Natalie “Nat” Craven is a financial blogger, mom, and wife. She loves budgeting, eating cheesecake, and exploring Utah with her handsome husband and four active kids.
Nat studied Family Finance at Utah State University. She earned her Bachelor’s and Master’s Degrees in Accounting from Weber State University where she was awarded a scholarship to research taxation. She became a Certified Public Account (CPA). Nat is no longer intimidated by the tax code—even though it is a complicated foreign language. After working in public accounting for a couple of years, she left the industry to raise money-smart children, but kept up her license and education by doing online coursework.
She volunteered and worked for Cornerstone Financial Education, becoming a Certified Personal Financial Counselor (CPFC). There she helped teach personal finance classes and started a financial fitness blog.
Through the years, she found her passion for budgeting as she realized that no one needs a CPA license or a Master’s degree in finance to manage their money well. Budgeting is a super simple principle to understand, but is challenging to apply. Her blog posts focus on the how we can “USE” our budget to reach our goals. Almost everyone has made a budget, but using it is powerful. Follow Nat on Twitter at @cravennat.
As parents, we often sign our kids up for soccer teams, swim, piano or dance lessons. But there aren’t any lessons for them to learn personal finance. My son is in first grade, and he is learning what money is and how much each coin is worth. However, it’s up to us as parents to teach him how to use money and to develop healthy financial habits. As parents, we want our children to be financially fit, and avoid some of our mistakes.
Here’s a few financial habits we can teach our children as part of daily life.
In our family, we give our kids a chance to earn money every week. My eleven-year-old daughter told me that her friends don’t have to earn money: they get allowances. She said that she has the worst life out of them. We value work and want them to understand that they earn money from working. They can earn as many dollars per week as their age. So my five year old can earn $5 per week - $275 per year! However, we struggle to consistently record and consistently have payday. We are going to work on that.
Our kids like to count their money. My younger kids still think every dollar is equal. I explained to my daughter that one $5 bill is worth five $1 bills.
We teach our kids to save for specific goals. Last week we realized it can be nice to have general savings also. My daughter was invited to go to Alaska to attend her cousin’s baptism. Jackie had several hundred dollars saved, and we had a vacation fund. We agreed to match her savings. So, she paid half of the airline tickets, and we paid the other half. When unexpected opportunities arise, it is nice to have some flexibility with our savings. She is so excited because she hasn’t seen this cousin and her family for 9 months, although she says it feels like it's been years. I encouraged my other children to keep saving so that they can take advantage of similar opportunities that they will have.
I love to see my kids give, but I don’t force them to give. We give, and our kids notice. I always let whoever is helping me at the store keep the coin change. While I was busy loading the groceries, my 4-year-old daughter put her change into the donation container, which was sitting on the counter. As we walked away, she exclaimed, “I gave money to help the sick people in the hospital!” That warmed my heart.
Shopping gives me so many chances to teach my kids about money. I don’t always take kids shopping because it takes 3 times longer, and it is very tiring. For example, last Monday, we went shopping as a family activity. Our boys ran around the store fighting. But, shopping with kids is worth it because of the teaching opportunities it brings. As we shop and see a lot of cool things, my young kids usually ask to get them. I often reply, “It’s not on the list.” My four year old isn’t the only one that struggles with this. I often want to buy things that are not on the list. She happily tells me, “It’s not on the list.” This is teaching them, and me, to prioritize and to use self control.
At the end of the shopping trip, I let the kids pay for the groceries. I was with my five-year-old last week. The total was 19.56. He paid with a twenty dollar bill. The cashier asked if he would get some change. He said, “No.” That opened up a conversation afterwards. We discussed which one is greater: $20 or $19. I really appreciate that patient cashier who help teach my child. Through this, he is learning the value of money.
We went to Walgreens to pick up some pictures. I let Chloe (4) and her friend look at all the Easter toys. She wanted to buy a stuffed animal. I showed her how much it cost, and explained that she could bring her money back to get it. She asked, “Can we come back today?” I told her that we probably could. We completely forgot about the item that she wanted. I didn’t remember about it until I wrote this post! This experience taught patience and focus.
My oldest daughter has her own library card and checks out her books. She told me she had a $2 fine and she was bringing a five dollar bill. We rode our bikes to the library, and she paid her fine. She is learning responsibility.
All of these stories I mentioned happened in just one week’s time. What money teaching moments have you had in the past week?
