Sunday, April 29, 2012


Well, friends, here it is—the how to make a budget post! Granted, there are countless ways out there to make a budget; this is just what has worked wonderfully for Corey and I. I’m going to try to make it as simple and user-friendly as I can, but if you have any questions don’t hesitate to ask!

First, remember my “get organized” post where I told you to list how much money you make as well as all your monthly expenses? Well, there was a reason. It will be absolutely key in creating your budget. If you haven’t done it yet, I strongly suggest doing it now. And if you have, awesome! Get it out! J

Now, as a warning, the first time you create a budget will without a doubt be the most difficult. You’ll probably want to throw things. You’ll probably wish you had more money. You’ll probably feel completely broke in the end. Keep in mind that it does get easier and that those feelings will go away the more you stick to the budget!

Next task—come up with a system. In my post on Friday, I posted a picture of the columnar pad I use to create our budget. Personally, I like being able to write it down, check it off, and carry it with me easily if necessary. However, if you prefer using Excel, or anything more high-tech, that’s fine. And, before I found my lovely columnar pad, I used a plain old notebook and that worked like a gem too. You don’t have to be picky—whatever works for you! I would suggest though to use something with lines, just to avoid confusion.

So, before we go any further, I’ve posted a picture of a sample budget. And, as a disclosure, this is very much not what our budget looks like—I threw this together quick just to use as a reference (sorry, I didn’t really feel comfortable broadcasting our actual dollar figures here—maybe someday!). After I finished, I realized the pretend owners of this pretend budget have way fewer bills than I do and way way more savings! Sorry about that! But anyway, here you are:

This wasn't so tiny on my picasa account...hmmm...

Maybe a bit better, but still kinda small...

I'm going to suggest that if you can't see it in the above pics (which, does not surprise me at all), to look at it through this link (that I realllly hope works!):

Clear as mud, right? Let’s walk through it.

At the very top you’ll see “Allocated Spending Plan.” This is also known as budget. I get the fancy “allocated spending plan” term from the Dave Ramsey class. He has you separate like this too, only his is a LOT more detailed. Maybe the greater detail will work better for you—and again, I would encourage you to take Dave Ramsey’s class. Dave’s class will also tell you recommended percentages for each category. Why don’t I use this? Well, our debit is way above the recommended percentages, and some of our items cannot practically stay within the guidelines. As an example, our utilities are always extraordinarily high in the winter, but in the summer it’s much closer. Another reason is that since I don’t use the broken down version, it makes it less practical to keep Dave’s guidelines. For us, it seemed a bit more realistic based on the way we live to do it this way. When we first started Dave’s class, we did use the percentages though. Also, Dave will teach you to use cash for certain items on your list. For instance, on my list you’ll see the “Food/Misc.” category. This is one of the areas I lump a LOT of things together. This is pretty much my all other expense except monthly bills money. Dave would say that’s a no-no and to use cash for Food and many of the other things I lump into that Misc. Personally, I’ve found that if I have cash, I spend it. Period. I look at it as “I have this money, so I can spend it,” and therefore do. Many people, as you learn from Dave Ramsey, spend less when dealing with cash because they can actually feel the pain of spending and see the money disappear. And if that’s the way you are, by all means use cash! As I’ve said before, I’m just sharing what’s worked for us. Anyway, I’ll say more about the “Food/Misc.” category later in this post and this tangent has lasted long enough!

The dates are the next part of the budget. May happens to be a nifty month that falls into the four Fridays category, making the budget make the most sense. However, depending on the day you choose to use as your “bill day,” this will be adjusted. Say, for instance, Thursday is your bill day. Your dates would technically be May 3rd, 2012-May 31st, 2012, and thus you’ll end up with 5 weeks. If you find it easier to just add an extra week to your budget, feel free to do so. Corey and I do it a bit differently though—I always use four weeks. So, to use the Thursdays in May as an example, my budget would have May 3rd, 2012-May 24th, 2012. Then, my next budget would end up being May 31st, 2012-June 21st, 2012 and so on. The biggest reason I do this is because I actually end up paying bills ahead, which ultimately ends up as more money! J YAY!!!

Item and Incomes are just labels—hopefully those make sense to you. The dates at the top are each week’s bill day broken down. Again, hopefully that makes sense. As I’ve said, feel free to ask questions if not!

