October Newsletter Finance Tip

In his April 2004 Conference talk entitled Earthly Debts, Heavenly Debts Elder Joseph B. Wirthlin outlines five key steps to financial freedom. This month we’ll look at:

· First, pay your tithing.

· Second, spend less than you earn.

· Third, learn to save.

· Fourth, honor your financial obligations.

· Fifth, teach your children to follow your example.

Spending less than you earn may sound like a no brainer, but in order to do that you have to have a budget. Knowing what comes in and goes out is crucial. Throw in the fact that almost anything can be bought on credit and things get a little tricky. When you buy anything on credit, you are spending money that is not there. Some people think they can keep spending as long as they can make the payments. This is disaster in the making. Taking advantage of “introductory offers” or “no interest until 20xx” may sound like good deals at the time, but you never know what the future holds. Church leaders have pleaded with us to stay out of debt for good reason. Many honest people have found themselves in financial trouble because of unforeseen shortfalls, medical emergencies, and a myriad of other variables. Debt puts us into bondage and can be an unforgiving taskmaster. Whenever possible the wisest move is this: if the money isn’t there, don’t spend it!

October Newsletter Scripture

Conference

What a blessing to have both General Conference and Regional Conference this month. We have a wonderful opportunity to hear what the Lord wants us to learn, directly from his chosen servants. Let’s make it a month of spiritual feasting as we prayerfully prepare for and listen to the Lord’s council.

“What I the Lord have spoken, I have spoken . . . whether by mine own voice or by the voice of my servants, it is the same.” -- D&C 1:38

Supplemental Income

In these tough economic times, we might just need a little extra income to pay the bills and to get or stay out of debt. Or you might need extra income to build up your emergency fund or pay for upcoming Christmas expenditures. No matter your reason, a small supplemental income can really make a difference.

Every family and individual is different; everyone has different needs, talents and abilities. The key to finding a supplemental income that works for you is to start by listing your needs and your strengths. What amount of income do you need? What kind of time commitment and hours can you allocate? Do you have to work out of your home or do you have flexibility to work at a business?

In listing your strengths and talents, consider what interests you. What are your hobbies? Do you have any unique skills that you can market? You will be more successful in earning a supplemental income if it is something you enjoy as well as something that you are good at. Get creative and involve the whole family!

Be cautious in considering work from home jobs. Do your research to make sure that what you decide on is legitimate and will work for the needs of your family. The Better Business Bureau and online forums can be of assistance. Any job that requires you to pay money to start is most likely not legitimate (with the exception of some home sales businesses that require you to purchase product or demonstration supplies).

Some ideas include:
• Sales – home shows, [Tupperware, Mary Kay, Pampered Chef, etc]
• Seasonal jobs – many retail stores and restaurants are hiring for the Christmas season and sometimes seasonal jobs can become more permanent
• Deliver newspapers or phonebooks
• Write freelance articles for local papers or online forums
• Keep a blog or website (earn income from advertising on the website)
• Create unique items to sell at farmers markets, craft fairs or online stores like ebay or etsy (Use those awesome crafting skills!)
• Sell your skills - music lessons, tutor, photography, handyman, electrician, face painting, balloon tying, catering, sewing/alterations, etc
• Sell plasma
• Substitute teach
• Clean homes or small businesses
• Be a companion for the elderly – cook, clean, etc
• Sell your stuff – your junk is someone else’s treasure
• Start a childcare or preschool from your home

Gratitude for What We Have

In speaking of the miracle of the loaves and fishes, President Thomas S. Monson said in October’s General Conference: “Notice that the Savior gave thanks for what they had—and a miracle followed: ‘And they did all eat, and were filled: and they took up of the broken meat that was left seven baskets full.’ (Matthew 15:32-38) We have all experienced times when our focus is on what we lack rather than on our blessings. Said the Greek philosopher Epictetus, ‘He is a wise man who does not grieve for the things which he has not, but rejoices for those which he has.’”
(The Divine Gift of Gratitude, October 2010 General Conference)

Let us be grateful for what we have been blessed with, instead of focusing on what we lack. We will be blessed as we acknowledge and express that gratitude to our Heavenly Father.