Life gives so many chances to teach our kids about handling money and to help them develop good financial habits. As I teach them, I also learn from them and with them. It can be tiring. Being consistent is challenging, but we’re succeeding as long as we keep trying!
A couple of years ago, we received a lot of money as a Christmas gift from our parents. That gift shocked us because we weren’t expecting that extra income. Adrenaline started running through my body as I thought of what we could do with this money. We were saving for a car, so that’s where we used it. Having a goal helped me calm down. It was great to know where to spend the money so we didn’t regret how we spent it. Even though the timing of bonuses, gifts, or inheritances is often unexpected, you can plan how to spend the extra income when you receive it.
I think all of us would like extra income, but do you know how you would spent it? Would you save it for retirement? Would you spend it on a vacation or a purchase? Would you pay down debt? It’s good to think about this ahead of time so that you know how you would spend extra income.
When Ty changed jobs in November, all of his accrued vacation pay was paid out to him from his previous employer. We didn’t expect that he would change jobs and receive all that money at once. We hadn’t been able to save for Christmas throughout the year, and we were considering using some of our emergency fund for Christmas. When he received that extra income, we paid for Christmas. I was glad that we didn’t have to use emergency fund money because I don’t consider Christmas an emergency, but we weren’t sure how we were going to pay for it.
I have noticed that unexpected income is often followed by an expense. Have you noticed this? Maybe you received a gift and then the washer broke. I have seen this happen enough times in my life and in the lives of others to see a correlation. A few years ago, my friend and I discussed this and how it can feel discouraging. She had learned to appreciate that money comes when you need it. I decided that I wouldn’t let myself be discouraged anymore when this happened. She helped me to learn to be grateful for extra income even if it needs to be used for bills.
After my family had saved an emergency fund, the unexpected repair expenses didn’t use the extra income anymore. I really don’t like to spend our emergency fund - just ask my husband. He teases me about having an emergency fund that I "won’t use even for an emergency.” I reply, “If I spend it, I won’t have it for an emergency!” Anyway, I might still choose to use extra income for an unexpected expense, but having an emergency fund gives me options to pick which money to use.
The purpose of this blog is to help you reach your financial peak. Each week I’ll give you a financial exercise to do. This week’s exercise was fun for me. I hope you will do it! And, I hope you enjoy it. I want you to make a wish list. Prioritize from the most important or most urgent financial goal down to the least urgent goal.
Here is my Extra Income Wish-List:
I often say that we can’t buy everything that we want, but we can do anything. Staying focused is challenging for me. This exercise helped me define what I would do with extra income. Now, I’m ready for unexpected and extra income. It’s welcome anytime!
My 4-year-old has been warning me, “If you don’t wear green, you’re going to get pinched on St. Patrick’s Day.” Similarly, if we don’t pay attention to our finances, we can experience stress and pain. I hope that we can all be successful financially. Very few people have a chance at winning a fortune, but we can all build one. Succeeding financially doesn’t depend on luck.
I’ve been thinking about being lucky. On Saturday, my daughter went with her grandma to see a friend’s new house. She came home and told me how lucky those kids were, “They had their own room, tablets, a movie theater, and a playroom.” I agreed that they were lucky and then asked my daughter, "Are you also lucky?" After thinking, she said, “Maybe.”
That same day I had walked through my friend’s beautiful brand new house, but I know it wasn’t due to luck. My friend and her husband have worked and continue to work very hard.
How do you define financial success? If we never define it, then we’ll never know when we’ve achieved it, and we can chase other people’s definitions of success. I think this is very important because financial success is individual. You don’t have to be a billionaire to be financially successful. What do you need? What’s your purpose? Money is a tool that helps you fulfill your purpose. It’s not the purpose.
Irecently watched Letters, which is a movie about Mother Teresa. In one of the scenes, she was offered a room that more than she needed. She asked the landlord to just leave the bed & desk and take out the rest of the furniture. She knew her purpose and was successful in my opinion. She didn’t need a million dollars to fulfill her purpose. In fact, money seemed to detract from her purpose.
Depending on your purpose, you might need a million dollars and that’s okay too, but it is individual.
