Though most family's don't want to admit it or "stick with it"...a budget is an effective tool in understanding what "comes in" and "goes out" of your home each month. Used correctly, budgets can help you make critical decisions that effect how your home functions, save for the future or make "want" and "need" decisions with ease.
Each New Year's Day (I know...as exciting as it can be!) Drew and I have a yearly financial budget meeting to discuss the goals and reallocation for the year's finances. This meeting helps us get on board and have a consensus of what will get accomplished each year (new purchases, home improvements, family vacations, etc). Though I complete the monthly budgeting and bills for our household, it is critical that we are on the same page for the welfare of our family. For example, our budget would never work if I had only planned a camping trip for our family vacation in the Puget Sound and Drew was insisting we should spend three weeks in Italy and it wasn't in our budget.
Being on the same page is vital. We have been married 14 years next week and have always had a set consensus of a dollar amount we could spend without the person knowing about it. For example, right now the dollar amount is $25, so if I want to spend $100 on new shoes I would have to consult with Drew to make sure we both felt it was a worthy purchase and that it fits into our budget. This has helped us avoid those awkward situations when one is worried about paying the car payment and the other person just spent $65 on a random rafting trip. But mostly, this helps us be accountable to our budget. Did I allocate monies for new shoes this year? Are the ones I have really worn out? Can I find a bargain price somewhere? Honestly this system has helped us not to make any impulse decisions and kept a lot of piece in the marriage. Depending on our income level this dollar amount has varied over the years, at one point it was as low as $10 and as high as $75.
Entering a new season for our family this decision has made us readjust our budget mid-year. Reducing my rate of pay and hours has caused us to re-evaluate our lifestyle. Many of the luxuries of me working full-time needed to be cut. Though we have a tight budget there were places we knew we needed to cut immediately to make our budget balance. Though some of these were easy...others were harder. Gaining more time with my family and personal time in my gardens were a huge factor in making any cuts seem logical and worth it. But nonetheless, these cuts are changes in which our family has to uphold in our budget and personally deal with.
Changes that immediately occurred included:
- Pull Fiona for the Afterschool program M/W. Savings = $77.50/month
- Cut Personal Training Sessions. Savings = $25/month
- Stop prepped meals with Dream Dinners. Savings = $100/month
- Change Keegan's Kindergarten status from full-time to alternating. Savings = $270/month
- Stop Cleaning Services. Savings = $75/month
- Discontinue/Minimize Babysitting during work hours. Savings = $500
In the next couple of months we will be re-evaluating our budget to ensure we are on track and able to sustain our new budget. If not, we definitely will go back into negotiations and have to "trim the fat" elsewhere. Developing a budget and sticking to it is one of the greatest tools you have in maintaining financial peace in your household.
From inside the little blue bungalow,