Can you believe it?  We’re finally at step ten to creating and maintaining a recession-proof marriage.  When I kicked off this blog series with the article entitled Money, Money, Money, I only thought I’d be writing on this topic for a couple days.  And now several weeks later, there’s an entire plan to help you and your family kickstart your financial independence.

As you may already know, this is the first blog series on the Happy Wives Club and the first time I’ve ventured into the topic of finances.  But since it’s on everyone’s mind right now–-even the members of this Club–I thought I’d be remiss not to share with you what I’ve learned on my personal road to financial freedom. 

This article ends our 10-step series.  If you’ve missed any of the first nine steps, I encourage you to go back and review them: Step One, Steps Two and Three, Step Four, Step Five, Step Six, Step Seven, Step Eight and Step Nine.  For your ease, I’ve also included a brief synopsis of each step below.  

STEP ONE: Stop comparing yourself to others and learn to be content (or even better, happy) with exactly what you have in this moment.  As Rick Warren said and I love repeating, “If the grass is greener on the other side, that’s because your neighbor has a higher water bill!”

STEP TWO: Team up with your partner in life, your spouse, and pray for wisdom.  This is different from the prayers you may have prayed until now.  You’re not asking Him to magically make your debt disappear or magically increase your income.  You’re asking Him for the wisdom to allow you to do it yourself.  No one knows your financial future better than Him so that is the life source you want to stay connected to throughout this process and beyond.

STEP THREE: Strip down your image.  There is no doubt that a part of the instruction God will give you will require great sacrifice and that means you will need to be okay with whatever anyone else may think of you.  Don’t allow your fear of what others may think keep you straddled with the burden of debt.  It’s just not worth it.

STEP FOUR: The 10/90 Rule.  Many financial experts will tell you about the 80/10/10 rule and it is what Keith and I follow.  But I learned early in my adult life that the 80/10/10 was a goal but for those desiring to financial freedom, the 10/90 rule is a requirement.  It is what I used 15 years ago to turn my financial situation around and I’ve never met a person for whom it did not work.

STEP FIVE: Allowance isn’t just for kids.  You’ve probably discovered, like most people I know, that budgets are similar to New Year’s Resolutions: everyone makes them but few actually follow them (at least beyond the first month or two).  Budgets are usually blown but allowances are not.

STEP SIX: Redefine the American Dream.  This step begins the process of helping you pay off your debt and learn to live below your means.  Keeping up with the Joneses, Kardashians, Steins or anyone else is a recipe for failure.  Defining the American Dream for yourself is the key to success.

STEP SEVEN: Let stuff go.  Using the analogy of “how to catch a monkey” we’re reminded how our refusal to let some things go could cause us to remain in debt and not live the financially free life we were meant to enjoy.  And like the monkey, who is caught because of his refusal to let go of a booby-trapped treat, our decision to “let go” can change one’s life. 

STEP EIGHT: Workin’ 9-to-5 is a movie and an award-winning song, not the way to obtain financial freedom.  Get creative in coming up with ways to bring more income into your household.  Think outside the box and you’ll get to “recession-proof” much faster than you may think. 

STEP NINE: Rome wasn’t built in a day and neither was your financial situation.  Be patient and diligent as you begin this road to financial freedom.  Your reward will far outweigh your sacrifice.  What’s important is that you stay the course.  It won’t happen overnight but your road to financial freedom is just as much a part of the journey as the destination itself.  Make the most of it as a family and don’t lose focus. 

And the 10th and final step:

STEP TEN: Get comfortable with loss.

I know, I know, you were probably expecting me to end this series on a super high note that would cause you to run into the street, pump your fist in the air and scream, “Yes!  Yes!  Yes!”  Sorry if this step doesn’t make you do that but hopefully it will allow you to sink into your couch with a cup of tea and simply say to yourself, “Yes, got it…I can be okay with that.”

Here’s the deal, at the height of 06′, 07′ and 08′ when homes were selling at overinflated prices, money was cheap and obtaining a loan to buy a house, boat, complete a remodel or do whatever we could possibly hope or dream, a lot of us made poor financial decisions.  We decided to borrow more than we should have and now that this recession has really whacked us a hard one, it’s time to face some realities.

One of the greatest freedoms I’ve gained in my life is learning to be okay with loss.  Everything happens for a reason and many things we “own” are only for a season.  You and your family may complete steps 1-9 and still find you can’t get from under this financial cloud that’s been hovering over your home for the past few years (and for some, even longer).  What it will take for you may be to simply let stuff go.

What kind of things am I referencing?  Anything you’re holding onto that by keeping it is preventing you from joining us on the path to financial freedom.  There are many things and only you know what they are but something as simple as a FICO score can be what is preventing you from getting on the right path.  I love what Dave Ramsey says about FICO scores:

The dreaded FICO score.  It’s that number that’s associated with every credit report.  We all know about it—most people have one—but what does the credit score really mean?  Like it or not, your credit score is not an indicator of winning financially.  All it tells you is whether you are good at borrowing money and paying it back.  That’s it.

