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! :)

1 comment:

  1. Your blog has come at the perfect time for my husband and I. THANK YOU SOOOO MUCH. I will be comtinuing to read ;)