Have you been feeling overwhelmed and down-right stressed out about your finances recently? We’ve all been there (at least I know I have). Thankfully, there are plenty of tools and ideas out there to help you cope with financial stress.

After dealing with some significant financial problems myself, including being homeless, I found that there are a few sure-fire ways to make yourself feel better about your finances while working to better them as well.

Set a budget.

If you’re going to handle your financial stress you won’t do it by simply being overwhelmed by it. You’ll need to take action and start putting a plan in place. First, you’ll want to track all of your day-to-day spending. After you’ve had a good look at all of your finances, you’ll have a good idea of where you can cut and what remains a necessity.

Then you’ll be ready to create a budget.  No one’s budget is the same, so be sure that your budget is tailored to your specific goals. Also be sure that you are creating a realistic budget. Many people are eager to start saving and get their finances on track that they don’t think everything through before making ambitious goals.

Emergency fund.

When you are setting up your budget, be sure you set aside money for savings. A majority of Americans don’t have the money set aside to cover a $1,000 emergency. Because that’s the case, many people wind up racking up credit card debt when emergencies come up. This will not help your financial stress. The additional monthly payments will only add to your stress. So, make saving money for emergencies a priority.

Get help.

Don’t be afraid to admit when you need help. What keeps many people stressed out about finances is not talking to others about their problems. In many cases, keeping the struggle you’re having to yourself will increase your anxiety about the issue. There are plenty of affordable financial advisors (and even free financial advisors) that can help you sort through your finances.

Make changes.

Nothing will happen to alleviate your financial stress unless you make a change. You can plan, budget, and track all day long but if you do not change your behavior, your financial situation will remain the same. If your finances have declined because you spend too much money going out to eat, but you don’t change that behavior, you will still be struggling at the end of the day.

Give yourself positive affirmation.

Last, but not least, give yourself positive affirmation. This is important when you are trying to reach financial goals and other goals in life. No one is perfect. You’ll have good and bad days with your finances. Be sure to remind yourself that nothing is permanent. You can always make more changes to better your situation.

If you keep these five things in mind, you’ll be able to keep your financial stress under control and you’ll be on the road to financial wellness in no time.

Have you been under financial stress? How did you handle it? 

What do I do when my spouse spends too much?

How do I keep my spouse on track?

I hear these questions all the time.

If you’re married or in a committed relationship, then you know that there are a lot of complexities involved when two lives join together.

Your two paths must move in the same direction with similar values, lifestyles, and goals for your future.

While all of your interests don’t need to be exactly the same, the direction you’re both heading in life must follow a similar trajectory.

Of course, there are always exceptions to every rule, but most long-term relationships can’t foresee a future together if one person wants to live in the hustle and bustle of New York City while the other person has their heart set on raising a family in the quiet plains of Montana.

As is the case if you want to live a life of debt freedom and your partner wants to continue living above their means, relying on debt to fund their lifestyle. Those two worlds are not aligned.

Being out of alignment with your spouse in such a huge area of life as financial goals can create a lot of tension, to say the least.

That’s why fighting about money is the top predictor of divorce.

Here are four strategies that you can use if you’re completely committed to kicking debt to the curb, but your spouse is sabotaging any progress you make by spending whatever he wants whenever he wants.

1. Make sure that you’re on the same page.

If you and your spouse haven’t agreed on your current financial goals, then review my article on how to get your spouse on board. Follow those steps to come to an agreement on where your financial life is headed.

2. Make sure that you’re giving him a chance to provide input.

Because I love numbers and spreadsheets, my husband is more than willing to let me run with creating our budget and then tell him how much we have to spend on things.
But he needs to have some ownership of the process too.So each month when I create our budget, I always show him the numbers that I came up with and explain any areas that are different from the previous month. I ask him for his input on what those amounts should be and explain how I came up with the numbers I chose. I always ask if he agrees, and since we’ve been doing this for so long, a lot of times, he does, but there are still times that he changes the numbers.And that is perfectly okay.

