Managing Money like a Mother

Hi, friends here on Lively Girl Fitness! My name is Carly Hill, and I am thrilled to be writing a post for my friend here, Rachel. Rachel and I met in our mom’s group and I knew I’d like her when I overheard her say one morning “my husband and I are Dave Ramsey fanatics!” 🙂 I’m gonna chat with you today about the plan, mindset, and priorities my family has adopted for our finances, and share some of the mistakes we’ve made along the way in the process of achieving our financial freedom and living debt free!

“Three Easy Steps to Stay Home with your Kids Today!”

Step 1: realize that shortcuts like this don’t exist. If they did, someone much richer and smarter than me would already be talking about it! 🙂

We’re following a 7 step plan The steps are simple, but they’re not easy! We all want to hear the small, practical tips to living on less and saving more, but these only help you when they fit into a big picture plan. So as much as I know you want to hear a few easy steps, I’m first going to focus on the less glamorous work of understanding your situation and making a long term plan.

You must begin with honesty. Take off the blinders and be honest with yourself about your situation. If you are married, take time with your spouse to apologize for lack of communication or hidden purchases or misguided priorities, forgive, and commit to being on this journey together. If your spouse refuses to discuss such matters or change their current lifestyle (I know many of you are, you are heard and seen and your efforts are still worthwhile!), do what is within your power to change while first and foremost honoring your love and commitment to them. Lead by example and pray for the humility to stay the course in love.

My husband, Kyle and I took Financial Peace University in the summer of 2016 right after we had become debt free. We say this all the time: that class was equal parts money planning and marriage counseling and we wish we took it before we got married! If you haven’t taken it and you ask me how to communicate with your spouse about money, I’m gonna help you sign up for FPU. 😉 I also recommend Total Money Makeover, following lots of debt free journey people on social media, and exploring www.daveramsey.com for insights. Get coffee with me or somebody you know who is a little further ahead and can tell their story!

Accepting your current situation and joining hands with your spouse is your first step towards financial freedom!

Define Financial Freedom

Once you’ve seen where your history with money has brought you, now it’s time to do a 180 and start thinking about the future.

What does financial freedom look like for your family?

  • Staying at home with kids full time?
  • A career change?
  • Funding missions work and adoptions?
  • Moving your kids from public to private school?
  • Ending the constant fights and shaming over purchases?

We all have different dreams and if we’re honest we want to achieve them all without any sacrifice or difficulty or denial of comforts. The Baby Steps from Dave Ramsey include basic money principles that apply across the board: pay in cash, eliminate debt, save for retirement, etc., but only you can determine what your specific end goals will be.

For me, it was staying home with my kids as much as I wanted. When I had our first son in May of 2015, we still had student debt and one car loan. We needed a second income to cover part of our necessary expenses. I worked a part-time job 25 hours/week and tutored a few students. I wouldn’t have chosen to have a job given an option, but it was the wisest thing for us at the time. I learned valuable lessons along the way about time management, increasing our income, and decreasing our expenses.

Decide as a family what financial freedom is and be ready to roll up your sleeves, realizing that it may take years to get there.

Decide What Your Sacrifices Will Be

Make short term sacrifices for long term freedom.

Not short term freedom with long term sacrifices.

I know many of you asked how you can make money while staying home with little kids.

I would encourage you to think more about how you manage the money you have rather than about how you make more money. Making money typically means getting paid for work done. But this excludes the work moms do at home to save. So I define it as “any activity that increases the gap between how much money comes in and how much goes out”. If you are working to lower the family’s bills, eliminate unnecessary spending, and live fully on less, you are making money. Sit down with your spouse and dissect your family’s spending to identify which areas you could improve. I’ve found that for many people, simply seeing how much they spend in a specific area in one month is enough of an eye-opener to motivate change!

  • Can you sell a bin of old toys you’ve had in your basement for ages?
  • Can you shop around for car repairs?
  • Can you cancel your cable bill and just use Netflix/Hulu?
  • Can you make your own laundry soap?
  • Can you learn contentment with last years’ swimsuit while others spend $80?

