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Bringing Christ into our Personal Finances

Budgeting Myths and Realities:Developing a Budget

You Can Live With

August 19, 2015

Bryan Sudweeks, Ph.D., CFA.

From the Marriott School of Management’s“Personal Finance: Another Perspective” web site at

http://personalfinance.byu.edu 1

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Abstract• Personal finance is not separate from, but

simply part of, the gospel of Jesus Christ. One of the most critical parts of individual and family finance is a budget or spending plan. This presentation talks about that plan, the reasons why we don’t budget, myths about budgeting, principles of budgeting, and gives suggestions on implementing a budget that you can live with. We finish with applying this information to an actual family case study.

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Objectives

• A. Understand the “Why” of personal finance• B. Understand my favorite excuses why people

don’t budget • C. Understand budgeting myths, realities and

principles• D. Understand how to develop and implement

a budget you can live with• E. Apply this learning to a real case study

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A. Why Understand the “Why”• We all have lists of what we could and should do in

our [ priesthood ] responsibilities. The what is important in our work, and we need to attend to it. But it is in the why of [priesthood service] that we discover the fire, passion, and power. The what of [priesthood service] teaches us what to do. The why inspires our souls. The what informs, but the why transforms (italics, color and brackets added, Dieter Uchtdorf, “The Why of Priesthood Service”, Ensign, May 2012).

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The “Why” (continued)

• We all have lists of what we could and should do in our [personal finance] responsibilities. The what is important in our work, and we need to attend to it. But it is in the why of [personal finance] that we discover the fire, passion, and power. The what of [personal finance] teaches us what to do. The why inspires our souls. The what informs, but the why transforms (italics, color and brackets added, Dieter Uchtdorf, “The Why of Priesthood Service”, Ensign, May 2012).

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The “Whys” (continued)

• What are the “whys” of personal finance that inspire and transform our souls?• If perspective is important, we can ask the “whys”

in terms of our different perspectives:• Spiritual• Temporal• Family• Individual

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• 1. Spiritual: To bring us to Christ• Whatever the problem may be in a person’s life—

failure to pay tithing, breaking the Word of Wisdom, casual church attendance, [or I add - poor financial habits, the]—real issue is faith in Jesus Christ. If we can help people obtain the gift of faith in Christ, good works will follow. The end purpose of any law of God is to bring us to Christ. And how well will the law work? It depends on what we think of the Author of the law (C. Max Caldwell, “What Think Ye of Christ?,” Ensign, Feb 1984).

The “Whys” (continued)

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• 2. Temporal: To become wiser stewards • Our resources are a stewardship, not our

possessions. I am confident that we will literally be called upon to make an accounting before God concerning how we have used them to bless lives and build the kingdom (Joe J. Christensen, “Greed, Selfishness, and Overindulgence,” Ensign, May 1999).

The “Whys” (continued)

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• 3. Family: To return with our families back to Heavenly Father’s presence• Harold B. Lee said, “The most important work you

will do will be within the walls of your own home” (Teachings of Presidents of the Church: Harold B. Lee [2000], 134).

• David O. McKay stated: “No other success can compensate for failure in the home” (quoted from J. E. McCulloch, Home: The Savior of Civilization (1924), 42; in Conference Report, Apr. 1935, 116).

The “Whys” (continued)

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• 4. Individual: To prepare for and accomplish our divine missions • I bear testimony of the fact that if you keep the

commandments, He nourishes you, strengthens you, and provides you means for accomplishing all things necessary to faithfully finish your divine mission here on earth (Gene R. Cook, “Trust in the Lord”, Ensign, Mar. 1986).

The “Whys” (continued)

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A. My Favorite Excuses Why People Don’t Budget

• I have been teaching personal finance for over a dozen years• These are my favorite excuses on why people don’t

budget• After the excuse, I have included what the

research says about this excuse• References are available upon request

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1. I don’t have any money(and I plan to stay that way!)

