Wednesday, July 21, 2010

The "B" Word

Budget is not the most likeable word in the English dictionary. The fear of changing our habits or simply being exposed to our addiction of shopping parse can make any one give endless excuses for avoiding a budget. We tell ourselves that we can manage money and reach our goals with out filling out any kinds of budgets weekly, just to find ourselves living overwhelmed from paycheck to paycheck. When you aimlessly trying to reach your goal, not having any kind of guidelines or plans for reaching it; you will either take a long time getting there or simply give up. My goal is to help you save money and it must begin with setting a budget.

For my family our first step in creating a budget was to list all expenses that we incur through out the month. We listed everything from paying for utilities to buying groceries. Next we looked at variable bills, for example groceries, versus fixed bills, such as car insurance. We decided to spend no more than $40 a week on toiletries, house necessities, and food. There are two people in our household, but often we are under budget each week thanks to coupons. Sure it takes time to hunt the best deals, but it is worth it to me and my family. We use brand name products, eat healthy food and give to others. If you think that there is no way you can cut you grocery bill, I would ask for you to reconsider. I believe you can achieve anything you put your mind to. Start off with baby steps by setting a goal of perhaps spending $20 less each week on groceries and keep on challenging yourself by reducing your allowance for groceries every time you meet your goal. The key to controlling our grocery budget is to use cash instead of credit card or a debit card. I take out $40 each week in cash and once it is gone, I know that I will have to wait until next week to buy the desired item.

Our next budget goal was to see our electricity bill go down. As our bill skyrocketed during the month of December, we knew we had to make some changes around our home to reduce the cost. We made the following changes around our house: we rarely use a dishwasher; we dry our clothes on clothes line outside (weather permitting), installation of a water heater timer happened last month and we changed the light bulbs to more energy saving ones. Lowering thermostat during cold month and raising it during hot months as we were told will significantly decrease our electric bill also. As we continue to work on ways to reduce our electric bill, we pride in the new changes that we have already adapted as our lifestyle.

Thankfully we didn’t have to make any changes to our phone bill. We live in the mountain area, where you can’t receive cell phone signal, so land line is a necessity to us. But we manage to keep our monthly bill low by using the basic and cheapest service that is available by our phone provider. We can’t call long distance, however when I married my husband I was introduced to a new way of making long distance calls without occurring any cost. Most of our family and friends live several hours away from us and know that when their phone rings one time and stops that means we are letting them know to call us back. You see, we dial a long distance number, wait for several rings and then hang up before any one has a chance to answer the phone. This alerts our family and friends, who do use long distance or cell phone to call us back. This allows us to keep our phone bill to the minimum. In additional to that we don’t have cable or internet, which not only eliminates the monthly bill for these services from our budget, but also allows us to spend more quality time as a family.

In our budget we also estimated monthly use of car gas. My husband drives about an hour one way two days a week for work and almost 40 minutes one way daily to attend university. On the other hand my commute is much shorter averaging about 20 minutes one way to work. We did set a budget for our gas consumption but do not have much control over the rising prices of gas. As prices increase we will have to adjust our budget, in a mean time we enjoy low gas prices and ability to use two cars for driving.

Enjoying the privilege of driving two cars is not the only fun we see in our budget. In order to have motivation to stick with the budget we penciled in once a month dinner date at a restaurant. I believe it is ok to splurge occasionally, plus budget doesn’t feel so boring anymore.

Next in our budget came fixed bills such as car insurance, student loans, medication and tithes. We know what we are expected to pay each month, thus it was easy to put a value in our budget. On the other hand the last expense that we listed in our budget is miscellaneous account. Unexpected visits to the doctor’s office or the need to buy a wedding gift for a friend are tracked under the miscellaneous account. I must admit that occasionally we make purchases that are not listed in our budget, but looking at the end of the month at our miscellaneous account makes us aware where the money is spent and reevaluate our purchases for upcoming month.

As I evaluate our purchases weekly by entering the receipts in our budget spread sheet, we know where every penny is spent. The best part is when at the end of the month you see that you have left over money in your account, it feels so good to be finally in charge of money instead of money being in charge of you. We can then dictate where we want our money to go.

So call me practical, sparing and penny wise, I can’t take credit for all your compliments. I must give God all the glory for wisdom in continuing to teach me how to be a good steward of riches He has instructed me with. It is my hope that you too will take pride in riches that is entrusted to you.

I have shared our budget strategy with my co-workers through a work newspaper. Since starting school, I have not had time to write out our monthly budget on a piece of paper. However, as soon as I am done with school in October, I am planning to pick up my good ole habit back. I just wanted to share this article with you, in case you want to start budgeting with your family.

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