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Ep 23 – It’s Not a Budget

I think it’s just you and I now it’s always you and I and here I think after that last episode we lost every last lesson. We definitely did I don’t know what it was we lost it

we literally I don’t want to say we were off our game I think it was cool that it humanized us It’s

who we are.

It is who we are

who we were.

But I’ve changed your back to calling me out and not paying attention to me.

Would you say Dr ma what are some of your least favorite words?

I can’t say them

well, what are the some of the leisure labor words that you can say?

Oh, I hate the word stupid. Really? Yeah, I joke about it a lot. I hate the word can’t and that’s not just because stereotypical I hate the word can’t

you hate how it sounds sounds gross. Means can’t

I’m unable we eat we train our boys we literally even with the game Roblox so you’re not familiar with that game. Let’s talk about Roblox for a minute. Is

that a digital game?

Yes, it’s iPad. We give our kids dedicated iPad time whenever we have wine downtime. They love this game called Roblox. We turned off the chat. So no, you know, 13 year old can’t Yeah. be disrespectful to our children? Yeah. And they can get to a point. Sometimes they say I can’t do it. I can’t do it. And they want to flail around and act like fish out of water and we sit down and we have the conversation. Never say you can’t do anything you can do anything you put your mind to, even with a little silly Roblox game. But I hope that I’m instilling in them lifelong lessons by telling them you could do anything. Yeah, cancer Dunmore. Don’t say it. If you’re we don’t have anybody listening. Let’s be honest.

It’s just you and me. That’s okay. That’s good. Do you like the word diet? Diet? I’ve noticed most people don’t like the word diet. I don’t have what it means.

I don’t ever use. I mean, I I’m thankful enough to have you know, healthy, very healthy lifestyle and active and I eat well, so no, that’s what I think of when I think of diet.

Yeah. Well, you know, diets, diets, a word that triggers the lizard brain to deep down spiraling dread.

Like, can I dye it by consuming less coffee? Like, is that part of my diet? Right?

Yeah. Well, there’s the word diet as in things you eat. And then there were there’s the word diet isn’t I need to lose weight. Okay. And that form, the ladder form is what triggers people’s brains into becoming dreaded. And there’s another word, and it’s something that you brought up that I’d like for us, and I think you’d like for us to talk about stupid budget. Oh. Let’s talk about the

budget. Budget. Okay, you’re waiting for me? Yeah. Okay. I think who here? Well, it’s who here has a budget? Me?

Do you know,

you really don’t have a budget? No, like a budget worksheet?

I mean, I know how to access or make one but I’m not operating on one at the moment.

Do you think so? You don’t find it? You’re not like, overly Dave Ramsey about your budget worksheet?

No. Okay. Because I used to be more so. And then, you know, you learn certain habits and tricks and practices that make that kind of perfunctory thing a little bit less necessary. Yeah. Now, as a family, we have kind of a conceptual budget. I mean, we know just not paper. As a business. For me, it’s the same. But I think it’s really important that people have an on paper on screen budget.

Yeah, let’s, let’s do something very simplistic for all of you who have actually never thought of it. Let’s say you only bring home $1,000 A month for simple math. Sure. And let’s say that your all of your expenses together your mortgage, your cars, your car payment, your car insurance equals $600. So how much do you have left? $400. So that means what?

That you have to live on $400 a month, which means probably about $100 a week, if you don’t want to save if you want to save, it’s gonna be less than

correct. There you go. So that’s my point. You need to kind of know where your money goes. You kind of have an idea of where your utilities are, and your mortgage and or rent is or if you have a car payment. I know that but I want to talk into more specificity. Good word. Yes, I did it. You said that a couple episodes going on. Like, wow, I can’t say it. I want to talk a little bit more specific, if I may. And I think it’s very important for people who are entering this world, you know, millennials are coming into the workforce and I’m a millennial. I’m still millennial, right?

You know, thinking about that? I don’t think so. I have to, I think a millennial is someone who was born after 2000. Really? Yeah. Go look that up,

Joel, Joel’s a millennial, and he’s born in 90 something.

Right? Well, there are no precise dates. Because these are these are generational questions that don’t have specifics, but demographers and researchers typically refer to millennials as having been born in Oh no, it says the 1980s and 90s.