And now we’re getting into the fun part! J First, list your incomes below the “incomes” title. Remember that this is actual take home pay, not pre-tax or anything like that. Your numbers will most likely not be as clear cut as my sample numbers, and that’s 100% okay. One thing that I’ve found useful when doing this is rounding. If on a typical week I make, say $392.54, I would bump this down to $390. That would leave the $2.54 as “extra” money, so to speak. Also, if your pay isn’t regular, I would strongly encourage you to use the low end of what you would make. When I worked at the bank, it would all depend on how many hours I was scheduled, so I always went with the low end. Say I had the potential to get a $500 check at the end of two weeks, but I also could make as little as $300. I would use $300. This gives me a nice chunk of “extra” if I do make the big bucks, but doesn’t cause a problem if I don’t. Which, speaking of—Corey and I both get paid weekly at our current jobs, but if you get paid biweekly, or even monthly, this will change your allocated income. Say you would get paid on the 11th and 25th—that’s fine. Put those as your pay dates and then pay your bills those weeks. It’s the same process. If any of you need me to walk you through this more, feel free to tell me! Message me on Facebook, leave a comment here, or whatever works. I’d be happy to create a sample budget based on your schedule if that’ll make it make more sense! Once you have your incomes all entered in, total them for each week, and in the “total” column at the end.

Expenses. Yikes. This is where it gets nice and sticky! First, list out your expenses. I’m going to go through my sample list to hopefully make it a bit more clear:

1.)  Tithing. Never will I tell you that you must tithe. Do what you feel God is calling you to do. I used the standard 10% when computing this, just for simplicity’s sake. Don’t feel as if you must follow—give more, give less, don’t give (though I lean more to the first two, I don’t want anyone to ever feel obligated to give to church… but I’m not going to start a sermon, so that’s it!)

2.)  Savings 1. This doesn’t necessarily have to be a standard savings account. On Corey and I’s budget, this is the savings account we have linked to our checking account. We put a good portion of Corey’s check there automatically every paycheck with the goal of putting it aside so we don’t spend it. We figure if it doesn’t ever hit our checking, it has a good chance of not getting sent out. Also, we’re working on paying off debt right now, so about once or twice a month I’ll move a big chunk of what has went into this account to put towards Mr. Credit Card. If you have something like this, cool! If not, that’s fine too. None of these items must be on your budget.

3.)  Savings 2. I added this again simply because it’s on our budget. Every week we put a small (much smaller than what the crazy people who own my sample budget do!) portion of our money towards an account for Tate. Our intention for this account is to use it if ever an expense comes up for him that isn’t covered by our normal finances, not for him to just have money socked away. If we get through his growing up years without using it all, we’ll give it to him someday (maybe when he gets married?). I eventually plan to post something about how to help children handle finances, where I’m sure I’ll go more in depth about what we plan to do with Tate, but part of this plan is that when he is old enough open up his own account that the birthday money, odd job money, etc. would get put into.

4.)  Emergency Fund. In Dave Ramsey’s plan, your emergency fund is Baby Step 1. $1000 in the bank. Corey had a savings account at a bank in Defiance before we got married that we’ve allowed to act as our emergency fund. The bank doesn’t have a branch in Bryan, so it makes access a little bit more difficult than our standard checking and savings. We have a small dollar amount automatically going to this account each week (not part of Dave’s plan, but since it’s a small amount, it makes me feel comforted and we don’t miss it!).

5.)  Mortgage. For some of you this will be rent. I don’t think I need to explain that aspect. However, a couple things. First, notice that in my sample budget this is listed the week of the 25th. I did this assuming your rent would be due on the 1st. If you haven’t paid May’s rent yet, make sure you don’t miss it! Also, I would like to add that for Corey and I our home insurance and property tax is included in our mortgage. If yours isn’t, you’ll need to add lines for these. Again from Dave, it’s a good idea to make use of a “sinking fund” for items like property tax that come up irregularly, but yet predictably, throughout the year. If you aside so many dollars each week for this, you won’t be surprised and scrambling for the cash when it comes due.

6.)  Utilities. Again, self explanatory. Ours are all on one bill, break yours down if you have things separated.

7.)  Internet. Same as before. Oh, and also—we both are still on our parent’s cell phone plans and have payment worked out without monetary transactions. You’ll need to add that if need be.

8.)  Food/Misc. Ahhh, the fun one! J In an ideal world, I would break this down a bit more. I could list out an allotment for clothing, toiletries, entertainment, clubs, yada, yada, yada. Instead, I add it all in here and keep track of this money in a check register I carry with me everywhere. I refer to this as my “extra money” fund. For this sample person, on May 4th’s bill day I would add $150 to my fund. Then, if I go grocery shopping that evening and spend $80, I would subtract that. I also would add the “extra” money I talked about in the income section. Say I wrote down that I would get paid the $500 in the sample budget, but I made $515. The extra $15 would be moved to the “extra money” fund. If I made less, this would be subtracted. Pretty much, anything not a regular bill gets added or subtracted and anything that is over or short of what I budgeted gets added or subtracted. This might be confusing—let me know. I do intend to go over this more in the future. Also, this money still goes in my regular check register. Yes, it’s a process.

