Friday, January 3, 2014

The Battle of the Budget

A big thank you to all of you who went to “lit” and read and commented on my story. I appreciate your time and your feedback! I will be a little slow in return visits. Life is Good but Insanely Busy right now.


How do you do your budget? Do you use software? Do you do it the old-fashioned way on paper? Are you somewhere in between and use a spreadsheet? The Engineer and I are in the agonizing process of making our budget for 2014. So far, we're both alive, and talking to each other and had a wonderful, belated “30th Anniversary of our fist date” dinner last night. However, I feel like I've been doing nothing but budget stuff for two weeks.

Of course that's not true. There have been plenty of other activities, you know, last week being what it was, plus we had two other major events.  It just feels like it's been parties, grocery store, food for parties, or BUDGET.

We are terrible at following through on our budget.  We've taken the highly recommend Financial Peace University class TWICE (were small discussion group leaders the second time) and have tried over the years to follow Dave Ramsey's principles of naming each dollar before it comes in, and not spending more dollars than you have.

No, you can't have that dollar for Home Depot. It says groceries on it!”

We have been...sporadic and not very successful, especially as of late. So back to the drawing board. The difference this time is that The Engineer has been beside me every step of the way. As a mathematician and former office manager who did accounts payable, account receivable, and payroll, along with our family's taxes, I've usually been the one tasked with the...onerous task. However, having him beside me, seeing in black and white (and of course RED) what we're really up against with some of our recent challenges has been SO GOOD.

I've of course “shown my work” before, but he's been pretty much Chevy Chase at the Grand Canyon about it, and then wondered where all the money was at the end of the month. No more. He's fully awake and aware and together we are trying to come up with a solution to what seems impossible to balance.

I'm asking seriously here, how do you handle the budget in your family? Any advice is welcome. Or maybe you have so much money that it doesn't matter where it goes, there's always more. I've dreamed of one day being there. I'd buy a big sailboat...


I know this isn't in English, couldn't find one...but the point is he glances at it for .8 nanoseconds...


Alex J. Cavanaugh said...

You mean budget as in write it down and plan out the money? Only for big things. Otherwise, I pay all the bills, so I know where it's going and how much should be left over at the end of the month.
And got your email (in case you thought I'd forgotten or it got lost in the pile of A to Z Team emails) and I will read your piece this weekend.

klahanie said...

Hi Tina,

I know all about being insanely busy. I balance all the bills in my house. The main thing is that the dog and my son are properly fed. I go without to make things okay and balanced. Feel better keeping on top of the household budget.

It's about priorities. The heating gets cut back and I purchase specials in the supermarket. Also, when I'm real brave, I go to the reduced price section. That's if I can put up with being attacked by the "old rage" pensioners :)


Rusty Carl said...

My wife and I try to work out a budget, just so we can feel awful about not following it later. But we still craft it with much care. In all honesty, the ones we make are things of beauty.

Hilary Melton-Butcher said...

Hi Tina .. I'm not very good at it - particularly buying books - and this year already! I'm sorting my life out ... then I can really settle down and get on with things.

I just hope the bathroom is in that list somewhere .. that's priority - because that will be fewer health bills I sincerely hope ..

Good luck - with all things .. cheers Hils

Elizabeth Sara said...

Well, I'm not old enough to do it myself because I'm under eighteen, but my family usually uses Microsoft Excel.

L. Diane Wolfe said...

I'm a business owner, so I have to plan a budget if I hope to make any money. Since I'm good with numbers and took several years of accounting, it's almost second nature to me. Doubt I could describe the method to my madness.

Coffee Lady said...

We get paid once a month. My husband's military pension and he works for the state. We pay everything and then whatever is left over, is groceries, gas for the car and other expenses.

IT's always tight with food and gas going up.

JoJo said...

Budget....well not so much on paper but in my head...we could do so much better but we try hard.

Rachel said...

I'm still learning how to do a full budget, with bills and stuff, since I just moved out. I've had budgets before (for instance, I had to save a certain amount before moving, so my budget allowed me to buy things every once in a while but mostly save). But this is totally different.

What my mom taught me to do, is ALWAYS over estimate on bills. Even if you phone bill is always exactly 200 dollars a month, say it's 230 in case there's an unexpected expense. Rent is 550? Not in the budget- it's 575 there! Then make a list and add it all together. It'll seem like you're spending SO much more, but at the end of the month, you'll have the predicted savings to spend as you choose. And the rest of the savings, from the overestimating, can stay in the bank account for unexpected emergencies.

It's probably not the most effective way and probably doesn't work for everyone, but it's pretty simple and it's been working for me so far. That might change when I'm not only paying my portion of the rent and groceries though.

