Tag Archives: Chris Gardner

Budgeting Money Tips

Money is known to be one of the major causes of tension in a relationship. So, try something new. Follow a few simple guidelines that can help you keep the fireworks in the relationship from exploding out of control.

1. Understand your Motivations and Goals

Traditionally individuals and couples will earn an income and automatically adjust their lifestyles to that income level. It’s nice to have the finer things in life such as home, new cars, vacations, etc. Very little thought, however, goes into motivations or values. It’s an important first step to understand what’s most important to you (your values) and from there you can set some specific financial goals.

Spending some time alone AND together and WRITING out your individual motivators (or values) and goals can be enlightening. Give it a try separately at first and then compare with your spouse or significant other. You’ll be well on your path to understanding each other better and set up for fruitful communications.

Once you’ve agreed on some goals, be realistic about the amount and timeframes. For example, if a goal is to buy your first home, calculate how long it will take you to save for a 30% down payment. Anything less than 30% down in this real estate market is very risky should you need to sell in the next few years.

2. Understand Your Current Financial Situation

Take some time to organize your records: Assets, Liabilities, and Income (ALI). Make a page for each ALI and list all the items in that group. For example, for the Assets group you would list home, cars, savings accounts, investments, and other major property items.

On the debt page, list all debts such as mortgage, car payments, outstanding credit card balances, student loans, etc. Do the same for all your sources of Income such as wages, alimony, child support, rental income, investments, etc.

Writing this all down will help you gain a big picture understanding your current situation. Once that is understood, you can work as a team to figure out how to achieve those financial goals you listed in step 1.

Remember, your financial information is your ALI!

3. Work Together as a Team

Work out your monthly budget as a team. Each of you will have a different value system or set of motivators that cause you to place emphasis on certain budget categories. Learn to work with each other and compromise where you disagree. Set up pre-set spending limits by budget category so that you are living within your means. When you disagree, you have your values and financial goals as your foundation. Keep coming back to revisit those. Make sure your spending plan supports those!

To help resolve conflicts, put in terms of “Needs vs Wants.” Once you think in those terms, many of your “wants” may need to be eliminated in order to achieve one of your financial goals. Remember, you based those on your life motivators or values, so those are much more important than some of your daily “wants,” i.e. a daily Starbucks budget category!

Set aside 30 minutes per month to work out your differences. Communicating your concerns lovingly and working through to the benefit of “one team” will help you maintain your financial goals and keep those fireworks going too!

4. Start Where You Are

Even if your financial picture looks grim, do not despair. Even if you are 50+, do not give up hope. You will probably live into your 80’s or 90’s, so there’s a lot of time to recover from past financial mistakes or just simply a late start. There’s a great book by Chris Gardner called “Start Where You Are.” If you need any inspiration at all, this book is a must read. Chris was a homeless single father of a small child and made a tremendous comeback to build a successful business. The book is full of inspiring techniques that will help you get started, no matter what your current situation is.

My advice is to start your financial plan within 24 hours of reading this. Studies show that a new thought, idea, or writing (such as this blog) should be implemented within 24 hours or the new thought, idea, or writing will NOT happen. So start planning now. Talk to your spouse or significant other today and encourage each other to take some ACTION.

5. It’s All About the LOVE!

Working together on your financial plan and making progress toward your life goals will bring harmony to your relationship. There’s nothing more comforting than knowing you are a blessing to someone else. When you put yourself on a mission to LOVE, you will be pleasantly surprised how good it will make YOU feel too!

As you work through your financial plan together and you start reaching those life goals, stretch yourself out – spread the LOVE even farther. What can you do to give back to the community, to your church, to your value system? When you start to think in terms of others and what life impact you can have on them, your own troubles start to disappear.