t live without? If you’re serious about getting out of debt, if you’re tired of the stress that comes along with being in such debt, you’ll live without them. Go to the bare bones. Turn off the cable, do you need a land line and a cell phone? Cut down your groceries and buy generics. Don’t eat out. Don’t eat out. Don’t eat out. Cut all unnecessary spending. Starbucks got way too much of my money. Turn down invitations to birthday parties. Lunchbag it at work. Don’t eat out. Get a 2nd job or work overtime. Have a yard sale. Sell something. Come up with the money before you borrow more. You can not borrow your way out of debt. In the end, you have to make the decision either to keep living a lifestyle you can’t afford, and borrowing, or to live your wage, pay off your debts, and be free from these financial burdens. It isn’t forever. In fact, Dave estimates that it takes about 2 years for people to pay off their debt. Wow. 2 years of bare bones living or 5, 10, 15, 20, a lifetime of living in debt.

~Manda

The thing that J and I learned is that both partners have to be actively involved in the financial part of a marriage. Dave hosts a TV show on the Fox financial channel. He’s dubbed Friday’s as Debt Free Friday’s. People who have completed their debt snowball call in and celebrate the achievement. Before hanging up, they get to yell “I’m Debt Free”. In the interview, the wife and/or husband always report that being on the same page is an integral part of succeeding and becoming debt free.

J and I have had to learn to relate to money. The true state of our financial indebtedness was revealed to me over the course of FPU, not just in any particular week. It had to come to a point where I demanded that we get the new checking account open, and that I see the physical or virtual copies of our bills. All were caught up, except 2. As far as I knew, they were all caught up. I can’t pretend to explain J’s motivations, I only know what he’s told me: that he wanted me to take over the bills with all them up to date. The lesson learned is that if all had been laid out on the table during week 2 in Relating with Money, I believe that we’d be farther along now. J removes his band-aid as slowly as possible. He hates conflict. I’m a rip it off and get it over with type, and I thrive on confrontation.

That’s just one of our differences. Dave explains the differences between men and women. Women need financial security, and I am no exception. Opposites attract and marriages typically contain a free spirit and a nerd. J is our free spirit, and I am the nerd. No doubt, our financial situation would be better had I been the Nerd I should have been. It was just too easy over the last two years to let Jason take the stress of the medical bills from our daughter, our diminished income due to my no longer being an active member of the work-force. I suspected all was not well, but that is where my involvement ended. With suspicion. And yet I dared to be angry with him, to blame him, when, if I’m being honest, I’m at just as much fault as he. Finances in a marriage is not a one person show. No matter who “earns the money”. Both should know what is coming in, and every dollar that leaves should be accounted for. It is always time to budget, no matter how inconvenient it is. Both must be bothered. Both most be active and to get on the same page in order to acheive FPU. Thirteen weeks ago, J and I weren’t even in the same book.

J and I missed our final class (and church) because our Dave car wouldn’t turn over. We discovered it had an alarm, but not how to turn it off. We had to disconnect the battery in order to keep the neighbors from mobbing our house. The air conditioning went out in J’s truck, so we decided to stay at home today instead of subjecting the girls to today’s heat. I was disappointed to have missed today in order to celebrate our class. A few of us attacked our debt with Gazelle intensity. The class has been life changing for J and myself. I hope that in a year, maybe 2, we’ll be calling Dave one Friday (if I gather the nerve) to scream “We’re debt free”.

~Manda

The other reason I have been blogging much on Time to Budget is because I don’t really like to take about my financial stresses. Things have not been easy for my husband and I. The rising gas prices was the start of it and since the prices rose we have not been able to get a good handle on our finances.

When things become difficult to handle thoughts of throwing in the towel often pop into my head. When I have these type of thoughts I always come back to reasoning – eventually. Why would we just quit and forget all the progress we have made over the last few years? Sometimes quitting seems easier than moving forward but it really isn’t.

Quitting is not an option. If we were to quit now then all of what we have learned over the past few years will have been a waste of energy. The knowledge we have gained through Financial Peace would be meaningless if we do not put them into action.

We have to remember that steps in the right direction will eventually help us reach our target. How ever small the steps may be they will still take us to our destination.

We are still on the road to Financial Peace…one small step forward at a time.

~Mona

I try to watch The Dave Ramsey Show on Fox Business as often as I can. If I could only watch 1 day, it would be Friday’s. Callers call in on Debt Free Friday’s and share their stories and scream “I’M DEBT FREE”. Dave probably won’t receive a call from us, because I haven’t the patience to try keep dialing, however, the shows are motivational.

Tonight Dave said that:

Part of achieving any goal is being willing to say no to things that are going to keep you from achieving [that goal].

It takes maturity to say no and discipline to keep saying no. Today I had the opportunity to practice several of the tips that J and I have gathered from our weeks at FPU. We have our cash flow plan (what we now call our budget), and if it isn’t “cash flowed”, it isn’t bought. If we NEED it, it comes out of the emergency fund. I have to plan to go to get my haircut. We’re planning for him to go to the men’s retreat at church. I got an email from Old Navy today that there is a Baby Sale. The kids NEED fall and winter clothes. I love on-line shopping. We’ve been so good, you see where I’m going with this. I was making excuses to fill that virtual shopping cart. So, I called Jason and had him talk me down. In the past, we’ve been enablers, but he said that we could go to Old Navy- cash in hand, if I still wanted to do so…. tomorrow. Now that the urge is past, I’m absolutely content to sit and wait until next week’s consignment sale. My kids have way too many clothes anyway. Clothes that typically goes unworn, although there is never a lack of laundry to fold.

I’m learning power over purchases through: maturity, discipline, a written cash flow plan, and seeking the counsel of my spouse[if you aren't married, Dave suggests getting an accountability partner]- all lessons that I have learned through the weeks during FPU. It’s nothing magical, even Dave says it. It isn’t remarkable. I’m sure there are people out there who know this stuff without Dave, but I suspect that most of us are the average American who wasn’t born wealthy; we believe that we’ll never have it if we wait until we can pay for it with cash. We believe that credit card debt is a necessary evil in our lives, or that we’ll always have a car payment.

This week will be our last week of Financial Peace. When we started we were behind in our mortgage, possibly facing foreclosure. One of our vehicles went into repossession. We had no communication in our marriage and J was struggling to hide our true financial situation with us. Deep down, I knew we were living beyond our means. It would have been simple to pull our credit reports, or even check our mailbox from time to time, but the truth is, I was scared to do so, and willing to let him struggle, all the while, self- righteously blaming him for the problems I’d help create. Sure, the death of our daughter and her medical bills played a big part of what we owed, but in the end, it doesn’t matter how we got in debt, just that we are in debt.

Our marriage was close to an end, and it is so hard to look back to that couple 13 weeks ago and realize that it was us. We’ve gotten rid of both of our vehicles and now drive two Dave Cars that have only liability insurance. We’re caught up on our bills. We have a written plan and we follow it. I don’t buy things that we don’t need, even when I convince myself that I NEED it. I know that it isn’t forever. We continue to tithe to our church, which is a big deal to us as Christians, and that feels good. Prayer really does work. I believe God led us to our church, we came to FPU through our church. So much has happened in the last 13 weeks that I can only imagine the wealth and peace that we will have in 13 years.

~Manda