Did you set any resolutions for 2019? Years ago I finally decided to stop setting resolutions, but really wanted to try to set goals for myself, especially with money. Today I thought I’d give you a few tips that have helped my family finally nail down a budget that really seems to be working for us.
For years and years we’d struggle with setting and maintaining a budget. Several years ago I read Dave Ramsey’s Total Money Makeover and it had so many wonderful ideas, strategies and suggestions that really started to put us on the right path. He talks about 7 baby steps to financial freedom, such as establishing a $1000 emergency fund, paying off all of your consumer debt, etc. He also talks about setting a budget and using cash for everything. If you haven’t read his book, I highly recommend it, you can check your local library for a copy or purchase one off amazon.
Back in August I decided to finally start using cash for everything and I know what you’re thinking, WHAT? All my cash has a category/envelope (which I learned from Dave Ramsey) and I’ve been sticking to it. I’ve cut my grocery budget down by roughly $80 a week or $320 a month for my family of 5. Before I started this system, I would just throw stuff in my cart and hope for the best. I actually calculate what I’m spending while I’m shopping now, because I know I have to stay within my budget. Making a meal plan for the week is a tremendous help as well.
Other categories I’ve added to our weekly budget are family fun, eating out, kids (like for school functions, allowance, etc.), gas, groceries, my fun money and misc. I was awful about going shopping on payday and then I’d be pretty much broke until the next pay period. Now I think about our plans for the week and see what category the money we’re spending should be coming from.
More often than not, I have money left over in each envelope, then I usually divide it up between my sinking funds. This never happened before I started using cash. Sometimes I might only add $5-$10 in one of the sinking funds, but it adds up over time.
Our “Sinking Funds” are little savings we put money aside for things we know that will be coming up. For the last few years I’ve been putting money back each month for Christmas so that we have a cash budget that we can stick to. I’ve also started little sinking funds for car repairs, pets, date night, back to school, and gifts. Now when I need to get my oil changed, I’ll have the money on hand, or if my kids get invited to a birthday party, I have cash set aside to purchase a gift.
I’m sure it seems like a ton of categories to keep track of. It took me probably 3 months of playing with our budget to see where our money was actually going and where it should be going. I actually found that the more categories I have, the easier it is to keep everything straight.
Please keep in mind, I’m no expert, this is what works for our family. There are so many books, websites, podcasts and apps you can use to help you get started on your budgeting journey. Community Action Agency offers a FREE Budgeting class several times throughout the year. They have two different classes starting this month. You can call 517.263.7861 ext 2229 or email jlaughlin@caajh.org to register. For more information, see the flyers below.
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Vanessa Armstrong is one of our Parent Liaison for Lenawee Great Start. Before joining Lenawee Great Start, Vanessa worked as a photographer and served in the United States Air Force of 10 years. She is a Florida native who has been living in Tecumseh with her husband Sean and their 3 children, Keira, Cooper and Harper since 2010.
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