’Tis Almost the Season!

The holidays are now upon us. What a fun and exciting time of year. Above all, there is the lingering question: How do we keep the true spirit of Christmas front and center in our families amidst all the hustle and bustle? For many, the pressure of finances can get in the way of feeling the spirit of Christmas. Here are a few tips that might help in your efforts to be a wise steward during the holidays:

#1 Agree on a budget. If you haven’t already, decide now how much you are going to spend on gifts, decorations, food, etc. Now for the hard part: STICK TO IT! If it’s not in the budget, do without. If you feel like it’s important, write it down so you can budget for it next year.

#2 Don’t go into debt. We’ve been counseled again and again not to go into debt for things we don’t need. A wise steward plans ahead. Saving money beforehand gives you freedom and peace of mind. If you didn’t save up this year, make it a priority for next year.

#3 Get the family involved. Especially in lean years it’s important to keep the whole family appropriately involved. Young members of the family can learn valuable lessons about service and frugality. They also might surprise you with innovative ideas to save money. Above all, it’s a great way to bring a family closer together when you are all working toward a common goal.

#4 Start Now! Now is the time to put plans into action. If cutting back on what you spend on gifts is in your plan, start now to prepare for creative ways to get into the spirit of giving. Homemade gifts, gifts of service, even letters of kind thoughts, these can be more memorable and meaningful than a toy or a sweater.

The following is a quote by Pres. Thomas S. Monson from his Christmas devotional message from December 2003: “There is no better time than now, this very Christmas season, for all of us to rededicate ourselves to the principles taught by Jesus the Christ. It is the time to love the Lord our God with all our heart and our neighbors as ourselves. It is well to remember that he who gives money gives much, he who gives time gives more, but he who gives of himself gives all.”

If you have money to give, Great! If you have time to give, Even Better! To give of ourselves is our goal and the surest way to keep the principles Christ taught in our homes during this wonderful time of year.

Question and Answer Competition!

We are going to feature a Question and Answer section in future newsletters that addresses the topics that most concern you. Therefore, we need you all to submit your financial questions to us by comment, email, phone or even a note. If your question is chosen to be featured in an upcoming newsletter, you will receive a small prize. Start thinking and submitting – the next newsletter will be coming out in January 2010!

Teaching Children – The Value of Money

Teaching children about money should be high on our list of priorities. The One for the Money pamphlet produced by the church has 12 points to guide us in properly managing family finances. Three of those points address the need to involve and teach the family members about finances. Family Home Evening is a great place to teach and discuss these important topics, but even more influential is your example and day to day discussions with your children.

Your interactions about finances with your children will depend on their age, abilities and comprehension. For example, with a two year old, the ‘discussion’ might include “Money goes in the piggy bank, not your mouth.” They can really enjoy the fun of putting coins in a money bank and it is teaching them to save from a very young age. A discussion with a teenager would be drastically different. For example, talk with them about whether they paid their tithing and ask what it is they are saving their money for, both short-term and long-term goals – clothing, a date, a car, college, mission, etc.

Kids also love spending money. Allow them the opportunity to give money to the cashier when purchasing something small, particularly when it will be something for them. Older children can count out the money and be responsible for that. Not only is it fun for them, they are learning that we don’t get something for nothing.

It is important that children learn the value of money. It will give them a foundation for making wise decisions on how to spend (or save) their money. Young children often don’t understand what items are worth, so telling them that a dollar will buy a candy bar, or rent a movie will help them put it into perspective. Another way to teach the value of money is to explain how long a parent needs to work to earn the money to buy a certain item. Encourage play around money – for example, set up a play store or a pretend garage sale.