I’m a millennial. Yes, you’re just old.

Though I am. I am really old. I was born in 1975.

Were you really that’s a great band in 1975.

That’s a great band. Yeah,

I think it’s important for us millennials and anyone entering the professional world or getting your feet wet or trying to grow. In whichever role you’re in. And leadership. As far as having budget and having an understanding of your budget and budgeting, think about more family homes and think about the clinic and you have all of the operational aspects.

I mean, the only Yeah, you have the budget is a plan. It’s a tool. It’s a goal. It’s a way of getting your organization’s or your family’s business, strategized over a time period, typically for a budget 12 months, right. So whether you and the Dave Ramsey types would say always, always, always have an actual budget. Every dollar has a name, put it down, be specific, you know, and the more and more you do it, the better better you get at it. And the less and less you have to do it on paper, at least for me. So I know, in the clinic at the montgomery, my practice, I know exactly what my expenses are, I know exactly what my projected income has to be. And I know exactly what you know, my strategy is. And I have to do that because as a businessman, if you don’t do that, it’s your lack fiduciary responsibility, and you end up hurting yourself, your family and potentially other people. And even your business businesses come and go every day. They go oftentimes because they weren’t able to manage their their resources.

That’s scary. Scary stuff. Drew just wrote on Slack. And he said I’m sorry. Yeah, Drew came in odd earlier guys came in

hot. So what are some benefits of budgeting? You think?

I think budgeting is a mental freedom. I think it allows for you to live your life and not be be consumed by the dollar be consumed by fearing the mailman or lady. Yeah, can you imagine? I bet you $100? Well, I might have an extra $100 in my budget to bet that you have

a line item in your budget for for casual impromptu bedding.

Yes, absolutely. Could you imagine our mail carriers for people who don’t have budgets? Who for people who live off credit for people who have no financial

discipline, the phone calls you get every day from creditors calling asking for money? That’s really really, really sad.

That’s scary. Yeah, it is very scary. So what are some steps that one can take to change their budget? Because why are we talking about this, everyone, we’re talking about this, because this is a part of being better versions of ourselves. Really, if you think about it, I mean, if you are financially free, not you don’t have to be rich, let’s be honest, to be financially free, you know, living a life where you are not consumed by the creditors and the mail carriers carrying, you know, second and third and fourth notices final notices before discontinuation of utilities. But that’s what we’re talking about this, we’re just we’re talking about how to be better versions of so what are some ways that we can that we can have financial freedom or budgeting skills, I guess? Well,

the good thing about a budget is you’re quantifying you know, you’re counting, it’s a plan, it’s something you can see it’s specific and it helps you to to both plan and then to be able to let go, like you said to live freely. I think it’s pretty easy. And I’m not a numbers guy, you know, me, I’m terrible with numbers I’d totally speaking of, as we did in a previous podcast dependence, totally dependent on my wife for all things numerical, but it’s pretty simple. First of all, you have to know your expenses, right? How much money is going out, then you have to know your income, how much money is coming in, then you need to obviously have your savings plan and your debt repayment goals in mind. And then you need to to record your spending and track your expenses so you know where every dollar is going. And you need of course to be super realistic about what’s what’s possible, what’s real, what’s necessary.

So don’t put $1,000 down on a $70,000 Dodge Ram and have a $1,200 a month car payment for 12 years.

Right if unless your income can support that and dodge doesn’t make RAM anymore. bought it. But now it’s just ram.

Oh, I did I know that

there are Dodge cars but trucks are now made by Ram owned by Fiat Chrysler.

