GPS Money Guide
This page includes four sections:
- PEACE Budget comments
- PEACE Budget Computation Form for Income
- PEACE Budget Computation Form for Expenses
- PEACE Budget Money Map
Inputs to the two forms generate a Budget Worksheet automatically, which you can print and use to record actual spending against your budget. As well, inputs in the weekly section of the PEACE Budget Computation Form for Expenses will give you data for your Money Map. Please give us your comments so we can improve these forms or other areas of this procedure.
A budget or spending guide is your best estimate of resources - time, talents and money - you will need during a specific future period to do specific goals. Think of it as your spending plan during a specific period that you developed from a goal and plan. Like a Global Positioning System, it is your guide to prevent you from getting lost; without it you will get lost. You decide the inputs and you control the results. Merely a guide, it is part of PEACE Budgetary Control that begins with goal setting:
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PLAN for a specific period to do specific goals ESTIMATE and record expenses needed to do these goals ACT on the plan and record results as you progress to your goals COMPARE actual spending with estimated expenses and progress toward doing your goals EXECUTE needed changes to remain on course to do the goals |
Budgeting is the methodical allotment and recording of what we need to do to get to specific goals. It is the Planning and Estimating phase of PEACE: The counting the cost before acting stage. In Luke 14:28 (NIV), Jesus told His disciples about the cost of discipleship: Suppose one of you wants to build a tower. Will he not first sit down and estimate the cost to see if he has enough money to complete it?
We prepare goals for a period showing what we plan to do or where we plan to go. Next we look at the steps to do the plan. And then we do a spending guide or budget. We do this ahead of an event to identify potential gaps and opportunities during the future period. This allows us to plan to remove gaps and seize opportunities. Since we are merely God's stewards, before we start, it is essential we identify His goals for us. Then we can work with His plans and estimates daily.
A budget or spending guide is a freeing tool. Without it we will stumble along and advertisements will dictate how we spend. The spending guide is merely the starting point. We need to Act - do what we planned; then, weekly, we need to Compare results against the plan and the budget. After that, we Execute needed changes. Throughout, we must seek to do His will and be sensitive to His Spirit. PEACE Budgetary Control never stops.
Use suitable frequencies for income and expenses as you complete the forms. For example, if you get your income weekly, enter amounts under the weekly section. The software automatically calculates amounts for other columns including the monthly budget. So, if you entered 10 in the weekly column. It divides 10 by seven days and multiplies that result by 365 days to get 521 for the year. After, it divides 521 by 12 to get 43 for the month. (later in recalculates the year (521) by multiplying 43 by 12 to give 516). This procedure applies to both income and expenses. To change amounts in the input columns, type over the existing amount. Note, the program calculates the "monthly budget column." If you are paid twice monthly, enter twice the amount in the monthly input (middle) column.
Notice the PEACE Budget Computation Form for Income. Giving to further God's Kingdom is the first deduction item. God already owns 100%! Develop this mind-set.
The Amount Available to Spend on the income form, limits spending allotments on the PEACE Budget Computation Form for Expenses. So, assign amounts first to necessary then to discretionary categories. Beware; don't plan to spend more than projected available funds, unless God shows you the way.
Finally, budgeting is iterative. You need to go through a few cycles to prune plans, which lowers expenses, to income. Note, focus on plans, not money. If you reduce money without corresponding plans, you will spend more than you budget!This process is the only way to stay debt free with a fixed income.
Refer to Matthew Chapter 6 and 2 Kings 4:1-7 as you trim plans and expenses to fit your income. Of course, seek His direction continually as you allot expenses.
For further amplification of PEACE, refer to The New Managing God's Money-The Basics chapters 8-10.
PEACE Budget Computation Form: Incomes
Identify specific budget goals for the period. Remember, dollars quantify plans, and plans show steps to do goals, which provide direction for your actions during the budget period. To start, calculate funds likely to be available during the next twelve months (or other period). Don't plan to supplement your income with loans. If funds are not available, you can't afford to spend. This is an old but relevant concept-see the Affordability Index!
Calculate and enter estimated income from all sources. Most important, remember God owns 100% of all income. So, develop the mind-set that all income you get go to God's bank account. And your goal is to maximize what God keeps and minimize the amount available to spend. This is the reason "giving" to further God's Kingdom is the first deduction item - even before taxes! Ask God to tell you the amount to enter in this row. Before you enter amounts for savings, review this Cost of debt Quarterly Letter. As well, review the Capital Fund before entering amounts in this row.