• Many do not budget because they don’t want to take responsibility for their habits

• It is not much fun to be responsible and disciplined in their spending

• It is hard to admit and follow through on needed change

• It is easier to blame circumstances, others, or to allow others to bail you out

• Research has shown that when people take responsibility for their spending, i.e., they begin budgeting, they make better choices as to the things they purchase, and acquire more wealth 12

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2. I love using my credit cards(that way I can spend my money before I earn it)• Many do not budget because they have credit

cards to bail them out• Credit cards take away the urgency and need to

balance the budget each month• Credit cards encourage consumption

• Most do not consider credit cards as cash—they will pay 12-20% more for an item with a credit card than those who pay with cash

• Research has shown that when you budget, credit card use is part of your overall plan—it is not your only plan

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3. I don’t want more money at retirement(I want to flip burgers for the rest of my life)

• Many do not budget because they have not caught the vision of how it can help them• They keep doing what they have been doing

because they: • Don’t have the knowledge• Haven’t learned the skills• Are not willing to put in the effort

• Research has shown that those who budget have more at retirement than those who don’t• This is likely due to a host of related reasons• One article stated that those who budget have

39% more at retirement than those who don’t 14

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4. I want money related stress in my life(Stress makes life more interesting, right?)

• Many do not budget as they do not realize the negative impact of finances on the family• Many different studies have found that money was

a major stress in 60-80% of the lives of those surveyed, both single and married• Remove the source of the stress, i.e., not

knowing where the money is going or where the money is coming from, and you reduce the stress

• Research confirms that with a budget where both spouses plan and know where the money is coming and going, there is less stress in life and marriage and both spouses are happier

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5. I don’t like managing my money(I would rather it manages me instead)

• Many do not budget because they are unwilling to put in the effort to managing their finances•  Pay interest instead of earning interest, and you

will have difficulty getting ahead financially• The average credit card user pays nearly $1,400

per year in interest (for a family of four, that is $5,600 in interest annually or nearly 55% of your income for debt service payments)

• According to the Federal Reserve, 40% of American families spend more than they earn

• Research supports when you plan where money goes, it goes farther and you accumulate more 16

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6. I don’t want to be happier in life(I want to be miserable like everyone else)

• Many fail to budget because they do not see the relationship between finances and happiness• Economic freedom is a key element of happiness

• Those in debt are in a form of “indentured servitude,” which can last for over 50 years in some cases where people do not understand interest

• Research shows when individuals and families owe money to others, they do not have that economic freedom they desire, and research has found them less happy

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7. I like being in debt to other people(I understand how the other 60% live)

• Many fail to budget because they do not see how it can help them avoid or eliminate debt• Consumer debt per capita was $7,730 in 2005 or

55% of income for a family of 4• The average household debt in 2005 was

$14,500 in non-mortgage debt• It is hard to get ahead financially when you are

paying 55% of your earnings in interest• Research supports when families get on a budget

where they earn interest instead of pay interest, they have so much more for themselves and their families and are much happier 18

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8. Budgeting is a temporal activity(Prophets only talk of spiritual things)

• Many do not budget because they either don’t realize what scriptures and prophets have counseled us or are not yet motivated to act• Spencer W. Kimball said that “every family should

have a budget” (Spencer W. Kimball, Conference Report, April 1975, pp. 166-167) . • We have been counseled by prophets for over

6,000 years to “pay thy debt and live” (2 Kings 4:7).

• Experience has shown that when we obey the prophets and scriptures, we are happier, healthier, and more able to bless the lives of our families and others 19

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C. Understand the Myths of Budgeting:• There are many myths of budgeting that are not

only wrong but hazardous to your wealth (and health). They include:• Myth 1. Its all mine• Myth 2. Budgeting is easy• Myth 3. There is one right way to budget

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Myth 1. It’s All Mine• Some believe the oft-quoted statement “it’s all

mine” • They think they own:

• The belongings they have• The education they gained• Their money and investments

• They earned these assets through their hard work, intellect, effort, sweat, tears, luck and the time they spent

• The reality is different 21

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Education Week 2015

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• Do you remember the cause of the downfall of the peoples in the Book of Mormon?• What did it start with?

• It started with pride from their riches• What was the “cycle of destruction?”

• Riches led to pride• Pride led to wickedness• Wickedness led to destruction

It's All Mine (continued)

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Reality 1. I Am a StewardPrinciple 1: Ownership

1. Ownership: Everything we have is the Lord’s• The Psalmist wrote:

• The earth is the Lord’s, and the fullness thereof; the world, and they that dwell therein (Psalms 24:1).

• The Lord is the creator of the earth (Mosiah 2:21), the supplier of our breath (2 Nephi 9:26), the giver of our knowledge (Moses 7:32), the provider of our life (Mosiah 2:22), and the giver all we have and are (Mosiah 2:21).

