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Thursday, July 10, 2008

Tightening the purse strings

I'm certain this will sound just downright ridiculous to some of you. You will laugh and think to yourself, “is this nut for real?”. “Is she actually someone's mother?” “How could she possibly be educated . . . wait – isn't she a teacher?”

Brace yourself.

I just completed my first budget. A real life, actual budget that monitors and limits your spending. defines “budget” as the following:

–noun estimate, often itemized, of expected income and expense for a given period in the future.
2.a plan of operations based on such an estimate. itemized allotment of funds, time, etc., for a given period.
4.the total sum of money set aside or needed for a purpose: the construction budget.
5.a limited stock or supply of something: his budget of goodwill.
6.Obsolete. a small bag; pouch.
7.reasonably or cheaply priced: budget dresses.
–verb (used with object) plan allotment of (funds, time, etc.). deal with (specific funds) in a budget.
–verb (used without object) subsist on or live within a budget.

Number 10 kind of hit me like a speeding train at rush hour. I mean, this is what normal, grown-up adults and parents do, isn't it? And while I'm sure there are many of you shaking your heads, thinking I must be an unorganized, over-spending goof . . . there must be a number of you nodding in agreement, recognizing that a concrete budget is something that's been on your own to-do list for far too long.

Despite not having a budget on paper, I'm not a crazy over-spender. We don't live a lavish, extravagant lifestyle. At this point in my life, I choose not to work and I have an extended maternity leave from my career (and I have been fortunate enough to have retained my full-time status and position in my school board) so that I am able to spend this part of my life at home, raising my children. It's a choice. But one that comes with some restrictions and limitations. We live in a modest, small, home in a mid-sized city. We drive basic, no-frills vehicles (what I wouldn't give for a power window at the drive-thru). We don't have a home filled with expensive gadgets, equipment, or “things”. Our recent Wii purchase (for Father's Day) is our first video game and only item of that genre that we own. We don't eat out often, we don't own NHL season tickets anymore, I don' t have extravagant jewelry and we don't take world-class vacations. We don't have any debt outside our mortgage.

I used to work in a career where I made a fairly decent salary. I chose to leave that career to pursue a degree in Education and become a teacher. Not because I hated the previous career, but I felt that I had a calling to become a teacher, and I had always loved and felt natural teaching children. It was a huge life adjustment for me and a large pay cut (but evidently extremely rewarding). My husband and I used to be DINKS (double income, no kids) and we ate, drank, traveled and spent. Changing careers and then having three children was a real wake-up call to our financial stability.

After putting our budget discussion on the back burner for ages, we finally got our act together and did it. It wasn't so hard. I'd always been great at saving receipts and documenting all our costs, so I'm certainly aware of where we spend too much money, and where the majority of our money goes.

The biggest and most aggressive change we made was to deliver a largerer percentage of our income directly into savings for retirement, education, etc. What is left we divided among our bills and typical monthly costs. At the end of that, well, there is not a whole left. You can see this is not rocket science, I didn't even use a fancy program like Quicken, I did it in simple old Microsoft Excel.

So this is where things change for me. Suddenly every penny I spend comes from a pre-existing category. I have certain allotted amounts per month, per category. I'm careful with money and I don't believe I waste it, but I'm not used to contemplating every dollar we spend. This is really going to make me think about things, and ultimately, that's a positive thing for our family. I've found lots of useful websites and blogs with great tips, so I'm learning a bit more every day.

Be sure to stay tuned in the coming weeks to see how a crafty mom does on a budget!


Heather @ Cancer Mommy said...

Please don't tell my husband about this whole budget idea!

I tried it once. Couldn't do it. Gave up. It was just to hard.

I probably should give it another shot.

Maybe tomorrow?

Kristen said...

Good for you!

And you are so not nuts!

We don't use a budget, I just have a hubby who carefully checks all receipts, so he is my budget! :)

Hope that you save tons and tons of money. And yeah for Canada and their maternity leave plan. Seriously, jealous that the US hasn't gotten its crap together to realize just how important this is!

amanda said...

yeah for the budget :)

hubby and i have been doing one for years now - kinda like our date night every two weeks. really.

not saying that every month is perfect, but it truly has been eye opening :)

ps - did i know you were a teacher? what grade?

Jenny said... are a brave one. i hate budgeting and figuring out how much to spend. I am cautious on what I spend but I just hate dealing with it. With school loans and credit cards, yikes. but we are doing better. go you though!
I am anxious to hear in the coming posts how you are doing with your budget.

Laural Out Loud said...

Welcome to my world! I LOVE to budget, and I have tons of Excel sheets to prove it. I really should find a career in numbers.

It's tricky at first, but budgeting is incredibly empowering.

Anonymous said...

I must say, I have to praise you for your ambition. It's a scary world out there these days. I've been married now for 27 years, and raised 3 kids. (2 college age ones still live at home) I was a SAHM for several years and then started working as a substitute teacher until the youngest was old enough to be home alone. Now I teach full time again. I have never found it to be as difficult as this year. With the cost of oil rising and gas prices here in the US...and everything else because of it, it could be scary times. Hey, that gives me the next topic for today's blog.....

Anyway, good luck!

Anti-Supermom said...

Good luck. It's very hard, but do allow yourself frill items, otherwise you will go crazy and feel guilty and feel deprived.

I agree, budgeting will give you some power, like you can do it all.

Simply Shannon said...

Wow, we really do have a lot in common!
We don't have an actual budget either. We certainly discuss our finances plenty, but nothing on paper really...although my husband does have spreadsheets listing all of our outstanding debts (and boy are they outstanding!). We're trying really hard to get it together, but not doing so hot so far. I look forward to more posts on this topic, maybe I can learn something!

Rebecca said...

It can be scary to have your budget done, but it is also refreshing to see what the money goes on.

Good on you for doing that Shans, and being sensible enough to know it is a good thing. :)

Megan said...

good for you! as for your ?, how do i do it? i don't know what to say, other than, we eat really really well, but i make most things myself, almost nothing comes from a box or can, if it does, it is an ingredient in a larger recipe, not premade. my splurge is fresh fruit/veggies. i calclated costs and buy only the things we really NEED and that are CHEAPER at sams, the rest at walmart. i plan meals, blah, but you know that.

you have such good plans in place! woo hoo!


McMommy said...

Shannon...I am FREAKING OUT!! I just did the exact same thing!! I have never once actually wanted to do a budget...but this week, I had had enough. I am now officially on the budget bandwagon.

I was going to post about this next week! We should pick a day and coordinate and link to each other. Email me!

Unknown said...

Congratulations on your budget! We have had one since I became a stay at home mom, it's not easy but so worth it :)

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