It is super cool to me that you don’t have to make a lot of money in order to accumulate a lot of money and to obtain financial freedom. My grandparents told me a story about their neighbor. He was a mechanic who lived financial principles. He ended up saving a lot of money. He didn’t look like he had money - financially, some people look better than they are and others are better than they look. He went into a car dealership and wasn’t treated well because the salesman assumed that this man didn’t have much money. He left and went to a competing car dealership and paid cash for a new car. I have known people like this man who have inspired me to live financial principles.
What financial principles did they live?
The character that you build is part of the success. While swimming this weekend, I thought about dedicated Olympians. As I jumped into the pool at 5 am on Saturday morning, I admired the dedication that they show to practice every day. They work so hard and sacrifice so much to be able to achieve swimming success as an Olympian.
How many people do you know became successful by chance? I can’t think of one Olympian that did. How about financially speaking? I don’t know anyone that succeeded financially without working at it.
My husband has been swimming for the past few months and is feeling frustrated about not progressing faster. He told me that he has to rest so often. I suggested that he keep swimming. I haven’t seen daily progress in my swimming ability, but over the years I have become a much better swimmer than I was 8 years ago when I started. Finances are like swimming. It takes time and practice to see progress.
When it comes to finances, there are some factors that we can’t control, but there are also so many that we can. We don’t have to leave our finances up to luck!
Countless blog posts have been written about credit scores and credit reports. Not one post has been written about my personal experience with credit reports. So, I’m going to share my credit story. I would love to hear your experience with credit reports & scores too!
Here are my tips for healthy credit scores:
Credit scores determine your ability to borrow money from many lenders. In my early 20’s, I applied for a car loan from a credit union. Then, I shopped for my dream car. The lender told me that I qualified to borrow $10k. That wasn’t enough to buy my dream car. I felt surprised that I didn’t qualify for more. I had heard stories of others who made less than me and qualified for so much more. I didn’t understand how credit was used to grant loans.
Years later I worked for a nonprofit and taught financial education. As I taught about credit, I understood why I hadn’t qualified for more money years before - I even felt surprised that I had qualified for $10k. Since I had no credit at the time, I had no credit score. The credit union was looking at my credit score and my income.
If you are wondering about the end of the story, here it is: Well, that experience helped me realize the value of money. I realized that ten thousand dollars was a lot of money! I actually decided not to buy car at that time. Instead, I used a free bus pass offered through my college until I graduated.
Nine years ago, we refinanced our home. The refinancing process included a credit check. The loan officer noticed that another social security number was being reported on one of my credit reports. It was an easy fix. She sent a letter stating that the social security number reported was not mine, and it was corrected.
Checking your credit report is one way to catch identity theft as early as possible. Also, mistakes on your credit report can negatively affect your credit score. Millions of Americans have mistakes on their credit report at some point in their lives. If you notice the mistake and notify the Credit Reporting Bureau of that mistake, they are required to investigate it. If you need more information on how to do this, check here. Disputes can be done online.
Ever since that time, I’ve checked our reports regularly. How often is regularly? Well, it’s not as often as I should be exercising or eating, but it is as often as I should be getting a physical check up (which I haven’t done for a while). An annual credit checkup has worked well for me. I suggest you find a time that you can remember to check it. If you aren’t preparing to get a loan, it’s easy to forget about checking your credit - just like it has been easy for me to forget about getting a physical checkup because I’ve been healthy.
By checking your credit score once a year, you can ensure accuracy so that when you do need credit, your reports will be accurate and you will be prepared. One friend told me that she checks her credit reports on her birthday so that she can remember to do it. I check my reports when I do my taxes, because they are both financially related. You can check your credit report once a year from three credit reporting companies for free through this website. (It does cost to get your FICO (Fair Isaac Corporation) score.) Each company reports different information in different ways. You don’t have to get all three reports at the same time. If you want to check one report every four months, you could do that. Decide what works best for you.
Credit Reports are not the easiest documents to read and understand. I almost needed a magnifying glass to read Transunion’s small wording on its report. I remember feeling confused and overwhelmed the first time that I read my credit reports. The reports seemed too long for someone with such little credit history, but it listed every address where I had lived. It also listed everything I had done financially.
Credit history can be long. Our mortgage loan was sold several times, and we have refinanced twice. So, all of that information is listed. Be prepared to sift through a lot of information. Check to make sure that the information is accurate. There are three different agencies that report credit information: Equifax, Experian, and Transunion. Each report is different.