9.)  Car Payment. Joy oh joy.

10.)               Fuel/Car Maintenance. This is also one I do weird, but for simplicity’s sake (and time management), I’ll discuss that in a later blog post. For now, this is where the money you’ll spend each week in gas, oil change, car washes, and the like goes.

11.)               Car Insurance. Ours comes out automatically every month. I know some people pay this annually or semi-annually. If that’s the case for you, this can be another sinking fund.

12.)               Health. It seems like no matter how hard I try, sneaky little medical bills, colds, allergies, or something, always enter my life. This is how I attempt to plan for it. If Tate gets sick and we head to the doctor, the money is there. If I run out of Tylenol and have a major headache, no worries, the money is there. You get the idea.

13.)               Life Insurance. I feel like I’m talking an awfully lot about Dave Ramsey, but he has a lot of great points. Life Insurance is hugely important, especially if you have small children. How will you keep your standard of living if, God forbid, something happened to your significant other? How will you pay for the funeral? I know it’s something horrible to think about, but do it. Dave recommends term life insurance, and it makes so much more sense than anything else out there. And, the younger and healthier you are, the cheaper it is, so do it! Ours is literally $30 bucks a month for peace of mind if anything would happen to either of us,  or, God forbid, both.

14.)               Babysitting. Not all of you would have this, and some of you most definitely do. You may not pay weekly, but again, adjust it as need be.

15.)               Credit Card. BOOOOOOOOOOOO!!!! L

16.)               Same with both student loans—ICKKKKKYYYYY!!!! L

Then, the next step is breaking it down. It will likely be a huge pain in the rear. Don’t be surprised if you mess up, a lot. It’s okay. And don’t expect your first budget to work perfectly as you’re using it either. Next month there’s a high chance you’ll have to adjust. That’s normal, good even! You’re learning! J Here’s a few tips how to make it go a bit easier though:

1.)  Look at due dates. If something is due the 1st of the month, hopefully it’s already paid, so you can put it into the 25th. If not, pay it the 4th, and keep in mind you may need to adjust in the future. If something is due the 15th, be sure to pay it either the 4th or the 11th. And so on…

2.)  Don’t be afraid to partial pay. Say your credit card payment is like the one on the sample budget, $200 a month. If you’re having problems finding a week you can pay that full $200, pay $100 one week and $100 the next. The credit card company (or any other) won’t care—they just want their money. Keep in mind the due dates though, and do your best not to be late!

3.)  Don’t shortchange yourself. Gas is an easy one to do this on. If you typically spend $100/week on gas, but last week you only spent $80, don’t take that to mean you can change your budget to $80. Keep it at the $100. It’s better to have it and not need it then to be short and have to find out where to take it from.

4.)  Prioritize. Some of you may have more expenses than income. If that’s your case, remember that having a roof over your head, a warm temperature, and food to eat are your priorities. You’ll also need a way to get to work. Continue to prioritize like that, and look for areas where you may be able to cut back.

5.)  Allocate every cent. You want your balance at the end to be zero. Tell your money where to go. Don’t think, oh, I’ll just keep aside $50 to add wherever I may need it. If that’s the case, put it in your Misc. fund, but don’t completely leave it off the budget.

6.)  Track your expenses. This is a new thing in the Herendeen household, and very much still a work in progress. I created an “expense report” Excel document on our desktop. Every time we spend a single cent it gets entered into our expense report. The expense report is color coded based on what category it falls under (food, home, entertainment, etc.). We do this for a couple of reasons:

a.    It allows us to see where we might be able to cut back. If there’s a lot of yellow, for entertainment, that might mean we need to cool it on the Redbox visits, just to name a possibility.

b.    It makes us think twice about spending something. If I’m in the store and see a snack that looks particularly yummy, it’s so so so so easy to impulse buy. BUT, if I think, is it worth putting it on the expense report? I’m a lot less likely to say no.

c.    It creates accountability. This relates to b, but also is worthy to be on its own. If I know Corey will see my McDonald’s Mocha on the expense report and pick on me for it, there’s a higher chance I’ll keep driving instead of heading through the drive thru.

7.)  Stick with it. I said before it’s not going to be easy. Just keep in mind it’s so worth it in the end!

And that is how you create a budget! YOU DID IT!!! J I truly hope I communicated it well… and once again, don’t be afraid to ask if you have questions. I 150% promise not to judge you… doing this isn’t easy. I understand. I just want to be able to help people avoid the all too easy to find pitfalls of finances!