But let’s take a deeper look.  How is your FICO score determined?

35% of your score is based on your debt history.

30% is based on your debt level.

15% is based on the length of time you’ve been in debt.

10% is based on new debt.

10% is based on type of debt.

It’s the I-Love-Debt Score

Your FICE score is an I-love-debt-score, isn’t it?  Does it factor in your income—or, even better, your debt-to-income ratio?  Nope.  Does it factor in your savings accounts, net worth—anything other than debt?  Absolutely not.

The only way to have a good credit score is to go into debt, stay in debt, and continually pay your accounts perfectly—without adding too much debt or paying too much off.  In other words, stay in debt for as long as you can.  How ridiculous is that?

I know this isn’t what we were taught.  It’s not what the previous generation told us about credit and the importance of maintaining a high credit score.  But it’s another fact of life we have to accept if we are going to move forward and out of debt.  If you plan on climbing out of debt, staying out of debt and ensuring you are not a “slave to the lender,” as the Proverb says, you may have to forego this score for now.  You won’t need it anyway.  The only way you need it is if you plan on borrowing and if I haven’t convinced you over the past few weeks that borrowing is what got the entire world into this big ole’ financial mess then I don’t know what more I can say.

But if I have been successful in convincing you that debt-free is the way to go,  I encourage you to find a plan and get started ASAP.  My favorite plan so far is Dave Ramsey’s Total Money Makeover but you can find a number of plans online for free.  Decide which plan works best for your family and don’t be afraid of loss.

You may have to lose in order to gain but in the end, what is peace of mind worth to you?  To me, it’s worth everything.

I hope this financial series has been helpful for you.  It has been amazing for us living through it.  Keith and I had to pay off well over $100,000 in debt in order to become debt-free (sans mortgages) and now we’re actively engaged in getting those paid off.  When we make a decision to have canned chicken salad or soup for dinner (which happens several times a week) instead of a nice steak dinner at our favorite restaurant, we know it is for a reason.  This is only a season and we don’t mind sacrificing now to get to our desired place later: 100% Recession-Proof.  Join us in this journey!

Until tomorrow…make it a great day!

Comments: With more than 15,000 Happy Wives Club members already actively engaged on our Facebook page, what better place to share your thoughts?  Join me there and let’s continue the conversation: Happy Wives Club Facebook 

We are finally on step nine of our 10-step plan for creating a Recession-Proof marriage and household.  For those joining us for the first time, with the exception of a few posts here and there, we’ve been focusing on finances for the past couple weeks.  I recognize that financial strain is the number one cause of arguments and divorce right now and those who may have joined the club as “Happy Wives” even just a year ago could now be feeling the pinch in their relationship.

And although nearly all of the writings on this blog focus on the life of a happy wife, during this poor economy I thought it necessary to address a challenge many of my fellow wives are facing.  For this reason, I began this series of writings.  If you haven’t had a chance to go through the archives, I encourage you to go back and review Step One, Steps Two and Three, Step Four, Step Five, Step Six, Step Seven and Step Eight.  For your ease, I’ve included a brief synopsis of each step below.  But I definitely recommend taking the time to go back and read each step individually.

STEP ONE: Stop comparing yourself to others and learn to be content (or even better, happy) with exactly what you have in this moment.  As Rick Warren said and I love repeating, “If the grass is greener on the other side, that’s because your neighbor has a higher water bill!”

STEP TWO: Team up with your partner in life, your spouse, and pray for wisdom.  This is different from the prayers you may have prayed until now.  You’re not asking Him to magically make your debt disappear or magically increase your income.  You’re asking Him for the wisdom to allow you to do it yourself.  No one knows your financial future better than Him so that is the life source you want to stay connected to throughout this process and beyond.

STEP THREE: Strip down your image.  There is no doubt that a part of the instruction God will give you will require great sacrifice and that means you will need to be okay with whatever anyone else may think of you.  Don’t allow your fear of what others may think keep you straddled with the burden of debt.  It’s just not worth it.

STEP FOUR: The 10/90 Rule.  Many financial experts will tell you about the 80/10/10 rule and it is what Keith and I follow.  But I learned early in my adult life that the 80/10/10 was a goal but for those desiring to financial freedom, the 10/90 rule is a requirement.  It is what I used 15 years ago to turn my financial situation around and I’ve never met a person for whom it did not work.

STEP FIVE: Allowance isn’t just for kids.  You’ve probably discovered, like most people I know, that budgets are similar to New Year’s Resolutions: everyone makes them but few actually follow them (at least beyond the first month or two).  Budgets are usually blown but allowances are not.

STEP SIX: Redefine the American Dream.  This step begins the process of helping you pay off your debt and learn to live below your means.  Keeping up with the Joneses, Kardashians, Steins or anyone else is a recipe for failure.  Defining the American Dream for yourself is the key to success.

STEP SEVEN: Let stuff go.  Using the analogy of “how to catch a monkey” we’re reminded how our refusal to let some things go could cause us to remain in debt and not live the financially free life we were meant to enjoy.  And like the monkey, who is caught because of his refusal to let go of a booby-trapped treat, our decision to “let go” can change one’s life.

