Marriage and Money: Agreeing on Large Purchases

Marriage and Money: Agreeing on Large PurchasesAs you get your budget under control, get out of debt, and build an emergency reserve, you will have increased cash flow.

With more money coming in, you will have the opportunity to make large purchases.

Question is, how do you decide on what to purchase first?

Let’s assume of course that you will save the money for the expense and will not use debt.

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How then do we agree with our spouse on a priority order on the purchases?

Invariably, you will have different ideas on what to buy.

One of you may want to save the money for a nice vacation while the other person wants to beef up the emergency reserve a little more.

Or one of you wants to do a home remodeling project that has been put off for a while, and the other person wants to buy a full entertainment system.

Here is an approach my wife and I use to come to an agreement about large purchases.

As you look at shared goals for this year, this might help you as well:

  • Make a list of all the potential expenses. Some examples include: vacation, car replacement, kitchen remodel, new couch, big screen TV.
  • Assign an estimated cost to each item.
  • Each person then goes down the list and assigns a priority (1 to 10) to each item.
  • Compare your priorities. Share with each other why each item is important.
  • Come up with a combined priority list.
    • Here is where the art of compromise comes in.
    • You are building a life together, so surely you can build a priority list together.
  • Total the amount required for all items. Based on your financial picture you might not get to all of them this coming year.
    • But you will get to the items that are important to both of you.
    • Now you know where to target your savings and you have a common set of goals.

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When you are married, the only way to win with your money is to work together with your spouse.

Healthy finances lead to healthy marriages.

If you are not working with each other you are working against each other.

Try this method and let me know how it goes!

Year End Financial Checklist

Year End Financial ChecklistCan you believe we are near the end of the year already?

Time flies and I am sure that if you are like me,  you are looking forward to the holiday celebrations and some well deserved rest.

However, before the year runs out, I wanted to give you a year end financial checklist.

The great Zig Ziglar said: “It’s true. Spectacular preparation precedes spectacular performance.

These actions will help you prepare to  start the new year on the right foot with your finances:

1. Check your Credit Report

Have you checked your credit report lately? This is something you should do at least once a year.

According to the Federal Trade Commission (FTC):

A credit report includes information on where you live, how you pay your bills, and whether you’ve been sued, arrested, or filed for bankruptcy.

Nationwide consumer reporting companies sell the information in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment, or renting a home.

The Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months.

So take the time to request a copy of your credit report.

  • You can order your free annual credit report online at annualcreditreport.com, by calling 1-877-322-8228, or by completing the Annual Credit Report Request Form and mailing it to:
    • Annual Credit Report Request Service
    • P.O. Box 105281
    • Atlanta, GA 30348-5281
  • Get a report from each one of the agencies.
    • They are supposed to cover the same information but there can be differences.
    • In some cases entries in one report will not show up on the other reports.
  • In case you cannot get a copy of your report from the online website, proceed with the phone call or complete the form to request via  mail.
    • Just make sure you get your hands on that report.
    • If I had done this, I would have taken the steps to correct the problem before starting the mortgage refinance.
  • Review your report for any inaccurate entries.
    • Keep in mind that only entries that are inaccurate can be removed from the report.
    • Don’t fall for scams that promise to “clean-up your credit”.
  • If you find any inaccurate entries, contact the appropriate credit reporting agency.
    • Send a letter via certified mail, return receipt requested detailing the inaccuracies.
    • Consumer reporting agencies must correct or delete inaccurate, incomplete, or unverifiable information.
    • Inaccurate, incomplete or unverifiable information must be removed or corrected, usually within 30 days.
    • Additional information can be found at the FTC website.

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2. Assess Your Insurance Needs

As you work on your financial plan, I also want you to consider the need to manage the risks to your finances by evaluating the role of insurance in your financial plan.

What is the role of insurance? In simple terms, insurance is the tool that is designed to protect you and your family against what might happen.

Ensure you have the right type of insurance and the right coverage to protect your financial plan.

3. Check Your Retirement Plan

Understand how your plan is progressing and make adjustments as needed.

Even with all the focus on personal finances today, planning for retirement is one area where we continue to come up short.

The good news is that you can do better than average. Seven years ago, I was part of those statistics but now I have a plan that is yielding good results.

Here is how I am preparing for retirement.

4. Prepare a Will

Do you have a will? If not, you are among 50% of Americans with children who have neglected this important step.