Saturday, April 28, 2012

Just Gotta Wait

Today's post was prompted because, as much as I hate to do this, I'm going to have to postpone the budget making post. Tate woke up from his nap in a bit of a mood, so I'm not going to have much time to post, and the budget making post is important enough that I need a good chunk of time to dedicate to it. I'm hoping tomorrow will work better to fit it in!

BUT, because it fits so nicely, I couldn't help but post about something else that is very helpful when handling finances-- patience.

In today's society, most people don't know how to wait. I'm no better. It's hard to be patient, postpone things, wait. We live in an instant gratification world. Unfortuntately, the world of finances is one where it is extremely important to know how to wait.

Credit cards, and debt in general, is all about getting it now. Debt is all about I can't afford it now, so I'm going to pay for it later. If you take Dave Ramsey courses, he'll tell you to elimate all debt. No credit cards, no student loans, not even a mortgage. And I will admit it seems like a great idea. I also think that, to an extent, it is realistic. Yet, there is also parts that aren't so realistic. For instance, our house. We had an excellent opportunity to buy our house, and our payments are lower than most people pay for rent. Had we not bought our house since we had to take out a loan, we would be paying more for something that held no value to us long term. While I grasp in many situations it is very good to avoid debt, there are also some that it works out okay, and maybe even for the better. I'll likely go into that more later...

But anyway, back on topic-- it is WAY too easy to swipe a card and get a new outfit, piece of furniture, fancy meal, and the list goes on, instantly. All too often though, what comes next is an outfit you pay for longer than you wear, buyer's remorse, or being even more broke.

Ulitmately, this is what I'm saying-- think before you buy. I'm not going to tell you to never go into debt. But I am going to say think long and hard about if what you want to go into debt for is worth it. Look at the interest rate-- how much will you actually pay for that item if you don't pay off the debt immediately? Is it something you really need or is it something that looks cool now, but really isn't of much value to you? And actually, this policy relates to if you're spending cash too... make sure your purchase is worth it. Don't be afraid to wait a day or so before you buy. It might save you a few dollars and cents! :)

Friday, April 27, 2012

Take the Time

Today is "bill day" in the Herendeen household. Every Friday, I sit down, log into my bank statements (LOVE online banking), make sure everything matches up, and then proceed to go through my budget and pay the bills I have marked for that week. On the Fridays Corey doesn't work, he joins me (which is every other). It's been a pretty good system, except for one problem-- some days I just don't want to take the time.

And well, today is one of those days.

Ever since I got home I've been thinking, man, I should really just go do the bills and get them out of the way. Of course, that thought is followed by something else I can do instead. As this process repeated itself, I realized I had stumbled on the perfect thing to blog about (and, obviously, put off doing bills!).

See, I've said it before-- I love finances and making numbers work. I'm not daunted by the task of going through my check book and paying the bills, I just plain and simple don't want to. It's so much more relaxing to watch TV, play with Tate, or read a book, just to name a few. It doesn't help either that I work with numbers all day. But still, if I love doing finances, how must it be for the people who hate it (or even mildly dislike it)? Eek. I guess that's why there are people out there who never balance their checkbooks or only pay a bill when they start to get collections calls. A part of me understands.

We played so hard, Tate is out cold! Love him so! :)

So, what to do about it?

Well, sadly, the best advice really is to just do it. Take the time. In the end, you'll be glad you did, and chances are it won't be as bad as you felt like it would be.  But here's a few things that I've found to compel me to be a bit more likely to do it:

1.) Schedule a day. As I said, for the Herendeen's, it's Fridays. I personally think it works well because that's pay day, so we know the money is there, and we have the joy of not having to worry about work the next day, so it's kind of like an exclamation point on the end of the work week! :)

2.) Give yourself a reward. Now, I don't mean like a shopping spree or something crazy and expensive. Think simple. Often times I'll tell myself that after I pay my bills and such, I can watch a movie or eat some popcorn. Granted, I am a grown up so I could do that before I pay bills too, obviously, but it helps a bit.

Reading a chapter of Captivating, my all-time favorite book, is my reward tonight!

3.) Do the legwork before. This goes a bit with my previous post. Have everything in one spot-- it'll make things go a lot smoother and faster. Also try to keep your check register updated throughout the week-- when you spend something, write it in! AND take the time to do the math and come up with your new balance. I'll be honest, in the world of online banking, this is probably one of the hardest for me. Why write it in when I can go home and see it online and they'll have my balance added up for me? Why even keep a check register? DO IT. Before my current job, I worked and a bank, and you wouldn't even imagine all the people who have no clue what's in their account. Just because the bank says you have $100 does not mean that's true! There might be a transaction that hasn't processed through the bank yet (not everything is instant!), there might have been an error in what was processed (and, keep in mind, it might not have been because of the bank-- the merchant can make the error too!), and countless other things. By taking the time to keep your balance, you can catch any errors that happen and know what really is in your account.