You probably won’t be able to walk into work and quit tomorrow, but you certainly could make concrete steps in the immediate future that bring you and your family closer to that picture of financial freedom you determined in the beginning.

Do the hidden, slow work

Now that you’ve figured out what your current situation is, visualized what financial freedom means to you, and determined where you can make sacrifices and changes to make steps towards freedom, it’s time for the tough love: this is hard work. This is tiring. This is a long, quiet, humble game. Broke people will make fun of you and compare their pretty, borrowed things to your old, paid for things.

It is essential to continually remind yourself in the middle of 3 years of paying off debt that your hard work WILL BE WORTH IT! This is the part of the journey that most people are simply unwilling to do.

In 2015, when we were new parents and throwing almost my entire paycheck to debt, I had this thought all the time: “I’m supposed to be enjoying life! I shouldn’t just work so that all my money can go to debt. Forget this plan.” Fast forward 4 years later and I can barely remember that time. My life isn’t ruined, my kids still love me, and the debt is GONE. For many of us, we are in our 20s and 30s expecting the lifestyle of someone who already put in decades of hard, sleepless work. We believe our car should never be older than 10 years, our furniture should be coordinating, our clothes should rotate every season, and our Instagram posts should be filled with our adventures.

There is a season for everything under the sun. Friends, this may be your toil and labor season, your year for rice and beans. It will teach you and grow your character more than pursuing comfort ever could. And you’re not doing this alone. Make a list today of the small sacrifices you could make that will propel your family forward towards financial freedom.

What this slow, hard work looks like for me

Ok that’s the big stuff! That’s the foundation that must be laid in order for the practical tips to truly propel you and your family forward towards financial freedom. Now, here are a few practical things that I do to make the most of our money:

  1. Zero-based budgeting by the Pay Period
    1. Hands down my #1 most essential, life-changing tip. We get paid every 2 weeks and I was so frustrated by trying to budget by month only to have the paydays land at random times of the month, changing every time. I was leaving so much extra in our checking each month because bills and paychecks and beginning of the month just weren’t lining up.
    2. We’ve been doing this zero-based budget  – budgeting until you get your account down to (almost) 0. I attribute the majority of our money success since we started 3 years ago to this single tool.
    3. If you’ve already done FPU, but feel like you don’t have a vision for what it looks like to live day to day in a way that accomplishes your goals, the zero-based budget is it. I coach women in this process and would love to sit with you either by video chat or in person, to work through this approach to budgeting. Game. Changer.
  2. Buy and sell almost everything used.
    1. When you buy and resell used items they lose almost none of their value. I regularly buy, use, and then resell household goods, baby gear, and clothes – either making back all of what I spent and even making a profit.
    2. Never think “it costs what it costs”
      1. Research your purchases, both big and small.
      2. Shop by unit price to compare store to store (hint: I did this will several major stores on typical home expenses – Costco was the most expensive unit price on almost every item I looked at! Buying in bulk does not always equal savings!)
      3. Meal plan around sales and cheap ingredients, set a fixed grocery budget and be willing to put food back in the store shelf if you go over, and eat everything you buy!
  3. Finally, commit and pray daily that you will grow in the quiet wisdom of contentment. Even if your husband makes more money than mine, even if my furniture is mismatched and used for the next 5 years, even if we don’t take a vacation this year, even if I take a second job to pay off debt faster, even if the van no longer has hub caps, I am committed to contentment. I am committed to paying off my past mistakes and looking forward to the future with hope. I am committed to being generous the whole way through.

If you’ve had enough of your money controlling you, and you want to find a way out, join the community of friends committed to eliminating debt and living free. Come join me as we talk about how to manage money like a mother on Instagram @debtfree.mom or look at pics of my hilarious kids @carlyronaynehill. I love helping moms with their financial journey, and I would love to connect with you on Instagram or in person! Drop me a comment here or DM and tell me where you’re at in your journey!