Hmm. Learn something new every day see,

but your example is a good one if your income is $4,000 a month, and you know making a pretext $40,000 A year and you and your family are mortgaging a home. And so your mortgages, let’s say $800. So now you’re down to how much a month $3,200 ish, yep. And then you calculate all your expenses, your utilities, you know, water, electricity, gas, if you have it, you have your you need to budget things like eating out. For people who eat out, entertainment movie going, having people over gift giving even vacations, people like Dave Ramsey advocate for having an envelope system, and you go to the bank at the pay period, and you take out a certain number of cash as dictated by the budget. And you distribute that cash according to the allocations of the budget into each envelope. So you know, I have a grocery, you’d have a groceries envelope, you’d have a clothing envelope, you’d have a dining out slash entertainment envelope. And that’s all you have for the month. So when the cash is gone, the cash is gone. If you decide to borrow cash from another envelope, then you’re robbing Peter to pay Paul, that’s fine, except it’s not an accurate reflection of the budget, you need to adjust the budget to reflect that so that you know what’s happening and where every dollar is going sailing way to make it work. So you have to have a line item for absolutely everything. Internet, Hulu, Netflix, your cable, Apple Music, if you have Spotify, if your Pandora premium. I mean, you’re getting a lot of there’s a lot of entertainment, a lot of streaming. Yeah, we’ve, it’s low, it’s low, but you add them all up and it adds up cell phone plans. Oh my gosh, they’re outrageous, right? All that stuff has to be added up. dollar for dollar line by line. And at the bottom you have that your expenses every month, I have to pay that in order to live this way. Is that here’s all my income. Well, what’s your goal? It’s just like calories, right? You have to spend more than you take in. If you want to lose weight. It’s the opposite for budgeting. You want to spend less than you take in so that you have some discriminant spending amount. So you have your expenses, you have your savings and then you have your spending money. And then you have to have you want to have something after that.

I literally have no desire for the only thing that I would buy every week. Seriously, is a new TV. It is the dumbest thing in the entire world. The Wonder Boys make fun of me. I always log into Amazon. They’re like you won’t buy it. And I’m always tempted to put put a TV in my cart at least once a week. So nothing’s really I don’t buy. You know, I don’t buy 52 TVs a year but yeah, anything else? I don’t care. When I first met Megan, I had to Faded Glory. Black polo T shirts. That’s it. That’s it. Yeah. So when I first started creating a budget, I lived off $35 in groceries every two weeks. Just so you know. That’s amazing. Yeah. bread and peanut butter. Yeah. Well, humble beginnings. That’s

what Dave Ramsey says. Beans and Rice, rice and beans. Yep. Yeah. Wow. Yeah. So do you live on a budget? Yes.

Yes, I do actually have a budget that is a Google Doc. And then also have a budget that was just sent to me for our 2018. For all the funeral homes, every one of them is, is budgeted separately, because they’re their own funeral home separate entity to create the budget plan for 2019. Starting with marketing and so forth. Luckily, I have people who are far smarter than I am Jim and Janice and them who can kind of like put the dollar where the dollar goes. But I have a 30,000 foot view of saying hey, it’s amazing. How how much and going back to the joke of you saying Hulu and Pandora and all those things. I’m laughing because of all the things that we can consume Sure, and spend little bits of dollar a little bit of money adds up it adds up super crazy because people come in and we want to support local all the time. So we’re always sponsoring you know, the the fall or the winter or the summer playbook for cheerleading or basketball or football. Next thing you know, you’ve looked at your budget and you’ve spent an extra seven grand on on some little eighth page ad.

Yeah, that’s it. And you do that a couple times. You just spent a lot of money, you spent a lot of money. There’s something called the latte factor. For people who go to their favorite neighborhood coffee shop or maybe a big box coffee shop that everyone knows name recognition wise and they spend three to $5 for their particular morning drink latte beverage of some kind. Let’s say it’s a let’s say it’s $5 Right, that’s it’s not hard to spend $5 at a coffee shop for a drink. And I mean, I think our grandparents would be like, what? But we do. And a lot of people do that every day. Sometimes the weekends, right? So let’s just say it’s $4. So you spend $4, a day, five days a week, on your lattes, you. So what’s five times five,

five times five is 25, times 425 times four is 100 times 12.

It’s $1,200 $1,200 a year, just in coffee, just in that one drink a day. And that’s not including weekends, it’s not including dining out. It’s not clear that’s $1,200. So when you think about it, if you’re making $4,000 a month, an entire week’s work worth of work plus, is going just to support that morning latte.

Oh my gosh.

