That is one of those evil words that can be so intimidating. It’s one of those annoying things in life you have to have.
And my family is at a point right now where we need to budget every penny we have.
Because lately life has been overly stressful trying to make ends meet. It all began last fall when hubby bought himself a pretty new truck. Trouble was, it is way out of our league as far as money we bring in and our spending habits. At the time he was in charge of paying the bills and so things went from bad to worse. When asked if he could get it, I repeatedly said… “You’re paying the bills, you know what we can afford.”
Apparently my subtle insinuation of “if you don’t think we can pay the monthly payment, don’t get the truck” didn’t make it’s way through his thick skull.
So here we are, scrambling. So as I do what needs to be done to make my family of 4 (sometimes 5) balanced each month (so I can stop robbing Peter to pay Paul, as they say), I’ll share with you what I learn.
The Good, the Bad and the Ugly of Budgeting.
According to Nerdwallet.com – you can create a budget in 4 simple steps:
- Calculate your monthly income
- List your monthly expenses
- Subtract your expenses from your income
- Set goals and allocate your additional money
Are you like me and thinking that is way too simple of a process?
So I went to another website, Cozi.com, as they caught my attention strictly because when my only electronic device was my Nook, it had an app where I could put a grocery list into Cozi and my husband could actually check off the list at the grocery store on his iPhone… so if something came up at the last minute he often would see the additional item and all would be well with the world.
Anyhow, Cozi had 6 steps in their list:
- Write down your financial goals.
- Record every single purchase you make, without exception.
- Create your spending categories.
- Hold a budget meeting (with your spouse)
- Schedule a time to create your budget
- Tweak your budget at the beginning of every month.
I liked this one a little better, simply because this is what I did recently. Not so much as I was spending the money, but I designated all my spending for the month of April 2016 and wrote down every expense that came out of my bank account and listed it into the following categories:
- Crap (yes, every stupid thing I bought that was completely unnecessary – like Chex Mix and a Polar Pop at the Gas Station before work)
- Fast Food
- Credit Cards
- Gas (for the car)
The categories were quite the eye-opening. Because I have an insane memory, I was honest and when I purchased the Smartfood White Cheddar Popcorn at the same time I purchased gas, I split the 2 charges up and put the amounts where they actually needed to go.
It did not take me long to realize I spend a lot of funds on unnecessary conveniences.
One of the additional points that I liked about Cozi’s suggested points was Step 1 – writing down your financial goals. They want you to list multiple ones. Financial freedom is always a great reason to want to save money, but so are fun reasons – vacations! These are your motivators to keep you on the straight and narrow – let these reasons be worth while!
Step 2 – they noted one category that is often overlooked – give yourself some weekly spending money… otherwise you will go nuts. And they are right… you will. Allowing yourself a weekly Polar Pop may just give you that tiny bit of sanity your world needs (or just the jolt of caffeine and sugar to keep you awake at work).
Step 4 – if you have a spouse, work on your budget with them. This would be a huge laugher in my household. I say this because my husband HATES discussing money. Actually, he dislikes discussing anything. Whenever I need to have a serious conversation with him, he gets this blank look on his face and I realize he is no longer listening to anything I have to say. Do any of you have this same problem with a spouse? (I do recognize men can read this blog and maybe your wife is the same way as my husband – doesn’t it drive you crazy?).
For me Step 5 goes along with Step 4. If you aren’t going to really, truly and honestly sit down and speak with your spouse in a meeting about the budget, do you really need them to schedule and create it? For me, no. But that doesn’t mean I won’t sit down with all my findings, show him what I came up with, what the game plan needs to be for us moving forward and tell him he needs to make sure he goes along with suggested changes to go along with our new budget.
And can I just say I love the fact that this list includes tweaking? Face it, once we get motivated and start saving and spending in a far better pattern than our reckless ways once had us, you can always see where this could help you here, or this could be done there.
Remember, your budget isn’t written in stone. You need to/can make adjustments accordingly to make life better for you and/or your family.
So, this week I am going to work on my goals, finish up separating my categories (I am a glutton for punishment and like to go back a couple of months) and next week we’ll try to focus on how to get the most bang for our buck at the grocery store.
Do you follow a budget? Do you have any tips or suggestions you can share to make budgeting easier for me? Please share in the comments below!