Instead of arguing my reasoning further, I agree to his numbers because I WANT him to be part of the process. I don’t want him to think his opinion doesn’t matter because I know that having him share ownership of the budget is more important than a $10 or $20 discrepancy in a spending category.

3. Make sure that you both have spending money built into your budget, and of course, that you AGREE on those amounts.

Whether you come up with a weekly, monthly, or an annual amount, make sure that you both explicitly agree to those amounts AND that you agree on what comes OUT of those amounts.For example, our spending money is used for when we want to buy ourselves something that isn’t included in other categories of the budget like a new gadget for my husband or a mani/pedi for me. Oftentimes, it’s our coffee or lunch money when we’re out by ourselves.I’ve heard time and time again from moms that they often use their spending money to buy things for their kids or someone else. So if you find that you’re using your spending money to buy things for someone else, then consider whether those purchases should be included in another category in your budget, such as gifts. For us, anything we purchase for someone else (even our kids) comes out of our gifts budget

4. Set up a reward system to keep you and your partner on track.

For example, I spoke with a woman whose husband would occasionally buy expensive sports equipment, even though it wasn’t in their budget.He worked hard for his money, and they both felt he “deserved” it, but it was throwing their plan to become debt-free in a few years off track, and it was causing her to have growing resentment because she was doing a better job of sticking to the plan and avoiding “splurges.”I suggested that she have a conversation with her husband about their common goal to become debt-free and set up a reward system. They could add a savings category to their budget for her husband’s sports equipment and add to it each month.

Or they could agree that once they paid off their next debt or reached their next milestone on their journey, he could buy his next piece of sports equipment then. I also suggested that she have some sort of reward at each milestone, too.

Doing so will keep them both moving forward toward their goals and satisfied that they’re making a point to enjoy their money, as well.

She’ll have peace of mind that they’re making progress, and he’ll no longer be sabotaging their hard work.

[bctt tweet=”Set up a reward system to keep you and your partner on track with your #budget.” username=”MonicaRLouie”]

If you follow these strategies, and your spouse is still spending too much, then review your budget categories and make sure the amounts are realistic.

Even if you both agree on the amounts, you might be trying to be too stringent. It’s better to loosen up a bit on the numbers and extend your payoff date by a few months than to get discouraged and give up entirely.

I truly believe that working together on your goal of becoming debt-free will bring you and your spouse closer and make your marriage stronger. I’ve seen it happen in my marriage, and I’ve heard the same from my clients.

Now I’d love to hear about you!

Have you experienced one partner in your relationship spending too much? How did you deal with it? What advice do you have for those in this situation? Please share in the comments below.

Have you joined our free private community on Facebook yet?

I invite you to join me in our private Facebook group called Your Debt Freedom Family, where we share more tips like this. We’ve got a fantastic community of people who are kicking debt to the curb so they can break free and live life on their terms.

Click here to join the fun!

We’d love to see you there!

Keep moving forward toward your goals. You really can live the life you dream about!

Okay, so I have to admit that I’m a little over-excited in today’s post.

Why am I so excited?

Well, over the past two years, I’ve earned over $500 in gift cards by using Swagbucks!

Sounds too good to be true, right?

[Read more…]

Sticking to your grocery budget can be challenging for a lot of families.

But it’s so important if you want to cut your spending so you can pay off debt and achieve financial freedom.

Today, I’m giving you three simple strategies for sticking to your grocery budget.

If you’ve been following me for a while, you’ll know that in 2015, we had a hard time sticking to our grocery budget.

In fact, in January 2015, we spent more than $1,000 on groceries when our actual budgeted amount was only $500.

No bueno!

But by March, we’d cut our grocery spending to just over $500, and I had a reader ask how we did it.

I wrote this blog post to explain how we did it.

So far in 2016, we’ve been able to keep our grocery spending under $450 per month.

We’ve had to be focused and diligent, but we know that by doing so, we’ll be able to reach our financial goals a lot faster.

