The Great Budget Postmortem – July 2016 Edition

Alright ladies and gents…The time has come!  We are about to enter into the (cue announcer voice) GREAT BUDGET POSTMORTEM!!!!  July 2016 edition.

 Now you may recall that at the beginning of July the Hubbers and I set up the first budget we have had in years (so totally awesome, right?!?!?!).  But a budget is absolutely useless unless you use it.  That bears repeating.  A budget is absolutely useless unless you use it!!!

 Exactly HOW do I use a budget?  You may ask…Well, you use it by doing a few simple things…

  1. You create the dang thing (see how here)
  2. At of the month/week/whatever…You REVIEW how much you actually got paid AND how much you actually spent and COMPARE that to what you planned to get paid and what you planned to spend
  3. Make adjustments  (i.e. tweak the dang thing)

 Simple, no?

 So last month over some serious vino we covered step 1.  So now we are moving on to step 2, or what I like to call the POSTMORTEM.  

 Postmortem: a discussion or analysis of something (such as an event) after it has ended.

 But first a moment of acknowledgement…

 Step 2 can either be freakin amazing (read “WOOT!, I am under budget!), meh (read “about right”) or an absolute nightmare that requires more of the vino needed for Step 1 (read “holy s@#t! How on earth did I spend that much money?!?!?!).  

 If you find yourself in this last camp, don’t fret!!!  The budget cycle is a glorious loop of improvement that reaps amazing rewards!  This month is “holy s@#t!” but over time you will find yourself saying “WOOT!”.  Just give it a bit of time…and always more wine…and you will get there!

 Now back to it…

 And the results of the July 2016 budget is…..drum roll please….”meh”.

In numbers speak we were actually about $800 over budget.  While I realize for some that may be a “holy s@#t” (and justifiably so, I might add), it wasn’t that bad for us.  Here is why….

 Of that $800:

  • Approx $250 was in dr. visits for the kiddo (unplanned and necessary)
  • Another $350 was in unexpected insurance premiums (again, unplanned but necessary)

 That means that we actually only went over by about $200 (“WOOT!”) in our “normal” discretionary spending.  This is freakin exciting guys!!!  This was our first budget in a years and we did pretty dang good when it comes to sticking to it.  Given we haven’t flexed this muscle in so long I honestly would not have been surprised if we had overshot it by a much larger number than that.  GOOOOO us!

Overall, I am feeling great!  We weren’t too far off.  We have identified some great tweaks and edits to our plan for next month.  AND THE BEST PART…reviewing the budget to see if we were on track actually left me feeling in control.  WOOT! For making progress..  

Until next time…

EV

Back to Basics (aka Budget)

If you read our About Us page you already know the deal…For those of you who didn’t, the gist of it is this…After a start-up, grad school, a baby, and countless moves, my husband and I are basically starting over and looking to build a solid financial foundation.  To do that, we have to get back to basics….and by that, I mean a budget.

Now we used to live on a pretty strict budget.  When we were but sweet young things, drowning in student loans, working multiple jobs, paying down debt, and stashing cash (again, read About Us), we lived and died by a budget.  I had a spreadsheet to reconcile accounts that would make your head spin (OMG I LOVE EXCEL)!  

But let’s get real here…we haven’t had an official budget in years.  I always knew what our fixed spending was (think rent, student loans, etc…), and I always had a good idea of our variable (things like the electric bill and credit cards), but I just didn’t want to get too stringent and put something in writing.

Why?

I felt kinda powerless, and I just didn’t want to face it.  End of story.

While my husband was doing his start-up or I was in grad school I just didn’t want to look at the numbers.  They were either depressing, or I didn’t want to place too much focus on it because it would become a point of stress (read I would start to resent my husband’s business or question his need to grab a drink with a friend).  Neither my husband or I come from money (quite the opposite actually), so we both (cough…me…cough) have some mental and emotional hangups when it comes to the green stuff.  And honestly, it is hard to look at debt going up when you know you aren’t making an income (school), or that your husband is absolutely busting his butt to make his business work, but the cash flow just isn’t where you thought it would be this month.  We were paying our bills (albeit using funds from our business or student loans) and our credit card every month, so I just said….”hey…we will get around to it when things settle down….”

