Why I'm Thankful For The Recession

I can actually think of many things that cause me to be thankful but this is going to be a long post so I will get to the point of this particular post.  Budgeting.  There I said it.  The "B"  word.  I was scared of the thought of budgeting and dreaded it for so long.  But because of the recession we had to get a bit stricter with our finances.  So we began budgeting and boy am I thankful that we did.  I don't think we would have ever started budgeting if it were not for the recession.

Let me just start off saying that I am by no means an expert in this area.  I have only been keeping a budget since January.  I do NOT have it all figured out.  I am not an accountant but a stay at home mom (of 3 exceptionally cute kids) trying to be a help to my husband financially while he is out working hard for us.  And I am not saying everyone needs to do it our way.  But in the past 5 months that we have been doing this, we have had very little financial stress (and this is with our income being slashed 40-50% because of the stinking economy)!   Budgeting has been such a huge blessing that we have been able to save enough just in the past few months for a nice long family vacation!   So I think it is a least worth a try  :-)  There are probably other ways to budget but this way has been extremely helpful to
us.  We have benefited greatly!  I have not read any books on budgeting.  I am so thankful for the church.  We have so many wonderful and helpful friends.  Rosy is one of those wonderful friends.  She showed me how
she budgets and I adapted it a bit to fit our family and my style. 
PLEASE if you have been budgeting for a while feel free to comment in
the comment section on any books or other ideas that have been helpful
to you.  One book that I think is very valuable is The Treasure Principle by
Randy Alcorn.  It is not a budgeting book but it will change how you
view money :-)  We tell everyone that comes to us for pre-marital
counseling to read this book!

Paying the bills has always been stressful, even when we were living in the "fat cow" years.  I have always thought that we lived modestly for our income and we were not extravagant spenders.  But we were not savers or planned in advance.  13 years ago when we were receiving pre-marital counseling by our pastor and we were told to budget.  We didn't listen!!  We thought it would ruin our fun.  We were wrong and had years of bill paying stress even in the years we were living high on the hog.  Now we are accountable to how every
dollar is spent yet there is a feeling of freedom too!  Budgeting has taken the stress away and has also helped us to seek our joy in Christ and not whether we had certain material possessions or living the "American Dream". 

Lots of people have been very curious and ask Erick or I how budgeting
works.  So Erick thought it would be helpful if I posted something in hope that some one will be helped like we were.  It has been a huge help to us!  Even if you are not struggling financially now.  This is still so important to you.  You never know when you will be financially pinched.  Budgeting also provides great accountability between a husband and wife of where money is spent but you still have freedom to spend your allotted amount of money in each category. There is so much more to say about the benefits but I will get to the HOW of budgeting.

So this is the HOW Of Budgeting:

Below is a scan of my budget sheet and then I will explain.  I know I am probably the ONLY person that does this on a pad of paper and not on the computer.  I am just weird like that  :-)  And I left the majority of the numbers out because I didn't think it was the whole world's business  ;-)  I don't mind going over it with you personally but not on here.  Hopefully I can explain it adequately!

Step 1:  What is your monthly income?  Write it in the top left box.  Divide that number by 2 to get your biweekly total.  (Erick doesn't get paid a salary because he is self employed.  This makes it a bit trickier because his income is variable every month.  So I had to estimate a reasonable number and estimate low so that on slow months it would still be doable (is that a word?) to make a paycheck to our home account.)  

Step 2:  List all your bills. For the bills that are variable (like Edison electricity), go back over the past years worth of bills and add each month to get the total for 12 months then divide by 12 to get a monthly average.  Divide the monthly average by 2 to get the biweekly average.  Fill in the boxes for the monthly and biweekly total amount for each bill listed.  For the bills with variable amounts some months will be a lot higher and other months will be a lot lower but it should all average out by the end of the year.

Step 3:  List all other expenses such as grocery/household, clothes, gas, etc...  Whatever amount of money is left from the top part you will have to distribute in these areas.  You will probably find that you need to eliminate or at least cut back in some or all areas  (oh I sure miss our house cleaner!!!)  to make it fit within your monthly income.

Savings and investing should be listed here too.  Right now when Erick gets paid in cash it goes into our savings.  Also if his monthly income exceeds the amount we have planned it also gets saved. 

Step 4:  Stay in your allotted amount of money you set for each category.  (This is the hard part, but worth it!!) 

Example:  We are allotted $100 a month for gas for my mini-van.  You will see it says "+9.13"  That means I had $9.13 left from the previous month ( I spent $90.87 on gas last month).  So $9.13 rolls over to this month.  This month I spent $92.25 and after you add the $9.13 from last month I now have $16.88 to roll over to next month.  BUT it goes the other way too!  If you exceed the amount allotted for a category you have to deduct it from next month.  This is what keeps your spending under control. 

I have a little notebook that I keep track of the purchases continually for each month and add the categories up every week to see where we are at.  Then at the end of each month I add up each category and see if we were +/- for that month and then write in how much under or over we were in each category.  I don't worry to much on the top part if we are over for the month because it should average out over the year.  However the bottom portion should be even for the most part or you need to change your spending in that area or readjust your budget.

Well I hope this made some sense.  If you are totally confused are interested in budgeting  I don't mind going over it with you.

The books of Proverbs and Ecclesiastes are filled with wisdom on the subject of money and are very worth studying.  Personally I have seen God's work in our lives during times of financial strain.  I have become much more dependent on God and find myself seeking God's guidance through His word and prayer.  It has been such a joy to see how God is answering prayer in many ways.

1 Chronicles 29:11-12  Everything in this earth is the Lord's

Ecclesiastes 2 and 5:10  Possessions won't make you ultimately happy or satisfied.

1 Timothy 6:9-10  Love of money is the root of many evils.

Hebrews 13:5-6  Content with what you have.

Be content in Christ Jesus.  He can give you ultimate contentment.  Especially when life is hard.