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I Am a Steward (continued)

2. Stewardship: We are stewards over all that the Lord has, is giving, or will share with us• The Lord through the prophet Brigham Young said:

• Thou shalt be diligent in preserving what thou hast, that thou mayest be a wise steward; for it is the free gift of the Lord thy God, and thou art his steward (D&C 136:27).

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I Am a Steward (continued)

3. Agency: The gift of “choice” is man’s most precious inheritance• President David O. McKay wrote:

• Next to the bestowal of life itself, the right to direct that life is God’s greatest gift to man.… Freedom of choice is more to be treasured than any possession earth can give (Conference Report, Apr. 1950, p. 32; italics added).

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I Am a Steward (continued)

4. Accountability: We are accountable for every choice we make• The Savior through the prophet Joseph stated:

• For it is required of the Lord, at the hand of every steward, to render an account of his stewardship, both in time and in eternity (D&C 72:3).

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I Am a Steward (continued)

• On the questions of what is really ours, Elder Neal A. Maxwell stated:• The submission of one’s will is really the only

uniquely personal thing we have to place on God’s altar. The many other things we “give,” brothers and sisters, are actually the things He has already given or loaned to us. However, when you and I finally submit ourselves, by letting our individual wills be swallowed up in God’s will, then we are really giving something to Him! It is the only possession which is truly ours to give! (italics added, “Swallowed Up in the Will of the Father,” Ensign, Nov. 1995, 22).

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Myth 2. Budgeting is Easy• Some consider that budgeting is easy, that it is

only math, and they can start any time• All you need to do is just need to make sure that the

math is correct--you spend less than you make and it will all work out

• The reality is different28

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Budgeting is “Bringing Together”• Budgeting, and money in general, is much

more emotional and behavioral in families• For couples, it is bringing together two very

different people who have two different: • 1. Backgrounds and history • 2. Goals and objectives• 3. Views of the message of the gospel of Jesus

Christ• And so they have different views on how the money

should be planned for and spent

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Reality 2. Budgeting is a Challenge• Its not that only one partner’s view is right

• It’s just that both views are different• Dave Ramsey said:

• “Personal finance is more personal than it is finance, it is more behavior than it is math”• The key is to understand the emotional or

behavioral component of money that comes from these differences

• Then we can better budget

• How do we do that?

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Challenge 1. Different Backgrounds and History

• How do you handle different backgrounds and history?• Understand how each other was brought up

• Do together Learning Tool 21: Key Questions on Money and Relationships. This will help you understand how each other was brought up to think about money and help you put together an Action Plan for your family

• Included are questions about: attitudes toward money, family, cash management, savings, education, missions, investments, and retirement 31

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Challenge 2. Different Goals and Objectives

• How do you handle different goals and objectives?• Develop family goals together as a couple

• Write them down and make them yours, then work toward them. Read the lesson on Setting Personal Goals and look at Learning Tool 2: Completed Financial Plans. Look at how they set up their personal and family goals

• Answer the question: What would Heavenly Father have you be or do?

• Write down your top three family goals• Write down your top three individual goals

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Challenge 3. Different Views on The Gospel

• How do you handle different views of the message of the gospel?• Be accepting of each other wherever they are,

regardless of where they are• Assume they are trying to do their best• Work on building an environment in the home

where the Spirit of the Lord can reside • Work on building consensus and avoiding

contention• Strive to do things that strengthen relationships

• Work together to understand what Jesus Christ would have you and your family do—then do it! 33

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A Challenge--But Worth It• Budgeting is not easy--but it is worth it

• Developing and living on a budget is the single most important thing you can do to achieve your personal and family financial goals

• President Gordon B. Hinckley promised: • If you have paid your debts, if you have a

reserve, even though it be small, then should storms howl about our head, you will have shelter and peace in your hearts (“To the Boys and to the Men,” Ensign, Nov. 1998, 52–54).

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Myth 3. There is One Right Way to Budget • Some consider that there is only one right way

to budget (and it is the way they do it). There are no other valid ways that work

• The reality is different• There are many different methods of budgeting,

although some may be better than others• The key is to get the principles right

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Reality 3. Many Methods so Follow the Principles

• What are the principles of successful budgeting?• 1. Understand yourself and your goals, and work

toward them.• 2. Spend less that you earn• 3. Keep good records for spending, tax and other

purposes• 4. Use a budgeting method that meets your

Individual and family needs and objectives

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Main Budgeting Methods• There are five main types of budgeting

methods:• Traditional methods• 1. The Envelope Method• 2. The 60% Rule• 3. Spreadsheet Methods• 4. Budgeting Software Methods• The method too many people use:• 5. DNAH-ial Methods (Do Nothing and Hope)

