Check out these four tricks used to get you to spend more (without you knowing it).
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Let’s play a little game of word association.
When we say money, you think . . . ? When we say inheritance, you think . . . ? Is your response so far something along the lines of “Partay!”?
What about when we say budget? Wah wah. Who invited the party pooper?
Look, life’s not all fun and games. Sometimes it gets serious—like it did for Eric and Jennifer. In 2009, they faced two car payments, three credit cards, two business loans and an expensive mortgage. They knew something needed to change. What they didn’t know is that life was about to get even harder.
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They joined a local Financial Peace University (FPU) class and started working on a budget right away. Their story is a reflection of the countless others we’ve received in the past 20 years since Dave Ramsey started teaching the course in 1994.
Jennifer shares three ways budgeting changed her family.
1. Budgeting taught us a new way of living.
We didn’t have a budget in place prior to FPU. We knew the bills we had each month and ensured they were paid but, beyond that, we had no structure to our finances.
The budget helped us to immediately recognize areas where we didn’t manage our money wisely. We often bought items with “no payments for 6 months” deals. We rarely thought about retirement or college expenses or having a cushion of savings. I mean, isn’t that what credit cards are for?
We look back on that now in total disbelief of how we were living!
We learned Dave’s seven Baby Steps and a light went on for us. I was the nerd and absolutely loved budgeting. Eric was equally involved and we made all financial decisions together. We both worked two jobs and sold everything in sight.
With a budget in place, we paid off $47,000 in debt in just over a year! Then we downsized our house and bought a home at less than half the price of our last one—with cash! So we were able to yell “We’re debt-free!” in April of 2010.
2. Budgeting taught us to prioritize our spending.
As we set up our budget, we realized we spent a lot of money on unnecessary items, but we didn’t have any health insurance. Being self-employed, we found our options for health care limited and expensive! We’re personal trainers who live healthy lives, so we figured it was okay to be without insurance for a while. After all, we never got sick and never went to the doctor.
In FPU, Dave talked repeatedly about the importance of being properly insured. We knew it was time to make a change. We didn’t want to work hard to pay off debt only to find ourselves bankrupt by a health crisis. Because we were on a budget, we realized it was wise to build that expense into our monthly plan.
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And surprise, surprise—because of the budget, we discovered we actually had the money to pay the premiums!
3. Budgeting taught us that we can make it through anything!
In November of 2012, at age 43, I was diagnosed with ovarian and uterine cancer. We had no warning and were stunned to hear the words “You have cancer.” Within a week I had surgery followed by radiation, chemo and genetic testing. And the medical bills came pouring in! We ended up paying $30,000 in deductible costs in less than 2 years.
As I look back I realize that, yes, the bills were frustrating, but we didn’t worry about how we would pay. We didn’t have the stress of mortgage payments, car payments, or credit card debt. I was even able to quit my high-stress job. We had money to pay our health care bills because we had a plan and stuck to our budget.
For someone going through cancer, reducing stress is absolutely essential. Being on a budget and having no debt was a significant factor that kept my stress low. I felt at peace and had faith that we would come through this just fine!
What Our Lives Look Like Now
Now, we stick to a budget and are able to save and give. We enjoy the simple pleasures like wildlife and birds, hiking and the great outdoors. We realize that things don’t bring happiness and there’s actually great satisfaction in saving for what we really want. We don’t feel like we’re missing out on anything!
We all go through tough stuff. Sometimes we’re suffering the consequences of our actions. Other times we’re just suffering. Thankfully, we don’t have to go through life alone—and we don’t have to settle.
Like Eric and Jennifer, millions of families have taken FPU—a decision that will change their lives forever. In fact, the average FPU family pays off $5,300 in debt and saves $2,700 in the first 90 days. In honor of this life change and our 20-year anniversary, we’re giving away $8,000! Enter here for your chance to win.