Well… I am out of excuses.  Things have settled down.  My husband and I are both working.  We now know our base salaries without a doubt.  We know all of our fixed expenses, and we have a pretty good idea of what we spend on a regular basis (this took a few months after moving to a new state, doing crazy things like driving again, and…oh yeah…having baby expenses), but it is still a work in progress.  So last week the husband and I sat down (with alcohol) and put pen to paper (actually we use MINT), and this is what we came up with (ish…).

Zero Sum Budget 2016As you can see (errr…sort off), we put together a detailed budget that addresses everything we routinely spend on a monthly basis.  Why do I say routinely?  Because I know there will be things that pop up that are unexpected.  It happens!!!  But if it keeps happening month after month…well, its not an unexpected expense is it?  It goes in the budget!!!  

NOTE: Don’t forget to include those things that you may pay infrequently, but you have to pay it.  For example:  We pay our auto insurance  in a lump sum every time we renew our policy.  Because we pay this every year, it goes in the budget (annual premium/12).

What we don’t put towards our total expenses goes to our “Savings & Debt” category.  And I am happy to say, we got a little green to throw that way!  WOOT WOOT!!!  

Total Expenses + Savings & Debt = Income

This means that every dollar we bring in is accounted for and assigned a category.  Or in other fancy pants finance lingo…we got us a Zero Sum Budget.  

Now time to put this baby to work!

Much Luv!

EV

 

 

 

photo credit: www.cafecredit.com

About Us

Hello!  And welcome to EarnVerse!

This site details the journey of me and my family as we try to get our butts in gear to get our financial house in order.  This site is my accountability tool, note repository, and maybe the occasional therapist.  I am not writing this to offer advice, declare the best way to do something, or tell you how to live your life.  This is OUR journey.  You are welcome to follow along!

Much Luv,

EV

 

A (not so) brief history…

My husband and I met in college (OMG we were practically babies!).  Neither of us came from wealthy families, so our college years were spent working multiple jobs, eating Ramen and taking on ridiculous amounts of student loans.  Post graduation we moved in together (ssshhhhhh!  Don’t tell my parents!).  This was largely due to the fact that I paid more in student loans than my parents paid on their mortgage, I was flat broke, needed a roommate, and this man happened to like me.  During our blissful roommate phase we both tackled debt (I took on a second job), started to stash some cash, and voraciously read any and every personal finance book, blog, etc..we could get our hands on.  We were happy!

Then we got married…(I maintain that planning a wedding is one of the most stressful things you can put a relationship through!  This is true esp. If you are the ones footing the bill!)…We paid cash, we took a month off for a honeymoon…again, happy!  But WHILE ON OUR HONEYMOON my husband throws me for one helluva loop.  He wants to quit his well-paying job so he can start his own business!!!  Fine.  But if he is going to do that, I want to go to business school (WOOT! Bring on the student loans).  And not just any business school…I want to go to a top ten program (even more debt, yeah!).  I want to study finance (this is cool).  And then I want to work and live in NYC (could I be throwing more money away!?!?!!).  I mean…I had to one up him on the crazy risk factor…am I right?

Lofty goals.  Big risks.  And we did it all.  My husband started his own gig, sold it, and it still operates today.  We didn’t strike it rich, but we didn’t eat it too badly on the deal either.  I went to B-School at my top choice, and then I went to work in finance in the Big Apple.  Everything was great!!!!  Except for the lack of funds living in NYC (OMG rent!), the crrraaaaazzzzzyyyy work hours that we were putting in (I didn’t have a day off in over 5 months and I am pretty sure there are pictures of me somewhere scarfing down cookies and coffee at 2am while at my desk trying to stay awake…a regular occurrence), and the fact that we decided to start a family…And daaaang did that happen quick!

Now I am a planner.  I like numbers.  I like spreadsheets.  I like everything in my house to have a place and be perfect.  I may be a bit OCD…And BAAAM!  No sooner did we decide to think about, maybe, possibly having a kiddo, than we were preggers (#blessed).  So clearly, we needed to pack up our bags, quit our crazy demanding jobs, move 3,000 miles to be close to family and start over.  

And that’s where we are folks…We are starting over.  Our twenties were full of action, risk and adventure.  We don’t have much (cough…in the bank…cough) to show for it, except a great education for us both.  We now have two new, well paying jobs with a solid work-life balance, the happiest little boy, like, ever.  Again…#blessed.  It’s just time to build (finally and/or about time) the solid financial foundation we want for ourselves and our growing little family.  

So let’s get started…