SaveGiveSpend

Speaking of organizational debt... (see May 14 post)

2011-05-17T21:02:00.001-05:00

What great timing! Dave Ramsey published an eye-opening article today on the size of the federal deficit and debt and how that would translate into an average family's spending habits.

Personally, I don't distinguish between personal finance practices and government fiscal policy. Don't spend what you don't have. This also means I never bought into Keynesian economics either.

But IS there a difference? Is it good fiscal policy to carry out deficit spending on purpose? If you were in Congress, what would you do regarding the current debt ceiling/budget debate?

Is organizational debt ever 'necessary?"

2011-05-14T20:49:00.000-05:00

"We don't have any debt-- what we have is a mortgage."

I am sitting at a finance meeting for a non-profit board on which I serve, listening to a kind, well meaning, and utterly convinced man explain that having a mortgage is not debt in any negative sense. A stifled response welling up in my gut, all I could think as I listened to him go on was, "That is the silliest thing I have ever heard!"

But this blatant confrontation between the fiscal views popular on this board on which I serve, and my own financial practices, have made me do some thinking. Should my stance on personal debt impact my stance on organizational debt?

I've been thinking about this a lot lately.

What do I mean by organizational debt? Simply put, I define it as debt that is held in common by a non-profit, a company, or a government. The latter have additional complexities that require a longer discussion, so I'll just stick with debt held by non-profits for today.

My work as member of both a non-profit board and my church's finance board have placed me in a position of responsibility to ensure that I make decisions that uphold the fiduciary interests of each organization. Both organizations are actively looking to expand and build new buildings- one would cost less than $100,000 and the other could easily exceed $500,000*. Given that popular opinion views debt as almost always a 'must' for capital investments like buildings, I have been forced to seriously consider how my personal views on debt should impact my responsibility to each of these organizations.

After some careful thought, I have concluded that even in these situations, my personal views should carry over to my role as a board member. Here are three reasons why.

1) My private views should be my public views and vice versa. There should only be one version of 'me.' Otherwise, I am a hypocrite. I don't like politicians who say one thing in public and then do the opposite at home. 'Nuf said.

2) The reasons why I don't have any personal debt should also apply to these organizations and others. Without debt and interest payments, the non-profit and the church have greater flexibility to pursue their mission. Dave Ramsey cites one fact that the American church is $33 billion in debt. $33 billion! If any of you are churchgoers, how tired do you get of hearing about mortgage payments and wish that money would instead be used to help your local community and others around the world?

3) Working with what you have ensures diligence and proper stewardship. Others might hold different opinions and see 'leverage' through borrowing money as good stewardship and faster growth towards goals. However, borrowing money places anyone, including non-profits, at risk. Given that non-profits and churches typically have restrictions on how to generate revenues, taking on debt is even riskier and a miscalculation in expected grant money or church offerings could be disastrous. Planning and saving for capital expenditures is not only less risky (is there even any risk?), it is also a good model for church-members to follow and possibly people that the non-profit serves (if that is part of its mission).

What do you think? Is debt EVER okay for a non-profit or a church?
Is there any risk to not taking on debt?

*This might seem like pocket change to some folks out there, but for the communities that I am working with this is a lot of money.

Image: renjith krishnan / FreeDigitalPhotos.net

Go green to save green

2011-02-07T20:53:00.000-06:00

Does going green mean this to you?

Solar hot water heating. $
A hybrid or even all electric car. $$
Solar panels $$$

Going green doesn't have to mean spending a fortune. Like with any major lifestyle change, you can take baby steps to lead a more green lifestyle. This brief article can help you with beginning to brainstorm about ways you can reduce your consumption and thus spend less moolah. And saving the environment is kinda cool, too.

Here are some of the things I do to help conserve and keep more money in my savings account.

