‘cashflow budgeting - the missing link’

www.simplybudgets.com.au

‘CashFlow Budgeting -The Missing

Link’

Disclaimer

This presentation is intended to be educational and in no way is it designed or intended to give

financial advice.

If you require Financial Advice you should see someone who is

suitably qualified.

September the 11th 2002.

People told me I was an Overnight Success!

1974 Wanted to become a Rock Star!

1975 Began an Apprenticeship (just in case).

1976 Band fell apart!

Wanted more than a trade would provide

Teacher’s College for two years

Teaching teenagers was less than I hoped for!

Began looking for ways to escape the school teaching JOB.

Back Yard Mechanic

Manufacturing Kid’s Furniture

Music Teacher in Spare Time

Manufacturing Adult’s Furniture

Computerised House Plan Service

Every time, it came down to –‘Get serious or get out!’

Growing Family – Needed a Bigger House

Interest rates went through the roof

Ran out of Pay Rises.

Desperate for a way out.

In my efforts to find a solution I stumbled onto a new way to plan and manage cash-

flow that worked so well I realised I could not keep it to myself!

I got really excited about how I could help people sort out their $$$.

Placed Advertisements for a ‘Budgeting’ Service and embarked on the journey of a lifetime helping people change financial direction (for the better).

Easter 2002 resigned from teaching!!!!

• ‘A Current Affair’September the 9th 2002.

• 12,000 e-mails overnight

• Over 5,500 orders by the end of the week.

• Sent 1,500 copies in the First Week

• Packed a further 3,800 boxes in one week-end.

• 7,500 orders within 3 months (over $500,000).

• Australia Post sent a Semi-Trailer.

• ACA Feb 03

• Today Tonight June 03

• Today Tonight Oct 04

• ACA 05

• 25,000 sales by end September 08

• USA (Radio & TV) - NZ Seminar tour 07

• Today Tonight 06

• 09 Began relationship in the USA

• Launch Simple Wealth Steps 2010

2011 – Launch Simply Budgets V2.0

Right Now - Simply Budgets USA Inc

To Show That Ordinary People Can Achieve Extra-Ordinary

Goals WithVision, Determination & Passion

You MUST Go For Your Dreams!

Why am I telling you this?

What are the BIG issues facing Property Investors right now ?

How much will you need each week in retirement?

Rental Calculator

Wealth Planner Spreadsheet

Saving Your WayTo A Wealthy Retirement

Who wishes they were 15?

What is the most important part of a house?

Hopefully you were thinking of the foundations!

What’s the most important part of your personal finances?

Let’s Talk about Foundations!

What would ‘Good’ financial foundations actually look like?

Does anyone have money problems on purpose?

Most people struggle to get their financial foundations right.

Why is this so?Are we all incompetent or stupid?

What really causes us to struggle when it comes to money?

Emotions – What you feel, think & say about $?

Six of the BIG-E’s that

Determine Your Financial Destiny

Environment – Where you go and who with?

Education –Your knowledge of Financial Matters.

Earning & Expenditure – Managing Cashflow

External Events - Forces you cannot control.

Emotions – What you feel, think & say about $?

Environment – Where you go and who with?

Education – How much you know about money?

Earning & Expenditure – Managing CashFlow

EARNINGS

The most commonly blamed cause of money problems would be lack of income.

The fact is; people blame lack of income no matter how much they earn!

Accept the fact that no number of pay rises will satisfy your ‘need’ for more income.

Every person in the world could easily spend more than they earn. Human nature drives us

to want more and better things.

It’s not about income!

When it comes to spending, people often consider lack of self discipline as a common reason for getting into trouble with money.

That is, – spending money even when they know they should not!

EXPENDITURE

But - How do you know when it’s OK to spend money and when it is not?

• Do you rely on feelings?

• Do you stop spending when your savings account is empty?

• Do you stop spending when your Credit Card is full?

• Do you overspend by accident?

Imagine this!

Self-Discipline is not enough!

You need Information!

External Events – Things you cannot control.

Control what is Controllable and the ‘Uncontrollable’ will have less ability to

bring you unstuck.

Make sure you have the right people around you to minimise the likelihood and the impact of any Uncontrollable events.

This is a major Wealth Secret regardlessof who you are or what you earn

Excuses – The stories you tell yourself so you feel OK about NOT achieving what you really want out of life.

Earning & Expenditure (Budgeting!)

A Common Budget Format

Income - $600 Groceries $150 ($450) Rent $200 ($250) Petrol $50 ($200) Entertainment $30 ($170) Telephone $25 ($145) Electricity $10 ($135) Car Repairs $20 ($115) Insurances $35 ($80) Clothing $20 ($60) Spare $60 ($0)

(Per-week amounts. - John & Mary Citizen)

• The problem is that a budget like this only tells you that you should be able to pay your bills.

• You need to know how to pay them!

It’s TIME for a change, but what should you do?

The 1st Step to Change:-Understand the problem.

Then you can find the right information to solve it.

So ……… What is the Problem?

We make financial decisions every day.

We blindly accept that we will find out in the future whether we made the right

decisions today (or not!).

Does this look like a problem??????

How can you be in the right place financially when you don’t know where that place is?

This was the very problem that caused me to stumble onto the Simply Budgets system!

Think about your Bank Statements – What secrets do they reveal?

Unravelling the Puzzle

By doing this you will identify your predictable Regular Expenses

Control what is Controllable

The Perfect Plan for Your Regular Expenses

Pay all of the planned expenses on time

Never run out of money

Cost as little as possible

Never have more money tied up than necessary.

A Real Life Example

(The birth of a new system)

12 equal Monthly payments of $1000

12 x $1000 = $12,000

3yr Fixed Rate Home Loan

26 fortnightly paydays to repay $12,000.

$12,000 divided by 26 = $461

Payday Deposit $461 $461

Loan Day Payment $1,000 -$78

Do You see the Problem?

That’s Month One.What happens in Month Two?

Imagine Having a Time Machine!

Would having your ideal bank statements for the next year in advance

be of any help to you?

“Question Time”

The End

‘cashflow budgeting - the missing link’

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