There are five basic components of a credit score. If you want more information about those five components of the credit score, read this blog post from Wasatch Peaks. I promise that checking your credit reports isn’t as painful as it may sound and is vital to keeping your credit score accurate and healthy.
To further understand your Credit Report, feel free to use the financial counseling services that Wasatch Peaks offers. The counselors are certified credit report reviewers and are there to give you guidance and support, whatever your financial situation.
Last week I went to yoga, and the instructor told our class to “embrace the warming feeling in your muscles.” Embrace that burn? I didn’t want to embrace it because it felt so uncomfortable. I don’t naturally enjoy exercising. In fact, I almost didn’t graduate high school because I didn’t have enough gym credits.
So, why do I exercise regularly? Those burning yoga stretches take my mind off the worries of life. As I fight for each pose, I become stronger. Going to the gym gets me out of the house and around inspiring people. The music playing in the gym inspires me. I exercise so that I can feel good afterwards.
My dad was in his mid-40’s when he started breathing heavily going up and down stairs. This was strange because he had been active and healthy. Doctors found that his heart’s mitral valve wasn’t closing correctly. He went through open heart surgery. Although it wasn’t his fault, his health gradually declined from that point, and he died a little over a decade later. That experience really impacted me. I decided that I would do all I could to be healthy. This is a strong enough reason to motivate me to leave the house in the wee hours of the morning to dive into a cool pool and swim.
Consistently doing anything is challenging. I have to have a strong enough reason for doing it, so I can overcome the challenge. It’s uncomfortable and even painful to do financial exercises like living within your means, using a budget, and saving an emergency fund. But, it feels so good to be financially strong. Find and define your reason! During the recession, I saw the stress of finances on my dad. When my dad died, I understood firsthand the importance of having life insurance and being financially prepared. This is my reason for living financial principles and having financial health. That keeps me motivated to budget and save especially when I make mistakes. I want my family to have financial freedom and avoid pain that financial stress causes.
Consistent effort doesn’t mean that you are perfect. It means that you keep trying. We have a framed poster on our wall of our turtle that says, “Slow and steady wins the race.” I’ve read the story of the Turtle and the Hare over and over to my kids, and we talk about it a lot. I’m not sure that they are convinced yet. Recently my daughter told me that she could beat that turtle. They don’t understand how a turtle who travels at walking speed could win. A couple of friends and I did a mini triathlon this month, and I was the fastest of the three of us. This shocked me because they both run better than I do. One is a better swimmer and is more experienced. I expected them both to be faster than me. Afterwards, my friend told me that I had been the most consistent at training. Her comment really impacted me and made me realize the importance of being consistent in whatever you are doing.
There are some factors of our finances that we can’t control. I am a recovering control-aholic. I’ve realized that I can’t control the weather, the economy, or others, and I'm okay with that. I can’t prevent a financial storm, but I can commit to living financial principles. The storms still hit my family, but we’ve had financial umbrellas that have protected us. That feels so good. One of my friends has been really consistent at saving and investing. She is only forty and her dad told her that she didn’t need to be worrying about retirement, but should enjoy life more. I felt shocked that he was trying to discourage her from living her financial habits. Slowly and steadily living financial principles isn’t popular, so the only way I can do it is to have a strong enough reason for doing it. When you feel the pain that comes from financial exercise, remember how good it is going to feel later and remember your motivation for doing it.
I hope you enjoyed the President’s Day holiday. Our kids were out of school on Friday & Monday, so we had a long weekend full of fun times. President’s Day reminds me of tax season. Although IRS technically started accepting tax returns on January 23rd, most of us have not filed because we were waiting for information. Also, some returns weren’t being processed at that time. For example, if you are claiming the refundable portion of the Child Tax Credit or if you are claiming the Earned Income Tax Credit and were receiving a refund, it wouldn’t be paid before February 15th. Now, tax season is definitely here. Unless you are waiting on some K-1s or 1099s, you probably have the forms that you need in order to file your taxes.
I recently attended an 8 hour seminar highlighting the updates for taxes - by the way, that was the short class. The long one was 2 days. Some things in life never change, but tax law isn’t one of those unchangeable things. For this post I’ll mention some of the tax topics that I think the readers here will appreciate. Apply each topic to your situation.
Partnership returns are due on March 15th now, which falls on a Wednesday this year. By the way, whenever a tax filing deadline falls on a weekend, taxes are due on the following Monday. Because April 15th falls on a Saturday and Emancipation day is observed on Monday, April 17th, the tax filing deadline is April 18th this year for individual filers and businesses filing an 1120. (See IRS for more information.)
