When it comes to personal finance, it's easy to get caught up in the minutiae of tracking every penny and managing day-to-day expenses. However, without a clear sense of direction, budgeting can feel like a tedious chore rather than a tool for achieving your dreams. That's why it's crucial to begin with the end in mind. This approach not only makes budgeting more meaningful but also ensures that your spending aligns with your values and priorities.
The Power of Dreaming At the heart of beginning with the end in mind is the concept of dreaming. What do you envision for your future? Do you dream of traveling the world, owning a home, starting a business, or simply achieving financial independence? These dreams provide a roadmap for your financial journey. By identifying your long-term goals, you can create a spending plan that supports and propels you toward those aspirations. Aligning Spending with Values Once you've identified your dreams, it's time to dig deeper into your values. What truly matters to you? Is it security, freedom, family, adventure, or personal growth? Understanding your core values helps you prioritize your spending in a way that brings you closer to your goals and increases your overall satisfaction with how you manage your money. But how do you discover what your values truly are? Here are a few steps to get started: 1. Reflect on Past Experiences: Think about times when you felt happiest and most fulfilled. What were you doing? Who were you with? These moments can provide clues about your core values. 2. Identify Non-Negotiables: Consider the aspects of your life that you are unwilling to compromise on. These are often closely tied to your values. 3. Set Priorities: Make a list of what is most important to you in different areas of your life, such as relationships, career, health, and personal growth. This will help you see where your values lie. Tools to Keep You on Track: YNAB One of the best tools to ensure your spending aligns with your values and priorities is You Need a Budget (YNAB). YNAB is more than just a budgeting app; it's a methodology that helps you take control of your money and make intentional spending decisions. YNAB operates on four key principles: 1. Give Every Dollar a Job: This principle encourages you to allocate every dollar you earn to a specific purpose, ensuring your money is working towards your goals. 2. Embrace Your True Expenses: YNAB helps you plan for irregular expenses by breaking them down into manageable monthly amounts. 3. Roll with the Punches: Life is unpredictable, and YNAB teaches you to adjust your budget as needed without feeling like you've failed. 4. Age Your Money: By living on last month's income, you can break the paycheck-to-paycheck cycle and gain more financial stability. Falling in Love with How You Spend Your Money Ultimately, the goal of budgeting is to fall in love with how you spend your money. When your spending aligns with your values and priorities, every dollar spent brings you closer to your dreams and enhances your sense of fulfillment. By beginning with the end in mind, you transform budgeting from a mundane task into a powerful tool for living a life that truly reflects what matters most to you. Conclusion Starting with the end in mind is not just a strategy for budgeting—it's a mindset shift that can transform your entire approach to money management. By dreaming big, identifying your values, and using tools like YNAB to stay on track, you can create a spending plan that not only supports your goals but also brings joy and satisfaction to your financial journey. Remember, the key is to fall in love with how you spend your money and make every dollar count towards a life you love.
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We Did a Thing! At the end of May, we made a long-time dream come true. For years, I've been wanting to take my kids to see the majestic Redwoods. Yet, it never seemed to become a top priority. Other opportunities and priorities for our time and money always seemed to get in the way. But earlier this year, I had an epiphany: this HAD to be the year and the last week of May HAD to be the time. Why the urgency? Our family is rapidly growing and changing. My oldest will soon be moving into her first apartment (it's in our basement, but it's still a significant change). Our second just graduated from high school and is heading into new and time-consuming adventures in the fall. Our youngest will be starting high school. And my husband, though retired from his former company, is exploring new fulfilling work opportunities outside the home. This was our window, and I knew we had to seize it. We had some money in our YNAB budget set aside for vacations. So, one afternoon in the midst of our crazy May, my husband and I did some research and decided that driving the 870 miles and camping would be the most affordable option. We booked the campsite and told our kids to request time off work. We were all super excited for this adventure, even our daughter who has an aversion to bugs and dirt! The weeks leading up to the trip were packed with end-of-school-year events, finals, graduations, and navigating semi-retired life. It was a busy and stressful time, but whenever one of us mentioned the trip, we all got a hopeful look of excitement, knowing that soon we'd be relaxing in the beautiful surroundings of the Redwoods. Folks, we were NOT disappointed! It was a dream vacation. With minimal phone reception, we had the chance to truly explore and enjoy the area and reconnect with each other without the distraction of devices. We enjoyed some amazing hikes, great food, and the peace and quiet that the area offered. We even drove our SUV through a tree! The morning we packed up to leave, I got a little teary-eyed. This was probably the last vacation we would have like this with our family as it is now. I didn't want to leave. If you know me, hearing me say I didn't want to leave CAMPING is saying something. The word that keeps coming to mind when I think of this trip is "sacred." The place, the time, the entire experience felt sacred.
