Exactly 350 days ago, Craig and I decided we needed to redo our budget and make some serious budgeting goals. We just weren't happy with how things stood and knew we could do better. We had a lot of the right pieces; a reasonable mortage, a desire to save, a lifestyle without a lot of frills, no credit card debt or habits of relying on credit cards. But the 2015 was a hard year for us with a lot of medical expenses (Shots that aren't cover by insurance all pregnancy, midwife, etc) during a time when I wasn't exactly up for clipping a lot of coupons and we had burned through our savings. Now, that said, I don't really feel bad about that because we did what we had to do to keep Norah with us and she is totally worth more than all the money I could potentially have and much more. But we knew we could do better this year.
We had $100 in our savings account which is a far cry from the 3-6 months of expense goal that we would have liked. And especially being sick, I didn't have much of an idea of what was coming in or going out. I was just out of the loop. We didn't fight about money but we just didn't' communicate much about it at all, unlike when we were first married. We have very traditional roles in our marriage. He's the provider. And he does a great job and works hard for our family. But he wasn't necessarily getting the "credit" for that because I wasn't feeling secure. I could look up our bank accounts and balances but without an idea of what the bills were, that number didn't mean a lot to me. It was time for some help.
The Solution: Budgeting software YNAB (You Need a Budget)
It was just what we needed. It's easy to use and allows both of us to know what's going on at all times. I'm more of the budget manager now but it's easy for Craig to tell me if something comes up and I need to move money around. I also really love that they encourage you to change your budget as needed. I also love that the program wants you to start where you are at and just take whatever money you have now and think about what you need it to do before you get paid again. When we started, our first goal was their "live on last month's income" and once that happens, it does make it easier to plan for one month at a time but even before that point, their system works.
Now, ynab wasn't the only thing we changed. Craig started uber driving occasionally. We cut out of a few recurring expenses although to be honest, we didn't have a lot of those that we could cut. Our situation wasn't a case of a couple that can easily save $50 a month by cutting out starbucks trips. We probably wouldn't even save $50 a year if we cut out starbucks. Maybe $5 a year. But every bit helps I guess. I just don't think those things would have helped without YNAB. Seeing the money adding up in the savings category was a huge motivator for me because otherwise I felt like if I saved money, it would just be spent elsewhere with nothing to show for it at the end of the month (which may or may not have been true but either way, my thoughts mattered, motivation is key in saving!)
We, it's been just a few days under a year and we've hit all our major goals!
- Save enough to spend next months income or as YNAB would say, we aged our money.
- Save 6 months expenses
- Pay off both student loans (~$7000)
Yep, last night I payed off our last student loan! Our only debt right now is our mortgage. But as great as that is, knowing that we set some steep goals for ourself and achieved them together tops it. As does knowing that we are now on the same page and can easily talk about our priorities and come up with a plan for our future.
And you'll notice that we didn't put our goals in Dave Ramsey order. I read his books and they make sense but with three small kids, two old cars and pretty reasonable monthly payments on our student loans, we felt like switching the loans and savings made sense. We also didn't mess with our previous retirement stuff. Craig was great about setting that up when he first got his job and I don't even see it as incoming money so we just left it as it was. We could have met our other goals a bit quicker had we taken that money as well but I'm glad we didn't. Now it's time to set some new goals - and I think a minivan is gonna be one of those!
*Now, if you've been following the basement remodel and are confused, I will add that that is all due to a very generous gift from my father and that money is completely separate. I just don't want you all thinking we did all this saving stuff while paying for a basement remodel! And its a good reminder overall that you don't know other people's situations, don't compare, don't assume, just do what your family needs you to do. Keeping your eyes on the prize was my goal this year.