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Posts Tagged ‘Budget’

QuickBooks For Personal Finances

July 15, 2009 Leave a comment

This is the topic of today’s web cast.

QuickBooks is great software for businesses and because it is great for businesses, it is also great for personal finances. Quicken is great, but I find that QuickBooks just does more and it does it more easily. Also when it comes to managing personal finances, it is really not any different than business finances in the most generic terms. That is to say that in both cases we are looking at income vs. expenses as well as debt and cash flow management. There are some things a business has that personal finances don’t, Great, we’ll leave those out. There isn’t anything I can think of on a personal set of books that wouldn’t exist in some form at least potentially on a business. Maybe medical expenses, but some businesses do pay medical expenses and even if they don’t they pay Health insurance. So at this level the concept is the same – they’re expenses, there are just different kinds and accordingly, different ways of categorizing them.

Watch the Web Cast Here:

http://nerdenterprises.acrobat.com/p58862925/

Conditions – a previous newsletter we sent out from our parent site

June 24, 2009 Leave a comment

People sometimes ask me. Seth why is it so important to you that you and for that matter others have a good handle on their finances? Isn’t it true that money can’t buy happiness?

My initial response is usually something like… stand outside of a car dealership and look at the faces of the people who are driving out in their brand new cars? A chuckle follows and then I explain that of course money doesn’t buy happiness. I have a theory though in terms of how money and happiness are related.

True happiness comes from being able to live truly in the moment. When I am spending time with friends, family – people I love I want to be able to be present. This means that both mind and body are right there with the people. I am paying attention and getting the most out of my time with them. It is when I am truly in the moment that I am the happiest. Usually when I am worried I am thinking about tomorrow. Most often when I am sad, I am thinking about something in the past. There can be exceptions, but the truth about this is where the expression “Yesterday is history, tomorrow a mystery, but today is a gift. That’s why we call it the Present.” comes from. Think about the last time you were upset about something. In that moment were you thinking about what was happening at that moment? Now think about the last time you felt really happy. I know for me at that moment I was thinking about how good life was and how good it felt. My mind wasn’t wandering, worrying about what might be or regretting what did or didn’t happen that I was disappointed about.

Aren’t finances one of the biggest causes of people’s worries? How many marriages break up over finances? How many times when things were tough financially were you able to go out and enjoy yourself? Imagine being worried about your finances and then going out and spending money. So no, money can’t buy happiness, but it sure can cause trouble when things are tough. If times are tight and I am out with friends and family how much of that time do you think is really spent enjoying the moment and how much time is spent worrying about finances? Out of 100% of maximum potential happiness during those moments, what percent do you think you get when your mind is wandering and wondering about the bills you have to pay?

So my theory is made up of 2 parts essentially. First, that if you have a good handle on your finances you can enjoy your downtime that much more because you are more able to be in the moment when you are with loved ones. Second, you don’t have to make a lot of money to be able to have a good handle on your finances. The second part often baffles people so let me explain because I have experienced it first hand. Good financial management starts with application of two principles. Organization and planning. Whether I make $30,000 or $300,000 or $3,000,000 really doesn’t matter. Bottom line my starting point in general terms is the same at any level of income. Income has to be higher than expenses. How many of us really know this for sure about our own situations? Unless you have actually sat down and drafted a budget, you can’t know. Not for sure and this is where the worries come in. My own direct personal experience has been that when I sit down and start this process I feel better within minutes. The reason is that the cure for the worrying is in the knowing. Worry comes from not knowing what the outcome will be, so our minds speculate and many of us have a natural inclination for speculating the worst. When you have a detailed financial outline in place then you know pretty much exactly what you can afford and what you can’t. Then it’s just a matter of living accordingly. The knowing will lead to a built in barometer for this. When I am spending money I know I can’t really afford to spend I am uncomfortable. When I know that I can afford to spend it, I am at peace and able to live truly in the moment – worry free. When I don’t know whether or not I can afford it, I worry.

So I am going to leave you all with this. Once I know what the conditions are I can change myself to meet the conditions. If I try to change the conditions I will likely only meet with frustration. This doesn’t mean I shouldn’t be ambitious and strive to earn more income – if anything the opposite is true. In fact knowing exactly where I am right now is the best possible starting point for planning the future and then setting and reaching new goals. It goes back to the planning and organization.

There are so many tools out there that you can use to help you keep the information you need organized so that it is easy to create and maintain what you need to find the peace of mind I am talking about. I have re-constructed my own budget at least 3 times this year and each time within a day. Partly because that’s what I do, but also because I am organized and I have everything I need right at my finger tips.