We set the heat to 60 in the winter. To stay warm and cozy, we wear layers in the house and use a small space heater in the room we are hanging out in. Luckily, Texas winters aren't too cold.
Consolidate errands into one trip. We live out in the country and this one really makes a difference for us.
Our garden has worked out really well for us. Some nights, half of our dinner comes from our home-grown veggies- rewarding, organic, and delicious.
Laundry and dishes are only done with full loads.

Remember- baby steps are the way to go so that you don't become overwhelmed.

Financial literacy.. err.. sophistication courses required at college.

2011-01-07T13:03:00.000-06:00

Champlain College is requiring students to attend financial literacy classes. While I wish that strategies on obtaining a great credit score weren't part of the classes, I do think that knowing how all of this works is better than not knowing. All things considered, I am so glad to hear that a college is finally preparing students for the real world in terms of personal finance, other than assisting them with gaining experience on paying back a loan.

Does growing your own food really save you money?

2010-11-28T10:06:00.000-06:00

I started my first garden this summer and am now wrapping up my fall harvest of green beans, Swiss chard, radishes, carrots, some basil, and marigolds for the bees and butterflies. I started my own garden so that I could have organic vegetables that are really hard to find in the grocery stores where I live. (I often get dirty looks when I ask for organic, as though it were a four-letter word!) I also thought it would be a great way to save money as I could replace a portion of my weekly groceries with what I grew.
The jury is still out for me on this one. I really enjoy spending time in my garden (it's often only an hour a week, though it probably should be more) but for some people, time really is money and the time they spend gardening may be time they could be making more money that will pay for those veggies and then some.

There's also the cost of getting your garden started and maintained- good soil, compost, fertilizer, watering, plant supports, seeds or seedlings, etc. My garden is in our church's community garden so many of these items have been free for me thanks to donations.

And if pests or a bad season devastate your crops (my poor zucchini succumbed to squash vine borer!) then you are out time and money.

For now, I think I will continue gardening and appreciate it for what it is right now- a hobby that can yield some fun and tasty treats. If I become more skilled, I might get serious about treating my garden as an important food source for my family.

It's been awhile.... Here's something to get us started again

2010-08-15T09:43:00.000-05:00

I've been so bad about updating on here. My apologies to all of you. We moved to the country about 8 weeks ago and have been trying to get settled ever since. And by settled, I mean raising chickens (that's Full Moon, a Plymouth Barred Rock chicken, to the right), building a chicken tractor, starting a garden at home AND in a plot at our church's community garden, unpacking, etc.....

I had a conversation with a coworker recently who told me he didn't have any money saved. And he has a good income! Sure, he has money in stocks and some in retirement but how long would it take for him to get that money out if he really needed it? At least a couple of days.

I came across this article today on the excuses people give for not saving money. I agree with most of what Liz says, but disagree with her 'wiggle room' on excuse #6 "I have credit cards to pay for emergencies."

Emergencies are funny little life events that can often snowball into major DISASTERS! Putting those emergency expenses on credit cards is like begging for a lot of high-interest debt that becomes a big hairy monster in your life for a long time.

Americans my age (young professionals) especially need to get with it on saving for emergencies. Most of us have not lived long enough to know that life can throw some pretty gnarly curve balls.

Community banks and credit unions vs. BIG banks

2010-04-06T17:12:00.000-05:00

In response to a comment on my last post, I am going to highlight some of the reasons why I think more people should take their business to a community bank or credit union. Many of these reasons are based on recent history with the financial services and housing crisis that resulted in the 'Great Recession.'

First of all, big banks (Bank of America, Citigroup, Wells Fargo, etc.) are publicly traded corporations. Their primary goal is to increase shareholder wealth. Providing great customer service through charging lower (or no) fees, employing well-trained customer service representatives, and offering higher interest rates on accounts and lower interest rates on loans are all ways to NOT increase shareholder wealth as they are more expensive ways to do business.