4.) Make a monthly budget, and break it down week by week. Tomorrow I'm planning on going into this one a bit more. This by far has been HUGE in helping Corey and I financially. It allows us to know what we're spending before we spend it. We know if we have a little extra cash this week or if we're going to have to pull back on a couple of extras. In all honesty, I can't imagine my life without it. I VERY strongly encourage you to do this for yourself. Yes, it takes some time to do in the beginning, but it is oh so very worth it!

5.) Invest in an adding machine (or calculator). I love adding machines. I love that the buttons are more distinct, the numbers are bigger, and I even can have a little receipt that tells me what I put in (very handy when there's a mistake!). I asked for one for Christmas. Yes, Christmas. Don't judge me. It's the best present my brother has ever given me! Anyway, maybe an adding machine isn't your thing, but at least get a real calculator. The touch screens of phones and i-pods and such just don't cut it. Personal opinion.


And lastly...

6.) Don't be too hard on yourself. If you've had a rough day at work, don't force yourself to do your bills. BUT don't allow that to be an excuse to not do it until the next week. There's some days that Friday just doesn't work. We have plans, we're really tired, the list goes on. It can wait. However, if Sunday night comes and we still haven't gotten to it, I know I MUST take the time to do it. Period.

But okay... now that I've procrastinated a bit, it's off to bill land for me! See you tomorrow for MAKING A BUDGET!!! :)

As a preview for tomorrow, this is the notebook I use to create our little budget!

Wednesday, April 25, 2012

Gettin' It Together

I've been debating since I posted yesterday about what I wanted to write about today-- what's worked, what hasn't, first steps, big decisions... the list could go on and on. But then I came to the conclusion that the most important thing anyone can do when working with their finance is get it together.

Get it together. What exactly does that mean? Well, a couple of things:

GET ON THE SAME PAGE. If you're in a serious relationship/engaged/married, figure out what your significant other thinks. To some people, that might be an obvious one, but you'd be surprised at how many people don't know where their partner stands on a whole variety of issues, not just finances. Take the time to have a serious chat. Sure, money should be a part of that chat, but don't feel like that has to be the only thing, or even the main thing, that you talk about.

Corey and I recently tried out an idea that I saw somewhere (I don't remember where; sorry!) that I think would work as a perfect "starting off point" for this. Here's what you do:
  •  Sit down with your (I'm trying to come up with synonyms for partner, significant other, et al, and it's not easy.. when I do, it's just cheesy-- so from here on out I'm going to use husband, since that's what Corey is. Feel free to replace as needed.) husband.
  • Take out a sheet of paper and rip it into ten little pieces. Each of you get five of these little pieces.
  • Now, I'm not going to ask you to go to separate rooms or anything, but completely on your own write down one goal you have for the next ten (or five, fifteen, etc. depending on  your situation) years on each one. Don't try to think to hard-- just the first things that come to your mind. Again, they don't have to all be financial (though, I think you'll find that even the ones that aren't necessarily financial still relate to your finances-- the joys of the world we live in!).
  •  And to be honest, I don't remember what Corey's and I were exactly, because of the next step:
  • Sit back down with your husband and share. It was interesting for me to see how similar Corey's and mine were. If I remember correctly, three were exactly the same: pay off debt, have a baby, and build our dream house. The other two weren't far off from each other, either. Yours might not be that similar, and that's okay. Don't feel like a failure if only one, or even none, match. That's part of figuring out your together dreams.
  • Which is the last step-- combine all of the dreams into a "dream list." Corey and I took it a step further and even created a sort of time line for ours. I'll share:
  1. Pay off credit cards & smaller school loans by Tatum's 3rd Birthday.
    • Ways to achieve:
      • put tax refund to debt.
      • be more careful about spending.
      • limit going out to eat to MAX one time a week.
      • put at least $400 extra a month straight to debt.
  2. Have a baby & Courtney stays at home.
    • This is our reward for completing number one.
  3. At the same time as number two, start a 401(k).
  4. Pay off the rest of our debt except our house.
  5. Build our dream home: Goal Date July of 2022.
Yours might be a lot longer, or shorter. Just be honest with yourself and with each other.

So hopefully you'll find that little exercise useful. And even if not, the whole purpose is to come together. You might even be in a relationship where you don't talk about finances with each other-- please change that! DO IT! Be open about where you struggle and what you're good at.

