Have you ever actually written down a budget? Have you ever followed a budget? I ask these questions not to judge anyone, because I had never sat down and made a budget myself until two years ago. I wish I had approached this concept much sooner. The word budget seems to bring forth many emotions; fear, panic, anger, and a thought of restraint. I learned two years ago, when I took the Dave Ramsey Financial Peace class, that budget is not a dirty word. I also learned that by making a budget I am telling my money where to go instead of wondering, at the end of the month, where my money went.
The first budget I set up was crazy because I did not know what I was doing but I learned the budget is not set in stone. It is a living organism changing as life changes and little things come up. The first few months I had to go back and adjust our budget several times. Now that I have been doing this for the past two years I rarely have to change it up or re-adjust it during the month but, I know that I can if I need to.
I was so afraid of setting up that first budget. I set it up and filled it out and then dear hubby and I went over it. If you are married it is important to include your spouse in the process. I am the CFO (Chief Financial Officer) of our family but, hubby and I both make major decisions together. A major financial decision for us is anything over $250. When I set up that first budget I found where a lot of our money was going. We spent a lot of money eating out. I am sure there are a lot of folks that do the same thing and don't even realize how much they spend. It made me sick to my stomach when I realized how much money we had wasted eating out.
Dave Ramsey also explains his envelope system. I love the envelope system and use it for our cash only items. When you set up the envelope system you set aside a certain amount of money to be spent on certain items. My envelopes are: groceries, restaurant, clothes, entertainment, hair cuts, vacation, pet supplies, and home repairs. Each time my hubby gets paid I put a certain amount in each envelope, the amount comes from how much I had budgeted for each item. When we go out to eat we use the envelope money and if the envelope is empty then we eat at home. My kids know this now and realize that we cannot go out to eat 5 times a week. I am not saying this is easy because it is not. Our first run with the envelope system met great resistance from my kiddos and we had to stand firm on the decision to stick to our budget. Using the budget, every dollar has a name and restaurants only get a certain amount. We give, save and spend a certain amount each month and we do not exceed our income.
I am amazed at how much we have saved and given in the two years we have been doing this. I wish I had known about this when my dear hubby and I were first married. We are older and wiser now and live on a budget and that is not a dirty word. It is our plan to save money so that we will be able to do the things we have always wanted to do. We also do not use credit cards, debit cards yes but not credit cards. We are paying off our car and house at a rapid pace. I want to be debt free!! That is for another post.
For more information on Dave Ramsey I highly recommend you google him and check out his site. You don't have to do everything he says, you can pick and choose what works best for you. Try out some of his recommendations and see what happens.
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