Here are my top three tips for sticking to your grocery budget:

1. Stop buying whatever is on your list when you reach half of your budget, and then be very diligent about buying only those items you need until the end of the month.
   This tip alone has helped us stick to our budget.
2. When you get home from the grocery store, review the items you purchased and pay close attention to the items that cost the most.
   When you’re getting close to reaching your budget, those are the items you’ll want to put off purchasing until your budget is replenished in the following month.
3. Keep your meals simple.
   I’ve been following the Paleo diet for over a year now, which can be super expensive. That’s part of the reason we spent more than $1,000 in groceries in January 2015. Plus, we eat mostly organic food, and that definitely adds up.To be able to continue eating healthy while keeping our grocery spending low, we’ve opted to keep our meals simple.For me, I eat eggs or meat with a side of veggies and sauerkraut for almost every meal. The kids eat oatmeal almost every day for breakfast. And my husband takes leftovers to work for lunch. We don’t make fancy meals that require a lot of ingredients.We figure that we can do that when we’re 100% debt-free.

If you follow these strategies and find that you’re still having a hard time sticking to your budget, then maybe it’s time to up it a little and decrease your spending in other areas.

We’ve worked hard to be able to get our monthly budget down to $450, and we know that anything less would be unreasonable for our family. And right now, our kids are only two and four so they don’t eat that much. When they get bigger, we’ll definitely have to increase our budget.

So give yourself some grace if you’ve got more mouths or bigger kids to feed.

Here’s a bonus tip:

Get really clear on what sticking to your budget will allow for you.

[bctt tweet=”Get really clear on what sticking to your budget will allow for you.” username=”MonicaRLouie”]

Maybe it means that you can buy another pair of jeans or save up for your son’s birthday party.

Maybe it means that you can start saving for your daughter’s college fund or give more to your favorite charity.

Or maybe it means that you can pay off more debt so that when you’re debt free, you’ll be able to do all of those things and still have more money for the fun stuff.

When you get really clear on why you’re sticking to your budget, it will be so much easier to make the necessary changes in order to do so.

If you’re on the website because you have debt, consider getting in touch with SoFi. They’ve got an interesting business model and good rates if you have debt you want to refinance. You can visit their site from this link or click on the banner above.

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Have you joined our free private community on Facebook yet?

I invite you to join me in our private Facebook group called Your Debt Freedom Family, where I share more tips like this. We’ve got a fantastic community of people who are kicking debt to the curb so they can break free and live life on their terms.

Click here to join the fun!

I’d love to see you there!

Keep moving forward toward your goals. You really can live the life you dream about!

If you were 100% debt free one year from now, what doors would that open up for you?

But what about if you were only 50% debt free?

That would still be pretty incredible!

Now’s the time to make this year the year that you take control of your money once and for all so that you can say “no” to debt and start saying “yes” to the life of your dreams.

I’m not talking about a resolution.

You know, those declarations where only 8% of people actually achieve success.

I’m talking about a new way of life.

A life where debt is no longer tolerated.

A life where you’re in control of your financial future and money is no longer a stressful subject.

The future is bright.

No matter how much debt you have now, and no matter how much (or how little) money you make, you CAN make progress to get out of debt.

To get started on the right foot so you can successfully tackle your debt, follow these steps:

Take a look back at the past year. If you’ve been keeping a budget or tracking your spending (and even if you haven’t), review how the past 12 months went. This is a good time to do an updated Net Worth Assessment.

How much debt did you pay off? Even if you didn’t pay much more than the minimum payments each month, if you have less debt at the end of the year than you did at the beginning, stand up and cheer! Be proud of yourself for not going deeper into debt!On the other hand, if you have more debt than you started the year off with, make a conscious effort to figure out why your debt balance increased.Were you not paying attention and got deeper into debt without realizing it, or was there a situation (or two) that surprised you that you don’t expect to come up again? Life happens so don’t be too hard on yourself. You really want to look at the year through an objective lens to figure out what lessons can be learned and how to avoid those situations in the future, if at all possible.

Remember, no judging, just adjusting where necessary. [bctt tweet=”No judging, just adjusting where necessary.”]