STEP EIGHT: Workin’ 9-to-5 is a movie and an award-winning song, not the way to obtain financial freedom.  Get creative in coming up with ways to bring more income into your household.  Think outside the box and you’ll get to “recession-proof” much faster than you may think. 

And today we’re adding:

STEP NINE: Rome wasn’t built in a day and neither was your financial situation.  Be patient and diligent as you begin this road to financial freedom.  Your reward will far outweigh your sacrifice. 

Finances are such a tricky topic because many would simply prefer to ignore any financial difficulties until they can no longer be ignored.  I remember having a business partner years ago who would leave his bills unopened.  There was something about not opening the bills that allowed him to pretend they weren’t there. It reminds me of an I Love Lucy episode I adore.

I can’t remember the episode exactly but I remember for some reason Lucy was in charge of paying the bills.  She gets so behind in her payments and finds them all to be overwhelming so she comes up with a simple solution.  She puts all the bills on one of those things that goes in the center of the table and spins around (for the purpose of moving food around the table) and spins it really fast.  Whichever bills remained on the “spinning thing” was the ones she would pay.

It’s classic Lucy and certainly makes for a hilarious episode.  But unfortunately, that’s how a lot of us handle debt.  We pretend it is not there until we can no longer ignore it.  By that time, there’s a mounting pile of bills that need to be paid.  And even if you make all the minimum payments, it seems to never decrease.  That’s one of the reason people get discouraged when they begin a mission to pay down/off all their debt.

I won’t attempt to give you a step-by-step plan to paying off your debt here because this blog series would go on for another two weeks and it’s unnecessary.  I highly recommend Dave Ramsey’s Total Money Makeover or his similar book based on Biblical principle, Financial Peace.  Keith and I followed the plan in Total Money Makeover (making a few tweaks here and there as made most sense) so that’s the one we always recommend to friends.

You can also find websites online with free advice on paying off your debt and giving you step-by-step plans to do so.  As to not make the mistake of endorsing the wrong ones, I’d suggest you Google “how to pay off debt” and then find the one that makes the most sense for you and your family.  Once you’ve found the right plan, just begin.  Beginning is 40% of the battle.  The other 60% is having the patience to see it through until the end.

When Keith and I began paying off our debt, we were extremely strict.  We’d eat like college students on a minimal weekly budget (canned tuna and chicken, anyone?) but we could do that because we were squarely focused on paying off our debt.  We remained focused the entire time.

A couple days ago, when I was walking along the marina early in the morning, I began thinking about something the instructors in my yoga videos always say right before we begin a balancing pose, “Find a focus point, it helps with balance.”  Anyone who does yoga knows that if you begin a balancing pose and do not have – and maintain – a consistent focus point, you will topple right over.  Alternatively, if you find a focus point and keep your eyes focused, you won’t fall.

The same is the case with dancers.  Have you ever watched a child spin around in excitement several times and then start stumbling everywhere because they’ve lost their balance?  What about you?  Do you remember the last time you spun around in circles and how dizzy you got after turning only a couple times?  But then a dancer can spin dozens of times in a row, without a break in between, and will never get dizzy.  Do you know why? 

Dancers fix their gaze on a single location or thing with every spin.  If you videotaped a dancer and then watched the tape in slow motion, you will notice their head turns well before the rest of their body.  They do not take their eyes of off whatever they have made their focal point (except for a fraction of a second).  This technique is called “spotting.” 

Most people have been in debt long before they even realized that’s what it was called.  Meaning, we have grown so accustomed to using credit that until the recession began, many of us didn’t even realize we were going so far into debt.  Keith and I were certainly that way.  But once we determined as a family we were going to climb out of that financial hole, we did so with all our effort and might and remained patient with the process.

There’s an old saying, “By the inch it’s a cinch, by the mile it’s a trial.”  Take this step-by-step.  Determine that you’re going to change your mindset about image recognizing that what matters most is the peace in your home, not what others might think about how much you have or what you just bought.

One of the things I truly believed helped Keith and me is we told everyone close to us that we were beginning this journey.  We let them know in advance not to expect expensive presents anymore and for us to be extremely frugal when we went out with them.  So many watching our excitement as we began paying off our debt decided to join us and they too began the journey to financial freedom.  Sharing what we were doing with others also made it much easier for us to stay the course.  It was almost like we had accountability partners without actually having them.

Determine the right plan for paying off your debt and simply begin. And then continue.  And continue some more.  One of the other things Keith and I did was we gave ourselves a “reward” for every major debt we paid off.  A few days away was usually the reward we chose but maybe it’ll be going to your favorite (yet pricy) restaurant or for those who love to shop, purchasing something you’ve wanted but have delayed it for months.  It can feel discouraging to work 60-70 hours a week and then come home and eat like a broke teenager.  So that’s why we gave ourselves gifts with every milestone.  Just do what’s right for your family.  What’s important is that you stay the course.

