Budgeting 101

Who wants to budget? Eeeewww... The brat in me just wants to spend and get what I want when I want it. But, as everyone knows, this is not only not possible, it is also not healthy. I grew up in a home that was middle class. We had everything we needed, and a lot of what we wanted- but not everything by far. There were several years while my dad was unemployed and our income was down and I know now my parents faced a lot of uncertainty and stress. But we as children were mostly shielded from those stresses because my parents didn't want us to worry. We were still provided for and our basic needs met. What a blessing.

When I enrolled at PCC at the tender age of 18 I got an application to my very first credit card. Now there is nothing like a credit card to make a teenager feel grown up and cool. I wasn't completely stupid and didn't run it up first thing, BUT, I did enjoy being able to have something when I really couldn't afford it and became quite accustomed to living that way. Credit was easy- I kept paying more than the minimum payments and my credit score and available balance soared. I got better and better jobs and adjusted my lifestyle accordingly, including my use of my credit cards(Sounds messed up, right?). So while everything in my life- my credit score, my income, my level of living went up, unfortunately so did my balance on my CC. But I was somewhat smart and financially savvy like my Dad raised me to be and I was able to keep that under control- somewhat- at least I never maxed a card out and have never had a collection call. Jeremy and I got together and a double income was a nice thing. Together we let our balances increase, but we both hated having this debt hanging over our heads. Twice we paid off rather large balances together and I am happy to say we have not used our credit cards in several years.

So, two and half years ago I was able to leave my job that paid me pretty well and take a job with my Dad's CPA business. While we work our bums off for about 3 1/2 months, we have it pretty easy the rest of the year, so my income dropped down to around 20% of what I was normally getting paid. This was OK- Jeremy and I knew it would meet our minimum needs, we could keep up with the house payments, and the reward was I could stay home with my children(which has no price), saving us money on childcare, commuting costs, and the other little things that come up while working(shopping at lunch was a big one). Now, I am sad to say, that income is gone too. Jeremy and I were aware this would eventually happen, but we aren't quite prepared for it like I would like us to be. So, it is time for a serious budget and learning to stick to the budget. This was and is hard for us, but so far so good.

First we needed to figure out where our money is actually going. I look at our bank statements and trying to categorize, even online, was a much too big of task. I subscribed to mint.com. They track and categorize our spending habits. The send notices when you get close to or exceed a limit in an online budget you set. It's very interesting information. I started this in the summer knowing while our expenses were higher with an out of country guest, we would still get an idea of the big unknown categories: Gas, groceries, misc shopping. This has helped give us a good idea of what we are spending so we can actually establish realistic budget amounts.

I did get paid in September, but we pretended I did not. We put that money in savings. In Sept. we needed some of it, and transferred it over, but are trying really hard to not use it in Oct. I started making grocery lists based on a weekly meal plan. I was shocked my first trip was $30 less. I didn't go off of that list, which isn't completely realistic because I like to stock up on things for our food storage(like if I had a jar of spaghetti sauce, I will buy two or three), but I know if I stick to a list of basics for the first pay day of the month(the one that includes our mortgage expense), I will be able to buy the extras the next trip. Hopefully. Jeremy started car-pooling almost from the beginning of getting this job- and that has helped with the climbing gas prices. I think before I turn up the heat and you are likely to see us wearing warmer clothes- I bought warm clothes for this time of year- I need to make use of them after all! I don't window shop. I can't go shopping without spending money, and I have found over the past several years I really don't enjoy myself shopping when I can't afford it or only allow myself to check out the clearance rack(though I love a good clearance deal). I do make sure we have money for fun stuff. We went to family swim last week for only $9 total- that was a totally cheap evening, and we all had a blast. We also have several things listed out that don't cost us much more than that, or anything at all.

Christmas is stressing me out a bit because while I do not believe that gifts are the reason for the season, I do enjoy giving things to people that have meaning and not worry about the costs. I want my kids to experience the magic of the holidays and the excitement of new toys. My extended family has avoided causing hardship for years by choosing a fun gift exchange with a $10 limit. I still usually get the kids something fun, but the exchange thing takes the pressure off. Last year I did get a part time job to help pay for Christmas, but that is not an option this year. I did notice several stores either bringing back lay-away or advertising it again(I have never used lay-away and am interested in figuring it out). I am still trying to find the ones in our area that offer it. I also am a bit crafty and plan to make some things for fun gifts and be satisfied with that. Its not about the amount you spend on a gift- its about the thought behind it. Right?

Now, I don't want my kids to worry about money. But, I do want them to be aware. If they want something and we don't have the cash on hand we tell them its not in the budget, and maybe we can wait for next pay-day. I see Leila thinking about money and she has even referenced our not doing something because we don't have money. She has also asked me when Daddy was getting paid again so we could do something fun(like go out to eat or something like that). I am hoping our honest approach will not stress her out but rather teach her we don't have to have everything right now, that we can save and plan for future purchases. We are creatures capable of waiting a week or two or even saving up for something that we want so badly. I have noticed after two weeks when we finally have the money, the desire is sometimes gone too. But she does like to get just like I do- this waiting for somthing you really really really want is a tough concept for me, a 32 year old. Its ever harder for a 5 year old. Yesterday, after asking for a trip to the dollar tree and my telling her no and explaining its not in our budget she thought about it for a bit and pulled out her beloved $2 from her little pink wallet. She gave $1 to Nathan so he could get something too. Very thoughtful. I did double check to make sure she really wanted to spend her dollars on this, and she was very confident that this was exactly what she wanted to do with her money. I put in my own $2 and bought us some pretzels and a soda to share at the park on our way home.

So, we have 1/2 a gallon of milk in the fridge, and don't get paid until the end of next week. Our balance on our checking account is alarmingly low. I will not have a problem transferring over some money so we can get our basics from the grocery store at the end of this week, but I know I can't buy more than our basic needs, which at this point is milk and pie crust(I have a major craving for pecan pie and am only missing the crust ingrediant and dont know how to make a successful one yet- and as any pregnant woman will tell you, a craving is a need, not a want!). We simply need to stay home and have fun and try not to waste what we do have- and I know we are capable of doing so. My friend Rebecca is into couponing and with coupons she is able to maintain a budget of $145 a month for all grocery, personal hygiene, paper products, etc. Wow! She does spend a lot of time organizing and searching out some of these deals, but if I can learn a tip or two from her and save even $75-100/month that would be great. I need to spend some time with her.

I feel now that my income is gone, I need to work even harder for a "hidden income" which is saving money and really knowing where we are spending our money. This adds yet another layer of pressure on me to make sure my home is running smoothly. And I do not enjoy this pressure. I have many wants- that include moving closer to Jeremy's work and upgrading homes, getting a massage or even a pedicure, going to Costco and stocking up on everything we might ever need just to have it, get more take-out dinners, buying some non-used maternity clothes, getting my kids anything they want for Christmas(Not necessarily in that order). BUT- these are wants and not needs. I feel confident we can live and be happy on Jeremy's salary alone. We won't have the extras, and won't be able to have fun weekends away or as many dinners out or fun shopping trips on things that aren't totally neccesary, but again- those are wants, not needs. Another month of sticking to this budget and I will feel much more secure in the way things are going. Learning to behave this way has leant me a feeling of increase control in what we do despite the fact we actually can't do as much. Its OK for us to tighten our belts once in a while- it makes me appreciate what I have even so much more. I do not need anything and everything the minute I see it.

So while I am now a full-time SAHM, I am also CFO of the Conser Home. Heavy titles, but important ones.