An friend on Twitter just asked me again this year to share the contents of the annual 'State of Our Union' and annual planning date Angie and I have every New Year's Day. I'm glad to, and updated many details below for 2015. I also added below our basic philosophy of budgeting. This planning format is something that helps us be biblical by both naming and celebrating what God has done in our lives the past year, while also planning in a unified manner for the year ahead, "if the Lord wills it" (James 4:15). The document is intentionally centered around finances, because how we use money is the ultimate concrete statement of what we value.
If it was a good year for us financially-speaking, we go for a long lunch at Red Rocks in Birkdale, and I get my favorites - housemade chips with blue cheese, and the filet medallions also with blue cheese baked on it. If it was not so good a year for us financially, well, our friends who own the exit 23 McDonald's will appreciate our business, and we can sit there as long as we like.
Without taking too much time or over-thinking it (I only start working on this on New Year's Eve), I prepare a hand-written one pager titled (last year): "Moses 2014: Achievements, Goals, Needs, Assets." The Bible verse I write at the top is an edit of Proverbs 21:5 "Plans lead to profit, haste leads to poverty," which doesn't just mean money, it includes dreams, relationships and careers!
Once we finish this 'meeting,' Angie and I prepare our monthly budget for the following year over the next couple of weeks. The most powerful impact this annual process has on our lives is unity between us, and driving our budget with goals for a more abundant life in our home the following year (rather than being driven by needs or scarcity, both of which there is always more than enough of to fill our vision if we don't start with goals and dreams the Lord has laid on our hearts).
Here are the sections I briefly hand-write, and examples of content from last year's planning: (I've attached a whited-out copy of our 2012 blank planning page and old school budget format (isn't my hand-writing awesome??) : Download Annualplanandbudgetforms
I. 2014 Achievements: Ecclesiasts 5:18-19 "This is a gift of God!!" Last year we named 17, including: 1. Austin admitted to a college that wiggles his ears, and plugged into Christian fellowship with a band of bros there. 8. Angie & Mike privileged to attend celebration trip with CIN to dedicate new Honduras orphanage. 11. EPC chooses to partner with LFC for Church Planting Residency training. 12. Mike elected Moderator (aka Grand Poobah) of the EPC. 13. Our church launched its WestLake Church! 14. Angie wrote x columns, X magazine articles, x paintings. 16. Rebuilt short term savings account for monthly breathing room. 17. Fulfilled the full tithe, putting God first in our finances and values.
II. 2015 Goals: Proverbs 13:19 "A desire realized is sweet to the soul!" Last year Angie and I built a list of 9, they included: 3. Beach week somewhere. 4. Focus on yard upgrades. 5. Angie begin writing a new novel. 9. Help Austin learn how to budget his money in college.
III. 2015 Needs: We listed 3, including: 2. Fix rotted window frame in bonus room.
IV. January 2015 Financial Snapshot. Proverbs 27:23, 24 "...know your flocks..." Here, I use the excellent records Angie has kept all year and record the starting and ending balance (and net gain or loss) for the year in these areas: Savings/Emergency Fund, Home Equity balance, Checking Account, Retirement Account, Annual Income (paycheck), Tithes and Offerings Given by us, any other investments, College Savings, Home Value vs. Equity (using Zillow), Life Insurance, etc.
Proverbs 21:20 "The wise store up...the fool consumes it all."
We budget using Dave Ramsey's 80-10-10 plan: The first 10% goes back to God, the second 10% we pay ourselves in forms of saving, and we live off of 80% of our income only as expenses. This plan follows biblical principles and WORKS for every income level, except for true poverty. Perhaps this could be your #1 goal for 2016? This helps us face our limits and hard choices. In order to live by our stated values and say 'yes' to the 10 and 10, it involves saying 'no' to something - a house with more square footage, the extra fun toy, the top cable tv plan, private schooling, etc. That will be different for each person.
That's pretty much it. We always crack some waiter up - showing up for a nice meal with manila folders, copies, pencils (no ink pens at this point), budget sheets, and a couple of calculators. We don't press ourselves to make any hard and fast budget decisions at the meal, just ideas and possibilities. The meal is to remember and celebrate the good (the bad, too) of last year, and dream within reason about the hopes and needs of next year.
I don't think this is 'the way' for everyone to 'do it.' We developed this slowly over several years. But if any of these ideas are helpful to you in having a more unified and/or abundant life in 2016, then I will have one more thing to celebrate this January 1st.