And another (quick?) note-- the financial class we took (Dave Ramsey's Financial Peace University-- it was brought to my attention that I failed to mention that earlier, and yes, I would recommend it) explains how there's a "nerd" and a "free-spirit" in every relationship. Typically one of you will be more apt to work at the finances than the other. In my relationship, I'm the nerd and Corey's the free spirit. I'm all about crunching numbers, making spreadsheets, and organizing our financial (and every other aspect) life. Corey, on the other hand, is perfectly content with being clueless about it as long as he gets a few bucks every week for the comfort of his wallet. And that's all okay, but we still need to work together. I need to work on letting Corey be a part of the finances and encouraging him to be a part of the decision process- it's his money too. And Corey needs to work at being more interested in the finances and taking the time to sit down and give his input. When we do this, it allows for open communication and for us to both be happy with where our money goes. Sure, when all is said and done I pay the bills and make the balance sheet, but Corey knows how much we're spending, and even does a pretty good job at noticing areas that I missed that could use adjustment.

Anyway, the gist of this point is communicate!

GET ORGANIZED. This one is shorter, I promise. More or less, figure out where your money is going. Figure out where your financial documents are. Get it all together. Corey and I use a binder to store everything. In that binder, I put our paystubs, paper bills, the budget sheets I create each month (more on that in the future), and any other items that relate to our money (statements, filled up check registers, important receipts, the list could sooo go on!). A binder might not be best for you-- maybe you'll use a file folder, a drawer, or any number of tools. The idea is just to get everything in the same place.

The next part of this might be a bit trickier (or not, depending on how messy of a person you are!). First, write down your monthly take home pay. If it varies month to month or week to week, write down a low (but still logical) estimate. Then, write down every single bill you have throughout the month. While you're at it, also write down the due date. Here's a short version with made up numbers (this will probably make more sense when I blog about making your budget-- I promise it'll come soon!):

$2000.00 Monthly Take Home Pay
-$400.00 Rent- 1st of the Month
-$100.00 Utilities- 15th of the Month
-$50.00 Credit Card- End of the Month
and on it goes...

Make sure you don't forget any! And good luck!

Oh, and real quick-- your expenses should be less than your take home pay-- if not, you'll have some extra adjusting to do, but for now, we'll get to that later. If you have any specific questions, don't be afraid to contact me-- I won't claim to necessarily be able to help, but I certainly will do my best!

Okay, I think that's enough for tonight! I'm hoping this all made sense and you can take some practical application from it! Thanks for reading! :)

Tuesday, April 24, 2012

My Story

I’ll be honest—one of the last things this world needs is yet another person giving financial advice. There are so many individuals out there telling you how to spend (or save) your money, how to get rich (quick or slow), and what to do about debt (good or bad). A lot of times the advice these people give is based on their own personal experience, sometimes from their schooling and such, and I’m sure the list could go on.

So why am I writing this, you ask? Well, for one simple reason—I’ve been very near the lowest of lows. I’ve been on public assistance, I’ve wondered how I’m going to pull off paying the bills, and I’ve thought it would never get better. BUT it has gotten better. Significantly. My family is no longer on public assistance of any form (despite the flaws in the system that make it hard to get out once you’re in—but I’ll get into that later). I no longer worry about paying bills on time; in fact, a good number of them are paid ahead. Things are really good. My husband, son, and I have been very blessed. And I want to share with others who are at that low point that I thought I’d never escape (or who just struggle with managing their own finances) how my family made it, or, at the very least, improved. I don’t want to tell you what to do or what not to do, just what we did with the hope of it being helpful.

As I promised yesterday, I’ve written my story for you (and, as warned, it’s long!). Here it is:

Let’s go back a little over three years. In the fall of 2008, I took a huge leap of faith and spent a semester abroad in Northern Ireland. That semester was without a doubt a major changing point in my life. I could go into details, but really it’s not necessary. The key is that, in all honesty, during my semester there I found out who I was and what I wanted for the first time in my life. Instead of living my life for everyone else, I lived my life for me. I loved it. But it also had a lot of consequences. I lost a few really close friends and my relationship of over five years ended in a very, very messy fashion. When I came back to the States that spring, my life had been turned upside down. It was crazy. I was crazy.
Derry, Northern Ireland-- my home for the Fall of 2008 and where my journey began.

How does this relate to my finances? Well… first, let me introduce you to Mr. Credit Card(s). While I was abroad, my credit cards were my main go-to for any major expense. We received an allowance each week, but that didn’t completely cover all of the extras I wanted to make my trip what I had dreamed of. So out came the credit card—extra travel, clothing, and souvenirs were easily paid for with a simple swipe. My intention the entire time was to pay off my credit card with my summer job, which should have been easy-peasy. Yes, notice the should have.

Let’s introduce the next character in our story: Retail Therapy. Remember that messy breakup? Any (okay, maybe not any, but a good number of them!) girl will tell you that shopping, shopping, and more shopping is a great tool to take your mind off of anything that is upsetting you. And shopping is what I did. A lot of it. Of course, with the help of Mr. Credit Card. Still, I figured the summer job would take care of it. And, again, it should have. I know, I know, should have.

