# Budgeting, Money and being young



## gillisonconstru (Jan 21, 2006)

My fellow friends and colleuges. I am writing this for advice I m 26 I work my a%# off everyday. I make money but am constantly seem to be out of money. I suck at budgeting and can use any advice I can get. My credit sucks from poor decisions. But I am ready to start to over get a grip on my money and my bussiness. I want to move on advance the bussiness upgrade equipment. Move on and and start my financial life I realize it doesnt happen over nite. I am open for advice any help available will be great. Thanks in advance guys.


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## Warren (Feb 19, 2005)

Pay yourself first. This means to put away something from every paycheck, towards retirement hopefully. If you have direct deposit it is very easy to do. If you don't have the money to spend, you wont spend it. At 26 you still have time to correct the ship. If you wait until 36, you have a huge problem.


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## contractorcoach (Sep 14, 2010)

gillisonconstru said:


> But I am ready to start to over get a grip on my money and my bussiness.


Your first priority is understand the difference between your money and the money of your business. They are not the same. This I find to be the biggest obstacle to most young people in business. Yes, you may get money from the business for the work that you have done, but the business, any business, is a living breathing entity, independent of you. Just ask the tax man. 

Pay yourself first is a great rule of thumb, but that applies to the business also. Its expenses must be first addressed and then your "labor" expense should be considered, then profitability can be understood. No money left after the first two, no profit. Simple as that.

Budget for the survival of the business first, the completion of the project second, your "cost" third, and the expansion of the business fourth.

The Contractor Coach


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## Heritage (Mar 20, 2007)

Warren said:


> Pay yourself first. This means to put away something from every paycheck, towards retirement hopefully. If you have direct deposit it is very easy to do. If you don't have the money to spend, you wont spend it. At 26 you still have time to correct the ship. If you wait until 36, you have a huge problem.


Good advice.

To go along with that, you can set up your bank account so that they will withdraw a percentage of every deposit/transaction and automatically move it to a segregated savings account. Things like this help idiots like us, because it forces you to save and you don't have to do anything, it's done for you.

Reduce spending, learn to live off "less". The fact that your credit is in the gutter is a blessing in disguise because you don't have the loan option and forced to deal with what you actually have.

Save.

Later on, invest. Investing is what separates average Joe's from the upper middle class & beyond. Rich people learned how to make their money work for them, whereas average people earn a living and spend like a cycle that never ends. Investing is the key to breaking out of that cycle & not revolving your financial dependence on your career. Your career should supply you with income that you can then use towards investments.

It's discipline, patience and truly wanting to get out of the cycle/shackles. At first, just focus on reducing spending. That alone is a mountain.


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## chris klee (Feb 5, 2008)

go buy Dave Ramseys book and read it. best thing i ever did.
if you have a lot of debt his book is really good. i didnt have any debt other than my house but the was i save money and invest are a lot better that before.


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## Hmrepairs (Sep 11, 2010)

No reason in the world to wait to start investing. Most mutual funds will allow you to start an account with a few hundred dollars, and a monthly investment, sometimes as low as $25.00. If a few hundred sounds like too much, then you aren't serious about getting ahead. Also, your original post said something about upgrading equipment. Do that as you can afford to, and I mean pay cash. You have one big advatage many of us here do not have, and that is time. If I had started serious investments just 5 years sooner, I would not be working today. The older you get, the more you are forced to put away, just to make up for the time you lost, and the potential return on investment lost with it.


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## Mike's Plumbing (Jul 19, 2010)

oops


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## Mike's Plumbing (Jul 19, 2010)

I had that exact same problem and I’m convinced your problem is lack of clear and concise goals. Paying yourself first is great advice and that’s exactly what I do, but this might be a cart before the horse kind of thing. If your company has no goals that means you also has no game plan, and if you have no game plan all you have is constant chaos. Trying to pay yourself first in a world of chaos creates a vicious cycle and puts you in a downward spiral.

