Mastering the Art of Budgeting Backwards {part 2 of 2}

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Here we go with part 2 of 2.  Practical shoe-hits-pavement, rubber-meets-road pointers you can grab hold of whether your bank account is black, red or any other kind of color.  I personally think turquoise would be fabulous, but that’s just me. 😉

If you haven’t read part 1, pretty please stop reading this post and go read that one first.  Thank you!

Aim for the G.O.A.L. You have probably heard you should set goals.  Write them down.  And yes, absolutely so. That part is coming.  This G.O.A.L. stands for Gutsy Obedience, Abandoned Life.  That’s how you walk out His vision which is 2/3rds of provision. A journey of gutsy obedience overflowing from an abandoned life in Jesus.

Then it’s time to learn the art of budgeting backwards. Usually we are taught how to budget forward based on our income.  In other words, we have such-and-such a salary that comes in every month and we budget accordingly to live within our means.  That’s a great place to start, especially if you are in a season of employment that has a set monthly salary.  But I believe God wants to stretch us past salary-bound survival to increasing levels of stewardship.

In order to accurately steward the resources God was to give us when I established and led the work in South Sudan, I had to learn what I now call budgeting backwards. This form of budgeting actually is way closer to the way entrepreneurs and business leaders use budgets to forecast needs and project expected/desired growth of their companies.

What do you do when you don’t know how much money is coming in each month?  How do you budget when income is anything but steady?

  • Start with your expenses.  Write down all your known regular monthly expenses by category.  And when forecasting always overestimate slightly.  Prices change and usually that means they go up.
  • Estimate unknown figures by taking an average of relevant past expenses and round up.  Don’t forget to add in categories for giving, self-employment estimated taxes, insurances and other things you might overlook.  You want the best possible overall perspective. In other words, you WANT the worst-case, most-expensive but still realistic scenario.
  • Do the same for quarterly, semi-annual and annual expenses {Christmas gifts anyone? Yep. They go here}. Then break each them down to a corresponding monthly figure.  Under your regular monthly expenses, add a new section for saving up towards other regularly occurring expenses.  At the very least, you will know these expenses are coming and they won’t shock you last minute.
  • Look at your debt for existing credit cards and see if you can consolidate it somehow… not to reduce your monthly payments, but to take advantage of better interest rates.  Look at your overall debt including car payments and student loans and commit to make any lifestyle changes necessary to stop adding to it and start paying it down.  Ruthlessly.  Even traditional “good” debt is still debt.
  • Find a financial counselor from a non-profit institution.  You don’t want your counselor trying to sell you MORE debt or their version of debt to cover what you already are dealing with. NOT helpful.
  • Read Dave Ramsey.  I don’t work for him I promise.  And if my advice contradicts with anything coming from him in the financial realm, go with his advice please… not mine.
  • Start a spending journal.  Every penny, write it down and let it teach you about yourself.  True priorities are best revealed by how we spend our time and our money.
  • Now take those regular monthly expenses, the monthly pro-rated other regular expenses, debt-slaying monthly payments and then add in a section for rainy days needing emergency umbrellas.  You want to add to it too each month.  First on paper then in practice.  Savings matter.
  • Have some non-regular expenses coming up like air travel or relocating to a war zone in Africa?  Put those on a different sheet.  Often specific story-related expenses are easier to raise support for.  People love to give specifically when they are taking part in His story in you.  Support-raising is ALL about stewarding His story in your life and creating opportunities for those around you to become part of it. It is not about a good sales pitch or slick marketing material.
  • NOW you know roughly what you need to TRUST Him big-picture wise.  Deep breath.  Really deep breath.  He’s got this, I promise.  Even better, He promises.  {Matthew 6:33}
  • On yet another sheet, write down all your income stream categories as they are now, both regular {i.e. monthly salary} and semi-regular {i.e. conference speaking, freelance projects}. Things like regular salary, existing monthly partner support, speaking, freelance work, small business income, passive income and the like.
  • And now you know more specifically where you are in the process. The difference between where you are and where you are going becomes an invitation to stretch your faith and exercise your no.  And minimalism is so in right now too! 😉  After putting all those numbers on paper, you have a much better picture of where you need to focus as you accept His invitation to journey deeper and farther than you have been.  Any dream worth doing is worth sacrificing for.
  • Unfocused faith is unfruitful faith.  To me, faith and goals that are born of His wisdom led by His Spirit infused with His Hope are the exact same thing.
  • Look at the next 3 months, 6 months and year. Take it all before Jesus and ask Him for realistic goals based in His wisdom and grace.  Then start believing for them and take steps towards them.  A step is a step no matter how small.  In either direction.
  • Wake up each morning and ask Jesus to show you where He is already moving in your stewardship of His story in you.  Get up and go join Him.

Goal-setting only becomes overwhelming when we try to figure it out and make it happen in our own strength.  This is not that.

This is a faith adventure with Jesus, Who is far more concerned than you are with you becoming who He’s called you to be serving where He’s called you to serve.

Tomorrow, more on how you can join me in this wild dance of faith and the amazing things Jesus is doing.  As always, I stand humbled by His goodness and ever grateful for your friendship on this unpaved road of grace.

You are Loved.  Michele