I have been blessed in the past week and a half to share with others about living within our means, the best we can. I say "the best we can" because some things happen that are unpredictable like loss of job, change in pay, change in benefits, etc. at this time we either rely on our precious savings or try our best to accumulate the least amount of debt possible.
Personally, I will tell you we are living on our precious savings because of the premium change and the amount the company covers on the premium. This one due changed has stopped us from saving money every month to using money from our savings.
I am blessed that we did begin living under our means a year ago. In that year, we accomplished many things, otherwise would have been impossible. The sad note is, if we would have started this practice in the first place upon marriage, we would not have been affected. Bringing to mind...
The wise man saves for the future, but the foolish man spends whatever he gets.
Yep, we were foolish. Ouch! Hate to be foolish in God's eyes. But here we are today, less foolish and living with our foolishness from the past and knowing the changes we made a year ago are changes we will keep for a life time. Hopefully, we will be successful in teaching our children these principles.
So each and everyday, I keep my eyes open to new ways to help me improve, organize, and make it easier for me to spend my budgeted money efficiently with minimal effort. I will be sharing with you techniques to come in other postings. I will also further explain better budgeting techniques.
First off! Know how much you have to spend.
This is very important. You can not pull an amount out of your head and decide that is your operating budget. Operating meaning: groceries, clothes, gifts, dining out, entertainment, etc. I have learned to handle my family of five, that includes diapers, on $150 a week. It can be done!
Calculate: List everything you have to pay each month. So this is: tithe, mortgage/rent, insurance, vehicle payments, phone, electric, credit cards, loan payments, etc. Now list these all out and subtract them from your take home pay for the month.
You will probably have to average these out to get a good idea. Now the amount you have left, is NOT your operating budget. Next you need to take about 10-20% off this amount for emergencies and the things you do not expect (i.e., flat tire).
Now typically there are 2 different types of spouses: the one who buys the groceries and the one who doesn't. Not saying that groceries is the defining element of management, but it can make you or break you. I am the grocery getter, but I DO NOT pay the bills. I hate paying bills. Totally irresponsible at it. My darling husband as known this, ever since he asked me to marry him. I have had one brief stint of paying bills and in fear, he quickly took the ask back.
The non-grocery shopper needs money. A reasonable (to your budget, not expectation) amount. This might be the amount of one lunch out and $5-10 convenient store spree.
Now the grocery getters! you will have what is left minus the non-grocery getter amount to buy everything else. EVERYTHING!
At this point in your life, PAY IN CASH ONLY! NO MORE CREDIT CARDS! set the cash out and you have it until it is gone and then you wait until the next pay day.
Now you will notice that I do mostly speak to the grocery getters in the world. This is what can make you or break you.
Here is what you need to do:
1. Figure out you operating budget.
2. Set a certain day you get paid. Mine is Sunday Night.
3. Get paid as your bread-winner gets paid. Mine gets paid bi-weekly, so every 2 weeks I get $300. I set $150 away and use only one week at a time. I then get the rest on the next Sunday Night.
4. Make a plan! How are you spending it.
There are great missionaries that will help you. In SW Florida, there is the Christian Financial Counseling with Mahlon L. Hetrick. He will come to your church and do a church wide seminar over a couple of weeks. My husband and I attended this one at our church. He was amazing and brought new clarity to spending and saving.
If you are not in this area, you can get his book: The Money Workbook, Banking on the Bible for a Balanced Budget, Mahlon L. Hetrick.
Check your area out for local christian financial help.
Good luck! God Bless.