Back when I was balls deep in debt and clueless about money and how to generate and save it I had to come to grips with the fact I needed help. So that’s just what I did, I ended up talking and hanging out with some very wealthy business owners who took me under their wing and nudged me along.

I won’t kid you on this, if your serious your gonna have to work very hard on your planning and organization skills that revolve around money. What I mean is, before I was always good at plumbing but money really eluded me. I never gave it much thought, just always figured it would sort of take care of itself…….well….it doesn’t, as you well know.

The first and most important lesson I learned was to have clear and well defined goals, in fact I was told unconditionally that in order to receive help I had to follow directions to a T and that meant writing all my goals down in a book. Once you have goals business became fun, it becomes challenging, and for the first time you can see light at the end of the tunnel.

All great business owners have goals, it the driving force behind growth and maintaining a viable business model. Once you realize this and pound it in your head the “game plan” kind of becomes easy to create. You have to have goals period, without this your pretty much doomed. I’m on my fourth goal book now and when I read your post I had to laugh a little because I was in the same darn predicament. I just dug out my original goal book for my business so I could write down here what I had and I had to laugh because man did I start out in big trouble. Here is my first entry in my original goal book as well as my first “game plan”.

First entry March 8th



*Immediate Goals*

*Get used tires for the front of my truck…March28*
*Get insurance for my truck…April 1*
*Put $120 back in my daughters piggy bank…April 1*

*Short term goals*

*Pay back $900 to Mom and Dad…May 1*
*Pay back $400 to Sister…June 1*
*Have $1000 in business account…June 1*
*Save $200 week to put in savings…Aug 1*
*Long term goals*

*Income of $***,*** year by January 1 2012*
*Cube van pay cash *
So that’s my original entry, Seems kind of weird now because I’m so used to it I hardly notice. The key thing to remember is to write it down, everything starts with this.

With the above all written down I began to feel pretty good about myself, it actually felt like I was accomplishing something just by doing this. To write it down is not the answer however, it’s merely the beginning. Now it’s time to put the goals into action.

When you write this all down the next step is to believe you can to accomplish it. For some it’s easy to think this way but for others they doubt it, in fact they can’t ever see it and never will. All I can say is goals like this are easy to accomplish and you can do it. Of all the accomplishments of mankind this is nothing for you to do. Make it fun and make it exciting because your about to discover a world full of low stress and uber high energy.

Once you have a goal centered mindset your off to the races.

Now simply write down what you are going to give up or gain to get them, basically you need to figure out every possible way you can change your life to help you achieve your goals. Below is the next part of my first entry in my goal book.


*What I need to do immediately to achieve goals*​


*Wake up at 4:00 and go to bed at 12:00. That gives to 3 extra hours to focus on my game plan.*
*Stop eating out and pack a lunch.*
*Become super organized so I can get more down in less time, drive less for parts, and do more work each day.*
*Study and learn about marketing*
*Review goals first thing in the morning and right before bed, try and think of it all day while I work. Do this 7 days a week.*
*Join every social club I can*
*Get to know local business owners and become friends with them.*
*Become active in the community*
*Smile and be a good listener to every person I come in contact with.*
*Eat healthy and loose 85 pounds.*
*Stop drinking Mt Dew*
The only thing left is to go out and do it. Just keep in mind you have to eat, sleep , and breath your goals.

Everything in my life turned around for the better, in fact, my life is so different now I don’t even recognize myself anymore. Goals and goal making are the only reasons.

Oh, I almost forgot. All my goals except my income goal for 2012 have been accomplished and all of the original goals were accomplished much earlier than I had written down. And since that time I have made hundreds of new goals for everything from a website to the type of customer I want. It works, no matter what it works, I guarantee it.

If a boat has no rudder it just goes in circles…..That's no way to live a life, you can do this I know you can!!!!

Mike


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## Mike's Plumbing (Jul 19, 2010)

And by the way Gillson, your not alone here most people do what your doing day in and day out for the rest of their lives. They blame everything and everybody but themselves. Writing goals are actually quite rare, and even more rare is accomplishing them.

