January 14, 2011

Our Budget is my Friend

We have been living on one income since July 31, 2009.  While I wish we had more income (everybody wishes the same thing), I can honestly say that I have gotten comfortable with living on the one income.  By that I mean that I am so used to bargain shopping and putting off purchases that it has become a way of life. 

In the fall of 2008 I knew there was a good possibility that I would be losing my job in the spring.  We had about 9 months warning of that possibility.  I sat down with my husband and told him that I didn't want to look for another job.  I wanted to stay home.  But I also wanted to make sure that we would be able to make it financially.  So after looking over our finances, we both concluded that I could stay home as long as I worked to at least March of 2009.  I knew that the soonest I would be without work would be July 2009, so we both knew that we could do it.  The only fact that we knew for sure was that the first year would be the roughest and it was. 

We're well into the second year and while our income has only increased by $50 a month, we are able to pay our bills, set some money aside in savings and pay down debt.

The one thing that has brought me peace of mind throughout the past 18 months is that we have a budget and I have learned to live within it.   We reviewed our spending and saw areas that we were overspending and knew we could cut back on those areas.  We also looked at areas that we did not budget, but we were spending money.  Those areas included some miscellaneous spending, entertainment and eating out.  We started to budget for those items.  We didn't put a lot of money in those categories, but we still budgeted for those areas.  It's odd but when I see that I have "x" amount of dollars to spend in a certain category, I am more apt to stay within that guideline.  I don't want to jeopardize my being able to stay home by overspending if I can help it. 

There were two months that first year that were tough.  It was November and December 2009.  At that time what was making it tough was that my husband was seeing the writing on the wall as to his job and he had started to look for a new job.  I would go so far as to say he was miserable.  Added to that stress was that we had some extra expenses those months, along with Christmas, which created a very high level of stress in our household.

I pondered during those two months if I needed to go back to work to help alleviate the stress in our household and take back some of the income producing responsibility.  But we got back on track with our budget in January 2010 and at the end of that month my husband had found a new job which he loves.  I decided that I should continue and persevere being home.  It was too early to throw in the towel and give in to fear.

Yes, I said fear.  There is a small amount of fear of living on one income.  After all if my husband were to lose his job, we don't have a second income to fall back on.  Yet, I can't live my life fearing something that may never happen.   In any event, we are preparing every month by putting money in savings just in case this would ever happen.

Now we are only 7 months away from having only our mortgage and one car loan as debt.  The same month we have the debt paid off, our youngest goes to college.  Still, financially speaking, we are making it and will continue to make it. 

I read recently that the unemployment numbers will not go back to their pre-recession numbers until 2016.  I read another article that said that the unemployment numbers will never be that low again.  Everyone has an opinion and each financial analyst makes an educated guess. 

No one can say for sure what the job market will be like in the future.  This is what I do know - be prepared.  The age old sentiment of saving for a rainy day still holds true. Those good ole fashioned values of waste not, want not are in vogue. 

I'll add a new sentiment:  a budget is your friend.


Maureen said...

I agree that a budget is your friend, but while I can work i really would prefer having the extra income. hubby has a heap of medical problems which mean that at any time he would have to retire, so I,ll keep plodding along.

I am always impressed with your housekeeping skills you manage your budget beautifully, so enjoy your time home.

Jamie said...

I found your blog on The Frugal Free Gal's site and wanted to drop by and say HI. I'm new to frugal living and becoming debt free but I totally agree with you about having a budget. I just started budgeting when I got Quicken Starter Edition for Christmas and it's really helped me see where I've been spending toooo much and where I'm not spending enough.

I've added your blog to my blog and my google reader so I can come back to visit.