Tip: If you have some investment accounts, you will want to wait until the final 1099s are sent out. Last year I worked on several tax returns that we thought had the final 1099s, but a few weeks after they were filed, another 1099 was received. Some of these 1099s were not received until mid-March. It is easier, cheaper, and better to wait to file than to amend a return, but returns can be amended. Regardless of when you file, I recommend you prepare the information you’ll need for your return now!
You have until your tax return filing deadline to contribute to your IRA accounts! For most of us, that is April 18th. Each year my husband and I try to reach our $5,500 limit for IRA contributions. Some years we do and some years we don’t even get close, but we aim for it. Having a few extra months helps me. If you haven’t started contributing to an IRA, I recommend you start with a small amount. That’s how we started. How much do you want to contribute before the tax deadline? You need to know this in order to file your taxes. For specifics, check here.
Tip: Always be aware of phase-out amounts. This means that if you earn over certain amounts, the credit or deduction “phases” out until you aren’t allowed any of that benefit. You can look up the specific phase-out amounts for the deduction or credit you may be wondering about. Just because a deduction is generally allowed, doesn’t mean it will be allowed for you. For example, if you are married, the phase-out range for the American Opportunity Tax credit is $160,000-$180,000. This means that as your income reaches $160,000, the credit will ratably be reduced, and if you make over $180,000, it will be gone. I often hear someone say “that is tax deductible” in conversation. I think to myself that it depends on the taxpayer’s income. Student loan interest is tax deductible unless you earn over the phase-out amount. I won’t list all of them here, but you can easily check them on IRS’s website for any deduction or credit that you are considering.
Will you be receiving a huge refund? Emotionally, it feels great to get a large refund. I understand this! I know I’m swimming upstream to suggest that you adjust your withholding, but a large refund means that you are letting the government hold your money. I try to withhold just enough to get a small refund.
Some people tell me that they don’t have the self discipline to save throughout the year so at least that forces them to save. I get that. However, USING your budget will solve this problem, and you can get off that wagon. I’ll get off my budgeting “soapbox” now.
IRS is trying to protect against this. If you want to read more information about possible fraud, click here.
Identity theft is a big problem right now. I personally have a friend who wasn’t able to file her taxes electronically because someone had fraudulently used her social security to file taxes.
This was an important law passed at the end of 2015. Some tax provisions were made permanentsuch as Child Tax Credit, AOTC - American Opportunity Tax Credit, & Tax Free transfer from IRA to charity.
Other tax provisions were extended. For example, the deduction of mortgage insurance premiums was extended through 2016. This is a nice deduction if it applies to you.
The IRS website is a great resource for tax topics. I hope your tax season goes well!
According to ycharts, the average personal savings rate in the U.S. at the end of 2016 was 5.5%.
That is what my family was saving, so we are average savers right now. Savings doesn’t happen without strategy, so this statistic shows we are prioritizing savings, but we can improve this percentage.
Eight years ago, my family had a savings account with a few thousands of dollars in it. We emptied the account in order to pay for a new roof. We saved for a couple more years and then we emptied it again to pay for a fence in the backyard, which we justified as an “emergency.” It felt like we couldn’t get ahead because we were filling and emptying our savings and couldn’t ever move on.
At the same time, I was feeling pressure to save for retirement, vacations, and my childrens' future college and marriages. I wanted the time value of money to be working for us in all of these areas. That resulted in me using that marriage fund for another expense. We only saved a couple of hundred dollars for college, and our retirement savings was minimal.
In 2010, we decided to focus on one savings goal and invest 3% towards retirement. We decided that our first goal would be to fully fund an emergency fund, which we would only use for emergencies. (Home improvements didn’t count as emergencies for us anymore!) About a year and a half into the goal, we had saved ¾ of our goal amount. I felt tired as we hit a savings wall. I started to justify that we had enough saved, but our commitment to this goal helped us to stay focused on it and climb over the savings wall. About a month after hitting that wall, Ty received a promotion and large raise from his employer. This raise was 5X bigger than any raise he had ever received in the past, and it allowed us to reach our savings goal within a few months.
