Patrick and I have been working on our debt, trying to build our savings and all around attempting to budget our money for awhile now. I was recommended a budgeting website probably a good three years ago and have been using it ever since.
Mint.com has been an amazing help to me (and I barely use any of the functions for it).
I am a very visual person, so seeing our budgets laid out helps me see where we can cut back and where we can adjust to make room for other things. I am able to see our debts (and adjust them as needed) which plays a part in seeing our networth (assets-debts). I have really enjoyed keeping track of these things and at the same time watching our debts decrease and our networth increase.
I have so many goals when it comes to our money. Shortly after Patrick and I got married we combined our finances over to my bank (we did this for the simple fact that I had already opened ten savings accounts at my bank). I also preferred to then be in charge of our finances- where the money goes, transferring to each savings account, paying the bills, etc. It is not that I didn't trust him with our money, but the fact that he never used a check registry honestly scared me a little. My slight obsessive compulsive side needed to see it all laid out and I was happy when he agreed to let me be in charge (with his input, of course).
The reason we have ten savings accounts is simply because we are saving for a lot of different things. We currently have the following savings accounts open:
Marley- instead of pet insurance we put $25 a month away into a savings account. When it's time to see the vet we transfer the money over. This way it is not an added expense, but rather just a small unnoticeable amount set aside. We will also use this in case of emergencies with her as well as when we find her a new scratching post as hers is well loved, but in need of being replaced (those things are expensive!)
Isabel, Leah and Kaleb college fund- It is never too early to start saving for college! Right now we put a small amount away every paycheck and eventually we will be able to help each of the children with their future goals. We are well aware that college is going to cost a lot more than we can afford and unfortunately we won't be able to send them off with college 100% paid for, but we do want to be able to help. Even if it's only a small amount.
Dopey Challenge- obviously flying to Florida, staying in a hotel room and paying for registration to the Dopey Challenge is going to cost a pretty penny. I have been paying myself $1 for every 1 mile I run and although it won't pay for the entire trip, it will help the cost.
Vacation- this is another account that we put a small amount in each paycheck. We really don't have any trips planned at the moment, but the savings does help when we do decide to go somewhere. Again, it usually doesn't pay for the whole thing, but it does help the cost and who knows, maybe if we continue to save we can eventually go on a big trip to somewhere amazing.
Christmas- in order to budget our money better around the holidays we decided last year to try a savings account. We put money aside each paycheck and then transfer it over when we start our holiday shopping. I do believe that I spent over the amount in our savings last year, but I still stayed below our budget and didn't feel as though it was over the top (like I did a few years ago and went into debt because I just kept buying gifts).
Retirement- Even though Patrick and I both have a 401K account through our work, we did decide to start a savings account for when we retire. The plan is to use our 401K after we retire for bills and miscellaneous grown up things and to use our savings accounts to travel.
New car- Patrick's car is going to be the first to go between the two of ours. He's put many miles on it on the trips down to pick up his children and back to drop them off. It comes at kind of a good time because we want to wait until we get out of debt before we put on more debt with a car loan. We are starting to look at 7 seaters because we want to have enough room for the three children and maybe a fourth if our lives take us down that path in a year or so.
House- this is our top priority at this point in regards to savings and we are trying to put as much as we can into this savings account. Some months we are able to put in more than others, but we are inching our way to our goal. Once our debts are paid off we will be able to contribute a lot more and we are hoping to be able to reach our goal and start looking into buying a house sometime in 2015.
As for our debt... We have made a payment plan schedule so that we can be debt free by August 2014. We are hoping that we receive a tax return this year and we have already decided that half will go into our house savings and half will go towards our debt no matter what the return may be. We have also agreed that at this point we are 100% focused on getting debt free as soon as possible so that we can then turn our attention to savings.
Of course we're not cutting out everything and we also want to make our budget livable, so we've added budgets for running and golf. This way we are able to still enjoy the things we want to do while fitting it into our budget. We each also get a cash allowance each paycheck so that we can buy whatever we want, no questions asked. I think this helps a lot because that way Patrick doesn't have to "ask permission" to buy something and vice versa.
We are going to see how the budget we created works for a few months before altering it. I know that certain things are not exact each month (like gas and electric bills as well as restaurants, groceries, gas/fuel and even our income, among other things). I think the main point in creating this is so that we are both on the same page and both focused on the same goals.
I know that it felt amazing when we were able to pay off one of Patrick's debts last month. He had been paying on it for a long while, so once we were able to make a plan and get it paid off you could tell the excitement. The hope is that we are debt free before our goal of August and that we take the time to celebrate the smallest of successes, even if it's a simple high five when we pay off a credit card or make a payment. I think that's an important part of it- celebrating.
I know, for me, that it is nice to have it all written down and I can visualize what we are doing. Like I previously said, I'm a visual person. I also like to have goals and to work towards them. Buying a house is something that we both really want to do and the sooner we do that the sooner we can work towards certain other goals (like growing our family). It will help to have a bigger place, especially for when the big kids are here. It will also be nice to have a home. Not that we don't consider the apartment our home, but it can feel a little too small most of the time. I would rather being paying towards something each month that is ours at the end of it all.
I am grateful to have a roof over my head and I am well aware that owning a home is not all rainbows and sunshine, but I can picture the fence, Patrick in the garage working on rebuilding a car, the dog running around the backyard, the kids playing in the living room, me baking in the kitchen (that's big enough to have more than one person in it at a time). I want that and I am going to put in the work to get it.
Here's to being debt free in 2014!
