- Ben Habeck
Who are you as a family?
Early on most companies spend a ton of time and money developing their vision, core values, mission, etc. I don't understand why don't families do that?
Just after we got married, my wife and I decided to develop a framework to bump our family decisions up against. So we sat down and worked through who we wanted to be as a family, what we valued, how we wanted to raise our kids (if we even wanted to have kids), etc. We even talked through what kinds of friends we wanted to have! When we finished, we had a list of five core values. We backed them with Scripture, and we came up with a one-sentence "mission" for our family. * On a side note, I've also done this for myself, personally. Who do I want to be as a person? Fascinating! *
This framework has had a crazy impact on our lives—especially when it came to our finances. For example, one of our values is that we want to be active people. But, we were spending about $200 a month on TV and Internet. Our spending didn’t line up with our values, so we cut our TV plan down to about $40 per month. Then, we bought a road bike for me and a jogging stroller for my wife. It sounds stupid, but that small decision is helping us become more of who God has created us to be and we're 100% more satisfied in life because of it.
Bottom line, you should bump every purchase decision up against your values. If your family values being able to give generously, and buying a new car will inhibit your ability to do that, then you shouldn’t buy the new car.
Most families should include getting out of debt and/or building up a savings account as part of their value system. Find a way to accomplish these goals that works for your family. As long as you can stay disciplined and diligent toward reaching one of these goals at a time, it doesn’t matter which one you tackle first. I don’t care at all about which method has the best “return on investment.” It’s like losing weight. If a person enjoys riding a bike, let him lose weight by riding. Don’t force him to go to a health club, even if the weight may come off more quickly that way. Do what works best for your family!
How much is enough?
Ok, so let's be honest. 99% of the time, your "family budget" is totally bogus. It really doesn't mean anything, right? Most people just sit down and list all the money that comes in each month, all the bills they have to pay, and then all the rest of the stuff like eating out, movies, auto expense, etc. Then they see what’s leftover and decide how to spend it or [most of the time], if they're short, what they have to cut out.
This, to me, is a waste of time! DO THE OPPOSITE! First, decide what it will cost to accomplish your family mission, then design your budget to support that mission. Cut out any crap that doesn’t line up with your values. What if you STARTED with a list of the things you need, as a family, ensuring each of those things line up with your values. Then, what it would cost to accomplish all those things! Finally, list your income and see if you can do it.
If you have enough money to support your values, great! If you don’t, then set goals for saving toward those values. If traveling to Europe is important to your family, but you can’t afford it, make plans to go in five years and save so you’re not maxing out a credit card to support your values.
Oh, and by the way, it's ok to make BIG changes. Sell your house! Sell your car! Change jobs! Move across the country! Do whatever it takes to reach your mission and align yourself with your values, regardless of what society says. Believe me when I say that aligning yourself with your core values is 100% more satisfying than the $500 worth of material crap you have in your closet.
A few years ago, I worked with a family who was having a hard time paying some of their bills, but one of their goals was to go to Disney World as a family. They were paying two car payments, but nice cars really weren’t that important to them. So, they sold both of their cars and bought older cards with cash. In doing that, they were able to save $600 a month and they went to Disney World the next year.
What if I have more than enough?
Alright, so, now that you’ve decided how much money is enough to support your values and mission, you have a very clear picture of what it looks like to have MORE than enough. So, what happens when you DO have more than enough? Whatever you want! You get to be creative because you’ve agreed you don’t really need that money anyway, right? Give it away! Invest! Send your friends on a vacation! Help other people reach their goals! Do whatever you want! Talk about freedom, right?
At the end of last year, our family had more than enough. (We're not rich, remember, WE define what "enough" is.) We had no idea how we were going to use the extra. Interestingly, around that time, we heard that some of our friends were struggling in their marriage. So, we were able to give them enough money to pay for marriage counseling. That was joyful giving! Because we had decided as a family what was “more than enough,” we were able to help our friends in a huge way. And, we didn't care about a tax deduction or anything like that. It was all about the person!
The key is, let your spending reflect your values.
Most people find that what they really value is not some material item. If you're honest with yourself (or, if you're reading this from a computer) you have more than you really need anyway, right? The truth is, if you're reading this, you're rich. (Think about that one for a minute.) Now, go make it your goal to let your spending reflect what really is important to you and forget about what everyone else thinks.
Ben Habeck is the founder and president of Dime, an outsourced accounting firm that specializes in churches, musicians, and small businesses. Learn more atwww.simpledime.com.