It won’t happen overnight but your road to financial freedom is just as much a part of the journey as the destination itself.  Make the most of it as a family and don’t lose focus.  Next up: the tenth and final step.

Until Monday…make it a great weekend!

Fawn

This weekend I had the pleasure of going to a fantastic engagement party for a wonderful couple.  As is probably customary with engagement parties (not sure, I think this was my first), many family members got on the mike and gave the newly engaged couple advice.  While looking at the bliss in their eyes throughout the night, I kept thinking, “Please hold on to that.  Please hold on to that and don’t let anyone take it away from you.”

Early the next morning they were on my mind so I sent them a note sharing the best advice Keith and I have received since getting married eight years ago.  It has carried us through every day of our marriage and what an awesome marriage this has been and continues to be!

When the Club was first launched, this was one of the first blog posts I wrote and although I’ve never posted the same information twice, I thought this would be a great time to share with the thousands of new readers the best piece of advice I’ve received about marriage and the one piece of advice I always give.  

Until tomorrow…make it a great day! 

Reprint from February 21, 2010:

Workin’ 9 to 5

What a way to make a living

Barely getting by

Its all talkin

And no givin

They just use your mind

And they never give you credit

It’s enough to drive you

Do you remember singing that song?  Just looking at the lyrics makes me think of Dolly Parton.  Although I don’t recall ever seeing the movie Nine to Five starring the petite country singer and Jane Fonda, I’ve always remembered the melody of the song and the first two bars, “Workin 9 to 5 what a way to make a living…”

And it’s the fabulous Dolly that brings us to the next step in this 10-step program to create a Recession-Proof marriage and household.  For those joining us today for the first time, I encourage you to go back and review Step One, Steps Two and Three, Step Four, Step Five, Step Six and Step Seven.  For your ease, I’ve included a brief synopsis of each step below.  But I definitely recommend taking the time to go back and read each step individually.

STEP ONE: Stop comparing yourself to others and learn to be content (or even better, happy) with exactly what you have in this moment.  As Rick Warren said and I love repeating, “If the grass is greener on the other side, that’s because your neighbor has a higher water bill!”

STEP TWO: Team up with your partner in life, your spouse, and pray for wisdom.  This is different from the prayers you may have prayed until now.  You’re not asking Him to magically make your debt disappear or magically increase your income.  You’re asking Him for the wisdom to allow you to do it yourself.  No one knows your financial future better than Him so that is the life source you want to stay connected to throughout this process and beyond.

STEP THREE: Strip down your image.  There is no doubt that a part of the instruction God will give you will require great sacrifice and that means you will need to be okay with whatever anyone else may think of you.  Don’t allow your fear of what others may think keep you straddled with the burden of debt.  It’s just not worth it.

STEP FOUR: The 10/90 Rule.  Many financial experts will tell you about the 80/10/10 rule and it is what Keith and I follow.  But I learned early in my adult life that the 80/10/10 was a goal but for those desiring to financial freedom, the 10/90 rule is a requirement.  It is what I used 15 years ago to turn my financial situation around and I’ve never met a person for whom it did not work.

STEP FIVE: Allowance isn’t just for kids.  You’ve probably discovered, like most people I know, that budgets are similar to New Year’s Resolutions: everyone makes them but few actually follow them (at least beyond the first month or two).  Budgets are usually blown but allowances are not.

STEP SIX: Redefine the American Dream.  This step begins the process of helping you pay off your debt and learn to live below your means.  Keeping up with the Joneses, Kardashians, Steins or anyone else is a recipe for failure.  Defining the American Dream for yourself is the key to success.

STEP SEVEN: Let stuff go.  Using the analogy of “how to catch a monkey” we’re reminded how our refusal to let some things go could cause us to remain in debt and not live the financially free life we were meant to enjoy.  And like the monkey, who is caught because of his refusal to let go of a booby-trapped treat, our decision to “let go” can change one’s life. 

And today we’re adding:

STEP EIGHT: Workin’ 9-to-5 is a movie and an award-winning song, not the way to obtain financial freedom. 

When I first began writing this blog series on finances, I thought it would take a couple days.  I’d share a few thoughts and hope you’d glean something great from it to begin on the path toward financial freedom.  Quite frankly, I thought I was just going to share with each of you one of our favorite books, Dave Ramsey’s Total Money Makeover, and be done with it.

Now, two weeks and eight steps later, we are finally nearing the end of this series.  We will be discussing step eight today, step nine on Wednesday and wrapping up with step ten on Friday.  And then I can return to writing about much lighter topics.  Yeah!!

So let’s talk about step eight.  As I mentioned on Friday, for some of you, the first six steps in this plan for a Recession-Proof marriage is all you’ll need to get on the right track.  But for those who find themselves buried in debt on a never-ending hamster will, selling excess might be necessary (step seven) and figuring out creative ways to bring more income into the family (step eight) may be required.

When times are tough, money is tight and the bills are mounting, obtaining multiple jobs may be necessary.  A secondary job is never ideal, and it’s rarely anything enjoyable, but it may be necessary.  Now, is the time to put your heads together as husband and wife or mom and dad and figure out how you can bring more money into your household.  That may mean working one job from 7am-3pm and another from 4pm-10pm.  It may mean working six days a week.  Not fun… I know.