I remember the Magic Eye 3-D images that required me to relax, focus, and disregard all of the distracting images in order to see the 3-D image through the busyness. You have to be committed to finding that 3-D hidden image. That’s what happened when we focused on one savings goal. We were able to ignore all of the busy distractions. We relaxed and focused in order to see the goal realized.
I don’t know who to give credit for the term “savings snowball.” When we were going through our Savings Attention Deficit Phase, I knew about the debt snowball. This focused on paying one debt off at a time while paying the minimums on everything else, and I thought it would be great to do that on the savings side so that we could avoid debt. I googled “savings snowball,” and found the phrase several times, so I wasn’t the first to coin it.
Think about how we make snowballs. My kids have been making a lot of snowballs. They can make a lot of little ones for a snowball fight, but to make a snowman, they have to focus on one and roll it until that snowball gets bigger and bigger. Pretty soon, we have a large snowball to use to build the base of a snowman. Once the snowball is big enough, we can move to the next snowball, which doesn’t need to be the same size as the first. We decide how big it needs to be, and then we roll it until it gets to be that size.
We started doing this with our savings. After saving for an Emergency Fund, we saved for a trip to Disneyland, which was a much smaller goal that we reached quickly. Then we saved for a minivan. Now we are saving for an SUV to replace my husband’s SUV. The savings snowball has worked well for us because we see progress in reaching our goals in a relatively short amount of time.
This method also helped me relax and focus. I don’t goal hop anymore or try to do everything. The percentage of our income that we saved has changed. We started with about 5%, and each time we got a raise, we put it towards savings until we were saving 20%. Then, with our job loss, we weren’t saving at all for a short time. Then, once again, we started saving 5%, which is where we are now.
Look at your budget to determine what percentage number is right. As you free up money by reaching your savings goal or increasing your income, you can add to that. What other savings strategies have helped you?
Over the weekend I bought Valentines for my family. Those are the first of the many gifts that I will buy this year. Budgeting helps me enjoy gift giving and helps me give more meaningful gifts.
The budgeting category of gifts can be challenging. It really is a subcategory that requires more planning. It’s not like my phone bill category that I allocate money and then pay it. Gifts need their own detailed plan within the budget plan.
Gifts and I have a love/hate relationship. I love giving gifts - especially when I find the “perfect gift” that will mean a lot to the person who is receiving it. Long before the Internet, I remember ordering gifts by phone. My sister and I were watching TV and saw an infomercial for a classical rock CD. She got excited and said she wanted it, so I sneakily wrote down the phone number and ordered it. Her eyes lit up when she opened it. That was so cool! I also love receiving gifts - especially surprises. I hate when I feel obligated to give a gift and can’t find one. In the past, I felt like I need to give someone a gift at Christmas because they gave me one, instead of graciously accepting what they gave. I’m trying to eliminate giving out of obligation, but I admit it is still a struggle.
Budgets make gift giving fun because it helps you avoid feeling regrets or other bad feelings. Here are steps to create your giving plan for this year:
Leave some flexibility in your gift budget. I’ve realized that there are some gifts that I’ll want to give that I can’t predict. I leave some flexibility in my budget for the baby showers, wedding showers, and graduations which will inevitably come up. We budget $20 a month to our miscellaneous “giving” category, so that we have some flexibility to give. Including this has been key to our gift budget.
Personalize your gift giving category. Make it work for you. When I give small gifts like the Valentines that I bought, I include them in my groceries. I keep it simple if it is minor, but for big gifts, I plan them out. There is no right or wrong way as long as it is your way! Just figure out what your way is. I learned to do what is right for my family.
Around our 10-year anniversary, I started to feel pressure to go on a big trip. When I thought about why I felt that way, I realized it was because my cousin and his wife had just posted pictures from their 10-year anniversary trip, but we didn’t have the money budgeted for that and didn’t even really want to do that. So, we didn’t. It’s cool that my cousin wanted to do that and had a great time. I was able to feel happy for them and feel content that we didn’t spend money we didn’t have on a trip we didn’t really want to do. By personalizing your gift budget, you give the way you want to give and can feel content.
Plan to save for the gifts that you can predict. Many of the big gifts that we give are predictable, like Christmas and birthday gifts. All of my family’s birthdays fall in the first 7 months of the year. I like this, but I have to plan for it. Some years I save throughout the year for birthdays and Christmas. This year, I don’t have the money saved, so I’m budgeting birthday money for the first six months. My husband is paid bi-weekly. I figured out when the 3rd paychecks of the month will fall, and designated those to go towards Christmas this year and birthdays for next year.
