You’re out to eat for a nice meal and you strike up a conversation with the server.  You come to find out she’s a single mom, works two jobs to make ends meet, and is going to school to get ahead.

Your heart goes out to her, but what do you do?

You’d love to help, but your budget is so tight that you can’t afford to.  You leave the restaurant hoping that she “makes it”.

Now imagine if you had $25, $50, or even $100 extra for the month set aside specifically for times just like this, where you spot a need and would like to help financially.

Imagine the feeling you’d get when you plop down an extra $25 for the tip with a note that says, “We’re praying for you!”

Doesn’t that sound exciting?  It does to me.  It sounds like True Wealth.

But how do you do that without going further into debt or taking an IRA withdrawal to make that happen!?

So here are a few things to think about when building generosity into your budget.

Build a Budget First!

Do I need to expand here?  In order to have generosity in your budget, you would first need to make a budget!

Planned Giving

This is the equivalent of your “tithe”.  The reason I’m not calling it a tithe is because I don’t want to receive a ton of emails arguing that the tithe isn’t biblical anymore. 

The point is not that you must give 10% of your money - the point is that you plan out a specific percentage to give to your local church first. 

How much should you tithe or give?  Now, that’s a good question.

More importantly, planned giving means you’re doing this regularly and faithfully.

This is also helpful with the budget because you know exactly what’s going out for your giving every month.  You can count it in the budget.

Above and Beyond

So you have a planned amount you are giving to your church, now it’s time to work generosity money into the budget.

What this means is you have an amount each month that allows you to be a blessing to others from a financial standpoint.

It doesn’t have to be a large amount.  The challenge is finding that figure and sticking to it.  This money should be a non-negotiable (just like you’d treat your savings).

If you hear of a coworker struggling to meet bills this month because of some unforeseen circumstances, now you’re able to help. 

Get a card, write a quick note – leave it anonomous if you want and slip the card on their desk.

Agree on the Details

This is extremely important.  If you’re married, you should work out the details with your spouse.  Both of you should be on the same page.

If you’re not, then one of you will end up being upset that money that should go towards goals, savings, debt etc is being used for others when you “just don’t have the money”.

It doens’t have to be a lot.  Just make sure you set the rules.  Here are some guidelines my wife and I follow:

• Set amount – we decided on an amount up front and both of us get the same amount.
• Used in that month – the money must be used in that particular month (this keeps us active in looking for opportunities)
• Autonomy – we are not allowed to tell each other whom to give to or what to use the money for - we each make our own decisions.

The Benefits Far Outweigh the “Cost”

My wife and I have found a tremendous amount of joy in doing our giving this way. 

The feeling you get when you’ve helped someone, or given them a gift unexpectedly is a great feeling!  Plus, I believe that you are storing up Treasure in Heaven when you do these types of things.

Generous Budget Ideas

Here are a few examples of things you can do:

• Grocery gift cards for a family who just lost their jobs
• Gas cards for single mom who is trying to make ends meet
• Leave an extra tip for a server
• Support local charities that are doing good things in the community

Now it’s your turn…what are some things you have done or would like to do with your budgeted generosity money?

This was a post I originally did for Christian PF – you can see the original post here.

So we’re taking a break from our 10 day journey to save $10,000 to have a look at some interesting items from around the web.

If you missed the initial post on the 10 Money-Saving Tips to Help You Stash $10,000, I highly encourage you check that out and join us as we resume next week!

It’s been a fun ride so far and we’ve already freed up roughly $375 per month!! 

The basic premise is to try to save $10,000 over the course of this next year by implementing 10 Money-Saving Tips! 

For roughly 10 days, we’ll look at a different tip each day to help you stash some money.  Even if you don’t save the full $10,000 – any additional savings will be well worth it! 