Working 12-hour days, 6 days a week is exhausting.  I understand.  My hubby understands.  We’ve both done it multiple times throughout our careers.  70+ hours of work each week is definitely no laughing matter but it may be necessary for the time being to create more income for your family.  And it should be temporary.

Set a goal of getting out of debt.  Lay all your bills out and begin calculating the length of time it will take you to pay them all off (there are a ton of websites that can show you effective ways to do this – just Google it).  Once you’ve determined how long it’ll take you to pay them off at your current household income, calculate how much time you can shave off of that by bringing in more money.  The sooner you can get it done, the sooner you can experience the financial freedom you long to have.

There are many Club members who are stay-at-home moms and you might be one of them.  If that’s the case, you already know you have one of the most exhausting and underappreciated jobs in the world.  But, and this may surprise you, it is also one that can potentially give you the flexibility to add another source of revenue to the family’s bottom line. 

There are a ton of creative ways to make more money (honestly and legally ) and if you even look online for testimonies, you’ll run out of time before you run out of success stories.  But one of my favorite is making your services available through sites like Elance and Odesk and expanding your job opportunities from the US or wherever you are located to participating in the worldwide job market.

When I mention Elance to people, it’s rare for me to come across someone who knows what I’m talking about.  But this company has been a conduit for pairing work with qualified workers for some time now and contractors (people like you) have earned over $425 million on the Elance Platform (you can read an article here).  I love Elance, I have contractors who work for me from California, Tennessee, Florida, Costa Rica, India, Argentina, Philippines and there are thousands of small business just like mine who look for talented workers through sites like Elance.

Many think these sites are only for workers from other countries who work for less than $5/hr.  That is absolutely not true.  My company, for example, pays no less than minimum wage here in the US – no matter where a worker is located.  I’m here in the US so I try to hire as many US-based contractors as possible.  The problem is not the amount of work available, it’s the number of people qualified to do the jobs here in the States.

No matter where in the world you’re located, here’s what I know, you have a computer because you’re reading my online blog.  If you have a computer, you can learn the skills needed to earn extra income online. This isn’t one of those “work-from-home” schemes (as I know there’s a ton of those), these are simply online marketplaces where businesses like mine look for people like you who are hardworking, dedicated and skilled.

I bet many of you would be shocked to find out you can learn to build websites at the highest level and become a programmer for free.  Yep!  And people around the world do it every day.  There is an organization called World Wide Web Consortium (W3C) that was founded by the inventor of the world-wide web (that’s right, every time you enter “www.anything.com” remember the “www” was invented by one person), Tim Berners-Lee.  And Berners-Lee believes the web should be open and everyone should be able to learn how to operate, create and build on it – for free.  

Without sounding too techy, since this blog post is about finances and not technology and building websites, just know this: you can learn everything you ever needed to learn about building websites by going to: http://w3schools.com/ and everything you’ll learn will be 100% free.  I’m always amazed at the number of people who say they want to learn programming but don’t know this resource is out there for free.

Maybe you have no desire to learn how to create websites or operate in that world known as the internet, there’s still plenty you can do.  If you like talking on the phone, make yourself available as a customer service rep.  If you type fast and your work is accurate, offer data entry services.  Enjoy research (I’m a total research junkie), become a research specialist.  And all of this can be done on sites like Elance.com, oDesk.com, Guru.com (and others I’ve not used yet but I know they exist).

Because I am in the technology business, this is what I think of immediately when someone tells me they’re willing to work more to get out of debt but just need to find a job.  I tell them, if they’ve been looking and can’t find a second job…Create one.  But technology isn’t the only way.  You just have to get creative.  Have a family meeting and ask yourselves, what can we do together to bring more income into our home? 

Once you’ve figured out a way to bring more income into your household, the important thing to remember is the purpose of this additional income is to pay off debt you’ve already incurred.  Don’t go spending it.  That defeats the purpose.  Pretend this money doesn’t even exist; it comes in, you apply the 10/90 principle to it, and keep it moving.  Keep your mind squarely focused on creating a Recession-Proof marriage and household and it will happen.

I’m excited about Wednesday’s journal post.  I look forward to you joining me here.

Until Monday…make it a great weekend!

Comments: With more than 15,000 Happy Wives Club members already actively engaged on our Facebook page, what better place to share your thoughts?  Join me there and let’s continue the conversation: Happy Wives Club Facebook 

Have you ever tried catching a monkey?  Maybe not here in the US but maybe you’ve heard of one often mentioned method.  In Africa, as the story goes, they cut a coconut in half, hollow it out, put a ripe orange in the middle and then seal the coconut back together leaving only a hole small enough for a monkey to get his hand through to the middle of it.

In India, as I understand it, they’ve used the exact same method except theirs involves taking a gourd, cutting a small hole in it and then putting some rice inside.  They then secure the coconut (or gourd) using rope and a tree.  Then they wait.