So why am I sharing this with you? Many money gurus would criticize our choice to take this trip. We don't currently have a steady family income coming in. That week was the last week we had medical insurance coverage. We don't have a solid plan yet for replacing the steady income we've enjoyed for the last 21 years. To take that time and spend that money could be seen as reckless by many financial experts. We should be saving that money. We should be using our time to find steady income. We should have our priorities aligned with what they view as important for financial success. Nope! The best way to find true financial freedom is to ensure your spending aligns with your own priorities and values. We value our family time, so that's where we want our money to go – spending time with family. Now, I'm not advocating for the "I value a trip to Italy with my family, so I'm going to go into more debt to pay for it" philosophy. It's still crucial to avoid debt for many reasons, especially because it doesn't add to your financial freedom; it adds to your slavery. So, if it's something you truly value, save up the money, find ways to make it more affordable, and do the thing! Taking this trip was a priority for us, and it was worth every penny. It reinforced what we value most: our time together. So, as you plan your finances, remember to prioritize what truly matters to you. Spend intentionally, and you'll find both joy and financial freedom. For the past 21 years, my husband, Lance, has been dedicated to the same company. He started at the ground level as a contract equipment installer, and when he left, he held the position of Chief Relationship Officer. With 23.5 years of marriage under our belts, Lance's departure from the company marks a significant change for our family.
We've always known the possibility of job loss or change could happen, and have worked over the years to be prepared for that possibility. As Lance began more seriously contemplating leaving, we understood the importance of preparing ourselves for this major life transition. Big life changes—whether it's marriage, welcoming a new baby, switching careers, going through a divorce, or retiring—require careful financial planning. Here are some steps we took to prepare ourselves financially for this significant shift:
As I write this, it's only been a week since Lance bid farewell to his office and drove his final commute home. Already, the transformation is evident—he's less stressed, happier, and brimming with excitement for our future. While uncertainties still loom, we're eagerly embracing the next chapter of our lives. Our years of financial planning have laid a solid foundation, and we're ready to navigate whatever comes our way. Gone are the days of puzzling over YNAB's target types! For years, we've all asked ourselves. Which target type for what expense? How to adjust for more funds? How to tailor targets so it does what I expect it to do? Now, YNAB simplifies targets. Whether you are online or mobile, just specify frequency, amount, due date, and action for the next interval. Easy, isn't it? If you haven't seen it yet, anticipate it in your budget soon! Gone are the days of puzzling over YNAB's target types! For years, they've left users scratching their heads. Which one for what expense? How to adjust for more funds? How to tailor targets? Now, YNAB simplifies targets. Just specify frequency, amount, timing, and action for the next interval. Easy, isn't it? If you haven't seen it yet, anticipate it in your budget soon! Do you want to meet to go over your targets and learn the new way of doing things? Let's set up a time to chat! Do you want to learn more about targets on your own? Check out YNAB's how-to!
While we're not typically big spenders, the no-spend month prompted us to rethink our purchases, emphasizing intentionality over impulse buys. Date Nights Initially, our date nights were more creative and elaborate, filled with planning, shopping (for a few fresh ingredients) and cooking together. I even made the table look a little more special than usual. However, as the month progressed, we found joy in simpler pleasures like homemade popcorn and ice cream. That counts as dinner, right? Family Vacation Despite the no-spend commitment, we still enjoyed our pre-planned family Christmas vacation. It had been planned and mostly paid for months earlier. Tangent: We decided as a family a few years ago to buy less Christmas gifts and spend most of our Christmas budget on a family trip instead. Opting for quality time instead of quantity of gifts has been a nice change. Tangent over. We opted for snacks and cold cereal from the grocery store rather than eating out every meal. We chose free activities in the area and the only souvenirs we brought home were some dirt, pictures and fun memories. Kids' Perspective
When I asked my kids about the no-spend month, they expressed that it didn't feel significantly different for them. It seems they've grown accustomed to adhering to our spending plan and hearing, "not right now." Husband's Reflection My husband, who was the instigator of this little experiment had this to say, “I found myself holding back on what would otherwise be impulsive buys. It made me think about what I really needed vs wanted.” He held off on buying some high-priced tools he really wanted, but knew it wasn't the priority (I'm sure they will make their way into his shop eventually). Conclusion Reflecting on our experience, a no-spend month proved valuable in realigning our spending with our values. It's a chance to assess priorities and ensure our financial decisions enhance our lives in meaningful ways. A lot of the stress people experience with regard to finances is due to the misalignment between our spending and our values. Are we really spending with intention on those things which will enhance and improve our lives; or are we spending on things that will give us a quick thrill, but don't add much value? We plan to try this again. What are your thoughts? Would you consider embarking on a no-spend month with us the next time we give it a go? |
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