Follow-up to the "B" Word

Roaming around on Pinterest I found a great site that gives you a breakdown to budget categories and I thought that I'd share it with everyone.  http://www.stay-a-stay-at-home-mom.com/household-budget-sheet.html.  Thanks to Rayven Perkins for this great information.

Budgets & Debts

I was thinking about my last post and maybe I didn't provide enough detail.  I don't know, because, for me, it is as basic as determining what is coming in and where it's going. 

There was a time in my life when I was drowning in debt and I wanted to give up.  My husband left me and I went from a two income family to a single mom with two children working two jobs and no child support.  I had a mortgage, a small business loan, medical bills for my son and, around $44,000 in credit card debt.  My husband left it all for me to handle; that was in 2001.  I don't remember five years of my life because I was so tired from working all the time.  I know my kids suffered, but I did it for them - to keep a roof over their heads.  I paid it all off, a lot of it by refinancing my home and using the equity to pay off my other debt.  When the real estate market crashed, I almost lost my home, but finally, through a loan modification, I got a mortgage payment I could afford, and thanks to being hit by a garbage truck, I got a settlement that enabled me to pay off all my debts except for my mortgage.  So here I am today, without a job, but for right now, still in pretty good financial shape.

What's the moral of my story?  It's easy, so easy, to get into debt and to get in over your head before you realize it.  But with hard work and with a realistic budget, you can get out of debt.  Don't give up - you can do this.  It takes work and commitment.

The "B" Word

To a lot of people, the word "budget" is daunting; they don't want to know where their money is going.  It's so much easier though to have a budget because then, you are in control of your money; your money does not control you.  Basically, a budget shows how much money is coming in and how much money is going out. There are a lot of great budgeting work sheets available on the internet, but I'm an old-fashioned girl; I like using a notepad and a pen.

One rule of thumb to manage your money is the 80/20 rule; live on 80% of your income, save 10%, and tithe 10%.  Everyone's situation is different, so use whatever works for you.

Now that I'm unemployed, having a working budget is a must.  Fortunately, financially, I'm in a pretty good position and it allows me to take some time off and find the right job for me.

Here is my monthly budget:

mortgage
groceries
utilities
cell phone
health insurance/dental insurance
life insurance
cable tv/internet
credit cards
auto insurance
tithe
savings
retirement

Most of these are fixed costs, so my budget won't fluctuate that much from month to month.

I don't include miscellaneous items such as gas, clothes, or auto repair; my car is a 2012 Nissan, which is paid for, and is still in great shape.

I rarely carry a credit card balance, but sometimes, it happens, and I'll pay it off over a couple of months.

I consider cable tv to be my only luxury, but if I have to, I can cancel it and save another $100.00 a month.

I have an emergency fund equal to 6 months of my former salary.

Even though I'm not working, I'll still contribute to my retirement through my emergency fund.

The real point of all this is that usually there are ways we can cut back on our budget; it may require hard decisions on your part, but when you're faced with unemployment like I am, you'll be glad that you took the time to make a budget.