Soon enough, an unsuspecting monkey will swing by and smell the orange or the rice and stick their thin hand into the fruit.  They’ll grab the treat and then attempt to pull their hand out.  Unfortunately, the hole is only large enough for them to get their hand in or out, if it is open.  However, with a clinched fist, the monkey is not able to remove its hand.  And thus it continues to try until a net is thrown over it and the monkey is caught.

All the while the monkey was trying to remove his hand from the coconut (or gourd), it never dawned on him to simply let go.  And thus, the greedy monkey leads us to our seventh step in this 10-step process to creating a Recession-Proof marriage and household.

STEP SEVEN: Let stuff go. 

Some of you will be able to follow the first six steps in this plan for a Recession-Proof marriage and that’s all you will need.  But for some, it’s not as simple as outlining a radical vision for emerging from the pits of debt or simply becoming determined to free your family from the bondage of slavery (as the Proverb says, “…a borrower is slave to the lender”).  For some of you, that will only get you halfway there.  You need more.  Step seven and step eight (which we’ll discuss on Monday) are specifically for you.

For those joining us today for the first time, I encourage you to go back and review Step One, Steps Two and Three, Step Four, Step Five and Step Six.  For your ease, I’ve included a brief synopsis of each step below.  But I definitely recommend taking the time to go back and read each step individually.

STEP ONE: Stop comparing yourself to others and learn to be content (or even better, happy) with exactly what you have in this moment.  As Rick Warren said and I love repeating, “If the grass is greener on the other side, that’s because your neighbor has a higher water bill!”

STEP TWO: Team up with your partner in life, your spouse, and pray for wisdom.  This is different from the prayers you may have prayed until now.  You’re not asking Him to magically make your debt disappear or magically increase your income.  You’re asking Him for the wisdom to allow you to do it yourself.  No one knows your financial future better than Him so that is the life source you want to stay connected to throughout this process and beyond.

STEP THREE: Strip down your image.  There is no doubt that a part of the instruction God will give you will require great sacrifice and that means you will need to be okay with whatever anyone else may think of you.  Don’t allow your fear of what others may think keep you straddled with the burden of debt.  It’s just not worth it.

STEP FOUR: The 10/90 Rule.  Many financial experts will tell you about the 80/10/10 rule and it is what Keith and I follow.  But I learned early in my adult life that the 80/10/10 was a goal but for those desiring to financial freedom, the 10/90 rule is a requirement.  It is what I used 15 years ago to turn my financial situation around and I’ve never met a person for whom it did not work.

STEP FIVE: Allowance isn’t just for kids.  You’ve probably discovered, like most people I know, that budgets are similar to New Year’s Resolutions: everyone makes them but few actually follow them (at least beyond the first month or two).  Budgets are usually blown but allowances are not.

STEP SIX:Redefine the American Dream.  This step begins the process of helping you pay off your debt and learn to live below your means.  Keeping up with the Joneses, Kardashians, Steins or anyone else is a recipe for failure.  Defining the American Dream for yourself is the key to success.

And now…

STEP SEVEN: Let stuff go. 

As you know by now, a few years ago, Keith and I made the decision to work toward becoming debt-free. A few months earlier, many financial analysts had predicted the United States was headed for its second Depression, and Keith and I knew we had not properly prepared to weather such a financial storm. Shortly before coming to this conclusion, Keith stumbled across a fantastic book (we highly recommend) by author Dave Ramsey called The Total Money Makeover. It completely changed the way we viewed, spent, and saved our money.

We’ve been incredibly blessed and fortunate to have avoided the vast majority of financial challenges many have endured during this recession. However, that had less to do with our actual finances and more to do with God’s grace, the plan we set into motion at the offset of this recession, our mindset and determination to K.I.S.S: Keep it Super Simple.  

Early in our marriage, we made a commitment to each other to pursue as simple of a life as possible while maintaining our drive and desire to succeed in every aspect of our lives.  Striving for a simple life meant we would need to learn to wear our possessions lightly, meaning we would need to be willing to shed whatever belongings caused us stress, the way marathon runners shed their jackets.

If you’ve ever seen a marathon on television, or if you’ve run in one, as I did several years ago, you’ll notice something peculiar at the start of every race. Most of the runners come with sweatshirts, trash bags, and light jackets covering their upper body. The reason is most marathons begin early in the morning when it is still quite cold outside. However, shortly after the race begins and the runners take off, those jackets, sweatshirts, and trash bags begin lining the first mile of the race.

Prior to the beginning of the 26.2-mile race, participants had the luxury of wearing those warm outer garments. However, once their bodies started heating up, they all quickly shed the extra layers, laying them down by the wayside as if they were trash. At the end of each race, marathon volunteers pick up the clothing and donate the items to a local charity to keep others warm.

Keith and I agreed that if the going got tough, our toughness would be exhibited in our ability to simply walk away from our material possessions. We would not be so prideful as to hold on to something we could no longer afford.

