Moving you from Ouch to Pouch!
Most people do not fall off the financial planning wagon…they never get on. The first step on is a doable and usable budget. The problem with traditional budgeting is not that it doesn’t work, it is that it requires skills, knowledge, effort, time, and resources that most individuals and families don’t have. The PouchPlan was designed to deliver 95% of the benefits of traditional budgeting with only 5% of the effort, time, and cost.
There are four main parts to the PouchPlan that drive its simplicity and power.
- Instructions are provided to you by paycheck, just like your money actually comes in.
- Your Regular (regular in amount and time each month) expenses are all set up to be paid (preferably automatically) out of your checking account. These are the ONLY expenses paid from that account and enough is deposited from each paycheck to cover those that come due until the next paycheck. The PouchPlan spreadsheet tells you this amount.
- Your bank checking account changes from a place where you park your money while you decide what to spend it on to a place where every dollar is considered spent the moment it is deposited into the account.
- Irregular expenses (those that vary in amount and time each month) are budgeted by category and funded with cash available from each paycheck after enough money is left in the bank to pay the Regular expenses for that pay period.
If you use this system, you no longer need to have any accounting or bookkeeping skills to have an up to date and accurate budget. You don’t even have to do any math! You will not spend hours tracking and recording expenses. Your total time commitment each month will average less than 15 minutes.
The PouchPlan is not an academic experiment. My wife and I put it into place almost twenty five years ago when we started our marriage as a blended family of seven, with five children ages five through seventeen It was forged in the blood, sweat and tears of real life. Because of the PouchPlan we have celebrated five college graduations with no debt. We have sung and danced at (and paid for) four wonderful weddings. We’ve gone from $100,000 in debt to having a secure and abundant retirement ahead of us. But we think the biggest accomplishment of the PouchPlan is that it has helped us raise five fully functional adults that contribute to their families, communities and country each and every day.
I constantly emphasize to people how many areas of their lives are affected by how they handle their money. If you do money right, life gets easier and better. If you do money wrong, life only gets harder. We call it going from “Ouch to Pouch”. Won’t you join us?
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