Did your assets (i.e. retirement account balances, savings account balances, home value, etc.) grow? The idea is that over time, we want our asset values to increase and our debt balances to decrease. This will improve our net worth and our financial health.

How much did you spend on average each month on groceries? Eating out? Utilities? Gas? Clothing? Etc? To figure this out for our household, I created a “Summary” tab in my budget spreadsheet that totals our spending in each category. It then divides the total by 12 so that I can easily see the monthly average we spent for the year. (You can easily do this with a pen, paper, and a calculator, though.) I like to analyze the averages for all categories, but you can start by reviewing the main categories that I listed above and any other pertinent categories for your household.

Determine what went well and areas that need improvement. What were the areas where you consistently went over budget? What areas did you consistently come in under budget? Begin to assess if you’ll need to adjust your budgeted amounts for these categories going forward. For example, as of December 28th, we averaged $601.82 for groceries per month, but we budgeted only $500 each month.Does this mean that we should increase our monthly grocery budget to $600 each month next year? Well, we still feel like keeping our grocery budget under $500 is a reasonable goal.

And here’s why:

I also reviewed the last six months (July through December) and found that on average we spent $464.55 per month! While there were a couple of months where we went over budget, we had four months in the last six months where we came in well under budget!

It might be worth doing some deeper analysis of your spending to determine if you should adjust your budgeted amounts up or down (or keep them the same).

Celebrate your achievements! For some, this will  be easy after going through the steps above. Others might have to work a little harder on this one. Even if you are having a tough year financially, come up with at least three things that are going well It could be as simple as lowering your cell phone bill or committing to buying things only when they’re on sale. I’ll bet that if you look hard enough, you can see that you made some positive changes for your financial future.

Use that momentum of feeling accomplished to fuel you to create your plan for the next year.

Determine new budget amounts for gifts, clothes, food, saving, etc. Create your Gifts Budget and determine your Budget Busters.Then break down these amounts into monthly amounts that you can include in your monthly budget. Take a look at your updated Net Worth Assessment and update your Debt Snowball.

Write down your SMART goals for 2016.How much debt do you want to pay off in the next 12 months?You can determine this by deciding how many debts you want to pay off this year (e.g. 3 credit cards), or you can come up with a percentage of debt you want to get rid of (e.g. 50% of my non-mortgage debt), or a nice round number (e.g. $20,000).However you come up with your amount, make sure you write it down (including the amount down to the penny) and add a deadline (e.g. December 31).And don’t forget to include WHY reaching this goal is important to you! Having a strong reason why is vital to success.Or if getting out of debt isn’t your goal, how much money do you want to save in 2016?

Break them down into shorter-term goals, e.g. quarterly, monthly, pay period. Let’s say you want to pay off $20,000 of debt. I don’t know about you, but that sounds like a huge amount to me.But I also think it is completely doable.Split up the amount so you know how much you need to pay off each quarter, month, or pay period to meet your goal.So $20,000 in one year is $5,000 each quarter or $1,666.67 per month.Maybe that amount fits nicely in your budget, and you’ll be off and running knowing you can easily meet your goal.But what if it doesn’t?

When you create your goals, push yourself a little outside your comfort zone. Shoot for a little more than what you think you can actually accomplish.

In 2015, our financial goals totaled $41,469.33!

That breaks down to $3,455.78 per month! And that amount did NOT fit nicely into our budget by any means.

But we knew we had to make great strides in 2015 if we want to be completely debt free (mortgage and everything) by 2021. And we definitely do!

So we pushed forward, got creative, and if you’ve been following my blog for a while, you know that, we were able to surpass those goals!

Even if you can’t see at all how you’re going to achieve your goal, I still want it to make you uncomfortable. Great things happen when we get outside our comfort zones!

And you may just surprise yourself!

Create your January budget.Determine how you’ll be budgeting — pen and paper, an app like Personal Capital, or a spreadsheet.  I made it easy for you to get started with my Monthly Budget template. There’s a separate tab for each month, and it will do all of the math for you. Enter your expected income for the month of January.Enter your monthly budgeted amounts.