We live in a rural community outside of Los Angeles. It is an equestrian community with large parcels of land, hundreds of horses and wonderful neighbors. The only downside to this town is our sewer system. We all have septic tanks instead of in-ground plumbing. When our septic tank got stopped up one day, we called a repair company out to fix it. After diagnosing the problem, they determined we would need to completely replace the system.  The dismal report saddened us momentarily because based on their estimate the repair costs would far exceed what we’d set aside for household repairs and emergencies.

Since we knew the cost of the repairs would be a burden on our household, we decided—without hesitation—we would get a second opinion and if the second mirrored the first, we would sell the house (likely at a loss) and get a much smaller, less expensive place nearby.

This decision took little to no thought, because we’d already made the commitment to keep our finances as simple as possible. Thankfully, a second company gave us a completely different opinion, and we were able to keep the place we affectionately named, Serenity Ranch. However, we would have walked away in a heartbeat if it meant compromising the peace within our relationship.

Keep in mind, Serenity Ranch, is not just a house to us.  This is where we hoped to raise our kids, grow old together and hang out all day once we’d retired.  This home was and still is a very special place for us.  But if the happiness in our marriage would have been in jeopardy, this house would have had a big, fat “For Sale” sign in front of it faster than you can say, “Sell!  Sell!  Sell!”

Are there material possessions you’re holding on to that by letting go would bring you greater peace?  In the past year or so, we’ve recommended more people than I can remember short sale their home.  No, it’s not the ideal solution but if a home is causing such a financial burden that it’s become an tremendous weight on your family, walk away.  Deed in lieu of foreclosure, short sale, it doesn’t matter.  Just figure out a way to let it go.

Do you know of people who have so much stuff they pay for storage space?  Are you one of those people?  If so, this is where you can start.  Clearly, the things in storage are not items you’re using every day.  They’d likely fall under the category of excess.  Yes, they might be wonderful things you plan to use at a later date, but we’re talking about freeing your family from debt and rising from the ashes of this recession.

Pull together all the stuff you don’t need; anything in storage that can be replaced at a later date when your family is in a better financial position.  And have a big ole’ garage sell.  Yep, I said it.  Sell that stuff!  Go online and sell on eBay, Craigslist and anywhere else you can unload your family “extras.”  

Start purging yourself of things you no longer need.  Free up as much cash as possible so you can begin paying off your debt.  The faster you can pay on the principle of something you’ve previously put on credit, the sooner you can stop wasting precious dollars on interest.

I don’t think it’s necessary for me to give you a step-by-step plan on letting stuff go.  You know how to do it.  You just have to do it.  It might be tough at first but look at it a different way.  Picture all the extra “stuff” you have as a weight on your shoulders.  Then as you sell one item and then another and then another, that weight continues to get lighter and lighter.

Here’s the bottom line for Step Seven: Don’t be a monkey.  Debt and material possessions are only a trap if you refuse to unclench your fist.  But once you determine to start letting stuff go, you’ll begin to taste the freedom your heart desires. 

If you’ve changed your mindset to know longer care about image and how others perceive you, created a radical vision to get your family out of debt, sold the excess stuff you own and you still find it impossible to get ahead.  Step Eight, which we’ll discuss on Monday is for you:  Working 9-to-5, is nota way to make a living (I know the “not” isn’t included in the Dolly Parton lyrics but it is included in Step 8). 

Until Monday…make it a great weekend!

Comments: With more than 15,000 Happy Wives Club members already actively engaged on our Facebook page, what better place to share your thoughts?  Join me there and let’s continue the conversation: Happy Wives Club Facebook 

I am so excited we’re at step five in this 10-step plan for creating a recession-proof marriage and household.  For those joining us today for the first time in this blog series on shielding your family and marriage from this current economy, I’d like to encourage you to go back and review the first four steps.  Here’s a quick recap:

STEP ONE: Stop comparing yourself to others and learn to be content (or even better, happy) with exactly what you have in this moment.  As Rick Warren said and I love repeating, “If the grass is greener on the other side, that’s because your neighbor has a higher water bill!”

STEP TWO: Team up with your partner in life, your spouse, and pray for wisdom.  This is different from the prayers you may have prayed until now.  You’re not asking God to magically make your debt disappear or magically increase your income.  You’re asking for the wisdom to allow you to do it yourself.  No one knows your financial future better than Him so that is the life source you want to stay connected to throughout this process and beyond.

STEP THREE: Strip down your image.  There is no doubt that a part of the wisdom you will be given will require great sacrifice and that means you will need to be okay with whatever anyone else may think of you.  Don’t allow your fear of how others might respond to keep you straddled with the burden of debt.  It’s just not worth it.

STEP FOUR: The 10/90 Rule.  Many financial experts will tell you about the 80/10/10 rule and it is what Keith and I follow today.  But I learned early in my adult life that the 80/10/10 principle was a goal but for those desiring financial freedom, I believe the 10/90 rule is a requirement.  It is what I used 12 years ago to turn my financial situation around and I’ve never met a person for whom it did not work.

STEP FIVE: (we’re discussing today): Allowance isn’t just for kids.