So what are some of your reasons for not dealing with this issue? You might think it is costly (it is not), or complex (it is not), or that simply you don’t have anything to leave to anyone so you don’t need a will (oh but you do).

Or you might just not want to think about your own mortality.

However, the reality is that we will all face death and the sooner you face that fact, the better off you will be.

So here are the 3 Reasons you should prepare a will:

  1. Because it puts you in control:
    • If you die without a will, the state takes over deciding what happens with your property.
    • The state already has too much say in what happens in our private lives.
    • There is no wisdom in leaving the disposition of your assets to the government.
  2. Because it is simple and cost effective:
    • You don’t need a high priced estate lawyer to do this. For most of us it is really a simple process.
    • Personally I used an online service that provided my wife and I with the required state specific forms for our wills.
    • It just took a few hours and less than $50 and we are able to put our last wishes on paper.
  3. Because it shows love for your family:
    • Imagine if something were to happen to you. In the midst of the grief and sorrow of losing you, your family also has to deal with the legal ramifications of what to do with your assets.
    • Don’t leave a problem behind. Love your family to the end by taking care of your will preparation today.

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5. Get on a Budget

I have always told you, the budget is the key to your financial success.

If you can’t control your money, you can’t build savings, you can’t pay-off debt, you can’t plan for the future.

Make 2015 your best financial year by starting to get control of your money today!!!

What other steps could you take this month to help you make progress with your money in 2015?

5 Ways to Avoid Christmas Overspending

5 Ways to Avoid Christmas OverspendingAre you ready for Thanksgiving? I am looking forward to a welcome break and to spending time with the family.

But just thinking ahead a little bit, I wanted to get you some advice for what happens after Thanksgiving: the Christmas shopping season begins.

So whether you will join the crowds on Black Friday or whether you will take advantage of Cyber Monday, here are 5 ways to avoid Christmas overspending:

1. Establish a Budget.

You should have a list of people that will receive presents from you.

Determine how much you want to spend on each person and add the amounts to come up with a total figure.

That’s your Christmas gifts budget, meaning you can’t go over that overall amount.

You may also want to establish a budget for items such as Christmas decorations or entertainment (Nutcracker tickets anyone?).

2. Use Cash.

As we have discussed before, cash is king.

Using cash will keep you from overspending, which is easier to do than when you use plastic (either a debit card or credit card).

When your cash is gone, your shopping should stop.

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3. Take your Time.

Don’t just wait until Christmas Eve to do all your shopping.

Don’t try to just buy something just to get it done. Give yourself the opportunity to do some comparison shopping and find the good deals that are out there.

Plan ahead.

4. Leverage Technology.

In these Internet days, search online for the best deals and compare prices. You can also save time if you order items online and avoid the battles for parking and long lines at the mall (provided you give yourself enough time).

Also, take advantage of your smart phone, and look for the best Apps to help you shop during this holiday season.

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5. Plan for Next Year’s Christmas.

Ideally, you will be starting your Christmas sinking fund now so you have the cash ready for next year’s expenses.

These few steps will save you a lot of money, a lot of time, and they will reduce your stress levels. Focus on spending good quality time with friends and family.

Don’t let the disease of “more” rob you of having a great Christmas season.

Finally, remember what this season is really all about. It is about celebrating how God reached out to provide for mankind’s greatest need.

God knew we needed a Savior and and He gave us His Son Jesus. If you have not had the opportunity to meet Him, there is no better time than today.

He is the indescribable gift, the Prince of Peace, God with us.

He is all that you will ever need in this life and the next. Let me be one of the first people to say to you: Merry Christmas.

“She will bear a Son; and you shall call His name Jesus, for He will save His people from their sins.”
Matthew 1:21 (NASB)

7 Principles For Financial Success

How are you building your financial household? Is what you are doing working? Do you see positive results?

Our family has been on a financial transformation journey for a little over 9 years now and I have had some time to reflect on how far we have come.

We have experienced the rewards of applying God-given, time-tested principles for winning with your finances.

I wanted to share these 7 Principles for Financial Success with you today because I firmly believe you too can win with your money if you are diligent in applying them.

If you want to know more, you can check my e-book in which I share more about how these principles have changed our lives.

If you are winning with money, I would love to hear how have you applied these or other principles to succeed. Share those blessings with others!

“The law of the Lord is perfect, restoring the soul; The testimony of the Lord is sure, making wise the simple.”
Psalm 19:7

7 Principles for Financial Success