Thrifty Thursday – Budgeting (Printable Checklist Included)

Every penny counts when you’re raising a family. Even if you are fully employed it can be difficult. If you happen to be searching for a job, it can be extra difficult to make ends meet. Budgeting is absolutely critical to reaching financial goals. Perhaps you are trying to make sure there is enough money to put your children through college, perhaps you are saving for your retirement, perhaps you are only dreaming of those things and are striving to make it to the next paycheck. Whatever the case, budgeting is the key.

When we first wanted to start a family, we knew we wanted to have me stay home with the children. We realized that pregnancy, birth and then experiencing loss of income would prove difficult hurdles when combined. We chose to have me stop working first. We would adjust our standard of living from the get go, so when children came along, we would already be living on one income, and the transition would not be as difficult. Little did we know how long it would take to have Poppet!

Along the way we made some mistakes. We were in debt a couple of times. We were fully debt free, when in our early 30′s my husband started college in Oklahoma. Once we had applied, we couldn’t let his work know, and so when they wanted us to upgrade our vehicle or lose his car allowance we had to eat the cost. Each month we saw almost $1000 go out of our budget. Then we had to move. Being a Canadian on a student visa, my husband was required to maintain a residential address in Canada while in the USA. Our finances were all Canadian based, and after we paid our taxes in the USA we were required to also file our Canadian Tax return and pay income tax at the Canadian tax rate as well. Needless to say, we were fighting a losing battle, and by the time we moved we had gone from being debt free to losing money on a monthly basis for the next 3 years.

Upon completion of college we moved back to Canada. We moved in with my Mum for a few months, which turned in to 2 ½ years. It was actually a great time! We all really enjoyed each other’s company. And for the first time in 8 years, I returned to work. We buckled down and budgeted very carefully. We were making progress. When we finally moved we could see the light at the end of the tunnel. I was 6 weeks pregnant when we moved back to Guelph from Toronto, and I was able to stop working again and have been home ever since.

As a family we have different budgeting methods. My husband keeps a super detailed spreadsheet. He gives me my own budget each month, complete with groceries, personal care, household expenses, etc. It is up to me to budget these funds and make the dollars stretch for our family. I choose to use an iPhone App called “Home Budget”. It cost me $4.99, and after 3 years, it has yet to let me down. Whatever method you use, the principles are the same.

1)  Set a realistic budget. This is key. If you know you eat out every month, budget it in. Trying to make ends meet is kinda like losing weight. If you don’t account realistically for what you are going to use, you will be frustrated at the lack of progress in the end. If you budget these incidentals in that you are going to spend anyways, you know what to expect. And a little indulging can always help head off a big bingeing session, whether eating or spending.

2)  Find a system that works for you. If you have tried everything and you are still overspending, GET DRASTIC. Put all your money in separate envelopes and spend from each as needed. When the envelope is empty that is it. There is no more until the next budget cycle.

3)  Don’t use a lump sum budgeting method. Make sure to break down your budget. If you lump it all together it is easy to run out of money for necessities by the end of the pay cycle. If you know you have $400 for groceries for the month, only spend $100 a week. It’s that simple. I like to place like items together on the check out belt. After each section (i.e. toiletries) I ask the cashier to total the bill for me. When I get home I keep track of how much I spent from each category so I know where I stand.

4)  Get creative. In our home we do not have cable. Almost all major stations now stream content online. We also found an unlimited internet provider. That way, we never have to worry about going over our usage for the month. Sometimes if you register for a business account instead of a home account you can get unlimited for the same price (many companies use streaming for their security systems, so internet providers choose to give them unlimited usage included in their plans).

5)  Combine packages. This can apply to everything from insurance to utilities. Many companies will offer a discount if you have more than one account with them.

6)  Shop around for the best deal. Call competitors. Then call your current providers. Ask what they will do to keep your business rather than you going to a competitor. Many will match offers.

7)  Little things add up. For example: every time we travel the Montreal, Ottawa, Toronto Corridor, we stop at Marysville. It is 4 minutes south of the 401. Why do we stop there? Because there is a reservation that has gas for 10-15 cents cheaper a liter than anywhere else. We can easily save $8-10 each fill up simply by going a few minutes out of our way.

8)  Set aside savings. This is similar to budgeting for entertainment. You know you are going to need savings. Whether it is for an unexpected car repair, needed clothing or a vacation you know you are going to take, budget for it. Even if it is just $25 a month. GET IN THE HABIT OF SAVING. Sure you may not have as much expendable income on a monthly basis, but when vacation time comes you won’t be going thousands of dollars in the hole either. The lessened stress is worth EVERY penny.

Budgeting Checklist

These are just a few small points, that if applied will help you get on the road to financial success. I would love to hear your creative ways of making ends meet! Make sure to leave a comment or e-mail me at info {at} pardonmypoppet {dot} com.

Warmest regards,

{jp}

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