To increase shareholder wealth, many of these banks charge exorbitant rates on credit cards after initially offering a lower teaser rate, invest in risky financial products that I have a hard time understanding how they work (sub-prime loans anyone?), and generally don't provide good customer service as a way to cut costs. Many of these banks also took federal bailout money and did NOT use it to help customers and thus the overall economy. (There are many more details surrounding this but I will not delve into them here.)

Community banks and credit unions generally have to develop and maintain a good relationship with their customers or else they will not have customers for very long. I recently emailed the community bank that I opened an account with and within an hour I had a response from the same person I spoke to on the phone last week. I think the reason that more people have not been using these smaller banks and credit unions is that bigger banks advertise more and have more physical locations that increase their visible presence in a community. This is not to say that smaller financial institutions are not going to make mistakes or mistreat you- but if they do your decision to leave hurts them a lot more than it would a bigger bank.

You can also watch this interview from Fox Business with the CEO of a community bank on why people are leaving big banks.

Checking with 4.26% APY?

2010-04-02T20:50:00.001-05:00

I receive a monthly newsletter from Dave Ramsey, a popular personal money-management expert and debt-free advocate. April's version included a link to CheckingFinder.com, a free online service to help you find and compare free checking accounts from community banks across the country. (Bank of America and Chase are not welcome!)

The highest interest rate I found was with a bank in Sugarland, TX offering a checking account called 'Kasasa Cash.' Funny name, but after some research I found out that it is a special product offered by many community banks.

The benefits of the account are:

4.26% APY* on daily balance up to $10,000
1.66% APY* on portion of daily balance above $10,000
Reimburses all ATM fees nationwide**
No minimum balance
$100 minimum to open, no minimum thereafter
Free online banking with bill pay
Free Visa® debit card
Unlimited check writing
No per check charge
First 50 checks free (singles or duplicates)

The requirements for receiving the 4.26% APY are:

Log onto online banking at least once per cycle (I already do all of my banking online; haven't set foot in a bank since college.)
Receive your monthly statement electronically (Yup, do this to.)
Make a minimum of 10 debit card purchases (a month) (Not a problem.)
Have 1 direct deposit or ACH auto debit (a month) (Can transfer my automatic insurance payment to this account.)

If you don't meet the requirements one month, your interest rate for that month is reduced to 0.05% APY. If you meet the requirements the next month, your interest goes back up to 4.26% APY.

This sounds too easy and too good to be true! Do you realize that if you have $10,000 in this account for 1 year you will receive $426 in interest? That's a lot more than the current rate of 0.65% that my current bank offers on savings accounts and CDs! I plan on keeping our emergency fund in this account and conducting a few small transactions (Redbox rental, gas for the car, etc.) that would normally occur in order to meet the requirements. I'll feel better about keeping our emergency fund in non-investments (as it should be) and will also consider opening up a second account so that we can split our emergency fund and receive the 4.26% rate on more of our money.

I applied for the account on Wednesday and am waiting for my account to be fully processed and opened up with my first deposit transferred from an account at another bank. I'll let you know after a month how this goes and if meeting the 'requirements' really is as easy as it seems.

Fly and Apply! Or... not.

2010-03-30T19:10:00.003-05:00

This just might be the most desperate or the most aggressive marketing of a credit card that I have ever experienced. I recently took a trip to Jamaica to attend a wedding and flew on US Airways. About half way through each flight, a flight attendant came on the PA system to announce a special deal for us.

Here is the 'deal':
Barclays (a financial services company) teamed up with US Airways to create a limited time 'special' offer for a credit card. By signing up for their card, you would automatically receive 25,000 air miles good for travel in the U.S. or Canada. If you paid $99, you could also receive a companion pass for someone to fly with you. If you submitted your application on the plane, they would give you another 500 miles. And all of this for the 'low' annual fee of $79. No mention of an interest rate although I didn't take the application so that I could find it amidst the fine print.

Is this desperate marketing? Or aggressive marketing? Or both? What better way to capture the attention of 200+ people who have nowhere to go, many of whom probably paid for their flight with a credit card and are now being presented with such a 'great' deal.

