The turtle and the hare

I'm sure by now that most people in life have heard about the turtle and the hare. I was asking my 7 year old about this story and if he understood it. He told me that being in a rush and always wanting something now is not always good for you. I thought that was a pretty good answer. A lot of us are that way when it comes to money and finances. We want to rush it and get it right now. We want to be rich over night. The amount of scams that people are able to fall victim too have grown rapidly. That's because we continue to think like the hare and want to get rich quick. We have all heard the saying that if it sounds too good to be true it probably is. If becoming rich was easy everybody would be rich. Gaining financial prosperity takes time and determination. If you start a savings plan and stick to it the money will continue to grow.

When I was younger I knew people who thought like the hare. They wanted money quick and now. They decided to sell drugs to get the fast and easy money. They eventually got busted and had to serve time in jail.
Slow and steady wins the race. There is a book called "The Millionaire Next Door," that explains that many people who are millionaires you would never be able to pick out walking down the street. The books talks about everyday people who decided to make little changes in their lives that made big differences that just so happened to turn out to be million dollar differences.

If we pace ourselves like the turtle and continue to be smart in our ways of thinking when it comes to finance we too will win the race for riches.

Who is Bill

I am pretty open with my kids about money and how I manage it. I want them to know the things that I know about money that were never taught to me. I am pretty similar to most people who came from a similar background where as you always paid Bill first and sometimes you didn't pay him all the way, just enough to get through to the next month. My kids would see my bank statements and see how much money I had and they would ask if we could go buy something. I would give them the typical response that most people give their children. I have to pay bills with that money. Just like most kids mine asked me who was Bill. Since they had never met him they was wondering why I was always giving him money. I explained to them that Bill wasn't a person but something that you received every month for services around the house like your lights, gas and water. Most people use a budget to pay bills so that they know how much money they will have left after paying the bills. I set a budget for my bills so that I know how much money I will have period. 70% of my checks that I receive is for bills period. If my bills exceed that then I need to re-budget what I have for expenses and change things. If having cable exceeds my 70% budget I drop the cable. If internet exceeds my 70% budget I drop the internet. I do whatever I have to do to stay within my budget. I don't know about you but I like to have money for myself, not just for Bill. If my kids can understand the concept that why should Bill( a man we've never met) get all of our money and we never have any for ourselves then why are most adults not understanding this. I know who I am, I know the people I have to buy dinner for and the people I buy birthday and Christmas presents for but I personally have never met Bill. If we want to have something for ourselves or for our families and children we need to learn how to  pay ourselves first then pay Bill.

Paying yourself first is not hard. Paying yourself first is not splurging and not having money to pay bills either. Paying yourself is about making sure you spend your money wisely so that you can do the things you want and also pay your bills. I was taught how to sew, cook, clean and various other things in home economics in high school. Not once was I taught how to set a budget. Not once was I taught how to pay myself first. I had a really great math teacher who could teach me how to find square roots or the answer for y but no one taught me how to mange my money. I don't like going into a store and telling my kids I can't get them what they want because I don't have the money.I don't think anyone likes that feeling. Some of us buy their kids what they want even when they can't afford to and struggle all the time. Money management isn't taught in schools, it's taught at home and just like me many people weren't taught that by our parents. It is up to us to teach ourselves and it is our responsibility to teach our kids how to manage money. My kids get allowance if they do good in school and at home. They are also required to budget their money. I got my kids savings accounts not too long ago and you should have seen their faces light up. They were excited to be able to put their money into a bank. Not only that but I taught them about interest and they were excited to start earning interest on their money. I want to continue to teach my kids about  how to respect money and how to manage it. Since my kids understand that we shouldn't pay Bill first, I truly hope that others will learn the same.

Producers and consumers

I make it a habit to ask my kids what they learned in school. If you aren't learning anything in school what is the point in going. I was talking to my 7 year old and he told me they were learning about producers and consumers. This is something I have been trying to teach him as well but in different terms. I asked him what each of things were. His response was producers make things or produce things for consumers to buy. Consumers buy what producers make. That was a good answer to me. It explained it in simple enough terms for anyone to understand. I asked him what category was he in. He told me he was a consumer because he went to the store to buy things but he would like to be a producer because they get the money. If a class full of 7 year olds can understand this concept. Why can't adults. Many people want to become more financially stable or want to have more money but do not understand this basic concept. As long as we are spending money and not making we will never achieve our financial goals. Going to work everyday you are producing an income for yourself. Like most people that money is probably already spent or consumed since there are bills to pay. Let's make an example and say that by going to work we produced $2. Our rent is $2 which is consumed from our paycheck. We now have nothing left over. Let's take that same example as say the $2 we made at work we didn't spend and held on to it. We now just produced $2 and have $2 more to our name. Wouldn't it be even better to turn that $2 into $4. That is where the real producing comes in. There is nothing wrong with working a job to produce an income. What we need to do is take that money and produce it into even more money. Then we will become true producers. You can do this many ways such as own a business, sell stuff on the side, invest your money and more. It is up to you but we all have to start some where. As long as we continue to be more consumers than producers our finances will always be difficult. I am like my son. I want to be a producer because they get to make money.

Budgeting for money

I am from the new generation where social media sites are popular. There are a lot of people talking about how they are going to work making that money, or clocking those dollars. Everyone is talking about they are working hard for the money. Very few people are talking about how they have their money working hard for them. It is nice to see that people are able to secure jobs that will help them pay their bills but at what point do we stop hustling for money and start making money hustle for us. I have read the book, "The Richest Man in Babylon," by George Clason and he talks about to budget your money. I put together a budge sheet as well based on what I thought was appropriate for my life. I was tired of hustling for the money and wanted my money to start hustling for me. I put together a budget sheet using google docs.(You can find a copy here https://docs.google.com/spreadsheet/ccc?key=0Am78C6ietmeKdGVhUldwRXR2TUc4dGtTR0cwYXdFYVE#gid=0 ) Out of every paycheck that I receive I take 70% to pay for bills, 5% for saving, 5 for investing, 5% for debt and 15% for personal. With the technology that we have available today this is quite easy to do even if you are not good at math. I use online banking which allows you to set up transfers to other accounts or pay bills directly online. You can set up recurring transfers to happen weekly, by-weekly, monthly or whatever is convenient for you. If you set your budget up on a schedule then you don't have to think about it much and your money will just keep growing for you.

I know a lot of people who have budgets for paying bills and there are different organizations that help families that are struggling with debt create a budget to make ends meet. Seldom do we set a budget for how we are going to make money or create more financial possibilities in our lives. Some people work overtime or get a second job to make more money but the income from that is limited to how many hours they work. Banks do not pay a lot of interest to you for using your money but it's a great place to earn more money on your money. Start making your money work for you. If you have a budget like the one I set up for myself putting away 5% of your paycheck every check can add up for future emergencies or plans that you might have such as a car, house or vacation. Let's say the bank gives you 2% interest on your money and you have managed to put $1000 away for the year. You have just gained $20 from the bank on top of the money you have saved yourself. This isn't a lot of money but if we are persistent in our efforts we can continue to have our money work for us and continue to grow. If you are like most people you are going to continue to go to work everyday to make sure that you have money coming in to pay your bills and feed yourself and your household. Make your money go to work everyday as well. If I am getting up to go to work in the morning then I am going to make sure my money does the same.

Eating a proper and balanced diet is important for our health. Creating a proper and balanced budget for our finances is important to our financial health.