Financial Managment

Dear Jack,

I’ve already written several times on the importance of money management (namely that we’re truly managers, and not owners).  Now I want to share with you some ways that Lydia and I have utilized this mindset in our financial lives. Specifically, I’m going to mention some points of how we work our budget.

We use a semi-cash only budget approach.  I say semi, because some households use an all-cash budget system, which is a bit too impractical (and unsafe) for my liking.  So, we use cash for certain budget line items.  Entertainment/dining is one category for us – so anything that we would use for “fun,” such as movies, coffee shops, golfing, going out to eat, out for drinks, etc.  We withdrawal $100 in the beginning of each month, put it into a white envelope, and use it till its gone.  I’m not sure how far $100 will go when you read this, but even now, it doesn’t go far.  We live pretty tightly in this regard.  If we run out of entertainment money before the end of the month, then we don’t go out and spend money.  It’s that simple.

The other cash line item we use is for groceries.  Lydia does a tremendous job with this – and we use the money that she earns from cleaning with her mom for this item.  Again, not sure what inflation will do with this amount, but we currently allocate $270/month for groceries, and this figure includes toiletries (which are just too hard to itemize since the food and toiletries are all bought at the same store).  And we don’t go hungry – Lydia does an amazing job with the food she purchases.  Coupon clipping is a weekly habit of hers, and shopping for deals has become second nature.

Why do we make sacrifices in this area?  It’s not because we’re in poverty (for this year I’ll earn just a little the national household average, and Lydia is working usually 5-6 days per month).  It’s because we made a commitment to leave beneath our means, and to give a standard amount away to the Kingdom of God.  And we’re not budging on either of these promises.  So we make cuts where we need to, and we make do.  We don’t have a full cable tv package, because we don’t need one.  We don’t have fancy TV’s because we don’t need them.  I’m not telling you this to brag either – in fact, I’m pretty timid in disclosing the information.  Rather I tell you because I want you to know that it can be done.  When Lydia and I became unexpectedly expecting, we made some tough lifestyle choices that a lot of people, even in our church, said wouldn’t be possible, so that Lydia would not have to work full time.  It is possible, and I encourage you too, Jack, to make tough financial and lifestyle decisions to honor the Lord God with your money, no matter the actual amount of it.  I feel fairly confident we can stand before Jesus and tell him we did our best in managing the money he entrusted to us, and I hope you can do that as well.  Till next time, Jack.



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