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The Envelope Method• Requirements: 6-10 Envelopes

• Divide spending each month into categories. At the beginning of each month, take the money you have planned for each category and put it in the envelope

• Once a bill comes, take the money from the corresponding envelope and pay the bill

• Once the money is gone from one envelope and you need more, you must shift money between other envelopes or make do with what you have

• There is no getting money outside the system

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The Envelope Method (continued)

• Advantages:• Low cost and easy to use• Will keep within budget unless you bypass the

system• Can save if savings is one of your “envelopes”• Harder to cheat this method if followed correctly

• Disadvantages• Does not allow for quality record keeping• Must be updated regularly• Must be careful not to bypass envelopes using

credit cards• Must be careful with the available cash 39

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The 60% Solution Method• Requirements: Journal or spreadsheet

• Determine your gross salary each month. Take 60% of that amount and only spend that amount each month. Do not spend beyond that amount• Take 20% of your salary and save for long-term

goals• Take 20% of your salary and save to pay your

taxes at year-end• Once you have spent your money, you cannot go

outside the method for more money

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60% Solution Method (continued)

• Advantages:• Low cost and easy to use • Has no individual categories or category tracking• Will keep within budget unless you bypass the 60%• Can save if update regularly and follow plan closely

• Disadvantages• Does not allow for good record keeping• Must be careful not to bypass 60% limit using

credit cards• May be difficult to determine closeness to the limit• Easy to miss the 60% targets

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Spreadsheet Methods• Requirements: Computer and spreadsheets

• Determine your gross salary and take home each month after taxes and other deductions

• Determine spending by category (row) and date (column), and budget each category

• As bills come in, input the spending on each date (column) and row (category)

• Plan in adequate amounts for a financial reserve and long-term goals

• Type in spending directly into spreadsheet• Can be useful if updated regularly (Learning Tools

4 and 31 on the website) 42

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Spreadsheet Methods (continued)

• Advantages:• Relatively inexpensive and easy to use, depending on

the spreadsheet• Can keep you within budget if you plan and execute

carefully and update regularly• Disadvantages

• May be difficult to track spending with categories• Does not allow for good record keeping• Easy to bypass limits using credit cards• Difficult to determine limits unless updated regularly• Easy to miss goals and targets 43

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Computer Software Methods• Requirements: Computer and software, such

as Mint.com (free), Quicken, Mvelopes, YNAB• Determine your gross salary and take home each

month after taxes and other deductions • Determine spending by category, and budget each

category. Work to within your budget for each category spending

• Obtain receipts and credit card information directly via internet from banks and credit card companies

• Can plan in adequate amounts for a financial reserve and long-term goals

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Computer Software Methods (continued)

• Advantages:• Relatively easy to use and low cost depending on the

program (Mint.com is free and quite good)• Will keep within budget if you plan and execute

carefully (can also save if follow plan closely)• Downloading data from banks makes recording easy• Allows for record good keeping if recorded properly• Makes tax planning very easy if done right

• Disadvantages• Plan must be followed carefully • Easy to miss goals and targets if not updated

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DNA H-ial (Do nothing and hope) Methods• Requirements: None

• This is what too many people use• Do nothing• Deny there is a concern• Hope things work out (they should because I pay

my tithing)• Only respond when things get so bad that you have

to act

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DNA H-ial Methods (continued)

• Advantages:• Easy and low cost• Requires no effort or planning on your part until

things get really bad. Then it’s a real pain!

• Disadvantages• There is no plan, no target, or no goals• Does not accomplish any of the principles of

successful budgeting• Likely result is failure and inability to reach any

major financial goals• Likely result is children will follow your example 47

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Which is the Best method?• In my experience, the best plans are those that:

• 1. Are relatively easy to use• 2. Are low cost• 3. Allow downloading of bills from banks and

credit card companies (makes data entry easier) • 4. Allow adequate categorization of spending for

income, spending, reporting and tax purposes• 5. Minimize the time spent in doing finances (I

spend roughly 1-2 hours per week)• What I recommend (for most):

• Mint.com for those starting out (free), and Quicken for more advanced users 48

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D. Developing a Budget You Can Live With

• Why develop a budget?• President Spencer W. Kimball said:

• Every family should have a budget. Why, we would not think of going one day without a budget in this Church or our businesses. We have to know approximately what we may receive, and we certainly must know what we are going to spend. And one of the successes of the Church would have to be that the Brethren watch these things very carefully, and we do not spend that which we do not have. (Conference Report, April 1975, pp. 166-167.)