What's next? Credit card marketing during half-time at a football game?

Mortgage paid off... Check!

2010-03-21T13:42:00.007-05:00

Oy vey. It's been too long since my last post and a LOT has happened since then. The biggest news, and the subject of this post, is that we (my husband and I) have PAID OFF OUR HOUSE!!!! This occurred on March 4 via a wire transfer to the company servicing our mortgage. It took us 19 months and 17 days.

It's hard to explain the feeling of being completely debt-free. On the one hand, we don't feel any different, except when we realize that we will no longer be making interest payments to anyone else ever again, and then we both can't stop grinning.

Now, every dollar that comes in can be used for saving, giving, or spending. We feel free to explore new ways to use our money, such as buying as much organic or local food as we like, taking vacations to visit friends overseas, or investing more into mutual funds. We could have done all of these things before we paid off our house, but now there is no trade-off of delaying our freedom from debt.

We almost weren't able to pay off our house due to an unexpected expense. I'll share more about that in my next post...

'Til then, keep working on getting rid of your own debt and know that there will be an end to it one day if keep at it!

2010 is the year! Create your SGS plan now!

2010-01-01T12:08:00.009-06:00

If you do not have a written down SGS plan (SaveGiveSpend plan, aka "The Budget"), it is time to do it. NOW! Don't let another day pass in 2010 if you don't have one.

I know you may be thinking "I can keep track of it in my head." No, you can't! Life is too complicated, busy, and full of surprises to be able to do that. I know, I've tried.

Creating an SGS plan is simple.

1) Write down all of your expected income for January.

2) Write down all of your expected saving, giving, and spending for January.

3) Make sure that Step 1 is always equal to Step 2.

4) Repeat Steps 1,2,3 in February, March, etc. It gets easier each month.

My version of budgeting means that you tell every dollar and cent where to go before you spend it. (Also called "zero-based budgeting") This means that if you put money away for retirement, give out $20 to someone in need, or buy a pair of jeans, you are going to account for it in advance.

"How can I account for every dollar I am going to spend (save or give) when I haven't even spent it yet???" This is what budgeting is all about. It is not meant to prevent you from having fun or enjoying your income. It IS meant to help you be in control of your money, and not the other way around. So if you want freedom to spend some money freely, create a category for it and call it "spending money," "walking around money," whatever. Just be sure to BUDGET for it and don't go over that amount.

In order to keep track of my budget and do some other fun stuff like create a pie charts and line graphs, I use Quicken software but there are plenty of other options. Get a notebook, create an Excel spreadsheet, use Mint.com (it's free, but is also owned by Quicken), or search the web for free downloadable spreadsheets.

If you have any questions about your SGS plan in particular, feel free to post them and I will respond to them.

Update: Cheap Dates - Great Taste

2009-12-01T16:48:00.003-06:00

As a result of our outing, we made the 'Noteworthy Events' page of a local lifestyle and culture magazine, Tribeza. Now that is not exactly an accomplishment worthy of a resume, unless you are majoring in 'Socialite,' but it will serve as a great reminder of how much fun we had that night- and at no cost to us!

Holiday Food Savings

2009-11-30T18:50:00.003-06:00

It's hard to think about anything coming up after the holidays before they are over. But with some thoughtfulness and planning, you can take advantage of fabulous grocery store deals on food now that will save you money for months to come.

For example, I usually don't cook a turkey for Thanksgiving because someone else in my family does. That doesn't mean I can't take advantage of cheap turkey meat. I bought a 12 lb. frozen turkey for $4.80. That's only $0.40 a pound!!! We'll probably cook it in January once all of the holiday celebrations are over so that we don't get turkey fatigue. From that, we can make a variety of dishes, prepare fresh turkey stock, and freeze cooked meat for use many more months after that.