When I wrote the above entry in my original goal book my life was such a wreck I didn't want to even live, I hated getting up in the morning because I had to deal with a crappy life. I hated people, I was a complete recluse and hid from everybody. I was in such bad shape my friends kept telling me to get psychological help with depression. The only thing that saved me was looking at my kids and doing it for them, I didn't care about myself enough to do it for me.
Trust me...You can do it!!!
Mike


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## A. Spruce (Aug 6, 2010)

Dammit Mike! There you go with that cheery attitude again! It's really starting to get annoying. :w00t::w00t:

As always, fine sir, your wealth of knowledge, compassion, and fortitude is inspiration to us all. :thumbsup:


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## Mike's Plumbing (Jul 19, 2010)

A. Spruce said:


> Dammit Mike! There you go with that cheery attitude again! It's really starting to get annoying. :w00t::w00t:
> 
> As always, fine sir, your wealth of knowledge, compassion, and fortitude is inspiration to us all. :thumbsup:


Actually Spruce, that was one of the most painfull posts I have written. It brings back some really bad memories. I just hope 1 person could be helped by this and that would make me very happy. Since I wrote this I have been looking for my original diary to see what I wrote on this day back in 2005, I can't find the book yet but I know it was really bad.

I think sometimes people feel a bit alone when dealing with things like this, I know I did. The reality is they are in a majority, this problem is everywhere especially now in this economy.

Everything I wrote is simply a matter of making a decision...that's it. This fella is only ONE decision away frome creating a new and prosperous life.

Mike


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## Ohiobuilder (Feb 16, 2007)

Buy yourself a copy of Quicken personal and be diligent about entering everything you spend on a personal level. Down to the very last cent, cash transactions as well. 



Ditto the Dave Ramsey suggestion.


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## A. Spruce (Aug 6, 2010)

Mike's Plumbing said:


> Actually Spruce, that was one of the most painfull posts I have written.


While I may poke a little fun in your direction sometimes, you have my utmost respect for what you've been through, your outlook on life, your constant push for personal improvement, and your willingness to help others.


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## Tiger (Nov 21, 2007)

Great post Mike.

To the OP:
Step1. Cut up all your credit cards.
Step 2. Budget to live on less than you earn.
With the extra money:
Step 3. Pay off your debt early. Pay the debt with the highest interest rate first.
Step 4. When you pay off all your debt, start saving by staying on the same budget. If your pay increases, stay on the same budget and save more.
Step 5. Buy things when you have the money all saved to buy things.

It becomes a good habit if you stick with it.


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## griz (Nov 26, 2009)

Get out of all consumer debt. IE: credit cards, etc.

Pay all business debt on time.

Start a retirement account. You will need it next week.

Have a long term savings acct. 

Start a rainy day savings acct.

Live with in, or slightly below your means.

Just start. As you see the balances grow it will encourage you to deposit more.


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## jimAKAblue (Aug 15, 2010)

Read the book: The Richest Man In Babylon.

Implement the same system.


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## CookeCarpentry (Feb 26, 2009)

Marry a rich women; forget what everyone above me said.

:thumbup:


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## William James (Mar 5, 2010)

CookeCarpentry said:


> Marry a rich wom*a*n; forget what everyone above me said.
> 
> :thumbup:


the quick and easy way will often lead to the darkside. This route will bring pain and suffering into your home. 

Great post Mike!


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## CookeCarpentry (Feb 26, 2009)

Craftsman Jay said:


> the quick and easy way will often lead to the darkside. This route will bring pain and suffering into your home.
> 
> Great post Mike!


It's by no means quick or easy....do you know how hard it is to find a rich, attractive woman who wants to marry a contractor? :laughing:


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## AustinDB (Sep 11, 2006)

for those interested in Dave Ramsey, he has an EntreLeadership course Nov 5th which is being simulcast at select locations around the country. Seems the main venue is in Atlanta. A simulcast location is in Wilmington, DE and the cost is $49. http://www.daveramsey.com/entreleadership/home/


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