I know it’s lengthy, but I tried to recap each month quickly so you get the idea. Please feel free to ask any questions. I know it seems crazy at first (and we never had any credit card debt or anything else substantial like that), but it is really working well for us.
December ends month three on the budget for us. As a refresher, we have
-paid off our second mortgage
-switched to an all cash system
-started a debt snowball to pay off our van and student loans
-are on our way to being debt free.
October was definitely hard. It was the first month on the budget and we were planning our girls’ birthday party. That was tough, but we did it, and ended up still paying some extra money towards our van (what we do with any extra cash at the end of the month). We discovered that we can eat out (using the term loosely) for $20 a week, and our family of four can do fine with $80 a week for groceries.
November went very well. We actually had the girls out of daycare for a week (as we are allowed one free week off) and got a referral bonus, so we had quite a bit of extra money and ended up paying quite a large extra payment on our van. We have found that while our health insurance isn’t awesome, we are thankful for our health savings account which allows us to save money tax-free from every paycheck to use for medical expenses. This comes in handy when you have to take your daughter to the urgent care clinic, the ER and the orthopedic doctor twice in one month.
December was the hardest yet. We had to budget for Christmas. However, while it was tough sitting down and crunching numbers, it was a lot easier knowing exactly what we had available to spend and knowing that we couldn’t spend anything extra. And with two days left in the month, I think we still have a little extra money! Quite the success.
One thing I’ve definitely learned, is budgeting has helped our relationship a lot. I am not a person that likes Mr. Serious to buy me gifts. Why? Because it’s my money, too, and I don’t want it to be spent on silly things like jewelry (I know..don’t shoot me) or flowers. That’s just me. And, even when it came time for Christmas, previously, I was upset that he spent too much.
This Christmas combined with our anniversary, however, we both had an allowed amount to spend ($50 total). While it was really hard to make this gift something nice and enjoyable, we both found that we appreciated our gifts that much more. More importantly, I was truly appreciative of my gift, and didn’t get upset.
So, I think the habit is set. And, we are doing well. We are still on course to pay off our van (and have my student loans written off) by this summer and I couldn’t be more excited. In fact, I don’t even think about using a credit card anymore….but I still have the numbers memorized!