Involve your children in your grocery shopping, gift shopping, etc. They will learn very quickly about the value of money. When a child asks for something, it could be the perfect opportunity to talk about how much things cost. Don’t hesitate to let them know if it costs too much, or it isn’t worth the price. Also, encourage them to save for something they really want. Children will learn more from being told no and waiting for their wants than being indulged at the moment.

Christmas Already?

It may only be September, but December comes quickly, and so does Christmas! It seems crazy, but it is never too early to start planning and saving for Christmas. Now is a good time to start discussing your Christmas budget. Decide now, before the Christmas wish list starts, what you will spend per person for Christmas. And stick to it! Don’t get tricked into increasing your budget because a certain person wants something that exceeds your budget. They can keep dreaming . . . or better, yet . . . teach them to start saving for their dream.

In your Christmas budget planning, decide whether you can afford your Christmas budget. If the money isn’t there and won’t be by Christmas time, get a little more creative with your gifts and spend less. It doesn’t benefit anyone by going into debt for Christmas.

Just to look at some numbers . . .

If you were to spend $500 for Christmas and put it all on your credit card at 13% interest, it would take you 42 months to pay it off with a minimum payment of $15 a month! Or, say you wanted to pay it off in just one year, your monthly payment would be $44.18. You don’t want to be paying for last year’s Christmas when it is time to start thinking about this year’s Christmas. Wouldn’t you be better off to have a light Christmas this year and start saving that $45 a month for next year?

A few other helpful Christmas tips:

Keep your eyes open for sales, clearance items and great deals all throughout the year. If you know the people you are buying for, you can sometimes get great deals long before you think about Christmas. Be cautious though, no matter how good a deal it is, if they aren’t going to like it [or it is a fad that will go out of style], it isn’t worth it. Always keep your receipts and don’t forget what you bought and where you hid it.

Get creative in your giving. Homemade gifts are generally cheaper to give and have a lot more meaning. Gifts of service are sometimes the most valued gifts. It truly is the thought (and time) that counts, not the money.

Make a list of who you really want to give to. It may be nice to give gifts to all your family, friends and neighbors but, is it necessary and can you afford it? Maybe a simple handmade note or card would be enough to tell them that you are thinking of them and care about them. If you were to ask them, they would probably say they would rather you be in a healthier financial situation than to receive a gift from you.

Emergency Fund

Experts recommend having three to sixth months of expenses saved in an accessible account for those inevitable emergencies that arise in life. Those ‘rainy days’ come in the form of unemployment, medical emergencies, car accidents and loss of vehicles, the demise of an appliance, etc. Sometimes it doesn’t just rain, it pours! How is your ‘rainy day’ fund doing? If saving three to sixth months of expenses seems beyond your current abilities – start somewhere. Make it your goal to have $1000 put away for an emergency – and remember it is only for true emergencies – not Christmas, birthdays, clothes, or whatever your current need or want is.

When that emergency happens, and you do have to use some of your ‘rainy day’ fund, it will be a blessing. You won’t have to use credit to fund your emergency and you will have more peace in your lives knowing that you can weather the storm. Think of it as your financial food storage and don’t forget to replenish it after use. Come up with a plan of how to save and build your fund (budgets are great tools for this) and DO IT.

A family in the ward recently experienced the blessings of having an emergency fund and being prepared for the future:

Several years ago we started a dedicated savings (emergency fund) by adding some tax money here, a bonus there, and $10/ month. When we paid off a bill, we increased the amount we saved each month.

Our family van died on a Friday. We had no money for payments on a used one. Since we had our emergency fund and had saved a little of our tax return for a shed, we knew we had a certain amount of money we could spend for a used van. It wasn’t much, so we took it to the Lord. We told the Lord we needed a safe vehicle and didn’t want to go into debt. We told the Lord the amount of money we had and asked him to guide us to find something reliable. We fasted on Sunday and by Monday we had a van. Between the van, inspection and licensing, it was the amount we told the Lord we had available. Because of our emergency fund, prayers and miracles, we were back on the road in 5 days.