by WayPoints Admin-JBM | Jun 10, 2015 | Your Cash Flow Journey
Camping this past weekend reminded me how fun life can be when it is kept simple. While at the campground, all we needed was food. Internet was not available, cable TV inaccessible, restaurants and fast food stops too far away and the hustle and bustle of everyday life put aside for three days.
We had a blast fishing, playing ball, throwing Frisbee, skipping rocks and playing cards at night. Sitting by the campfire and listening to the radio was serene and relaxing. On our drive home, I daydreamed of a life that was more filled with simplistic pleasures.
There was no opportunity for boredom, or to internet shop, or spend money frivolously. Nature pulled us in, captivated our hearts and gave us peace we rarely experience in our everyday lives.
What if we made our lives a little simpler? Think about how much money you could save by eliminating the distracters and all the costly activities and indulgences you have adopted as part of your lifestyle.
Since I track my income and expenses on a daily basis, I wanted to challenge myself to see what keeps me from living simplistic. I was a bit surprised when I reviewed my last 30 days of expenditures. There were at least $350 worth of expenses that were indulgent in nature and produced very little satisfaction after their purchase.
We are a society of immediate gratification but seem never satisfied and always wanting more. Let’s take some time today and assess our indulgences, analyze our unnecessary spending habits and make some changes in our lives so we can get back to a simpler but more enjoyable life.
by WayPoints Admin-JBM | Jun 4, 2015 | Your Cash Flow Journey
As I was making date night reservations for dinner tonight, I was reminded how simple it is to develop a budget and have a plan for my money.
People who don’t budget, live from the balance of their checkbook. Living by a checkbook is like having only one category to pull from. If all your money is sitting in one spot, there is a greater chance you will overspend.
By dividing your income into all your expense categories (including savings and investments), you will maintain better control over the allocation you set for each category. It’s like having a separate envelope for everything you do.
When I opened up my copy of our proprietary WayPoints Financial Services Goal Planning System, I knew before I made the reservation, that I allocated $200 to the eating out fund. By using and tracking through this system, I am reminded every day what my balances are for every category I allocated funds to. With our system, there is no way I can overspend without consciously being aware of it.
Call us today and ask us to help you develop your own plan so you too can go to dinner with peace of mind knowing you have enough money to cover you for the rest of the month.
by WayPoints Admin-JBM | Jun 1, 2015 | Your Cash Flow Journey
If you’re having financial troubles or living paycheck-to-paycheck and not sure how to fix it, budgeting can save you from a lot of undue stress.
So what exactly is a budget? It’s foreseeing your future income and expenses and planning accordingly. Personally, it’s setting up a set amount I plan to spend, so that my income can exceed my expenses. No one wants to live with a deficit.
There are easy steps to budgeting, it just takes diligence.
- Start with a cash flow plan and begin tracking what your income is and your expenses in every category. This is a day to day task. WayPoints Financial Services has a great system to help you with this.
- Now you know the details of your monthly expenses. They may change but the last month you tracked is the best estimate to use. Take that and attempt to reduce spending where you can to “budget” yourself. Then see if it’s feasible in practice.
- The last two steps are generally all you need to consider for a budget. But for those of us looking for financial freedom, try to find ways to increase your income as well. While continuously finding more ways to cut and trim your budget even more.
by WayPoints Admin-JBM | May 26, 2015 | Your Cash Flow Journey
Over the years, I have had many people take that step of faith and walk up to the front of the classroom and cut up ALL of their Credit Cards. Not because they decided to implement a budget, but because they decided that they needed to change the direction of their financial journey. They no longer wanted to be treading on dangerous waters and made a conscientious decision to stop the insanity.
Good personal finance management doesn’t stop at developing a budget. It takes faith, courage and a behavior change to say enough-is-enough.
Anyone can put a dollar amount to a group of expense categories and call it a budget, but it takes commitment to live and breathe by the numbers you have established as part of your plan.
If you continue to use credit cards, then your plan will never work, you will never succeed and you will fall right in line with the majority of your neighbors and your friends.
If you really want to make a difference in your life and leave a legacy for your children, make the decision today to change your behavior about spending, learn to develop a plan, execute your plan and begin to live a life that is free of financial stress.
by WayPoints Admin-JBM | May 19, 2015 | Your Cash Flow Journey
The heart of every dollar is the interest rate. If you are paying interest, you have a weak heart. If you are earning interest, you are financially healthy and have a strong heart.
Ever notice that when a bank advertises loans, the APR for personal loans are anywhere between 9% and 18%? But, when you deposit your money into savings, you are lucky to earn 3%.
If we as a society could grasp the phenomenon of compound interest, we would never borrow money again.
Interest charged is a debt trap (Sound like death trap?). Interest earned is like exercise to the heart. The more you invest, the more you will benefit from growth due to compound interest.
Stay away from bank investing (unless you are saving an emergency fund) and find a financial advisor who is willing to research the best return for your risk tolerance.
Pay off your debt and begin to become financially healthy by investing those dollars you had been using to defeat your debt.
Over time, you will begin to see a dramatic change with your financial health.
by WayPoints Admin-JBM | Apr 30, 2015 | Your Cash Flow Journey
Most people have no idea how to develop or even begin to develop a healthy cash flow plan. A well developed plan will allocate every dollar of income towards multiple expense categories. Expenses can be personal necessities, taxes, discretionary items, debt, gifting, savings and investing. But there is an order and sequence that should be followed in order to achieve true financial health.
The most important and very first category of spending that needs to be allocated are your absolute necessities. Do you have enough income to cover housing, transportation, food, basic clothing and utilities (electric, water, gas)? If yes, you can now begin to allocate monies to service your debt.
Debt is broken down into dischargeable and non-dischargeable debt. Non-dischargeable debt includes government backed student loans and IRS debt. Both of these need to be at the top of your debt payment list when allocating funds. If there are still available funds left over to allocate, then you want to service (at least the minimum payment) all of your dischargeable debt.
If there is still left over cash to allocate, then you can begin to allocate all your discretionary categories. The greatest focus in this area is to determine what you can and cannot live without. This is the area where you have the greatest control over and the area where you will be able to cut back on if you want to make the greatest progress with eliminating your debt.
While you still have debt to service, it is not wise to save (other than a limited emergency fund) or invest at this time. You will have the lowest opportunity cost by eliminating your debt first since debt interest rates are predominately much higher than the return on any savings or investment portfolio.
Once your debt is paid off, then you can begin to reallocate those fund toward your savings and investment goals. If you need help getting started or need additional guidance, feel free to call us or email us at mail@WayPointsFinancialServices.com
