Thursday, September 12, 2013

Living on a Budget...which I sometimes hate

A few weeks ago someone asked about how Trent and I manage our finances as newly weds in my Survey Followup: Answers to your anonymous questions post.

Before we were married, Trent paid off all $6,000 of his student loans within a 7 month period. I know, it's impressive. He lived with his parents and worked at a bike shop with hourly pay in order to do it. He came into our marriage with NO DEBT! No credit card debt or anything. THANKS BABE!

And then there's me....

Graduating college with $28,000 of student loans.

My eyes burn from looking at that number. I also kind of want to throw up.

I know I am not alone in having this kind of debt. A lot of you may even have 6 digit numbers.

University of Missouri's tuition of $20,000+ a year (including living expenses) is not easy to cover. I worked 2 jobs through all of college and went to summer school twice to graduate in 3.5 years. My parents helped me out, but I am one of 5 children. Also Mizzou barely gave me any scholarship at all -stink on them.


Trent knew going into marriage that I was coming in with a big 'ol load of monthly payments for the next 10 years. I'm glad he still loves me.

I was blessed to get a full time job right out of college and within 9 months knocked out $7,000. Just $21,000 more to go...

We got married and lived pretty reasonably. I wouldn't say our lifestyle was luxurious, but we were able to afford things we wanted. We could give to others and still manage to pay chunks off of our debt. Still though, we never really kept track of where our money was going. It was all completely random.

Around February we knew for certain that Trent's job would move us to Topeka. We put money in savings and stopped paying student loans for a while to pad the transition. The nice thing about paying MORE than your monthly bill is that you are literally years ahead. My statements were like "next payment due October 2015." THE BEST.

So we moved to Topeka. Money was tight for a few months while I looked for a job, but we made it.

And here is where it gets bad...

I got a job. The next 2 months we spent almost everything that came in.

We weren't paying off debt.
We weren't giving like we should.
We were just spending. And spending.

The majority of the spending was me, not Trent. One day I decided to add up all of our bills and found it to be MUCH MORE than what I expected.

Where is our money going?

A few weeks later Trent convinced me to start a budget. He had a lot of good points...if you REALLY want to pay off debt and save for upcoming life events (a car or a house or a trip) then you have to have a plan.

We used www.mint.com which has been AWESOME. You can create a budget and keep track of transactions made through all your accounts -loans, checking and savings accounts, car payments etc.

The first month on a budget was a learning experience. We left a pretty big pad in the "miscellaneous" category. That didn't work.

We ended up saying "Oh, we can just put this in misc" when other budgets were maxed out. (Again, mostly me, not Trent) We also found that we were spending a LOT of money eating out.

Lots of lessons learned.

The next month we budgeted EVERY. SINGLE. PENNY.
Everything.


A list of our budget categories:
-Auto Insurance
-Auto Payment 
-Auto Services and Parts
-Auto Gas and Fuel
-Internet Bill
-Gas Bill
-Mobile Bill
-Water Bill
-Utilities Bill
-Student Loans
-Movies
-Groceries & Toiletries
-Gifts
-Savings 
-Tithing
-Doctor
-Gym
-Furnishing
-Rent
-Beauty
-Laundry/Dry Cleaning
-Pet and Food Supplies
-Clothing
-Hobbies
-Misc (Small amount for truly misc items such as parking or printer paper or something)


Since starting our new budget, we have been able to achieve all of our monthly goals. We paid off a large chunk to debt. We put money in savings. We saved up for vacation.

As we follow our plan, the debt is dropping and dropping at a regulated pace. I am proud to announce that this month my debt is less than $10,000! No longer a 5 digit number!

Those kinds of achievements are great, but others are not so great. Like passing up this clearanced out rug made of jeans because my home furnishings budget is maxed out :-( I HATE THAT!!


But why do I hate it?

This experience has taught me how selfish I am with my money.

A few months ago we got a support letter in the mail for a missions trip. I wanted to give but we already maxed out our giving budget. That means I had to take money out of MY clothing, hobby or beauty budget to give.

It's hard to admit that was difficult for me.

I am humbled to recognize that giving has not been all that sacrificial for me before now. I'm glad to have learned that about myself.

I think there will be a day when we don't have to budget like we currently do, but unfortunately that day isn't here yet. I have a lot to learn in controlling my spending.

What kind of budgeting tips work for you? I would love to learn about them!


5 comments:

  1. This comment has been removed by the author.

    ReplyDelete
  2. Excellent work both of you! Proud!

    ReplyDelete
    Replies
    1. Thanks Debbie!! :-) We are getting there!

      Delete
  3. My husband and I are in the same boat. This was so very encouraging! Thanks for sharing!

    ReplyDelete