How to develop your PLAN

I DO THIS EVERY DAY! For real! I guess I must be a lot more OCD than I thought (that has been becoming more and more clear to me lately). In any case, in addition to spending and keeping the record of the transaction, at least once every two days (usually daily; more OCD???) I enter it into my Quicken checking account. Sometimes more often if there seems to be a lot of activity, ie. receipts stacking thicker behind where I keep my debit card.

My husband and used to HAVE to use cash to do this exercise. But back then, ALL expenses were planned to the penny. We were living the "bare essential" senario. It was NOT fun and VERY difficult, however, we learned tons!

WildAmbitions-

Have you been through the first 3 exercises?

If you're willing to share your CORE values/characteristics, all can learn as we go through the process.

-Russ H.

__________________
"Control everything. Own nothing." -John D. Rockefeller

"Don't confuse motion with action" -Ernest Hemingway

I too have been recording all my expenses for years on Quicken. It was part of my "work hard and save strategy" to attaining wealth.

I also recognize how this activity parallels recording the living expenses on the cashflow card in the Cashflow 101 game. I extended by making my own computerized spreadsheet for my real life, personal cashflow. Now I can enter prospective numbers on my own interactive Cashflow spreadsheet and see how any purchase will affect my monthly cashflow.

I am still working on the first three steps though. Deep introspection and self analysis is not my strong suit. Thanks for the strategies Russ.

Greg

You're welcome!

My brother (a biker) is also someone who is not into self analysis.

But he does seem do it.

I asked him how he gets into the right mindset.

His answer:

"Either a fifth of Jack Black, or, more often, after everyone's in bed and I can't sleep, I'll sit out on the porch, smoke a cigarette, and count my blessings.

"Each blessing I think of tells me what's important: Everything from seeing Emma or John (his kids) smile, to having cold beer in the 'frig."

Made sense to me.

-Russ H.

__________________
"Control everything. Own nothing." -John D. Rockefeller

"Don't confuse motion with action" -Ernest Hemingway

Russ,
Yes I have, my husband has, and then we combined a list (2000). I think that was how we came to the decisions that we had to make the drastic changes that placed us into the bare essential living era. From there we set up a five year plan to get us restablished financially (2005). We sat stagnant for about a year, not sure of what we wanted to do next and then last year again to where we are now.

Ironically, I coppied your post to complete again last week and happened to do it at the same time (different location) as Yves (I keep telling her great minds think alike ).

Something that we also did was to list our core values with which were most important to us. (If we had 5 values, we numbered them in order 1 having the highest value). When we compared our lists they were not the same. To survive as partners (I would think that this might also work with business partners) we needed a complete list that took into account each others values.

I read in the book series "Light Her Life & Light His Life" to always remember that one persons core values and morals are just as important to them, as yours are to you. This was particularily deep for me.

Anyway, I was approaching the exercise for my personal life because I knew that my husband and I needed to start setting up our next five year plan. Our next plan should get us to the "comfortable" stage financially (RK stages: secure, comfortable, excessive cash) and if desired will be able to continue toward the excessive cash stage.

For my own sanity I have to have all areas of my life in order before taking on a new area - especially one like a new business (ad)venture. Now that I know where I am personally I will be able to duplicate the process and develop my business plan(s). This part is challenging for me because my husband loves the concept but is not as willing to make many sacrifices to gain big rewards. Financial security is very high on his list of core values. I am the opposite, but my family core value has priority over everything except God (personal choice). At this point, it becomes a balancing act. Once I knew that from the exercise (yours or any one of many others that I try to do often) it became much easier to develop a plan that will work for us.

I'll get my list up later today.

Upon further reflection, I have decided that what would satisfy all my core values would be to provide a resort type atmosphere for families or active couples. I would ideally like to:
Run a resort located on a lake and one in the mountains and be there just from time-to-time. I would like each resort area to be family friendly with a 50’s sense of community (a la Dirty Dancing resort area) but with a somewhat modern twist…flat fee for outdoor equipment rentals, low key movie area, internet café and game room.

I like the idea of going commercial, as I think I can increase value similiar to that of an apartment complex, but I would have all the benefit of vacation rentals.

yveskliensky-

It's clear you continue to dream and plan about investing.

Back to the PLAN . . .

How is Step 2 coming along?

Wow-- EXCELLENT insight. Rep points for you.

