September 2012 Wise Stewards Finance Tip

Wise Stewards Finance Tip Series 2, Article 5

“U S E   A   B U D G ET.   Every family must have a predetermined understanding of how

much money will be available each month and the amount to be spent in each category of the family budget. Checkbooks facilitate family cash management and record-keeping. Carefully record

each check when written and balance the checkbook with the monthly bank statement. Save and invest a specific percentage of your income. Liquid savings available for emergencies should be sufficient to cover at least three months of all essential family obligations. Every LDS family should file honest and timely tax returns. ” 

–from Elder Marvin J. Ashton’s One for the Money Guide to Family Finance 

It is essential to have a functioning budge and to know how much money goes in and out each month.  One thing that makes it harder to keep track is the use of debit cards.  Most of us no longer write checks every time we purchase something.  Swiping a card is so much easier, but it also makes spending money easier-and recordkeeping easier to forget.  Don’t forget to track all of your purchases.  Always review bank statements and reconcile your spending.  You don’t have to budget for an entire month, but do budget for a specific time period.  It is helpful to have this match your pay period whether that is monthly, bi-weekly, weekly, etc.  All these tips are meant to keep us out of pitfalls like the one in this quote from Elder Ashton: “Please listen carefully to this—and if it makes some of you feel uncomfortable, it is on purpose: Latter-day Saints who ignore or avoid their creditors are entitled to feel the inner frustrations that such conduct merits, and they are not living as Latter-day Saints should! Bankruptcy should be avoided, except only under the most unique and irreversible circumstances, and then utilized only after prayerful thought and thorough legal and financial consultation.”

February Wise Stewards Finance Tip

February has come and the Christmas decorations are packed away (hopefully). You might still be keeping some of your New Year’s resolutions, and you may already be eyeing a certain box of chocolate for that special someone, but do you have your taxes done? Taxes aren’t due until April 17^th, but that doesn’t mean you can’t get them done early. If you do your taxes yourself there are some great ways to save time and money. Before you go out and buy an at home tax program for your computer, check out the IRS website. Go to www.irs.gov and click on the “Free File” icon. If you made under $57,000 last year you can use software programs by some of the same companies that sell them in the store, for free. E-filing is free for anyone regardless of how much you made, and you can find online tax forms at the IRS website as well.

Now that I’ve put a bug in your ear about taxes, let’s get down to the really important stuff. Have you picked out a Valentine’s present yet? How about a plan to get out of debt?! It may not be easy to gift wrap, but it could have a more positive effect on a relationship than a stuffed toy or some perfume. Whether you’re married or single, having a solid financial plan is beneficial to anyone. Being in good financial standing when you’re single is tough, but doable. Staying in good financial standing after you’re married should be just as important a goal. In Elder Marvin J. Ashton’s Guide to Family Finances, Elder Ashton quotes, “The American Bar Association has indicated that 89 percent of all divorces can be traced to quarrels and accusations over money. Others have estimated that 75 percent of all divorces result from clashes over finances.” Having good communication and positive goals is essential to a good marriage, but this is especially true regarding your family finances. So if you are married and a financial plan isn’t a romantic enough Valentine’s present for you to give, go ahead & wrap it up with some candy hearts. I bet they’ll both be appreciated.

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!

You Have the Choice: Your Path to Financial Freedom

In General Conference of October 2010, President Monson spoke to the brethren about The Three R’s of Choice. Wise council from a prophet can be applied to all areas of our lives and to all who are willing to listen. President Monson referred to Alice in Wonderland where Alice asks the Cheshire cat, “Which path shall I follow?” The cat answers, “That depends where you want to go. If you do not know where you want to go, it doesn’t matter which path you take.” President Monson comments, “Unlike Alice, we all know where we want to go, and it does matter which way we go, for by choosing our path, we choose our destination. Decisions are constantly before us. To make them wisely, courage is needed – the courage to say no, the courage to say yes.”

We all want to reach a destination of financial freedom where we no longer have to worry about money and where money, or the lack of, is not the dominating force in all of our decisions. In order to do that we have to set realistic goals and have the courage to say no, or yes, to those important decisions in how we manage our resources. President Monson reminds us that “Each of us has come to this earth with all the tools necessary to make correct choices. The prophet Mormon tells us, ‘The Spirit of Christ is given to every man, that he may know good from evil.’ ” We have all the resources we need to be able to make correct choices. We have access to the Spirit. As we are righteous, obedient and prayerful,the Lord will guide us in the paths that we should take – and that includes the path to financial freedom.

With that in mind, and the beginning of the New Year, it’s a good time to assess your financial health and set or re-evaluate your financial goals. Remember how important it is to make specific and realistic goals, both short term and long term. One of your goals may be to have the funds for a family vacation, but if you don’t have an emergency fund or are struggling to pay the monthly bills, a more realistic goal may be to build up your $1000 emergency fund. So, here’s a brief summary of some steps that you can take on your path to financial freedom.

• Pay Your Tithing
• Create a Budget: Stick to it and Review it
• $1000 Emergency Fund
• Get out of Debt!
• Expand Your Emergency Fund (3-6 months living expenses)
• Fund Your Retirement
• Prepare for Upcoming Events (car, mission, college)
• Save for Your Dreams

Also keep in mind that financial goals should be set as couples and as a family. Everyone that contributes to the decision making can also contribute to the decision keeping, so involve all members of the family that are mature enough to contribute. Having the support of our families and the Lord by involving them in our decisions will help us on our path to financial freedom.

’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.