Millionaire Money Advice

Everyone wants to be a millionaire...very few of us will actually become one. Most people think that in order to become a millionaire, you have to win the lottery, get an inheritance, or strike oil in your backyard. It's actually much easier than we think. With time, dedication, and some wise investing with the help of a professional, most people can become a millionaire by the time they retire. Unfortunately, very of few of us will put in the thought and effort to actually make it happen.

However, for those of us who are willing to make the choice to change our financial future, let's see what the experts have to say. Researchers have found that almost all self made millionaires have one thing in common: they all follow a budget. That means the even some of the richest people in our society don't just blow their money recklessly, but instead they know exactly where every penny is going.

Studies have found that 68% of Americans do not write down and follow a budget every month. It's interesting that almost everybody can tell you how much money they make, but 68% of Americans don't know how much money they spend. Isn't that a problem? Maybe this is why people in this country have so much debt...they don't know how much of their money they are spending! It seems like common sense, but a majority of Americans just don't do it.

If you are tired of living paycheck to paycheck and you are ready to make some serious changes to your financial situation, then I highly recommend starting and following a monthly budget. Brooke and I would never budget. We would rarely even talk about money because we were both too embarrassed to figure out where it all went. I remember at the end of a certain month about a year ago, we were both so tired of having no money and waiting until our next paycheck, that we finally decided to make a change. We were going to sit down and talk about our money.

It was a very uncomfortable talk, but it had to be done. We sat together at our kitchen table and wrote down every single expense that we had. We started with our "big" things that we pay every month like our mortgage, our utilities, cell phones, car payment, health insurance, student loans, credit card, cable, etc. Then we moved onto necessities like food, clothes, and toiletries. Then we listed all of our "extras" like fun money, eating out, pet maintenance, etc. We had a long list, but we finally knew where all our money went the past month.

Next, we planned. That's the basic point of a budget. We looked at all those expenses and realized most of them were unnecessary and useless purchases that could be avoided. So, instead of wondering where our money was going at the end of the month, we decided to plan where it would go at the beginning of the month. The key to every budget is making sure your outgoing money is less than or equal to your income. I know that seems like a basic budgeting principle, but you would be surprised by how many people don't understand that concept. To put it in easier terms to understand: make sure you aren't spending more money than you make.

We downloaded an app called Every Dollar (you can visit the website here). The app was a cool and easy way to have our budget on our phones, tablets, and computers. Every time I pay a bill, go to the grocery store, or go out to eat, I always log my expense right into my phone. Every Dollar does have a "Plus" version that you can link to your bank account and it will automatically keep track of you expenses for you, but I didn't want to pay for a monthly "Plus" version when I was trying to get out of debt.

Having a budget changed my life. Every month, Brooke and I sit down together and discuss the upcoming month's finances. We went from never talking about money, to talking about it almost every day. We sit down at least once a month for a "budget meeting" and I can't even begin to tell you what it has done to our marriage. Less stress, less arguments about money, and more teamwork...who wouldn't want that with their spouse. Also, it has been found that people who start following a monthly budget will pay off 19% more debt and save 18% more money (daveramsey.com). Sounds good, right?

Most importantly, I feel that budgeting is something God wants us to do. Luke 14:28-30 says, "For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it— lest, after he has laid the foundation, and is not able to finish, all who see it begin to mock him, saying, ‘This man began to build and was not able to finish’?" Sadly, too many of us start "building our tower" but never consider how much it will cost us. We all start our month feeling good because there is money in the bank account, but by the end of the month, we are scrounging for every last dollar we can get. Stop the stress and heartache. Start budgeting.

Not everyone will be a millionaire, I understand that. However, it would be smart to look to them for advice and practice what they do financially. If most millionaires sit down and make a monthly budget, don't you think we should too? We work hard for a money. Instead of blowing it and watching it disappear, why don't you make a plan? Don't get to the end of the month and wonder where all your money went...get to the end of the month and rest easy that there is still money in your account because you had a plan. You can find some documents here that will help you list your debts and your expenses. This will help you start to form a monthly budget. If you need some help or need some coaching, contact me and let's get you heading toward your financial freedom. Kevin