Commitment

In the book, "How Successful People. . . Keep their lives out of the toilet" by Sandra Phillips and Don Aslett, I learned a new way of thinking about commitment.  Commitment is the "I will . . ." attitude.  This differs from I wonder. . ., I wish . . ., I will try. . . ., I'll see what I can do . . ., I will do it as soon as . . .Instead of just having an intention to do something great we must make the commitment to do so.  "Yes. I will."  "I promise."

According to Yoda, "Do or Do not. There is no Try."  After the commitment is made there must be followthrough.  Distractions, detours, and temptations will certainly follow the making of  a commitment.  If we are truly commited then we will not falter from achieving what we said we would do.  

Stick to your task till it sticks to you; 
Beginners are many, but enders are few. 
Honour, power, place, and praise 
Will come, in time, to the one who stays. 

Stick to your task till it stick to you;
Bend at it, sweat at it, smile at it too; 
For out of the bend and the sweat and the smile 
Will come life's victories, after awhile. 
-Anonymous 

Improve Your Credit Score

Recently I was reminded of a friend in my ward.  He and his wife wanted to buy a home several years ago, but found that it would actually take some time.  When they went in to inquire about a Mortgage the lender told them they had no Credit scores. Essentially they would have to build their credit before purchasing their home.   So, unless you are going to buy your first home or your next home with Cash it is a great idea to pay special attention to your credit score.

Another secret I recently learned reminded me to keep improving our credit scores.  Higher credit scores mean that borowers are less risky to investors.  Therefore, they are willing to loan you money at a lower interest rate.  If you don't have great credit then you will likely get charged higher interest rates.  Even worse, you may not qualify for a loan at all.  Remember if you are qualifying with both husband and wife then both credit scores need to be great because your interest rate will be affected by the lower of the two spouse's scores.

Delay Gratification

Today I just wanted to do a short post about the benefit of delayed gratification.  This principle really goes with not buying things that don't increase in value unless you have cash.  When you want to get something it pays to give it some time.  Make sure that after "sleeping on it" you still want it, you can afford it, and you can afford it now.  

Janell and I recently purchased a bedroom set.  This is something that we have wanted (especially Janell) since we got married.  Well, now that we have had a few years of saving we can afford it.  We found something we really like on sale.  So, we slept on it and decided to go ahead and make the purchase.  Wow, it really gives you satisfaction to pay with the debit card (Cash).  

In our "I want it now" world it actually means more when we put off things we want until we are truly ready financially to get them.  When considering a purchase we can ask ourselves the following questions:

Can I afford to get this?

Can I pay cash?

What do I have to give up to get it?

Does it make sense to buy it now or later?

Only pay "cash" for things that depreciate

This post got started a couple weeks ago, but the internet went down.  Now I finally post it.  I don't remember the source of this train of thought. Nevertheless, it is good advice. Don't buy stuff on credit that is going to depreciate or go down in value. Sometimes this isn't always possible, but the ideal is there. When we buy stuff on credit the value of the product or service can go down. This means that we could owe more money on a product or service than it is worth. For example, The value of a New car goes down several thousand dollars right when you drive it of the lot. Why should we owe more money on the car than it is worth.

There are some things that do go up in value after they are purchased.  For example, the value of an education generally goes up every year.  We can certainly earn more money with higher education.  So, if it takes some debt to get an education it can definitely be worth the "investment".  Likewise, buying a home is likely a great long term investment.  Debt can be used wisely in buying a home.  In most cases over a long period the value of a home will go up.  location, bad neighborhood, flood,  cracked foundation, etc are some examples of when a home may not appreciate.  Tough economic times can also cause the value of a home to temporarily stay constant or go down in value.

The Moral--when you cannot afford to buy something that depreciates with cash. . . . .don't buy it until you save the money to pay "cash".  Let interest work for you instead of against you.

Take baby steps

I jumped on Dave Ramsey's website tonight.  He does a national radio show about personal finance. Dave seems to focus on real life personal finance for the average American.  I love step number 1. $1,000 emergency fund.  hmmm, it seems like I've heard something similar before.  Setting a goal for how much to start an emergency fund with will certainly be beneficial When we have an emergency in our everyday life.  Starting now with a budget has helped us work on building our emergency fund.  

Dave quotes John Maxwell on his website, "A budget is telling your money where to go, instead of wondering where it went." In other words we should plan on paper or on the compter what we are going to spend before we spend it.  This also sounds familiar--Spiritual creation before the physical creation.  This principle has sure helped us begin building our emergency fund while saving for other things as well.

Build a Reserve

"We encourage you wherever you may live in the world to prepare for adversity by looking to the condition of your finances. We urge you to be modest in your expenditures; discipline yourselves in your purchases to avoid debt. Pay off your debt as quickly as you can, and free yourselves from this bondage. Save a little money regularly to gradually build a financial reserve. If you have paid your debts and have a financial reserve, even though it be small, you and your family will feel more secure and enjoy greater peace in your hearts."
-The First Presidency (All is safely gathered in pamphlet)

I love the principle that is taught here by the First Presidency. If we regularly save a little money, then this growing financial reserve will offer us peace and a sense of security. I know that our reserve is currently small, but as we regularly put money aside that will help us have hope and peace in what will come in the future.

Conquer Procrastination

Today is a great day to write about Conquering Procrastination. In the book " The Richest Man in Babylon" George Clason writes about the need to Conquer Procrastination. One of the characters in the book said, "To me, Procrastination proved to be an enemy, ever watching and waiting to thwart my accomplishments." I've been wanting to post about this principle for a while, but now I finally do it.

It is so easy to procrastinate. We often think about things that we need to do, but wait to do it. Later in his book Clason says, "Action will lead thee forward to the successes thou dost desire." There is no better way to conquer procrastination than to take action now. Of course we should set goals and plans to accomplish them. Then we must act on those plans. We should prioritize and then stick to the plan.

I think that many young couples wait to save for retirement or wait to set a budget. Hopefully we can do a little better in areas that we know we need to to set goals and work towards them. Let us conquer procrastination as it relates to our finances and other important areas of our lives.