Which leads us to the most important part of the story… in March of 2009, I made a three hour impulse trip to visit a guy I had met in high school through my ex-boyfriend. We were acquaintances at worst, friends at best. The old me would have never done something so daring. The new me was pumped. And thank the Lord for new me—that impulse trip was an adventure of a lifetime and by the next week the guy who had been an outskirt friend was my boyfriend—Corey, for future reference, because he is very much a part of my future.

We had what, for lack of a better phrase, you would call a whirlwind romance. It may sound completely insane, but we just knew that we were the one for each other.

And then came the test—in May of 2009 I found out I was pregnant. Yep, pregnant.
Corey and I during my pregnancy.
We were determined to make the best of things even though this was never in our plans. Corey tried to pick up more hours at the retail store he worked at; I figured I would still stick it out at my summer job at school even though we would be about an hour and a half apart from each other. It wasn’t ideal, but it worked. For seven weeks.

At seven weeks along I started having morning sickness… and mid-morning, noon, early afternoon, mid-afternoon, late afternoon, early evening, mid-evening, late-evening, and midnight sickness. It was miserable. The job was out. I moved home, Corey stayed at my parent’s house with me, and once again we were determined to make the best of things.

Throughout my pregnancy, I was in and out of the hospital ten times, not including the day I gave birth to our wonderful little boy. While I was covered under my parent’s insurance, I’m not going to lie—we would have been in big trouble had it not been for Medicaid. Early on in my pregnancy we enrolled, despite both of us being ashamed and feeling very guilty. Every time I pulled out the Medicaid card, I tried to remember the words a friend of mine who was majoring in social work, the gist of which was, “Courtney, it’s made for situations like this. You’re not taking advantage. You’ve paid into the system and now you get to benefit from it. As long as you don’t abuse it, you’re using it the way it was intended.”

But I’m digressing. Pregnancies last nine months, as you all know. This meant the fall of my senior year was during the in-and-out of the hospital experience. Luckily, my good track record in college encouraged my professors to work with me through the ups and downs; one of the many blessings showered on Corey and I during our journey.  Since Corey had just wrapped up his freshman year of college, he opted to go to a small community college in our area instead of back to the school he had attended the year before. Then, in January, we welcomed our little boy, Tate (the best blessing of all), into the world and I started the spring semester of my senior year two weeks later (and three weeks late).
Corey & Tate the day we took him home from the hospital.

So there we were—a little family of three living in my parent’s house on a part-time retail job pay. Corey had decided that the community college wasn’t for him and instead did his best to pick up as many hours as possible. Still, it was tough. Granted, my family helped us out a lot, as did Corey’s. I can’t imagine how different things would have been if my family hadn’t been willing to give us a place to stay, if we would have had to have paid for all of our food (we helped out with the grocery bills some), or if my mom hadn’t been willing to watch Tate when I went to school and Corey worked. Again, we were very blessed.

Fast forward, just a bit. And here are a few extra details, too, so I don’t leave anything behind—because of me not being able to take classes the same summer I was supposed to be working at the school and having to take a lighter load during my pregnancy and the semester Tate was born, I had to go an extra semester at school. Corey, as I said, wasn’t going back to school, but did get a full-time job in a factory in August of 2010 that, though it didn’t pay great, did pay a whole lot better than a part-time retail job (unfortunately, six months later the school bills started showing up). However, we had also decided to get married, so of course you have to throw in the expense of an engagement ring and all the (who knew it cost so  much to get married?!) odds and ends of a (fairly small) ceremony. Plus, I’m going to be honest—we didn’t consistently do so well at managing our finances.
Our Wedding Day-- October 1, 2010

But as I was saying, the fast forward—we’re going to stop at November of 2010. Our little family was newly-wed and ready to get out on our own. I love my parents and siblings, but for best results, young married couples should not live with in-laws on either side. Of course, we had to be able to afford our own place. And, lucky me—I married a man who thinks that renting is the ultimate waste of money, especially in a market filled with cheap foreclosures. He was determined to buy. Which, enter another blessing—my grandfather. Grandpa has worked in the construction business for as long as I can remember, though he was a farmer at one point before I was born. When my great grandma died, his inheritance allowed him to become a “flipper.” In November of 2010, he was just finishing up a flip and was looking to sell. When it wasn’t selling quite as fast as he hoped, we were given the opportunity to rent from him for a period of time until he decided what to do next. By rent, though we had worked out a dollar amount, I mean that Grandpa let us live there more or less free of charge. Every month I would write a check, every month it went un-cashed. Granted, we did do small projects to finish the house—painting, flooring, decorating, and such, but it wasn’t all that much. My grandpa is a wonderful, wonderful man. However, the situation wasn’t helping his finances. In January he kindly told us that he thought he needed to sell. Enter a (pretty good) idea from the minds of my husband and grandpa—we could buy! With amazing assistance from my grandpa, in February of 2010 Corey and I officially became homeowners. That same month, I also got a part time job at a bank as a float teller. Yes, things were looking up.