Sharon and I were fortunate in that our top CORE values are the same (she does love her kitty more than me*, but that's a ways down on the list

-Russ H.

* I joke about this, but it should be mentioned: While we have virtually the same CORE values/beliefs, and likes/dislikes, the specific things we like are different.

For instance:

-We both love being fit. Sharon is a gym rat, and doesn't like the outdoors much. I hate gyms, and prefer anything outside.
-We both love listening to music-- but different kinds!!!
-We're both home bodies (love to spend time at home). But the things we like about "home" are different.
etc etc.

__________________
"Control everything. Own nothing." -John D. Rockefeller

"Don't confuse motion with action" -Ernest Hemingway

Hi Russ- Part 2 is pretty uneventful for me! So far this weekend I have spent $24.79 on dog food, and meds for my dog.

If you are motivated, try to write down what you think your current expenses are (rent or mortgage, prop tax, insurance, car expenses, etc) each month. For expenses that occur only once a year (like dental appts or vehicle registration), divide by 12.

My current monthly expenses are:

Total: $3103/month. Expenses that aren't covered by rental income: $1023/month.

A couple of quick corrections:
Light Her Fire / Light Her Fire by Ellen Kreidman.

The ranking insight from above was also learned from a book. Maybe Suzi Orman??? I can't remember. I recall the book also taught us how to organize our finances so that we would always "know" what we had. (This works great but does not prevent you from continuing to make mistakes -as any human will).

OK, my list.
Core Values(whats important, in order for me)
Relationship with God
Spousal relationship
Relationships with my children
Family(immediate) time
Family(immediate) health
Family and Friends
Financial stability/security
Personal Health

Things I like to be around-not in any order
Nature
Sunshine
Mountains
Running Water
Family(immediate)
Friends
Relatives
Hockey rinks
Sports arenas
New things
Inspirational and motivated people
Books, give me a Barnes and Noble
Money

Things I like to doactivities- not in any order
Relaxing w/coffee on my porch watching the sunrise over the mountains.
Getting together with family/friends for a BBQ/fire in my back yard, beverages incl.
Going to the theater for new movie releases
Watching movies at home.
Watching movies in bed (limited company).
Traveling anywhere.
Quiet time just for me.
Reading
Drawing layout or design.
wine tasting -this is currently done with friends, from a box-as often as possible.
hiking
skiing (in the past)
shooting guns
playing hockey (yes, chicks with sticks!)
playing board games
solving puzzles-suduku, mind benders, etc., not jigsaw
crafts
designing things to be built or fixed
shopping
sleeping
eating out
dancing (also a thing of the past)
camping
fishing
playing sports

WOW, that's a long list!

I think that is all there is for part 1 & 2. More later for part 3.

[quote] Seriously? You haven't pulled out your wallet/purse for ANYTHING other than this? No coffee? No credit card purchases? No food purchases, at ALL?

If your current expenses are 3103/mo, does that mean you took in only 3103 x 12 = 37,236 in post-tax income, or do you have other sources? (apologies if this is too nosy).

My reason for asking: Before I started doing the day to day expenses, what I thought I spent vs what I actually spent in a year was off-- by more than DOUBLE!

(in other words, when I drew out what I thought were my total expenses, say, 28K a year, I found that I was spending close to $60K a year-- So $32K/yr worth of things I didn't realize! (like fast food, eating out, clothes, bridge tolls, car repairs, vacation/trip expenses, etc). By far my biggest "unconscious" expense was going to the grocery store, or to the hardware store, or Target, for some specific item and buying other items that sometimes totaled as much-- or more-- than what brought me into the store originally!

Once I realized how much money was going out the window for some of these things, my spending habits changed.

-Russ H.

__________________
"Control everything. Own nothing." -John D. Rockefeller

"Don't confuse motion with action" -Ernest Hemingway

[quote=Russ H;7201] I haven't done anything this weekend that required money- unfortunately! I was all geared up to go to this beer fesitval, and then my handsome little prince (my dog) got really sick. So I stayed up with him all night. Poor guy. If I had gone to the fesitval I would've blown about $30. ...Overall, I work weekends and come home for lunch. I bring my coffee to work in the mornings, as there is no coffee shop nearby, and there is no night life here...plus my husband is deployed- so I haven't been doing much. ...Now granted, if I did this excerise for 1 month, there would be much different results. I do tend to piss away probably about $500/month on stuff I don't need. ...Keep in mind that I live in a small town with not much going on. I have a lot of "free" fun. I have or go to dinner parties weekly, I crash my neighbor's pool often, I spend way too much time on this forum, time fixing up my house with relatively inexpensive projects ( you should see my kitchen!) and time outside.