These are the tips we’ve gone through so far: 

Tip #1: Cut Back on Going Out to Eat  

Tip #2: Evaluate Your Entertainment

Tip #3: Cut Your Cable

Tip #4: Turn Your Heat Down

Now on to the rest of the show! 

It’s another week in the books and it’s time for a quick tour.  This Week in Personal Finance takes a look at interesting articles, posts and news from the past week in the personal finance arena. 

So give these articles a click!

Don’t miss another post! Get Redeeming Riches delivered straight to your inbox!

• Thinking about starting a blog to make a little side income?  Pete from Bible Money Matters is offering an ebook to help you do that!
• Enemy of Debt is hosting a “Manage Your Money” Challenge where each challenge will be different or will introduce you to a unique approach to managing money by using a variety of services and software.
• Kevin from Out of Your Rut takes an angle on retirement planning that doesn’t get talked about near enough – working toward a low-cost/debt-free lifestyle in retirement.
• My wife and I have been talking about starting a garden this spring because we love fresh food and we also love to save money. Frugal Dad offers a unique alternative to a monster garden in Square Foot Gardening.
• Jason Price, writing for Christian PF, posts about one of my favorite topics – Money and Happiness!
• Brip Blap offers some insights into raising kids without regrets. 

R2 Around the Web

These are some Blog Carnivals I participated in this past week:

• Carnival of Personal Finance #245 hosted by Budgets are Sexy.
• Festival of Frugality #218 hosted by Think Your Way to Wealth
• Carnival of Money Stories hosted by Personal Finance by the Book
• Best of Money Carnival #39 hosted by Canadian Personal Finance

Plutus Awards

Lastly, it was a great honor this week to be named as one of the top 5 finalists for the Plutus Awards – (think Oscars for the blog world!) in the category of Best Religious Finance Blog!! 

If you get a moment to vote, head on over to the Plutus Awards site and cast your vote for Redeeming Riches! 

Thanks for reading this week, have a great weekend!!

Your debt may be costing you more than you realize especially if you are making these 5 mistakes.  Paying off your debt is a battle you can win by bypassing these blunders:

1. Not paying the bill in full each month

This is where it all begins.  You buy something you can’t afford and think to yourself, “I get paid in two weeks, I’ll just put it on the credit card and as soon as I get the bill I will pay it off” and then something else comes up.  Your brakes go out, your washer quits working  or you find some other trinket you want to buy and you put that on your credit card too.  At the end of the of the month you receive a hefty bill and only pay what you can and wind up leaving a balance on the card that accrues interest at insane amounts. Creating a budget will go a long way in helping to avoid this problem.

2. Only paying the minimum payment

If you are paying only minimum payments on your debt, your credit card companies love you and you should be getting Christmas cards from them each year.  Paying the minimum payment will basically ensure that it will take a lifetime to pay off your debt.  You must pay more than the minimum if you want to get anywhere with your bills.

3. Not paying attention to due dates

This is easy to do because we are busy people, but making a late payment even if it is only by a few days can rack up ridiculous charges that only compound your debt.  Those annoying charges can also have an impact on your credit report.  Being vigilant about paying your debt and paying it on time is key.

4. Not paying attention to the interest paid

If more people understood how much interest they are paying to their card companies each month in interest alone, perhaps they would make a greater effort in getting these debts paid off.  Matt Jabs at DebtFreeAdventure.com takes a revealing look at his own interest payments for the month and shows how interest destroys your ability to build wealth.

5. Not negotiating with the card companies

It puzzles me that more people don’t call their card companies to negotiate with them.  You can negotiate things like interest rates, late payment fees or even payment plans.  If nothing else, it doesn’t hurt to give them a call and find out what they can do for you.  Bob Lotich at ChristianPF.com tells about his experience in  negotiating with credit card companies. 

Getting out of debt isn’t easy, but don’t make it harder on yourself by making simple mistakes that can easily be avoided. 

Few things can make people’s skin crawl like the idea of creating budgets. If you are unsure where your money goes each month or wonder why you never seem to get ahead, a budget might be a good tool for you.

