Couple in Everett finds success with financial map

Published 3:15 pm Thursday, November 13, 2008

Shiloh, a mostly black, shaggy dog of mixed parentage, has a special category in her family’s money plan. Food, treats, health care and medical emergencies are covered.

In these tough economic times when most of us are looking for ways to stretch incomes to meet basic needs, Shiloh’s humans say their plan has taken the stress from money management.

Worth a look, even if it requires discipline and organization.

John Spencer, a technical designer at the Boeing plant in Everett, says he and his wife agree the map system “has brought clarity to our financial future. “

“It’s been really freeing for us. We have a great marriage. Once we were in the financial rat race like everyone else and now, life’s easier,” he says.

Actually, John and Kitty Spencer picked up a small book called “Creating your Personal Money Map” by Ethan Pope to encourage their college-bound son to get a handle on finances as he prepared for his college.

That was several years ago and their son wasn’t all that interested. Like many young people, he went on to experience his share of painful money lessons.

They, however, read in that book a solution that might make their lives easier.

In a way, the Spencer’s plan is like my Gramma’s envelope system: income is set aside to meet regular monthly bills as well as saving for such “biggies” as medical emergency or major purchases. Only the “map” is a spread sheet with all those categories itemized and then money allotted to each based on income.

It begins with “zero-based budgeting.” Zero-based means you pre-assign every dollar of income into pre-planned categories that you choose, Spencer explains. For example: charity, mortgage, clothing, groceries, gas, insurance, vacation, household maintenance, gifts, pet care and allowances.

Yep, John and Kitty’s budget even includes their monthly allowances — money to spend any way they choose. “We really appreciate this part. Sometimes we don’t spend it all and it builds…if we want to go out for a really nice dinner, we go ‘Dutch’ and share the bill,” he says.

Their map sheet for each month has a place to record deposits and withdrawals with a beginning and ending balance. The same rules apply, he says, as Gramma’s envelope method. No negative balances.

Such careful planning tends to eliminate impulse buying, especially at the grocery store. The Spencer’s make a list and stick to it. They’ve even gone so far as to take exactly the amount of cash they can afford to spend with them to the grocery store to make sure they stay on track, he says.

“If you stick to the map you will always have the money to pay off credit cards in full when they come due,” he says

By planning ahead and “pre-funding” some categories, there’s money on hand to pay property taxes, automobile insurance and other big ticket items when they come due.

Beyond that, is the need to establish and plan for long-term priorities such as eliminating all consumer debt, paying off the mortgage, building a three- to five-month cash reserve.

Getting used to all this took some effort and cooperation, but has proven time and time again to be “freeing” rather than a hassle. Although he’s still a dozen years away from retirement age, Spencer sees this as a “lifetime” plan that works for folks of any age.

A few years ago, while discussing his family’s money plan with the associate pastor of his church, Spencer was invited to share his story with the congregation as part of a discussion on stewardship.

Several people were interested in learning more.

Since then, Spencer has taught a series of classes on financial mapping at that church, The Father’s House.

There’s no fee. He provides the books at his own personal cost (a category for ministry and giving on his map).

“No matter how much or how little you make, you still need to have a written plan,” Spencer told me.

This all sounds, at first, like a strict diet with no hope of chocolate.

But, as dieting experts might say, it’s not a diet; it’s a healthy lifestyle change. The difference is you can add a category for chocolate to your map. Or, as Shiloh might suggest, “More doggie treats.”

Linda Bryant Smith writes about life as a senior citizen and the issues that concern, annoy and often irritate the heck out of her now that she lives in a world where nothing is ever truly fixed but her income. You can e-mail her at ljbryantsmith@yahoo.com.