• If the brethren watch these things very carefully, shouldn’t we?

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A Budget You Can Live With (continued)

• What is a Budget?• It is the single most important tool in helping you

attain your personal goals. • It’s the process of making sure your resources

are used for the things that matter most—your personal goals

• Budgeting is a star to set your sights by, not a stick to beat yourself with

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A Budget You Can Live With (continued)

• What is the Budgeting Process?• 1. Know what you want to accomplish (know your

goals)• 2. Track your spending—your expenses• 3. Develop your cash budget• 4. Implement your budget• 5. Compare it to actual expenses, then make

changes where necessary to achieve your goals

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1. Know What You Want to Accomplish

• Know and write down your individual and family goals• What do you want to accomplish?

• Do you want to:• Graduate from college?• Prepare to be a worthy spouse?• Get a great job?• Send kids to college and on missions?• Save for retirement?• Return to live with your family and your

Heavenly Father? 52

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2. Track Your Spending

• There are different ways to track spending:• Checks and credit cards

• These expenditures leave a paper trail• Cash

• Record expenditures in a notebook• Computer programs, i.e., Quicken, Money

• These are very useful, especially if tied to bank and credit card companies

• The goal is to generate a monthly income and expense statement

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Education Week 2015

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3. Develop your Cash Budget (the better way)

• What is a Cash Budget?• A plan for controlling cash inflows and outflows• You spend money for what is really important

• Income:• Examine last month’s after-tax total income and

make adjustments for the current month• Expenses:

• Identify all fixed (“must have”) and variable (“would be nice to have”) expenditures

• Add in quarterly and annual expenses• Look for ways to reduce both types of expenses 54

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Budgeting: The Old Way

Available for Savings

Personal Goals

Income ExpensesTithing

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Budgeting: The Better Way

Income Expenses

Personal Goals

OtherSavings

Pay the

LordPay

Yourself

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The Better Way (continued)

• Before• You paid the Lord first, lived on the rest, and

whatever money was left at the end of every month went into savings

• Now• You pay the Lord first, yourself second, and then

live on the rest--your priorities are now in order• And now you have twice the chance of

achieving your personal goals

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The Better Way (continued)

• President Gordon B. Hinckley stated:• In managing the affairs of the Church, we have tried

to set an example. We have, as a matter of policy, stringently followed the practice of setting aside each year a percentage of the income of the Church against a possible day of need. I am grateful to be able to say that the Church . . . is able to function without borrowed money. If we cannot get along, we will curtail our programs. We will shrink expenditures to fit the income. We will not borrow. (Gordon B. Hinckley, “To the Boys and to the Men,” Ensign, Nov. 1998, 51.)

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The Better Way (continued)

Elder L. Tom Perry affirmed this when he said:• After paying your tithing of 10 percent to the

Lord, you pay yourself a predetermined amount directly into savings. That leaves you a balance of your income to budget for taxes, food, clothing, shelter, transportation, etc. It is amazing to me that so many people work all of their lives for the grocer, the landlord, the power company, the automobile salesman, and the bank, and yet think so little of their own efforts that they pay themselves nothing. (L. Tom Perry, “Becoming Self-Reliant,” Ensign, Nov. 1991, 64.)

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4. Implement your Cash Budget

• Try the budget for a month• Record all income and expenses• Sum all days or columns• Note how much you have available in each category

at the end of each day or week• Adjust the plan or expenses as necessary to

maintain the plan• Try to be as financially prudent as possible

• Make your plan for next month

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5. Compare Budget to Actual

• Compare your budget to actual• Adjust the plan or expenses as necessary to

maintain the plan• Don’t reduce payments to the Lord or yourself

• If all else fails, this method will work!• The Envelope method:

• Put money for each expense in an envelope• When the money is gone, its gone

• It forces you to make it work (no cheating)

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Final Remarks on Budgeting• Elder Marvin J. Ashton stated:

• Some claim living within a budget takes the fun out of life and is too restrictive. But those who avoid the inconvenience of a budget must suffer the pains of living outside of it. The Church operates within a budget. Successful business functions within a budget. Families free of crushing debt have a budget. Budget guidelines encourage better performance and management (italics added, Marvin J. Ashton, “It’s No Fun Being Poor,” Ensign, Sept. 1982, 72).

