Being Broke on a Budget.
We always talk about budgeting and always acknowledge it’s a good thing to do, and occasionally we even sit down and plan a budget… but we never stick to it. Well, this whole minimalist thing has really kicked us into gear and helped us straighten our priorities. We’re forcing ourselves into responsible adulthood, and being the master of our finances is one aspect of our new lifestyle.
My husband and I are both teachers at a small, rural Texas middle school. My paycheck is $1,950 once a month. My husband has been teaching a year longer than I have, so he gets a little more: $2,050 per month. That means that we have right around $4,000 per month to work with.
Here is the list of our monthly bills:
- Mortgage: $983
- Student Loan: $300
- Cell Phones: $205
- Car Insurance: $63
- Internet: $43
- Electricity: $50-150
- Gas: $45-90
- Water: $46
- Gym Membership: $77
- Netflix: $14
- Compassion International: $38
Here are the usual weekly expenses:
- Groceries: $60-90/week
- Gas: $40-80/week
- Eating Out: $150/week (embarrassing)
So, anticipating the higher range for the fluctuating expenses, we spend about $3,300 on monthly costs. We also try to tithe each month, so that number is closer to $3,700. That leaves us about $300. We try to put $250 in savings each month, so we end up with a whopping $50 unallotted each month. Lately, that and money that is allotted for savings has been going to car repair (our cars are 12 and 14 years old, but they still run, and we don’t owe any car payments!). Usually, we spend the rest on eating out, going to the theater, or on trips out of town to southern gospel singings.
Always being broke is no fun, and it is quite stressful. I decided that something had to change. In fact, I decided that six things (so far) had to change.
Change Number One: Phone Plans. This one was fairly simple, but will take a little self-discipline. We had 10 GB of data every month, so we could pretty much do whatever we wanted whenever we wanted, electronically speaking. We cut our plan back drastically to 1 GB. That took our phone bill from $205 to $95 per month.
New Unallotted: $160
Change Number Two: Electricity Usage. Summer in Texas is pretty rough. Last year, our AC broke, and it got up to 96 degrees in our house. However, this isn’t summer, and we’ve managed to keep our air and heat off since sometime in January, relying instead on fans and open windows. Our electricity bill has been consistently $45-ish, as opposed to the $109 it was this time last year.
New Unallotted: $265
Change Number Three: Eating Out. This is the biggest one yet. We got into a nasty habit of eating out for nearly every breakfast on the way to work, and nearly every supper on the way home, and it was draining the little money we had. You can see one of my earlier blog posts to see how I’ve solved this one. We’ve decided to only spend $30 per week eating out, which is one meal at our favorite restaurant, or several days of breakfast on the go.
Change Number Four: Spending Time Earning Money Instead of Spending It. My husband and I are not professional musicians, but we do have solid backgrounds both in music and in teaching. I now teach private piano lessons to eleven different students, and my husband teaches private violin. Now, I realize that this is not an option for everyone, but I highly recommend finding something you’re good at that will help you make some money (realistically, not something that takes a lot of time and money to make, but is hard to sell). If you know how to clean, you can charge quite a bit to clean houses. My mom ran a cleaning business for a while, and she charged $25 per hour.
With our music lessons, we’re making about $550 per month.
New Unallotted: $1,295
Change Number Five: Use Cash. This is a combination of a mind game and a practical piece of advice. It is a mind game in that physically having cash leave your hand rather than swiping a card has a certain finality to it, and you feel the cost more. The practicality of it is that when your cash is gone, you’re done spending money. There’s this thing called the “envelope system”, where you decide right when you get paid how much money you are willing to spend on a certain area (groceries, eating out, date night, et cetera). You then take out that much money, and put it in an envelope labeled with its purpose. You only spend what is in that envelope.
I don’t have my life together enough to use the envelope system yet, but I do get paid cash for most of my piano lessons. What we have been doing is only buying groceries and eating out with cash. It is a good motivator and helps me visualize how much I can spend better than a debit card does — if I only have enough cash as I know I will need for groceries, then I obviously should eat my leftovers instead of going out to eat.
Unallotted: Still $1,295
Change Number Six: Less Spontaneity. Most of our money was spent in last-minute decisions, and most of them weren’t even that expensive: “I don’t want to cook today. Let’s go eat out.” “Oh my gosh, that movie is in theaters? Let’s go see it!” “I really feel like getting some Baskin Robbins right now.” All those things add up, and we were always low on funds by the time the next paycheck rolled around. Now, we try to plan these things ahead of time (only eat out on Friday night, ice cream trips only once per week, only see movies on pre-determined trips). Now, there will still be unexpected costs — last month, we had to pay $350 to fix a car — so I will reserve $295 per month for things like vet bills, house and car maintenance, eating out, birthday presents, and fun stuff. If it isn’t needed, it’ll go to savings.
New Unallotted: $1,000
Now, that’s a big difference! Here in a little bit, I will be posting part two of this post: Being Broke and Getting out of Debt. What advice do you have for those of us who are trying to budget?