Brian Miller said...

we have followed the ramsey principles mostly....but quite honestly been so broke the last 7 years we just did not buy much other than what it took to subsist...ha...

Briane P said...

Here is how we do it:

Sweetie and I get most of our money for the year on December 31, when I get my share of the profits (ha!) from the year before, and we rarely know how much we are getting before about noon that day.

Once we have it, we sit down and figure out what our monthly bills are -- how much the mortgage, car payments, etc. are -- and then how much we have to spend on top of that each month. That's our "spending money."

We then try to come up with categories of money: "Groceries," "Gas" and the like, and allocate money to them.

Then, we give each other an allowance -- seriously, people laugh when I say that, but I'm being 100% serious. The allowance is important, because it is money we are allowed to spend on whatever we want: books, the Dollar Store, McDonald's, more books, publishing companies we are starting, etc.

That's one number one thing, and the other number one thing is WEEKLY MEETINGS. Each week (on Wednesday, for us) we sit down and look at what we have spent the week before and what we plan on spending the next week. We don't always live by this (we don't never, actually) but by sitting down together we have to confront when we've overspent and acknowledge how much we've spent and discuss what we might do.

And then we re-adjust the budget, so if we've overspent a lot, we might get our allowances cut for the rest of the year.

The other thing we do is make sure we put money in savings everytime we get paid, or whenever money comes in. We have a set amount for that, too -- 3% of my biweekly draws, and 75% of any additional money (tax refunds and gifts, etc.) -- so that we won't be tempted to use more, but so that we also can use the money for some fun, too.

I hope that helps! The most important thing is the weekly meeting and reconciliation. I HATE IT. But you have to do it, because 'fessing up helps you avoid doing it again.

(See aformentioned Dollar Store, which is my weakness.)

Jo said...

I have been using Quicken for years, before that I used Manage Your Money. Everything has been budgeted for, for years and periodically adjusted when necessary. I do all my banking on line and I check my accounts every day. I know to the penny where everything is going. I am very meticulous about it. Matt doesn't use computers so if anything happened to me he would be back to using books, can't see it working these days myself, but.....

Cheryl said...

I've been thinking about writing a post about how to budget without killing each other and BOOM! Here's the question. We built our budget back in the late 80s and have never wavered from its underlying principles. When you're trying to start a budget, you have to figure out where the money is going. That took us months to finally nail down. I used a simple spreadsheet that was constantly changing until we knew income and outgo. That's the process no one is addressing and it's the most important thing you need to do. Once you know that, set aside enough money -- in a savings account -- from each paycheck to cover all of that annualized. We never touch that money except to pay the bills we set the money aside to handle. NEVER.

What are your goals? Our original goal was to become free of credit card debt and always have the money we needed when the big bills were due: real estate taxes, home and auto insurance, car repairs/replacement, heating oil, etc. Over time our goals have matured and we've found different financial tools to handle those.

Having savings has always been important to me and that had to be part of the original budget set-aside. With employers offering 401(k) and other pre- and post-tax retirement funds, most of our savings is now tied up in those.

We each have, for lack of a better word, an allowance to spend as we please. We stay on track with the family finances by being accountable to the budget and living within our means.

In case you wondered, I still track the big stuff on a very simple spreadsheet. My husband is a spender and I'm a saver. If we can do this, anyone can.

Send me an email if you want to know how we worked individually and together during those early months to hammer out a budget that we could live with.

shelly said...

In my house we keep our money separate. I write a check every month for half of the bills and pay certain ones on my own. I'm a saver. He's not.

Hugs and chocolate,

CA Heaven said...

We normally don't make budgets. But now, since we are refurbishing the house, and it's quite some costs, we made a budget for this project. We simply used Excel. It works fine, and sums all the numbers autmatically. My wife is managing the project, and I'm the doer. BTW, she's an engineer (I'm kind of too) >;)

Cold As Heaven

Michelle Wallace said...

My basic budget (as in water, lights etc.) is in my head and I like to pay my bills as they arrive.
Popping in to wish you a happy, peaceful and productive 2014, Tina!
Take care.
And I'm off to read the piece...
Writer In Transit

Anonymous said...

Man, I still haven't seen the Grand Canyon -- but Waimea Canyon on Kauai was awesome. Great story, Tina! Left you a comment over there. Budget? What budget? We keep our checkbooks balanced, and so far that's been working. =] Thanks for visiting my blog. Star Trek / Firefly fan, eh? If you Google search Captain Quasar Milo James Fowler my stories should show up...

Kate @ Another Clean Slate said...

I've heard good things about Financial Peace University and also using I am trying to figure out my own budgets as well!