Family Budgets

  • “We live in a world where luxuries are often made to look like necessities.  Our self-images are much too wrapped up in what we have and how we look, making us think we need what we actually only want.  Our children need our time more than they need what our money can buy for them.  

Remember – 
Spending expands to fill the money available.”
                   “Needs expand to fill the expectations we allow ourselves to have.”

“When families depend upon two incomes, their lifestyle expands to the level of the total of both incomes; and then, when the  husband or wife loses a job or has to stop working for some reason, the bills can’t be paid with the one remaining income—and bankruptcy or other forms of desperation can result.

Those who try to live on one income have 2 kinds of security:
 1)  The second income can go into savings.
 2)  If one job is lost, the family is not automatically in trouble."
(“Why the Family,” Linda and Richard Eyre)


Statistics
  • In July 2015, American citizens borrowed over $19 billion.  Over the past year, consumer borrowing has risen 6.8%, paced by a 7.9% surge in borrowing for auto loans and student loans.  The credit card category has risen 3.9%.  (Consumers borrow at record rate, by Martin Crutsinger, Associated Press, September 2015) 
What You Can Do
  • Prepare and live within a family budget, providing for
1)  Basic operating needs such as food, clothing, etc.  
2)  Home equity
3)  Emergency needs, such as savings, health insurance and life insurance.  
4)  Wise investment for the future, such as education and retirement.     
  • Spend less than you earn to avoid debts and obligations that you cannot meet.  

  • "The most common reason people are facing foreclosure is because of a major illness or death of a spouse."  (Monica Lloyd, SNAP's housing counseling program manager, "County teams up with SNAP to assist homeowners," The Spokesman-Review, April 26, 2013) 
  • Learn to distinguish between needs and wants.  Resist the temptation to purchase property far more spacious than you really need.  
  • Get out of debt, and stay out of debt.  Pay off your debts as quickly as possible, and avoid the burden of unnecessary debt.  Avoid consumer debt which is the most expensive way to purchase because of the added heavy interest charges.  Avoid buying anything on credit.  
  • Interest never sleeps.  “Interest never sleeps nor sickens nor dies; it never goes to the hospital; it works on Sundays and holidays; it never takes a vacation; it never visits nor travels; it takes no pleasure; it is never laid off work nor discharged from employment; it never works on reduced hours. . . . Once in debt, interest is your companion every minute of the day and night; you cannot shun it or slip away from it; you cannot dismiss it; it yields neither to entreaties, demands, or orders; and whenever you get in its way or cross its course or fail to meet its demands, it crushes you.”   (J. Reuben Clark)
  • Choose investment counselors carefully and wisely.  
  • Be honest in all of your financial affairs.  
  • Avoid looking to the government for handouts or future security.  Keep in mind that the U.S. Government has borrowed—
$1.2   trillion from China,
$882  billion from Japan, and
$272  billion from the U.K.     (ABC News, June 15, 2011)  
A government which is unable to pay its own bills can hardly be depended upon to pay yours.  
  • Happiness and peace of mind do not increase by amassing possessions beyond the reasonable wants and needs of the family.  
The Fulfillment Curve explains why purchasing non-essential “stuff” does not make us happy.  Research shows that as we feel the joy of acquiring the necessities of life (food, clothing and shelter), as well as some of the amenities (toys, a wardrobe, a bicycle, a car), we begin to associate money with an upward curve of happiness.  As an effort is made to acquire more money to purchase more stuff, we find that the thrill wears off quicker; because the more we have, the more we have to manage and worry about—a larger home, more vehicles, taxes, responsibilities, and stuff to keep everyone in the family happy.  
“All the stuff we acquired now has to be stored, maintained, repaired, and protected.  We begin to feel guilty about the stuff we are still making payments on, and finally decide to sell it.  No longer is money and its ability to purchase more stuff increasing our joy, and the Fulfillment curve has headed downward.   

“The key to acquiring peace and happiness with our possessions is to identify and feel gratitude for what you need to be comfortable, with no extras (financial burdens and things you don’t need) to weigh you down, distract or distress.  When we are free from the unnecessary burden of worrying about stuff, we are better able to focus on helping others in our family, community, nation and world.  By serving others, we avoid personal greed, selfishness and overindulgence.  As we become mindful of the needs of others, we learn to live a life of greater depth and meaning.   (“Your Money or Your Life,” Joe Domingues and Vicki Robin)
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