Use the analysis from your 12 months of spending from Step 1 and the monthly amounts you came up with from your Gifts Budget and Budget Busters exercises from Step 2.

Next, fill in your other expected budgeted amounts, and then determine how much extra you’ll be paying toward your smallest debt on your debt snowball (or how much you’ll be saving each month if that’s your goal).

Set up your daily and/or weekly habits to keep yourself on track. How many times each week will you update your budget? (I like to do it twice a week — usually Mondays and Fridays.)Schedule when you’ll update your budget on your calendar. If you see it as an appointment with yourself, you’ll be more likely to do it. If you don’t have an accountability partner, find one.

Determine what you will do when you get off track — because you will! We’ve been on our debt freedom plan for more than two years now, and we’ve never had a perfect month! But we have paid off more than $120,000 of debt on a single, middle-class income. Our progress has come in waves, and we seem to get off track at least a couple of times each year. But each time it happens, we remember why we’re working so hard to get out of debt, re-commit to our goal, and then resume our focus on keeping our spending low and boosting our income so that we can pay off more debt.I’ll be sharing more next week on how to get back on track when you get off course so stay tuned!

Plan how you’ll celebrate when you reach each shorter-term goal from Step 2. For each of your shorter-term goals come up with a way that you’ll reward yourself when you reach each milestone. Maybe you and your partner will share a bottle of wine and indulge in a fancy dessert. Maybe you’ll sign up for that half-marathon you want to participate in next summer. Maybe you’ll get yourself a long-awaited manicure and pedicure. (Maybe these are all ways I plan to reward myself when we meet our goals. 🙂 Just sayin’.) Shooting for the shorter-term goals may be incentive enough to achieve them, but sometimes we need a little extra push to stay on track.

You can tackle your debts!

It will take work, but with a little-advanced preparation, you’ll increase your chances of achieving your goals.

Now I’d love to hear about you!

What are your financial goals? How are you setting yourself up for success? Please share in the comments below.

Asia, Latin America, Europe – these are just some of the places Kach and Jon have traveled while living free from debt!

Today, I’m honored to share the story of Kach Medina Umandap and Jonathan Howe, the top monkeys at Two Monkeys Travel Group – Community Travel Blog! [Read more…]

One of the first things you should do before starting any financial journey is to get your spouse on board with change.

Whether your goals are to pay off all of your debt or simply to ensure that you have enough saved up for a comfortable retirement, it is imperative that your objectives are aligned with those of your spouse. With financial issues being the number one cause of divorce, it is vital that you and your spouse work together to build a solid financial future.

Sometimes, though, this can be easier said than done.

When I saw the financial light (so-to-speak) and began to imagine the freedom we would feel if my husband Mike and I paid off all of our debt, including our mortgage, all it took to get him on board was a simple conversation.

When he got home from work that day, I nervously explained my revelation and my excitement about paying off all of our debt. Then I waited for Mike to reply.

To my delight, Mike smiled and said, “Let’s do it!”

From there, we worked together to develop our plan of action and started dreaming together about what being completely debt free in a few years would allow for our future.

Unfortunately, not everyone will have such a smooth experience.

If you are ready to take control of your money, pay off your debt, and work toward true financial freedom but are worried that your spouse may be resistant, I have come up with some strategies that you can try to get him or her to jump onto the financial freedom bandwagon.

Please understand that the intention here is not about manipulating your spouse into agreeing with you. You simply want what is best for your future and the future of your family. You recognize that having a plan for your money can provide security, freedom, and opportunities; while living with a lack of intention regarding your finances may lead to a life of regret, uncertainty, and unnecessary stress.

Implement the pieces that you think will work for your situation, think positively, pray for guidance, and be prepared that it may take several conversations before your spouse fully commits.

Starting the Conversation

Once you have decided that a conversation about your financial future with your spouse is necessary, find a time when you can talk without any distractions. This may be after the kids have gone to bed in the evening or before they wake up on a Saturday morning.