Keith and I have been giving ourselves an allowance for at least the past six years.  The reason we began doing this is we realized more often than not a monthly budget is just a number on a piece of paper.  It is a goal, similar to a New Year’s resolution.  But the number of people who manage to stick to their budget is about the same as the number of people who stick to their annual resolutions. 

I don’t remember exactly where or from whom we learned about giving ourselves an allowance but continuing to do it over all these years has helped keep us stay on track financially.  Here’s how it works.  All of our income goes into a household account and each month we both get an “allowance” from our joint checking account.  That money is the maximum we commit to spend that month on our personal needs – and we stick to it.

We decided in advance who would pay for what out of their allowance (for instance, groceries might come out of your allowance while date nights may come out of your hubby’s). We determined our allowances based on needs and a few wants.  And by needs, I mean actual necessities.

In determining my actual needs, I tracked my expenses for a month or two by obtaining receipts for every single purchase I made and making every purchase in cash.  Even something as small as a pack of gum for $.89.  If I spent money, I tracked it.  At the end of the month, I was able to ascertain what expenses were actual “needs” and which were “wants.”

The process of determining needs vs. wants can become quite complicated if we allow it to be.  But really it should be simple.  For instance, cable is a “want” while internet, depending on what you do for a living, may be a “need.”  Coffee may be important to you to give a “pick me up” if that’s what your body is accustomed to in the morning.  But a $4 cup of coffee from Starbucks definitely falls under the “want” category. 

Ladies, I know it can really get tricky for us but let me help you see the difference between needs and wants when it comes to our personal beautification.  Getting our hair done, manicures and pedicures at an actual salon are a “want.”  Looking presentable for work and overall in life is important but there are many ways to get there.  I can count on one hand the number of manicures and pedicures I’ve actually gotten done at a salon in the past year and my hair dresser, who at one point saw me every week, now sees me bi-monthly for a trim.   

Gym memberships, as long as there is grass and concrete outside to run or walk and videos you can buy or rent to excercise from home, are a “want.”  I went from spending $150/mo for an upscale gym membership to $0/mo to practice yoga with a video.  And you know what?  I’m now in the best shape of my 35-year old life. 

Buying a new shirt because the one you have is “so last season” is definitely a want.  Purchasing another pair of shoes when you already have 50 pairs, no matter how “necessary” they are, is also a want.  Even purchases in the grocery store need to be divided between needs and wants.  Now, I’m not saying life should be boring and you shouldn’t have a lot of your “wants,” it just depends on where you are financially.

After Keith and I paid off all our debt a couple years ago (sans mortgages), we returned to much more liberal spending habits.  But now that we’re actively engaged in paying off our mortgages we’ve once again reined in our spending quite a bit and returned to limiting ourselves mainly to our “needs” while sprinkling in a few “wants” here and there.

Once you’ve determined not to participate in this recession and begin dumping any financial debt you might be carrying, embracing radical ideas may be necessary.  When Keith and I started making drastic changes to curb our spending habits and told my brother-in-law about it, he sent a text that read, “You’ve got some NURV!”  That acronym, borrowed from a movie, is exactly what I’ve been writing about in this recession-proof blog series: Never Underestimate Radical Vision.

Even daring to talk about becoming recession-proof three years into the worse recession of our lifetime, knowing most economists expect it to get worse before it gets better, takes a lot of NURV.  And creating a financial plan that keeps you on track should be just as radical.  And a weekly, bi-weekly or monthly allowance may just do the trick.

Everyone’s different but I’ll share with you my exact plan.  Each month, I deposit the same allowance amount into a personal checking account.  And Keith does the same.  I then withdraw 1/5^th of the total amount in cash.  That is what I give myself for the upcoming week. 

What’s great about an allowance being in a separate account is there is no extra money to spend.  Once it’s gone it’s gone so it forces me to spend wisely throughout each week and over the course of the month.  The reason I withdraw 1/5^th each week instead of 1/4^th is because I want to keep a little extra in the account just in case I come across a “want” I really, really want.

Listen, I realize this may be a little too “radical” for some.  Many like having more flexibility.  And I recognize one size does not fit all.  But what I can tell you is it’s worth a try.  Track your receipts this month – even for bubblegum – and tally them up at the end of the month.  Then separate the purchase receipts into two piles.  The first pile should be of items you purchased that were needed.  It is the total from this pile that should be used as a basis for determining your monthly allowance.

Test this for a few months and see how much you save.  Really, what do you have to lose?  If you don’t like it, go back to what you were doing before.  My desire is to see you debt-free and not participating in this recession.  And this is Step Five.

Next, we’re going to help you start freeing yourself from some of the bills hanging over your head by redefining the American Dream.  Understanding the difference between what the dream was meant to be and what it has become just might be the puzzle piece you were missing to begin pulling yourself out of debt.  Ready?  Let’s go.

Until Monday…make it a great weekend!

Comments: With more than 15,000 Happy Wives Club members already actively engaged on our Facebook page, what better place to share your thoughts?  Join me there and let’s continue the conversation: Happy Wives Club Facebook