So when Pete when you’re talking about wealth, acquisition and sustenance, when you talk about building and keeping wealth, that it’s not typically a practice of people who have great wealth, to spend that kind of money on that kind of thing, because people who have money are aware of the value of money, and they tend not to, and I’m speaking in sweeping generalizations, right. It’s a great book about this called The Millionaire Next Door. When they in the latte factor is described in that book, people tend to not spend money frivolously when they have a lot of it, because you know, part of their fiduciary responsibility is to be a good steward. And spending $1,200 a year on just one drink a day, five days, not including weekends, not including other meals, that they would consider that frivolous. That’s

something to think about, if there’s something that you want in life, if you want to better your business, or if you want to grow your business, and you find yourself at a point where like, Man, I probably could cut that out or sacrifice that I would highly consider maybe taking that. Taking that cutting it, you know, like, for instance, cable TV, I’m totally against. I’m sorry, not gonna say any names. I think that the TV company that is the ala carte, you can do Sling TV, and you can actually get and pick your channels and pay like a very nominal fee. But you literally the amount of commercials that you’re paying $120 a month for is out of this world. Yeah, it’s insane. Yeah, it’s insane. I know. I know, this isn’t a I know, this isn’t a budgeting or finance. Podcast. This is a podcast about like I said, living an incredible life, then and bettering yourself day in and day out. And I don’t, I don’t think there’s anything more that you could better you know what I mean? You can better your financial situation, you better your personal everything else. So that’s why I feel it’s important that we talk about it.

Yeah, no, I think it has to do. So that’s one quick way to even if you just said, Okay, I’m going to save $5 a day, I’m not going to have that morning breakfast beverage, I’m gonna make coffee at home, I’m gonna say $5 A day that way. But you still put that money in an account. At the end of the year, you have $1,200 in that account, if you did it five days a week, every week $1,200 that you can invest. And in 10 years at 1200 bucks due to compounding interest will become so much more than 1200 bucks. Plus, you’re continuing to do $5 a day. So it’s really easy to budget, a savings plan, which is, you know, I think savings is different than hoarding, right? There’s investing and there’s saving and saving tends to be like for something, maybe you want to have a down payment for your first house, maybe you want to put a down payment on your car, maybe you want to buy your next car out in cash, which of course is really smart to avoid all those fees and an interest in car loans. By the way, it’s a lot easier to get a car loan than a mortgage. So you’ll see sometimes people who have homes that that might not seem large, but they’ll have like a super nice car. And you always wonder like, how are they driving that? And they’re pulling into that home? It’s like it seems like a difference. It’s hard to reconcile, well, car loans are a lot easier to get than mortgages. So people get a car loan, and they end up having to rent something a little bit different. So that’s how that works. But you can create a savings plan out of just that little bit of latte money, and over the over time, have a lot of money just just from that one little thing.

There’s a couple of really cool apps, if I can like to share a couple of apps that have been really helpful and beneficial to me is an app called acorns. I really, really enjoy this app. It’s a it’s a simple app helps you you know have to be an investor or someone who has a ton of knowledge and investing but save Saving money is important. So for every let’s say you spend $1.27 on something with your debit or credit card you can attach your account to that and then it does what’s called roundups it will take there maintain balance, like to get to the next dollar, and we’ll put it in a savings account. Definitely recommend checking that out. It’s again, it’s called acorns. Another app that I highly recommend you checking out his stash, you can set a stash account up, you can set up a retirement account and within stash. It’s really simple. It educates you along the way. And it has what’s called an auto stash feature where you can set it and forget it and you’re always saving money, you’re putting money aside, as it is investment. Yes, it does go up and down. But one thing I was always told was always safe. Always put money aside, because it does not matter. Do not look at the market. Do not do that. But yeah, most importantly, save your money. Be disciplined in that because I think if you’re disciplined and saving money, if you’re disciplined in every other aspect of your life, like going running, or eating healthy, you are far more likely to be disciplined in your work. And everything else. I don’t know, I just I think this is an important podcast to be to be talking about today. So if this is not something that you are currently needing, just you know, check out another podcast.

So you mentioned discipline. What makes a person disciplined?

I was going to the word themselves themselves. Is that I think someone is disciplined by their desire to be helped me out? I don’t know. Yeah, right.

