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Think you “can’t” trim your budget? I think you can.

20 May

So we’re a little over a year out of my unemployment and I am happy to say that what I thought would be a terrifying year, has turned out not to be too bad.

The fact that I received Employment Insurance for about 6 months of it did help. That combined with my husbands income allowed us to stay on top of our budget and actually stay on track with paying down debt in the process. We did have to cut back on a lot of the “extras” of life that we used to enjoy, however, we didn’t have to scrimp and shrimp ourselves out of any fun either.

Groceries were probably the biggest area that saw the cutbacks. That combined with the fact that we are out of the house so much more of the day has allowed me to cut my grocery budget back to between $500-$600 a month. While that is still a huge number, its a significant drop and I’m not sure I know what I was spending the money on before.

Well, I do. It was all just frivolous wasted things. Unnecessary treats for the kids, food that would sit in the fridge and never get eaten, useless household items that would never get used. I really do realize now how much of our income had been wasted. I find it so enlightening because I used to sit and wonder how I could possibly trim our budget and I really believed that there was no way. That the money we were spending, we NEEDED to be spending. Now, I can clearly see how much I could have been saving along the way.

We are on goal to have our trailer paid off this year. The loan we took out was actually for 5.5 years but I always knew it was a 3.5-4 yr plan. I do that all the time. Whenever we borrow money, I plan worse case senario and that is what we tell the bank and make plans for. But I always have different numbers and plans in my head, maybe just goals and challenges i guess, but it’s never for what we make the plan with the bank for. I don’t know if its the feeling of being locked in to payments, or the fact that I like to beat the plan, but it’s just how I do it. Anyways, the trailer was supposed to be paid off Sept 2014 and with any luck I will have that out of the way June 2013.

Once that is paid off, a portion of those funds will be allocated to the mortgage, increasing those payments. Those payments are already increased from what is on paper. Again, I knew that when we signed the deal. I believe the mortgage is a 20 year term, but I have a huge lofty goal to pay that off in 10-12 years. I would love it to be sooner, and that is the ultimate goal, but I also want to be realistic and not get side tracked by failure. Its a long term goal that is going to take patience and discipline.

With the change in careers of both my husband and myself, what our financial situation is going to look like in 1 or 2 years will ultimately determine how aggressive I can be. But I honestly never thought I could stay on track this year. I’m proud of us for staying on track when it would have been easier to cut back payments and continue to live with disposable income.

I’ve found a new plan along the way also. In all my readings I have discovered a Freedom Account. Basically, you divide all your yearly payments by 12 and deposit that amount in that account so when it comes due, the money is there. Things included would be car insurance, house insurance, life insurance, kids registrations, piano lessons, christmas gifts, etc. The list can be tailored to your specific needs. I love it. I can’t wait until I am in a position to start again. I can already see how that would give me “freedom” from the stress and worry about how much I need from this paycheck to put towards fees or registrations.

I’ve always believed in the saying that everything happens for a reason. What has happened is teaching me a lot about what I thought I already knew a lot about. And its opened my eyes to so many areas of personal finance that I would not have seen otherwise.

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4 Responses to “Think you “can’t” trim your budget? I think you can.”

  1. Connie June 8, 2013 at 9:54 am #

    Hi, I just found your blog after reading your comment on the Mean Moms that put gum in a teacher’s hair.
    First I am so sorry you and your son have had to deal with bullies. I wish they could understand how their actions can scar their victims for life.
    Second…..I have recently started blogging again,,,,I have had to rim my budget down to less than $800 per month due to my ex’s non payment of the court ordered child support so over the past year I have filled 3 2’binders full of thrifty ways to cut expenses down to the absolute minimum….I have decided to start posting them on my blog…..today’s blog is on homemade laundry detergent…. I saved a total of $269 over the past year by doing this,,,,I thought you might like to see if any of my budget slashing methods may help you out too…..

    • myjampackedlife June 13, 2013 at 7:28 pm #

      oh wow. thanks for stopping by. i still have that post about the bullying in the drafts folder. i just can’t seem to publish it. maybe because for every story there is two sides and maybe im just not seeing things from her perspective. i don’t know. im certainly not perfect either, you know. i will check out the laundry detergent. i see those on pinterest all the time and have thought about it. in fact i just bought hydrogen peroxide to make some cleaning products from scratch. looking forward to getting to know you better!

  2. Wanita Johnson May 20, 2013 at 7:43 am #

    Isn’t amazing how much a household wastes in groceries? So great to read about your budgeting and your aggressive goals on how to pay off your loans earlier. I need to sit down with you and do this for my household!

    • myjampackedlife May 20, 2013 at 9:30 am #

      it really is amazing. when my husband and i were both working full time we made well over $100,000 combined income. And we were struggling to pay the bills every month because we “thought” there was no way to cut back, that we were being responsible with our money and we really needed everything we were buying. Now with that cut in half and then some, we are still here and living and sure we have had to make some harder choices, but we are doing it. it makes me sad to think where we could have been now if we would have only realized the amount we were throwing away.

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