Let your spouse know that you have something exciting you would like to get his or her input on. Explain that it is important and that you would appreciate their full attention.

If you lead with your excitement your spouse may be more open-minded to hearing you out.

Start by establishing some common ground for your conversation. Focus on the dreams that you and your spouse share and explain how taking control of your money can help to make those dreams a reality.

Avoid beginning the conversation with details that your spouse may be opposed to such as getting on a budget and tracking your spending. Instead, focus on the bigger picture and the direction of your financial future.

Focus on the Benefits

Explain why making a change is important to you. Focus on the benefits that being more intentional with your money will provide.

Discuss why taking this step and working together on a healthy financial plan is crucial and what it will do for your future. Share about the added security you will feel when you have a plan that will get you to your goals.

You may want to share examples of other couples who have paid off their debt and are working toward true financial freedom.

If your spouse has traditionally been the person in charge of handling your finances, let him or her know that you would like to be more involved.

Without criticizing your spouse or indicating blame, indicate how your current financial state has you feeling concerned for your future. This can be tricky so choose your words carefully or omit this part if you feel that your spouse may not react favorably.

Ask Your Spouse for Input

Ask how your spouse feels about having a financial plan and working together to create one.

This is where you stop and listen. Fight the urge to interrupt if his or her response is not the reply you were hoping for.

If he or she is on board and shares your excitement, then begin by getting clear on your dreams together and writing goals that can lead to achieving those dreams. Next, develop your plan for success.

What to Do If Your Spouse is Resistant

If your spouse is resistant, however, then it may be best to end the conversation. It is important to respect your spouse’s opinions and avoid turning the conversation into an argument.

If you feel your spouse is open to discussing further, then ask why he or she is hesitant. Listen and try to understand where your spouse is coming from. Put yourself in his or her shoes and appreciate how they feel.

Try to offer some ideas in response to your spouse’s objections in a way that does not come off as argumentative. Position your responses as ways to help you both to achieve your objectives and work together on a solution.

Recognize that your spouse may not be able to articulate why he feels the way he feels. If your spouse is not able to explain why he or she is resistant or refuses to discuss further, then switch the conversation to a more favorable topic to your spouse.

Understand Why Your Spouse Might be Hesitant

Reflect on your spouse’s childhood and how his or her parents handled money. Examine your spouse’s relationship with money and try to understand what may be holding him back from being proactive about your financial plan.

It may just be that your spouse needs some time to process the idea of creating a financial plan or changing the direction of your financial future.

He may feel overwhelmed by the idea of budgeting, tracking spending, paying off debt, and saving money.

He may not know the first thing about budgeting or why it is necessary.

He may not think he has enough time to devote to creating and implementing a financial plan.

He may not realize that having a plan can make him feel more in control of his money. Instead, he may feel like a plan will control him.

Whatever the situation may be, being sensitive to your spouse’s feelings about money will help you decide how best to proceed.

Lead by Example

While it is best to work together with your spouse on your financial plan, that may not always be possible.

Rather than giving up on the idea of being more intentional with your money, think of some simple ways that you can lead by example. It may be that once your spouse sees you making some changes that impact the family in a positive way, he may decide to jump on board and find out how he can help.

Here are some ideas:

• If you are the one who generally decides what to make for dinner, then maybe you can start meal planning as a way to save money on groceries and try to adhere to a food budget.

• Perhaps you can look at your expenses and try to negotiate a cheaper rate for Internet.

• Or maybe you can start limiting the number of lattes you purchase during the week so that you can make an extra payment toward your credit card.

• You may want to go through your closet and pull out some clothes you no longer wear and take them to a consignment shop to bring in some extra money.

Once your spouse sees you making an effort to take control of your finances and understands how important making a change is to you, he may be more willing to work with you to develop a plan.

It is important to remain patient, maintain a positive outlook, and have faith that your spouse will eventually see the financial light.

What About You?

Participate in the conversation. What advice would you give to someone who is trying to get their spouse on board? What worked for you when you had a similar conversation with your spouse? Share in the comments below.