There are a lot of ways to save for gifts. Look at your personal situation to figure out how to save for those. Would it work best to put it all away at once or save every month? If you are self-employed and have a busy season, it could make sense for you to save for all your gifts during that time. Wasatch Peaks has a Christmas Club Account and Budgeter Accounts that could be a great tool to do this. I have used a spreadsheet or budgeting software to make electronic envelopes and set aside the money for birthdays so that I don’t spend it. Thinking through these details has relieved so much stress.
Don’t just give because you feel obligated. When I do this, I feel bad afterward. My mother-in-law asked us not to give her anything for Mother’s Day except a homemade card. This was very hard for me because I love her so much and really wanted to give her a gift. She knew this and told Ty that she would be mad at me if I did something. I learned a lot from this. If we can think of something she would enjoy, like pictures of our family, we give them, and she graciously accepts them.
Express love through gifts. We can’t buy love, but we can buy gifts, and if done in the right way, they can help express love and strengthen relationships. When we were dating, Ty made me a DVD with songs to go with it. He also gave me a watch. The DVD meant a lot to me because it was so thoughtful. And after 15 years, I still have the watch (it just needs batteries). These are gifts that last. Since that time, I remember only one other Valentine's gift. Instead of focusing on Valentine's Day, we try to show love all the time. It’s so fun to pick up a favorite treat for my husband while I’m at the store. We aren’t anti-Valentine's Day - if you buy the heart balloons, big stuffed teddy bear, and heart shaped chocolates, that’s cool with us! My husband has gone to Walmart the night before Valentine’s Day for entertainment. He loves to watch dazed shoppers searching for a gift.
Give what you can afford to give. Often, the best gifts are the gifts that mean the most to the receiver. These gifts are heartfelt, and not because they are expensive. They are often super simple and cheap, but require understanding what would mean the most to the receiver.
Almost 2 years ago, I attended a youth conference with a group of youth and adults. We got to know each other really well on that trip. One of the leaders served as our cook. At lunch time one day, he found out that I love eating the ends of the bread. On the way home from this youth conference, I found out that my husband had be fired unexpectedly and without cause. This was an emotionally hard time for us. We really needed support as Ty & I clung to each other and our young family. One morning soon after, I opened my door and on the porch was a bag of bread heels! I knew who had left them. I’m sure that this unconventional gift that didn’t cost much more than the trip down to the bread store. Most people wouldn’t get emotional or appreciate a bag of leftover bread heels, but that gift is one of the most thoughtful, unique, and meaningful gifts I have ever received. Tears come as I think of the kindness of that dear mentor!
Gifts can be a major or a minor budgeting expense. It’s up to you! Budgets are personal. You can make your gift budget as small or as large as you want it to be.
I have received a lot of gifts over the past 4 decades and I really appreciate those gifts. Budgeting has improved my gift giving! It makes it less stressful and more fun. The work it takes to create gift budgets has been so worth the reward.
In 2006, my sister got married. On the day before the wedding, I was asked to run a few errands to pick up some last minute items for her reception. I bought some music. I also bought a cardboard cutout of President Bush (which we turned into a cutout of my brother who was unable to attend). Lastly, I bought some decorations. A few days after the wedding, I checked my account and saw THREE overdraft fees for $25 each, which totaled $75. When I had made those purchases I knew that I had money but didn’t realize that it was in our savings account and not our checking account. The overdraft fees cost much more that the items I purchased.
First is to plan (aka budget) for parties. Because it was my sister’s wedding, I really hadn’t planned to spend money besides her gift. By planning, you can avoid costly fees and spending hangovers/aches. It was nice of me to want to help out and run the errands for my mom who was very busy, but I should have made sure that I could afford them or honestly said that I couldn’t.
If I could afford them, I needed to make sure that I had the money in my checking account. The items I bought were not that important for the party. We could have gone without them or my mom could have paid for them.
Secondly, I learned that mistakes can teach us. I haven’t had an overdraft charge since that day over 11 years ago because I decided that I would never let that happen again. At the time, it seemed like a very expensive mistake, but looking back, it was a cheap mistake that has saved me a lot of money because I decided to change. This mistake inspired me to become a budgeter.