I mean, I’m asking to like, obviously, it’s a decision, right? It’s a choice. Because I think we are offered all kinds of opportunities at any given time any given day to do this or that. And if we’re not disciplined, then we might answer to the siren calls of have varied number of opportunities. And that would obviously sometimes be different than what our character our principal say. So when you’re a character person, when you’re a principled person, you have to be disciplined in order to uphold those principles as core guiding values and beliefs. So So discipline, which of course the root word of that is disciple, so you have this sense of being trained following something or someone, there, there’s some things that I think you have to do in order to become more disciplined, and I always could benefit from becoming more disciplined. Number one, as you just suggested, has to do with how how you eat, we are what we eat, I would say you have to eat well, you

know, the way to be disciplined. Don’t sit here, hit your snooze button,

right. Let’s get up and get going get going. I would also think that getting rid of temptations, because those tend to be the things that derail us. And so I think we have to recognize them, name them, engage them dismissed them, sometimes we need somebody to help some accountability to make sure that happens

routine was retained part of creating a just share Yeah, of creating

a routine, a ritual, a set pattern way of spending time, I’d also think that you should schedule breaks, treats, little, you know, like, if your particular really committed to a healthy eating plan, there might be one day a week or one day a month, where you might allow yourself something that you would ordinarily eat or imbibe, like, ice cream, or, you know, something. And I think that that builds adherence to the discipline. Because if you’re just saying, I’m just, I’m never going to do that, I’m never going to eat that. And, and then it’s something that you really like, over time, that that temptation just gonna wear you down, it’s very hard to adhere to a stricter schedule and routine, even an eating plan. Unless you have built in breaks. So you think about a long subway train. And each that long train isn’t one long train is made up of different cars, in between different cars, there is the linkage, and there’s that rubber boot that you might see that’s on the outside, which partially protects you from putting your hands inside and getting caught in the machinery. But it also allows for the give, so the cars can give without hitting each other. It’s not not brittle, and inflexible, but it’s also not detached and completely gone. So you have that rubber boot that kind of and I feel like that we need that, that give to to help in adherence.

How do you create your analogies in your brain? How does your brain do that? I’m a visual learner and you literally just taught me something just by the picture. It’s pretty cool. Thank you. Yeah,

no idea. I just just kind of comes so that’s it. And I think finally when it comes to discipline, we’re gonna mess up we just need to forgive ourselves and move on. You know, it’s like people who are dieting and they’re like, oh, gosh, I just had a steak and cheese biscuit at Hardee’s this morning. Now my whole day is ruined. So I’m going to go to Burger King for lunch at Taco Bell for dinner. Obviously you think, okay, I made a mistake, forgive myself and move on. Let’s pick back up on the discipline pick back up on the adherence. For lunch, and for dinner, and start back where we were. So those are some ideas that I have about discipline. But I think everybody has their own ideas. And I think we all could stand to be more discipline and, and many of us just aren’t. It’s what separates those kind of elite athletes from the rest of us. And they have all kinds of rationale and reasons for why they do what they do. But at the end of the day, we have to decide for ourselves what is worth being disciplined, principled, and committed to? And what am I going to do about it? And I think budgeting is one really huge way where you can see at the end of every day, the difference that your discipline makes. If you save five bucks on drinking a latte tomorrow, you have five bucks in your account that you wouldn’t have had. You do that for five days, you get 25 bucks, you did the end of the year got 1200 bucks. That’s, that’s awesome.

That’s really awesome. Yeah, I really like it, guys, gals, I really hope that you’ve taken just a nice little nugget from this, this Podcast, the podcast about not so much budgeting, not so much generalistic approach from my perspective, of course, talking about budgets. I’m no Dave Ramsey, but I think it all does boil down to discipline. That’s, that’s really it.

I think so too. And you know what, we are disciplined about trying to bring you good content. And we’re gonna keep trying to do that. Let us know what you need to hear. Let us know what what you’ve learned, if anything, and give us some feedback to teach us because we are incredibly teachable.

Mom, thanks for listening. Yeah.

Thanks. We appreciate you listening till next time.

Do you want me to say bye? Bye, everybody. I’m Nathan. I’m Jonathan.