Why Plan Personal & Family Finances? Watch How Achieving Intentional Financial Goals Creates Wealth Confidence For Your Family!

Janice and Ben are in their mid-40s. Janice is working full time, while Ben is currently looking for work. Janice is starting to get concerned about paying the monthly expenses with only one salary.  Their teenage son’s car was vandalized and needed a new back window.  Janice’s car’s engine light came on yesterday.  And Ben’s car’s brakes needed to be repaired. The total repair for all those unexpected expenses was close to $3,000! Janice and Ben began stressing over how to pay for those expenses.

Had they done their planning, Janice and Ben could have setup a spending plan, which included a Freedom account for unexpected expenses. With a quick check of the balance, they would find the money they needed for the repairs.


Getting Started on the Right Financial Path

So how do you get on the right financial path, so you don’t end up like Janice and Ben?

It starts with understanding the four parts of Intentional Financial Goals: Set Your Targets, Create a Spending Plan, Protect Your Wealth and Live Your Ideal Life.


Step 1: Set Your Goals

You might be thinking, how do I set goals when I’ve never set financial goals before?

Have you ever had a goal that required planning and money to achieve it? Such as a vacation trip.  You needed to know when you wanted to go. You also needed to know where you wanted to go. As you planned the length of your stay, you determined how many days and nights you would need a hotel room. Then there’s the cost of transportation: the airline tickets, and rental car to consider.

See you already know how to plan certain things. Now, let’s turn our attention to planning our financial life.

A goal has four critical elements to it.

  1. A Name – Retirement, Freedom, Out the Door, or Work is Optional. The name of the goal should have a specific meaning to you.
  2. A Timeframe or Date – This needs to be specific like a date on the calendar. And, on that date we will be able to measure it and see if we accomplished the goal or not. Working from that date, you can create a plan to get you there.
  3. It must be Measurable – If your goal is a financial one, it’s pretty easy to measure because you can pick a dollar amount and easily know when you have reached the goal.
  4. An Outcome – What is the outcome when you’ve achieved that goal? What is the feeling you expect to get when this goal is achieved?


Step 2: Create a Spending Plan

For many people how they were raised and the way their parents handled money, dictates how they approach spending. Sadly, that usually means spending money as fast as you get it, without thought about how it’s spent or how it could be doing more for your future.

There could be many reasons for the way you spend money. But what’s most important is your mindset about money. You might have an attitude about money that makes it difficult for you to get a handle on your finances. You might have an attitude that helps you grow your money with little effort. You get to choose. You can choose the steps that lead to success or failure. It’s up to you.

If you’re not accustomed to planning or didn’t have good financial example as you grew up, chances are you may be living paycheck to paycheck. That’s a good indicator that your priorities are not aligned with what leads to financial success.

Wouldn’t it be nice to know where your money is going? Even better to know your money is working towards your financial goals? That is what a spending plan is all about. Directing where your money needs to go, rather than saying at the end of month, where did all my money go?

Good habits will help you reach financial health. Set up a new financial habit by creating a spending plan, where you pay for things in this order:

  1. Pay Taxes and Gifting
  2. Then, Pay Yourself
  3. Then, Pay Fixed Expenses
  4. Then, Pay Variable Expenses

This may seem strange, if you normally pay all your expense before thinking about paying yourself. However, using this wise counsel will yield wonderful fruit in no time.



Step 3: Protect Your Wealth through an Escrow Account

Your cashflow is doing well and you’ve paid your bills on time. You start to think about a discretionary item you want to purchase, but the idea is quickly squashed because in today’s mail you discovered the property tax bill or auto insurance premium is due. Sound familiar?

Cashflow is about timing. In business when there is irregular cash flow, it is more difficult to regulate expenses. The same is true for your personal expenses.

However, if you had a template to organize your expenses before they occur and had an allocation plan for where the money needs to go, when the unusual expenses occurs you wouldn’t have to worry.

Rather than waiting for those unexpected items to sabotage your spending habits, learn to plan for them.

Using your past experience, make a list of all the irregular expenses you have. Things like insurance premiums, auto repairs, home maintenance, property taxes, clothing, furnishings, and health-related expenses.

Your list might look something like the following Irregular Expense Tracking Sheet below:


Irregular Expenses Amount Due by
Life insurance premium $120 Quarterly
Auto insurance premium $1600 Quarterly
Homeowner’s insurance $1100 Quarterly
Property Taxes $6,500 Feb & Apr
Auto Repairs (oil change, rotate tires, alignment) $500 As needed
Clothing Allowance $500 Once a year
Health-related $1,000 As needed
Gift Giving $600 As needed
Total Irregular Expenses $12,820

Figure 1: Irregular Expense Tracking Sheet


One way to help manage a few of the larger expenses, is with the use of an Escrow Account. If you have a mortgage, the mortgage company can set up an impound account for payments on your Property Taxes. That means money is collected through your regular mortgage payment and a portion is set aside for that expense. The result is you won’t have to remember to pay those bills because it will be done for you.

A Freedom account operates like an escrow or impound account for all the other items on the list. You setup a Freedom account by putting money aside each month.  As your Freedom account grows, you use the funds to pay for these items, instead of using your regular checking account or credit card.

To know how much money to set aside each month, total up the items from the list, divide by 12. This will tell you how much money to put into the Freedom Account monthly.

Let’s take Gift Giving as an example: Take the total $600 and divide it by 12= $50.

That’s how much money to set aside for gift giving you want to do throughout the year.

The freedom account helps you keep track of over and under allocation as well. In one month, you may spend less and another month you may spend more. Having the separate Freedom Account gives you better visibility on these irregular or unusual expenses.


Step 4: Live Your Ideal Life with Savings

In order to live your life well, you will need to have savings.  Certified Financial Planners and all the Financial Coaches at The Complete Money Truth & Life Mastery Program Online financial learning center recommends you should maintain at least a 3-month cash reserve to cover base expenses. To be doubly prepare you might consider saving a minimum of 6-month cash reserve.

Remember, the goals you outlined earlier?  Prioritize those goals into buckets. Short Term Goal is something you want to accomplish within the next 5 years. Long Term Goal is within 6 to 10 years or longer.

The next step is to allocate savings as follows:

60% to cash reserves until “full”

20% to Short Term Goal Funding

20% to Long Term Goal Funding

When cash reserves are “full,” switch to 40% for Short Term Goals, 60% to go Long Term Goals.

If you’d like help setting goals, creating a spending plan, and directing your savings to

create your Family Finance Plan, you might be interested in the Judy Copenbarger’s powerfully life-changing Complete MONEY TRUTH & LIFE Mastery Program the Truth About Money!


Remember your Family Finance Plan should have these four areas covered:

    1. Set your Targets
    2. Control your Cash
    3. Protect your Wealth
    4. Life your Ideal Life

When you have created and follow your Family Finance Plan achieving your intentional financial goals creates wealth confidence for you and your family.

Need More Information

We have crafted a valuable library of family financial planning worksheets. These will help you get organized as you begin the planning process!

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