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D. Apply Knowledge to Case Study I received the following email. What problems do you see and what recommendations would you make to help this family begin their budget?• “I would be interested in a unit on the emotional

component of money, and how to avoid contention when two people have opposite ideas of how money is to be managed. Sometimes, the pathway of applying correct principles leads right to the doorway of contention.”

• “For example: one spouse believes in your advice to save a small amount of money. The other spouse refuses to allow that and insists on spending it. If the spender is the husband and the saver is the wife, how do you reconcile those positions while avoiding contention?” 63

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Case Study (continued)

Does your answer change with this second email?• “How does the more sophisticated money manager

spouse, say the wife, remain patient with the more primitive money manager, say the husband, when real financial harm or financial chaos is being created? How can that be tolerated in order to avoid contention? Which is the higher priority: avoiding contention or working to stop the financial hemorrhaging?”

• “And the second issue involves the difference in risk tolerances of husbands' and wives, i.e., the husband has a particular talent and has started his own business, the wife wants a steady paycheck. If the pros and cons are of equal weight in both scenarios, doesn’t the husband’s idea win by default if he is the wage earner?”

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Case Study (continued)

How about with this second page of the second email?• “Another point is that the presentation seemed to

assume that the viewers came from LDS families – I for one am a convert, and did not grow up with parents who saved for a mission or paid tithing. In fact, I have to be extremely careful about my tithe paying as it is an extremely sore subject for my non-member family who disapproves of the practice.”

• “Again – yet another scenario in which it is the very act of trying to obey correct principles leads to contention and opposition within the family. You have my permission to use my questions and concerns.”

• Signed 65

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Case Study Answers• Following are a few of my recommendations

that may be helpful for this couple:• 1. Understand family backgrounds. There appears

to be a difference in how each was brought up and how they relate to their families. While they cannot control how they were brought up, they can decide how they will do things in their family. They should do it in the “best interests” of the family and assume both are trying their best

• 2. Develop individual and family goals. There appears to be a difference as to the goals of the spouses. They should work together to come up with shared individual and family goals

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Case Study Answers (continued)

• 3. Handle different views of the gospel in a Christ-like manner

• A. Be accepting of each other--build the relationship. Assume both spouses are trying to do what is best, and that both are trying. Realize that there may be differences of opinion, and that is OK. They should first work to understand, and then be understood

• B. Improve communication and problem-solving skills. There seems to be concerns here. They need to make finances a part of their weekly “companionship” interview where they discuss children, scheduling, goals, etc. and finances

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Case Study Answers (continued)

• 4. Strengthen testimonies. Finally, they should work to strengthen their testimonies and live according to the gospel of Jesus Christ. They need to work to bring Heavenly Father more into the relationship through prayer, scripture study, etc. When they are doing what God would have them do, they can have His help. Since families are ordained of God, God will help them resolve their differences and become more like Him

• 5. Begin the budget. Once they accomplish these things, then budgeting will be easy because they are coming from a common direction. Then it really doesn’t matter which system they use, as long as they follow the principles

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Summary

• We have talked of many things today• A. We talked about the “Why” of personal finance• B. I shared my favorite excuses why people don’t

budget• There are lots of excuses, as many as there are

individuals• But if one of our goals is to follow the

scriptures, the prophets, and our Savior, then budgeting becomes not a question of math nor of finances, but of faith, and none of the excuses make any sense at all 69

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Summary (continued)

• C. I shared budgeting myths and realities• Myth 1. It’s all mine

• Reality 1. I am a steward• Myth 2. Budgeting is easy

• Reality 2. Budgeting is challenging• Myth 3. There is one right way to budget

• Reality 3. There are different methods. Just get the principles right and you will be fine.

• The principles are a. Spend less that you earn, b. Use a method that meets your needs, and c. Keep good records 70

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Summary (continued)

• D. I shared How to Implement a Budget you can Live With. It is:• 1. Know what you want to accomplish (know your

goals)• 2. Track your spending—your expenses• 3. Develop your cash budget• 4. Implement your budget• 5. Compare it to actual expenses, then make

changes where necessary to achieve your goals• And I shared the better way to budget

• Pay the Lord first and yourself second71

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Summary (continued)

• E. Finally, I showed how the process works through a case study• Doing the math is the easy part of budgeting• Its the behavioral aspects are what make it really

challenging

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