Also, check out your local grocer's deals on typical holiday items. They usually discount baking supplies, canned fruits and vegetables, and some fresh produce (sweet potatoes for $0.19 a pound!) in order to entice you to do all of your holiday shopping there. Stock up now and use coupons to maximize your savings.

As always, don't shop without a written budget and don't buy food that you know will not be used just because it is on sale.

Cheap Dates - Great Taste

2009-11-02T17:42:00.003-06:00

My husband and I have a weekly date night (Friday) and we are always looking for creative things to do that don't cost a lot of money. Dinner and a movie gets stale after a while, and the cost of such a date can easily be $50 or more. With 52 dates a year, that adds up to $2,600!!!

This past Friday as I was driving to work and listening to the radio, I heard about an art exhibit at the Russell Collection Art Gallery. There would be a reception that night for "Pissarro - The Four Generations" with the great-granddaughter of Camille Pissarro (an Impressionist artist) answering questions about her family's and her own work and wine and hors d'oeuvres. We RSVP'ed, got dressed up, and had a fabulous time! All for... $0.

There are plenty of romantic, exciting, and free or inexpensive activities for couples to do. Check your local papers, city website, and local radio or TV news stations for ideas. Ask other couples, neighbors, or family members what they like to do. Check out local art galleries, museums, events at college campuses, etc. The possibilities are endless if you do a little homework.

VISA “Black Card” – Faux prestige you pay for

2009-09-26T22:34:00.003-05:00

Today’s mail included a really nice, thick, black envelope that looked like a wedding invitation at first glance. Inside, however, was an ‘exclusive’ offer to open up a line of credit with the VISA Black Card, the “World’s Most Prestigious and Versatile Credit Card.”

If I enrolled, I would gain access to the following:
“Limited Membership”
“24-Hour Concierge Service”
“Exclusive Rewards Program”
“Luxury Gifts”
“Patent Pending Carbon Card”

And the kicker of them all…
“Annual Fee $495”

Furthermore, I am told that “The Black Card is not for everyone. In fact, it is limited to only 1% of U.S. residents to ensure the highest caliber of personal service is provided to every Cardmember.”

Wow. How does paying to go into debt make me part of an exclusive club? How many people do you know that have had or currently have credit card debt? Not exactly an exclusive club.

Credit card marketers are experts and spend hundreds of millions of dollars at hooking people into believing that credit is a way of life, needed to get ahead, and as this offer shows, what “really important people do.” Ask yourself this, “Does anyone really care what kind of credit card I have? Does anybody else but me even know if I have a platinum, uranium, or plutonium card?” I bet you answered “no.”

The irony of all this is that yesterday my husband and I shredded our only credit cards since we are in the process of becoming completely debt free. Even though we always paid off our balances every month, we decided that becoming debt free should mean not even using debt on a temporary basis. It also makes keeping track of our finances a lot easier since now we don’t have to worry about paying our credit card bill every month.

If you use a credit card, what are your reasons for doing so? If you have credit card debt, what are you doing to pay it off?

Groceries for 2 for less than $20 a week

2009-09-21T17:58:00.007-05:00

My husband and I are aiming to pay off our house by the summer of 2010.

Yes, you read that correctly. Barring any financial disasters or major life changes, we will be paying off a house in less than 24 months.

How can we possibly do this? The two biggest factors are: two incomes and careful money management. Part of our money management includes adhering to a strict saving/giving/spending (SGS) plan each month. (AKA... The Budget)

Our SGS plan has several categories, one of which is for groceries, and it is set at $80 a month. If you have debt that you want to get rid of or if you want to be able to save more money, consider these 5 strategies that we use to keep our monthly grocery budget at or below this amount.