Budgets conjur up feelings of kissing your freedom and your fun goodbye, and some people even try to mask the feelings by calling it a spending plan.

Ironically, many people find budgeting a highly liberating experience. A budget, sorry – spending plan, can be a great tool to help control your money instead of your money controlling you.

What many find after creating and sticking to budgets is they have more money to spend on discretionary items and can have fun without the guilty feelings.

I’d like to provide some simple and practical ideas on how to make a budget and tips on sticking to it.

Creating a Budget: Where Are You Now?

The best place to start in creating a spending plan is to find out where you are. When you Mapquest directions you always need a starting address. It’s the same idea with financial planning. Getting an idea of where you are is an eye-opening experience for many people. To me, the best way to figure out where you are is to do a 30-day diary of expenses. It takes a little more time up front, but I feel it reaps big rewards.

Write down every single dollar you spend in a month whether it’s coffee at the gas station or lunch at a local restaurant. After 30 days of doing this you will get a pretty good idea of what unnecessary expenses you might be able to cut out.

Next, list out the categories of each expense (i.e. gas, food, clothing etc.), jot down the amount in each category and determine if those numbers are realistic. For example, you may find that you spent $75 that month on lunches, but by making your own lunch once or twice a week you feel you can get that down to $50. Use that number for your plan and do this for each category.

Creating a Budget: Where Are You Going?

The next step is to figure out where you want to go financially. What I mean is consider what goals you want to plan for. You may have a goal to give more of your money to charity or to save for your child’s education or your own retirement. List out each goal so that you know what you’d like your money to do for you. This doesn’t mean you will be able to save for each goal, but listing them on paper is a powerful and motivating tool.

It’s important to remember that these items must come out first, otherwise you and I both know that if you wait to see how much is left over and then try to give or save it probably won’t happen.

Creating a Budget: How Do You Get There

Once you’ve determined where you are and where you want to go the next step is to put some numbers down. Write down all of your expenses and the alloted amounts or targeted numbers for discretionary items like going out to eat. One of the reasons budgeting becomes such drudgery for many people is that they don’t plan for fun things. Bob at ChristianPF.com has a good post about how budgeting should be like making cookies.

Michelle Jones, editor of BetterBudgeting.com, has personally reviewed and recommends several budgeting tools to help get you started. She says these budget tools “can be extremely useful and will help you stay on track year after year, but the most important thing is that you find something that works well for you and your family.”

Once you’ve outlined your alloted expenditures, factoring in your savings and giving the hard part is sticking to the plan. Review it often and make adjustments as necessary. Remember, the budget is meant as a tool for you to control your money so don’t let the budget control you. Be flexible when needed, factor in the fun things and persevere.

Creating a Budget: Staying On Track

Here are some general tips to staying on track:

• Make it a family affair.  When everyone is working together toward the same goal you are more likely to stay on track. 
• Check your progress regularly.  Ideally once a month you should sit down and review how you did and make any adjustments as necessary.  You may have budgeted $100 monthly for gas, but you find after a few months it isn’t realistic.  It’s OK.  Make your adjustments and determine where you might be able to cut back. 
• Make it a lifestyle.  You’ve heard people talk about this with food: “it’s not a diet it’s a lifestyle”.  The same can be said for budgeting.  Make it part of your life and with some discipline you will reap rewards. 
• Start at the right time.  Don’t start when you know it will be difficult (e.g, right before the holidays or before a major vacation that was already planned)
• Find a budgeting system that fits your needs (e.g., budgeting software)
• Build rewards into your budget (e.g., eat out every other week)
• Try to avoid using credit cards to pay for everyday expenses.  Using credit cards makes it more difficult to track your expenses.  After you get the hang of your budget and have been sticking to it, you may feel comfortable enough to start using them again, but remember to pay off your balances in full each month.