As far as total debt, I bring in around $45k a year. (not including rental income which I will find out what is going on come Wed, when the bookkeeper helps me get it all figured out!) My husband, Kyle, has his "own" money as my investing makes him nervous. He pays for all expenses relating to our primary house, and I pay for the two cabins, plus my car, student loans, etc. I don't count his money as my income as it really is his to do what he wants with.

Russ-
Here are my results for the Taking Action exercise (after having done the exercise and implemented an actual budget that we stick to, for more than a year).

Total expenses per month (rounded up) $3000.00
Passive income (before taxes and rounded down) $2300.00

My husband I both work jobs that we could do forever, just because they are fun-mine is actually high paying.

My CORE values:

-LOVE
-Health
-Family & Friends
-never ending personal growth
-happiness
-tolerance / acceptance
-freedom of choice = lifestyle, individualism, freedom of thought, religion, schedule
-personal reflection & rejuvenation
-Home
-financial security
-personal safety for myself and friends/family/world
-leaving the world a better place than when I found it (make a contribution / leave a legacy)
-honoring my commitments, responsibilities
-being really "good" at my chosen path

Things I like to be around:

-My fiancee
-Friends & Family
-Accepting, open-minded, non-judgemental people
-Water (lakes, oceans, etc)
-Any type of athletic event / sports game (baseball, football, soccer, hockey, etc)
-Kids & dogs
-Homes
-Cities / neighborhoods with a lot of energy
-Nice people
-Sunshine
-motivated and successful people

Things I like to do:

-Go to restaurants and eat great food w/fiancee
-Take vacations = see the world
-Meet new people
-Chicago Cubs = watch on TV, go to games
-Watch professional and college football on TV
-Read (business, bio's, history, fiction, magazines)
-Go to live music shows
-Listen to music
-Spend time with my family
-Spend time with my friends
-Read / look at pictures of home magazines
-Driving around looking at homes (and stopping at open houses to look inside!!)
-Walk around downtowns / cool neighborhoods
-Sit outside in busy areas and people watch
-Watch / listen to inspiring stories (I don't think I've ever watched Extreme Home Makeover and not cried)
-Play sports
-Exercise
-Wear stylish clothes
-Attend personal therapy
-Sit alone for hours at bookstores
-Go to movies
-Play trivia
-Mountain bike

**I plan to add to this list from time to time as I think of more things.

Expenses this weekend:

(borrowed pen & pad from office)

Friday
$56.74 - Bar/restaurant bill with friend in town, fiancee (friend and I both spent $56.74)
$10.01 - 6 pack of beer for fridge for friend weekend

Saturday
$20.01 - Gas
$1.64 - 7 Eleven Coke (fiancee stomach ache)
$50 - my portion of a dinner with a different friend who was in town
$385 - purchased flight home to Midwest for 5 days for Thanksgiving

Sunday
$5 - laundry
$47 - groceries for week (fiancee and I each spent $47)
$41.05 - food from Thai restaurant for friend / her hubby who just had baby (we took food over since we know they've been dying for some Thai food but haven't been able to leave house with 3 week old baby)


$206.44 food
$20.11 gas
$5 laundry
$385.00 flight

$616.55

Wow, this was considered a SLOW, uneventful weekend for me. This is quite the eye-opener.

Exactly.

It was for me, too.

There were weekends that I spent in excess of $5,000 without realizing it (no joke).

-Russ H.

__________________
"Control everything. Own nothing." -John D. Rockefeller

"Don't confuse motion with action" -Ernest Hemingway

Uh oh. . Im not even 18 and i already have a car payment on a car i dont NEED. Its more of a WANT. Good news is - My weekend spending was only $44

Wow, exactly $44? How did that happen?

Where is your list?

-Russ H.

__________________
"Control everything. Own nothing." -John D. Rockefeller

"Don't confuse motion with action" -Ernest Hemingway

I took $30 out for party "donations"

Then it cost me $14 dollars for pick up hockey on Sunday, so $44 even was my spending.
But now that i think about it, thats not too good, because I dont make nearly as much as people with a salary.. $8/hr