Cash only: We bring cash to pay for our groceries. When we used credit cards (which we have since cut up) and even debit cards, I always had a hard time staying within the budget. When you only have $20 to spend, that is what you spend. You will spend more time evaluating how much items cost and how they fit into your budget if you only bring cash.
Bulk foods (when it makes sense): Buying in bulk can often, but not always, save you money. If you know you will not be able to use fresh food that you buy in bulk before it spoils, don't buy it! Otherwise, you are literally throwing money away. Also, compare the price per unit on bulk foods versus smaller packaged items. Retailers can often 'trick' you by charging more if you buy in a larger package. If the grocer doesn't list the price per unit, bring a calculator or use your phone's calculator feature.
Unprocessed foods: Cook from scratch. Yes, it may take more time but if you plan properly you can cook a healthy, tasty, and low-cost meal by preparing all of the ingredients yourself. When you buy pre-cut veggies or fruit, frozen meals, or boxed meals, you are paying extra for the time it takes the producer to process the raw ingredients. A slow-cooker (e.g. a CrockPot) can take a lot of the time and hassle out of cooking from scratch. In order to stick to less than $20 a week, we make a lot of stews, cook beans and rice with Mexican flavoring, and stir-fry veggies and tofu.
Coupons: If you get a Sunday paper, there are often several inserts with dozens of coupons in them. The key here is not to buy something just because you have a coupon. I once got a $3.75 pound of coffee for a $0.75 because I had a coupon for $1 off from the producer and my local grocery store had their own promotional $2 off coupon. I get the coupons and then go shopping the same day so that I don't forget about them.
Low meat diet: Meat is expensive! I only buy lean cuts of meat that are on sale and then buy them in bulk and freeze a lot of it for future use. Even then, we only eat meat with maybe 2 or 3 meals a week or we use just a little in each meal. We get protein from other sources, such as eggs, tofu, and beans. Not only is this a healthier way to eat, it is also better for the environment.

I know that $20 a week for groceries is pretty extreme in the eyes of most people (especially if you have children), but take some time to figure out how much you are spending a week and aim to cut that by 20% next week. If you are spending $100 a week, try to get it down to $80 next week. We started out at $50 and have been able to cut our bill by 60%. It is doable, but it takes persistence and smart spending decisions.

Cash for Clunkers = Repos in 6 months

2009-08-05T23:20:00.004-05:00

The federal government is offering YOU $4500 to take your older, working, and (hopefully!!) paid off vehicle to trade in for a brand-spankin' NEW vehicle that may save you a bit on gas but will depreciate significantly within the first two years of ownership and, like most Americans, put you into more debt if you don't pay for it in cash.

Has Congress forgotten so quickly about what happens when you make it really easy for anyone to buy something on credit? Do the words 'recession' and 'housing market' ring any bells?

I'm predicting that within the next 6 to 12 months, we are going to see a huge uptick in the number of repossessed vehicles as a direct result of this program. The only real winners in all of this are automakers and the car dealers (if they actually receive payment from the federal government).

Our government is sending Americans the WRONG message. We should not be encouraging people to go further into debt on an asset that does nothing but depreciate just to add a few miles to the gallon.

Update - $1600

2009-08-05T23:04:00.003-05:00

I called my boss this week and was only able to leave a message, but I received word that, as I suspected, the extra payment was a clerical error. Within a few hours, HR had contacted me and asked for my permission to create a bank draft to withdraw the overpayment from my account. I expect that everything will be sorted out by Friday.

One surprising fact surrounding all of this was that not a single person involved in correcting this (3 total so far) ever commented on the fact that I voluntarily asked to return the money. Not a single thank you or acknowledgment of honest and ethical behavior.

Although I am not the type of person who always expect thanks for just doing what is right, it would have been nice if someone actually said "Thank you." Am I off base about this?

Returning $1600? - $1600... Keeping Integrity? - Priceless

2009-08-01T23:57:00.004-05:00

How much is your personal integrity worth? One dollar? One hundred? One thousand?

When we commit to living a certain way, it often seems that opportunities to cut corners pop up. Here is how it happened for me.

