Let it Snow Let it Snow Let it Snow

Well, mine and DH's birthdays are coming up (DH's birthday is the day after mine) and we have budgeted $200 for our birthday. That will include gifts, going out (if we want to), etc. We also have finally bought a digital camera to replace the one I broke a few months ago. Even with birthday and the digital camera purchase, we still have $200 to throw at our smallest debt, which should keep us on track for our Oct 1 kill date for our smallest debt. I can't WAIT!

We have been really good at not spending on unnessesary things. We are managing our money and telling it where to go, so we always still have money at the end of the month.

Now I find myself wondering where all this money is coming from instead of wondering where all our money went!

The Dentist Still Takes Cash

I had my wisdom teeth surgery about two weeks ago and I paid cash. I mean cold hard cash. In 20s. I probably could have either paid with 50s or 100 dollar bills, but I just wanted to be dramatic. So there I sat, counting out 20s. The office lady asked if I had exact change. I almost did. My bill came to $488.30 and I had $490.30 So she had to go across the street to get change for my ten.

It was pretty fabulous. I wonder when the last time was they had someone pay in cold hard cash.

There's just something satisfying about laying out those bills - maybe it was mostly the fact that it was budgeted, and this wisdom teeth wasn't going to come back in a credit card bill at the end of the month, and I didn't have to "finance" with the dr's office.

The borrower is servent to the lender, and I am not going to enslave myself!

Budgeting Tips

I’m trying to think of any unique tips I can give on budgeting, but there are so many websites out there with how-to rundowns of budgeting. So basically I’ll just say this…

A budget needs to be flexible. Not so flexible that it defeats the purpose of having a budget, but flexible enough that if you need to move things around, you can.

Your goal, though, is to get a lot of things (like food, clothing, gas, etc) settled after a few months. After a while, it’s pretty easy to see how much your spending in various categories. Other things may take a while to figure out how much you spend, and you may not be remembering every little thing you need to budget for.

For example, we realized that we needed to budget for our car registration. A few weeks later, we realized that we needed to be saving for oral surgery to get my wisdom teeth taken out. A few weeks after that, we realized that we should be saving for a new rear tire for dh’s motorcycle (his main work transportation). So our budget changed three times in a few weeks. We had to change how much we’re spending on groceries, how much we’re putting into our baby emergency fund, and how much we put in the “blow money” category.

The moral of this story is that your budget should be flexible – but don’t make it so flexible that you defeat the purpose of having a budget.

A Written Budget

The first part of Dave Ramsey’s Baby Step 1 (BS1) is to get on a written budget. Fortunately, we had already been working out the kinks in a budget since we moved here for some more military training. So when we started to do the TMM (Total Money Makeover), we had a step ahead. We just fine tuned a few things and started squeezing money out of every corner we could find.

We are currently living on $300 a month in groceries (for myself, my husband, and our two year old. Our 3 month old breastfeeds exclusively, so that’s one less mouth to feed for a while) and $100 a month in gas. We’re trying to sell our car and downsize to free up another $300 a month to throw at debt (so far no luck there, but we’re not aggressively perusing that). Anyway, we’re spending as little as humanly possible (we’re allowing about $30 a month for spending money divided between us). That may not seem like a lot, but we don’t have a lot of time to do anything anyway! Plus, there are a lot of really cool fun free things to do here – not to mention the gorgeous beach that is a stones throw away from us! But no matter where you live, you can always find fun free things to do. We spend about $10 a month on movies by mail so that we can save money on going out to see the latest greatest movies. We don’t spend gas getting to the theater, we don’t spend money on tickets, and we don’t spend money on a sitter, since we just watch the show after the kids are in bed.

I’m getting really adept at using Quicken to balance our checkbook. I’ve set up “line items” in our checking account so I can “save” without actually putting the money in another account. I use my Quicken balance as my actual balance, since there is a bunch of money in our checking account that is sitting around waiting for the day we pay for car insurance, registration, oil changes, dental work, etc.

We’re really learning how to live well within our means. We have definitely felt the blessings for following the counsel of our Prophet to get out of debt and save a little for a rainy day.