We’re about a month into Financial Peace University, and I thought I’d share my thoughts on how it’s going thus far and some cool stuff I’ve learned.
- The Cash System Works! One of the guiding principles of Ramsey’s budgeting system is to use a cash envelope system for your variable expenses such as food, clothing, and entertainment. I’ve wanted to try this for some time now, and I’m amazed at how well it’s going now that we’re actually doing it! Did you know that you will spend 12-18% less if you use cash instead of a debit card? I find we’re definitely spending less because we’re actually SEEING those dollars go in and out of the envelopes. There’s no room for overspending and it’s easier to stay on track.
- Make Your Budget Sync with your Lifestyle. For years, we’ve struggled with keeping a budget that works for us. Through the course of this class and our wonderful mentor, Sarah, I realized one fatal flaw: we’ve been trying to budget to a calendar month instead of our paychecks! By simply moving the “month” from the 1st to the 8th (Terry’s payday), a lot of stuff cleared up for us. I think part of the problem was by starting it on the calendar month, it always felt like we were a bit behind and the checkbook was harder to balance.
- Make an Allocated Weekly Budget. Once you have your monthly budget agreed upon, break it down by weeks. This was oh-so-infinitely helpful too! So once you agree to spend, say, $400 on food for a month, you break down which weeks you will take the cash out. Perhaps you take it all out on your first paycheck, or you take out $200 on each paycheck. These allocated weekly amounts should then roll up and reconcile to your monthly budget.
- You CAN Change your Money Habits. If you’ve been doing not such a great job about saving, you can change that. If you’ve gotten yourself into credit card debt, you can get out of it. If you haven’t communicated with your spouse about your financial dreams and struggles, you can change that. This is perhaps one of the biggest takeaways I’ve gotten out of the class – there is hope to change the things you don’t like about your financial situation. It may mean sacrifice, hard work, and some learning – but you can do it!
I would highly recommend this course – it’s good stuff, and Ramsey does an excellent job of making complex financial concepts easy to understand. He uses a lot of word pictures that really stick with you and illustrate the ideas.
If you would like to learn more, you can buy the Financial Peace book on Amazon for about $13 (hardcover). You can also visit Dave Ramsey Financial Peace University online to find classes in your area, download free forms, and more.
Have you gone through Financial Peace University? I would love to hear what you got out of it!