I have been teaching the DebtWatchers class in order to help participants improve how they manage their personal finances. Yesterday, however, my bank account received $1600 from an employer that I stopped working for a month ago, meaning that I was paid for an entire month of work that I didn't do. My first thought was, "Wow! Now I can buy/do _______!!!" But then I had to acknowledge that the deposit was probably a clerical error and not an unexpected bonus.

What do I do now? To be honest, part of me wanted to just accept the money and write it off as "their mistake." Why should I have to take action and write a check back to a huge organization that wouldn't really miss the money?

But I knew that anything that money was used for would always feel tainted or ruined because that money did not rightfully belong to me, regardless of how I came into possession of it. I know that my personal integrity is worth a lot more than $1600 and is hopefully priceless.

So on Monday, I will be calling my former boss to try and clear up all of this. An immediate benefit of this is that it will improve or at least solidify our already good relationship since I can continue to use him as a professional reference.

This experience has me thinking about other instances where money came into my hands that didn't necessarily belong to me. (Granted, finding money randomly on the street with no way of identifying the owner shouldn't make you feel guilty, although you could donate it to someone else if you don't need it.) Have you ever been given back too much change from a cashier? Or have a waiter that forgot to charge you for part of your meal? What do you do when you know that money won't be easily missed?

My hope is that we will all start thinking about how much we are willing to sell our integrity for and start putting a "Priceless" tag on it.

Reigniting Giving

2009-07-28T23:13:00.003-05:00

Ask yourself, how much money should you give away each year? Now, how much do you REALLY give?

If you are a Christian, as I am, we are called to give away at least 10 percent of our income as a tithe and anything above that is considered an additional offering.

Tithing has been a hot topic at this first round of DebtWatchers where everyone attends the same church. I have been surprised at class member's views towards tithing where almost everyone believes that tithing a full 10 percent of our income is either a) too much, b) impossible, or c) interchangeable with giving of our possessions or time.

I don't want to discount the value of our time spent volunteering and ministering to others or of the importance of living simply and giving things away that we don't need to others who are in need. But there is a misconception that doing these things instead of tithing from our income is the same. I won't get into the Biblical meaning of "tithe" or why we are called to do it other than to say this: Christian tradition has a tithe at 10 percent and we are called to give it back to the Church because that is what the Lord told the Israelites to do as a way to honor Him.

The incomes of the class members range from a few thousand per year to a few thousand shy of six figures and yet similar attitudes toward tithing were held by all. Meaning that regardless of income, tithing was not viewed as a) important for today, b) demanded of us, and c) a call to give away $$$. When delving into this as a group, class members found that they often waited until the end of the month to figure out how much they could give and this was usually around 3 percent of income rather than giving away 10 percent at the beginning of each month or with each paycheck.

If you don't place tithing as a priority, it WON'T happen! Money is easy to spend and our selfish nature shows that it is even easier to spend on things for ourselves and our families. Furthermore, tithing isn't supposed to be easy. It is supposed to be sacrificial giving, which is why the Lord commanded the Israelites to give the best of the first harvest gatherings and not the leftovers that wouldn't be missed.

So how do we go from 3 percent to at least 10 percent? Start living on less and pay God first. Many churches now offer automatic bank drafts which you can set up to occur when your paycheck is deposited. Also, enlist the support of other church friends to keep you accountable. It may be a conversation they have never had before, but I recommend that you find people who tithe a full 10 percent. Like any habit, tithing is a discipline that becomes easier as time passes. Who knows! Maybe you will even find a way to give 12, 15, 20% or more of your income as you become more financially disciplined.

Week 1 of DebtWatchers

2009-06-26T00:12:00.002-05:00

We had our first class meeting this week and it was great! Five people from my church signed up. All of them are over 40 years of age, which surprised me. I had hoped that there would be some younger people who wanted to take charge of their finances early on in life.

The range of financial knowledge and levels of debt varies, but everyone seems really committed to ending bad, old money habits and starting good, new habits. Since this is the pilot class, my challenge will be making the material coherent and building upon skills. There is so much to talk about when it comes to personal finances, but I think that starting with the basics will be the best approach.