Up, but still not great. With my additional income from my part-time job, we made just a little too much to qualify for Medicaid anymore. While in some ways this was a relief, it was also a bit scary. Tate had been healthy, but what if there was a major expense that came up, God forbid? It wasn’t like we made enough to save much—we were scraping by just to get bills paid. Things were pretty tight. We were definitely living paycheck to paycheck.

Then came a bit of a life-changer—Corey’s grandfather wanted us to go to a financial course that was going on at his church. We agreed and every Wednesday night we were there. I loved it. As a business (and writing) major, finances always intrigued me, but I had always felt that since I didn’t have money, I couldn’t really do too well at managing it. This class taught me that wasn’t true. I could still do well. And we did. Budgeting became something I did every week (as opposed to rarely, if ever, before). We actually began to see growth in our savings account and decrease in our debts.

Soon, Corey got a new job at a better-paying factory and I also was hired full time in the accounting department of a local factory. As I said, blessings abound.

And this is where our story is now. I know I keep saying it, but we were blessed so many times along our journey to this point in ways that significantly helped us, though, at the time, I probably wouldn’t have noticed how blessed we actually were. I truly believe that God had a hand in our lives in huge ways and helped us so much more than I even know. We have family that helped a lot, and other benefits that too many people in similar situations don’t have.

In the end, Corey and I won’t lie and say that we have it all figured out. We have a long way to go before we reach all of our goals and, hopefully, dreams. In all honesty, we haven’t always done great at staying within the lines of being “financially savvy,” but we haven’t done awful either. I’ll also be blunt and say that we haven’t continued to follow all of the rules of the financial class we went to with Corey’s grandpa, though the basic guidelines have stayed a part of our lives (more details later). Still, we’re learning.

So, because we’re learning, and I think that what we’ve learned is extremely valuable, I’m sharing. I hope you made it through this post—I know it’s a bit long, but I think it’s important to know me and my experiences before I start telling you how Corey and I changed our financial life and made sense out of very few cents! J

My little family about a year ago-- yes, we have new pictures-- I just haven't downloaded them yet!

Monday, April 23, 2012

The Beginning of a Journey

This may be a really cliche way to start out a blog, but I truly believe everyone has a story. For whatever reason, the various events in an indivdual's life brings him or her to where he or she is meant to be, for better or worse. I love hearing people's stories, and even more, I love helping people who's stories have hit a bump in the road.

Finances are a passion of mine. Through a very interesting journey, I've been through a lot in the world of money and want to share my experiences. I don't intend for this to be a step-by-step "do this and you'll get this" type of blog or even for it to truly be an advice column, so to speak. Instead, I simply want to share my story and offer aid to anyone who might need a bit of a helping hand getting their dollars and cents figured out. I'm hoping I can show, not just tell, too.

Tomorrow I plan on posting my story-- I'll warn you now, it'll probably be a bit long. However, I really want you to learn more about me before I start telling you what my husband, Corey, and I have done to improve our financial life. I really don't feel as if I have any credibility unless I give you a bit of background. I'll do my best to at least keep it entertaining! :)

To start out though, here's just a tiny bit of "getting to know you" info about me:

1.) My name is Courtney Herendeen.
2.) I am a 2010 honors graduate of Bluffton University with degrees in business and writing.
3.) I currently work in the accounting department at a factory near my hometown.
4.) I am married and have a wonderful son-- and I feel that this point should be higher on the list, because they truly are at the very top of my priority list.
5.) I also am a Christian-- yes, this does relate to how I handle my finances. If you don't like it, tough-- don't read my blog. I'm not going to apologize.
6.) My intention isn't to help people who have a good handle on their finances-- I want to help the people who feel lost when they open their check register (or maybe don't even keep one) and have rarely, if ever, created a budget in their life (and feel overwhelmed at the thought of doing so). Please, feel free to keep reading if you don't fall into these categories, I just want to make it clear that that is my "target."
7.) I will very likely write ridiculously long blogs on more than one occasion. While my classmates always struggled to meet the word/page limits on assignments, I was the one who was struggling to cut information out to not be over. I promise to try to control myself, but while I love the mathematical, clear-cut side of numbers, I also love the creative, free side of writing. Hopefully I'll find a balance!

And that's where we're going to end it for now. Stay tuned for tomorrow!