Although I’m not perfect at budgeting, I have improved so much. Parties are all about celebrating something: life, friendships, and accomplishments. I don’t want the celebration to leave me with regrets. When you follow a budget, you enjoy the party before, during and after. By sticking to the plan, you feel like you do after a workout - you feel good.
For example, a wedding budget could be $5,000 or $20,000. If you have a large budget, you can do an expensive party. If you have a small budget, then it will be a less expensive one. Both can be great, but the budget will determine the party. By spending what you plan to spend, you feel less stress and can really enjoy the experience and the memories which come out of it. I’ve been to wedding receptions that were expensive and some that were not expensive. Both were great because they were what that couple wanted. Some of my favorite parties have been the inexpensive ones. The memories made were priceless.
I’m not much of a partier. It’s probably because a lot of parties involve late nights and I like to go to bed early, but if you are a partier that is great. I saw a commercial for the upcoming Super Bowl parties. If you are a fan, you are counting down the days to watch the Patriots and Falcons face off in the Super Bowl this year. You might be planning how you’ll cheer on your team.
Answering a couple of questions will help you decide the best way for you to plan the finances for your parties.
Parties are a great way to enjoy life and make incredible memories. Budgeting for these parties will help make them successful and allow you to party on without regrets!
With snow piled taller than me, it’s unthinkable that someone would wait in line for two hours to play in the snow. But, my sister and her family went to a Winter festival in Houston, Texas, and the city had hauled in a load of fake snow for it. There was a long line of Texans waiting to play in the “snow.” Being from Utah, she was amazed. Her kids wanted to wait, but she couldn’t make herself wait in a line for two hours for fake snow. I wish I could mail some of Utah’s snow to my Texan nephews. We are running out of places to put it.
I’ve lived my entire life in Utah. For quite a few winters I took care of babies, and we hibernated. I took the snow for granted. A couple of years ago, I decided we would dress warmly and start adventuring out into the snow. I wanted to enjoy the winter too.
Last Saturday, my family went to the Winter Festival at Wasatch Mountain State Park. After receiving six inches of snow that morning, it was the perfect day for a party to celebrate winter. We went cross country skiing for the first time. Snow shoeing and riding snow bikes were also available. Lunch was provided. The whole event was free for us. The only thing that we had to pay for was transportation to get there. Utah has 43 state parks, so if you are looking for a staycation or a day trip, state parks could be a good fit. The fees are low at most of the state parks. We bought an annual state parks pass $75 ($35 for seniors), and it has been well worth it.
To find out about upcoming activities, you can check out the Utah State Parks website. This year is the 60th anniversary of the state parks. Each week there will be some activity at one of the parks to celebrate. There will be “hiking, fishing tournaments, dances, winter festivals, and more!” We were told that each state park has its own mailing list, which is how we found out about the Winter Festival. Iif you are interested in a particular state park, you can ask to be put on their email list. There are two Winter Festivals this weekend! One is at East Canyon and one is at Bear Lake.
Over New Years we went to Zion’s National Park and saw tourists from all over the world. This made me realize how neat our Parks are and gave me the desire to go to them more often. Because they are so close, sometimes I take them for granted.
Staycations and day trips are great and Utah has so much available, but kids grow up. I want to do a big trip to Disneyland and San Diego. My sister’s family just moved to Alaska. I miss her, and I want to visit them. She’s very adventurous and has found so many beautiful and adventurous activities in Alaska, which we would like to do. We also are planning a trip to Spain in a few years.
While growing up, my husband’s family didn’t take expensive trips. They loaded their family in a Volkswagen Rabbit and went camping. My husband loved it. He didn’t feel deprived. He is content taking camping vacations. Their family lived debt free.
My mother-in-law is one of the wisest women I know. So, I asked her if she would do the same kinds of trips that she did having the perspective that she does. She said that she would see everything close in Utah, but she would also put a few dollars away each month to be able to go on a neat big trip every few years. She would still pay for them in cash, but she would prioritize doing some trips that are important to her family. She regrets not doing a few more big trips.
Personal Finances are just that - PERSONAL and INDIVIDUAL. Which means that budgeting is not just mathematical, it’s emotional! The emotional aspect of personal finance can be the hardest part. It requires self-discipline, focus, and delayed gratification. It’s an emotional struggle to delay gratification! With our budget, we plan to enjoy staycations and day trips at Utah’s many state and national parks, but we also look forward to big trips that are important to our family.