Looking forward to Week 2!

Unwanted Sales Pitch

2009-05-18T13:55:00.005-05:00

How many of you have been contacted about an "opportunity" only to find that the opportunity is nothing more than a sales pitch?

A colleague of mine told me that her significant other, who works for a large insurance and mutual funds company, is impressed with my financial knowledge and efforts to educate others about finances. He contacted me and we set up a lunch meeting for today. I wasn't sure exactly what he wanted to talk about, but I thought it would be a great networking opportunity and a potential chance to get some financial support from a financial services company for DebtWatchers.

Was I wrong.

It was nothing more than a sales pitch for me to become one of his clients. He heard about how "with it" I am with my own finances and outlook on retirement that he said to his girlfriend "she is someone who would be a perfect client." (That is at least what he told me .)

Not only was he only interested in selling me his financial services, he scoffed at the idea that I would reach out to low- and moderate-income families to educate them about personal finances and retirement, and he didn't see how anyone with a low income could save money. I was ready to walk out the door at that point.

This is an important example of what is wrong with the financial services industry. Many of the professionals there (not all!) are looking for an easy sell. They don't see that there is a HUGE untapped market of low- to moderate-income families and individuals who would be glad to have some sort of help with their own finances. There are many CFPs (certified financial planners) who won't even take on clients who don't have liquid assets worth at least $100,000. How many people do you know of that have at least $100,000 in savings or investments? Most Americans don't.

I understand that financial professionals have to make a living, but basing services on commissions and high fees leave a lot of potential clients on the side of the road. We have to rethink how we offer financial products and counseling so that more people can become clients and get on the road to financial freedom.

I politely informed my new acquaintance that I was not interested in his services but that if he ever wanted to volunteer his time to teach others about retirement savings and investments, he was more than welcome to help out with DebtWatchers.

Starting Up

2009-05-15T13:23:00.005-05:00

When I really began to get serious about this plan to start a non-profit, I had no idea where to start. NO idea. Fortunately, I know some other non-profit professionals who gave me some advice about how to at least have some sort of legal authority to operate without having to file a lot of paperwork and pay a lot of fees. Thus enters the "DBA," which I had never heard of prior to starting this process.

In order to operate as a business in Texas, you have to (at the very least) submit a DBA (doing business as) form to your county clerk's office. Although SaveGiveSpend is a non-profit, we don't have to incorporate as a non-profit in order to operate but we do need to have a DBA. Not incorporating immediately will give us some time to determine who the Board of Directors will be, the bylaws of the organization, etc. I decided to file the DBA as "DebtWatchers" since that is the most readily identifiable name thus far for what I am doing. I can always file another DBA for any other names that we want to operate under.

But back to filing the DBA. What should have been a 15-minute excursion to the county clerk's office turned out to be an 80-minute ordeal. And it wasn't the fault of the county clerk's office. You have to show an official ID in order to file a DBA form and I had left mine at home along with my wallet, which I didn't realize until I was in the middle of filing the paperwork. So I head back home, which is only about a 10-minute drive, get the wallet and jump back in the car. Then, about half-way there, I get a sneaking suspicion that my ID (driver's license) isn't in my wallet. I pull over to check, and as suspected, it's not there. Back to the house. I spend the next 20 minutes turning everything upside down and inside out and finally find the ID in a pocket in one of my skirts. Back to the county clerk's office for a 5-minute wait, quick processing of my application, and, yes, verification of ID.

The Creation of SaveGiveSpend

2009-05-14T10:43:00.002-05:00

For the last five months, I have been planning a non-profit that will provide education, accountability, and support for people who want to take charge of their financial situation. I am about 2 weeks away from launching the first class, called "DebtWatcher$."

SaveGiveSpend will document the progress of the class and the still nameless non-profit as well as offer tips for taking charge of your financial future so that you can save more, give more, and spend more.