As Benjamin Franklin wrote to Jean-Baptiste Leroy in 1789 (many years before Mark Twain's attributed quote), “Notre constitution nouvelle est actuellement établie, tout paraît nous promettre qu’elle sera durable; mais, dans ce monde, il n’y a rien d’assure que la mort et les impôts.” or rather, "“Our new Constitution is now established, everything seems to promise it will be durable; but, in this world, nothing is certain except death and taxes.”
Tax season. For most it is met with dread. The process of collecting all the receipts, forms and paperwork is enough to drive someone to distraction. Yet, it is something we all have to do.
When we do our taxes it always gives me pause: Should I have been a better steward with our resources? Why didn't we save more? Did we share enough with others? What the heck did I do/spend with the money we received? Why wasn't I more frugal?
I have been thinking over all the financial advice that I have read and received over the years. I need to revisit how I practice it. It really comes down to some simple steps:
Budget. Every financial advice column talks about a budget and the need to first develop one. You need to get a handle on your income but more importantly, you need to understand where you are spending your money. Some things are non-negotiable but most of us spend money on non-essentials and discretionary spending.
Save. Besides a budget, almost all financial advice talks about "paying yourself first". Personally I believe in giving first (see last point), but saving is up there too. In many incidences it is recommended to have money taken directly from a paycheck and put into a savings account, an IRA or some sort of savings/investment plan. The idea is "out of sight, out of mind" or spending.
Financial Fasting. Many years ago I read about a practice of financial fasting. For a set amount of time, one should spend money on only the essentials- food, shelter, transportation. The thought is to try and live within those parameters for say, a month, and save the rest of your income. This might be a good beginning practice in preparation for setting up an ongoing savings account. Or if you need to get your budget in alignment, financial fasting can help you prioritize what is important.
Give. There are many reasons to be generous with our finances. We are called to be a people who share. I believe that we give in response to our gratitude to God. It is also a faith gesture- we give even when it doesn't seem to make budgetary sense. Somehow in God's economy it all works out. Plus, it does seem as if we should be able to financially live on 80% of our income (saving 10% and giving 10%) or at least strive for that as a goal.
What about you? How are your finances? Is it a source of great anxiety and stress in your household? How can you get a handle on it? Do you need to see a financial counselor? Do you need to give up some area of spending in order to gain some peace of mind? After all, isn't that what it is all about? Financial Peace.