Is Budgeting Really Worth It?

photo by dam

Two years ago my husband and I were in the height of financial distress. We had been married for 8 years with no children and both worked so we felt that we had enough money to cover not only the things that we needed but also the things that we wanted without worrying about a negative financial impact. This thinking, however, had slowly begun to dig us deeper and deeper into debt, so deep that we were not able to make dents in our existing debt as we continually added to it.

What jolted us into action was the unexpected news of a baby and that in less than nine months we would be down to one income. We began to make small changes, like no more Starbucks everyday, and started to think about how we could possibly make it work. As we approached the baby’s due date we realized the only way to make it work was to sell our house. This was a long process and while we waited we then began taking a 13 week class, “Financial Peace University” put out by Dave Ramsey. What an eye opener this class was! Our thinking on money began to change and we quickly jumped on board by making a budget and actually sticking to it. Our house sold during the classes and we were able to pay off all our debts, put 4 months expenses into an emergency fund and put a large chunk into a future home account. With this success under our belt we were even more gung ho about budgeting every month and so we did for at least 9 months pretty well, but then we stopped making it a priority to redo our budget every month and little by little we began to fall into our old ways again. Then baby #2 came along and with him three thousand in medical bills. At the same time my husband had an emergency trip to the hospital and that cost us two thousand. We also started having trouble with our car and had to put a few hundred into it only to find out we would need our transmission rebuilt to the tune of three thousand dollars. We like to do things big. So without a plan every month and with the added expenses coming out of our savings like crazy we were beginning to burn through our emergency fund quickly. Finally we got it together and began the painful process of creating another budget and sticking to it.

It quickly became evident that we would need to sacrifice alot of our luxuries if we were going to stop using our savings every month and truly live only by what our budget allowed. So out went cable, eating out, clothes shopping, entertainment and instead we started packing lunches, cooking from scratch, finding free entertainment or simply going outside. I also had been getting better at couponing and so I was able to reduce our household expenses by getting much of it for free. Probably the biggest money saver was meal planning and then only buying the things we would need for each meal for the week and nothing more.

Following our budget was painful. At this point in our lives we just don’t have any disposable income so I had to just not ever go into any stores period so as not to be tempted. The only shopping I did for three months straight was to Walgreens to take advantage of their sweet deals which usually made me money, or to the grocery store with my list in hand. Some weeks we ran out of peanut butter and I just couldn’t fit it into that weeks list, so we had to wait until the next week. My two year old was starting to grow more and I kept having to weed out his closet of small things which left him with no sweatshirts and cold weather approaching. I so wanted to take him shopping but had no room for it at all, so we just made do with what he had.

After over three months of sticking to our budget completely we finally are seeing how it really makes life less stressful. This past month we had an extra pay period giving us an extra paycheck to work with. Normally those paychecks just go into the account and are used up immediatey, but not this time! No, this time I made November’s budget and realized we had a whole extra paycheck that was unclaimed! Oh the possibilities, what to do, what to do. So I have been carefully planning out every dollar so that we don’t spend any more of it than we have and also so that every dollar has a specific place and won’t be wasted away on trivial things. I think that is one of the most important things I have learned these last few months: so much of what we spend our money on is trivial. Sure, I would love to have new clothes and I would love to dress my boys super cute and tell my husband to just go ahead and buy lunch today, but that is not where our money is best used because we simply don’t have any to spare.

So is budgeting really worth it? Completely, but it is painful at first. Although now I have become so used to not shopping that the thought of going shopping seems somewhat foreign to me. I am sure I could easily slip right back into it though, so I am going to try to continue to stay away from stores even when our income increases.

A few parting thoughts on what these last few months have taught me:

*By not shopping I am much more content with what I have because I don’t see what I don’t have.

*The more I stay home the more time I have to take my children outside which they love and which is so much better for all of us.

*By staying home more I have more time to cook and bake from scratch thereby saving money and reducing the opportunities to spend money

* I really don’t deserve that latte just because I didn’t get enough sleep last night and the kid is driving me crazy. A little money here and a little money there can waste a lot of money in the long run.

* I shouldn’t feel like I am sacrificing by sticking to a strict budget, as even our small income still puts us in the top 5 percent of the world’s wealth

So go create your November budget if you haven’t already done so, and the next extra pay period you will see the benefits of budgeting like I have.

-Rebecca

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