In my classes this semester I feel that I have learned a lot. I learned a lot about the brain and how it works in my Behavioral Neurobiology class. I learned a lot about parenting through the eyes of research and church leaders. I gained a greater testimony of the gospel and the temple from my Pearl of Great Price class. I learned more about memory in my Cognition class. And I learned about money in my Money Management class.
For my minor, Marriage and Family Studies, we are required to take Money Management because today the number one reason for a divorce has something to do with money, mostly because people don't know how to manage their money. And 70% of Americans live pay check to paycheck. For these reasons, I was required to take the class, to learn for myself and family, and to help others.
In this class we covered so many aspects of money. Because of all I have learned I feel that I have truly changed. I feel I can better manage my money, because I know how to budget my money. Much of it was from our textbook, but I feel a greater source is the all-knowing Dave Ramsey. In my opinion, he has the best advice on everything concerning money. I think part of that is that he to was once broke, but he figured it out and is now a millionaire. So here are a few things I have learned about money this semester:
1) The idea of buying on credit and having debt is entirely an American idea. It's ridiculous. 100 years ago Americans didn't borrow money to buy things, they saved up if they wanted a car or whatever else people buy with credit these days. We don't have to borrow money to be happy, we just need to save. Life is cheaper that way too. Plus then you don't end up paying more then is needed without the interest.
1) Every dollar counts. When making a budget, plan for every dollar before the month starts and before the paycheck comes. This way I always know where my money is going.
2) There are only three times in my life I will allow for our family to have debt: a) Home ownership, since buying a home is kinda a lot of money getting a mortgage is an exception to getting debt, but only if it's a 15-year fixed-rate mortgage. I don't want to spend half my life paying for my home. b) Education, school is expensive and JT and I have learned how hard it is to pay for school and pay the bills while also staying as full-time students. Although federal grants do pay our tuition and books, only working a combined 40 hours while in school isn't enough to pay the bills and survive. So taking out loans that can wait to be paid until after graduation are acceptable to me. c) Medical bills, when we have babies it's going to be too hard to pay all the costs of the hospital and doctor appointments at once. And sometimes things come up unexpected. But hopefully insurance will help.
3) I will never want us to own a credit card. They might be safer for online shopping, but it's not worth it. It's a temptation to buy things that aren't needed. This is why we have a budget, to spend the money we have. If an emergency comes up, we use our savings.
4) It's always smart to have an emergency fund, of at least $1000, for just in-case. This fund isn't for vacations or random things we want, its for a case where our car needs repairs or whatever. It's also our goal to figure out our cost of living for 3-months, then save up for it. This is for in case we go for a time without working but can still pay the bills without gaining any debt.
5) I don't ever want to buy a car through financing. Like I said, I only have 3 times debt is acceptable to me, and a car loan isn't one of them. It's much easier and cheaper to just wait a year or two and save for a car. It might not be the best car, but it's sure better than paying thousands more than its worth in interest. And fun note: When you buy a new car, and drive it out of the dealership, it loses thousands of dollars in value once its out of the dealership, so gaining debt on a car thats losing value just doesn't seem worth it to me.
Overall, I feel I have learned a lot about money and how I want us to manage our money. I want to be strong, and I want to be able to someday do fun things with our money. This will only be possible if we start spending wisely now.
Here are some YouTube videos about money management from Dave Ramsey: