My budget story actually begins with wealth! For as long as I can remember, all I wanted to do was work. I loved the sense of accomplishment it gave me and the joy involved with building up my bank account and savings. By the time I turned 18, I was a supervisor of a successful framing crew, working on average 55 hours a week. I bought a brand-new truck and had it paid off in a year. I fell under the category of what you would term, “sitting pretty.”
Well, as the old adage goes, first comes love, then comes marriage, then comes debt? In our first few years of marriage, we made some poor financial decisions and very quickly ended up living paycheck to paycheck. I can remember one particular time when the mortgage was due and I had to work 62 hours that week just to pay it – with no money left over afterwards. The financial strain became too heavy, and soon we found ourselves taking the frustration out on each other. It definitely wasn’t the ‘Happily Ever After’ I had imagined for myself.
Then one day, I just knew it had to stop; the overdraft notices in the mail, the constant feeling of going backwards in life, and the misery I saw on my wife’s face - it all had to stop. We were more than $350,000 in debt when I finally said, “Enough is enough.” I knew the key to crawling out of our debt hole was to stop spending more than I was making. Seems like that should be common knowledge, right? You would be surprised! According to data I read recently in (Forbes.com), 52% of Americans continue to spend more than they make. In fact, for every dollar that the average American earns, he or she spends $1.33! I can’t imagine all of those people feeling as low as I had felt! Anyone who is ready for a change can follow the same system that helped me all those years ago.
My first step was to create a budget. Please note that I did not say, I WANTED to create a budget, but rather that I HAD to create a budget. Over the years, you would not believe how many bubbles I have burst by telling people that in order to control their money, they have to control themselves, aka create and stay true to a budget. This is a huge step in financial freedom, and one I will spend quite a bit on in the future. Part of creating our budget was to track our monthly expenses. I soon learned that you cannot even begin to manage money until you know how much you’re spending and where you are spending it. This involved tracking all our bills and expenditures and carefully recording where our dollars went. It took several months to get on track with our budget and we failed many times. I quickly realized that even when we failed, we were spending less than we did before we put ourselves on a budget. It takes at least 90 days to even get close to making a budget work correctly. You forget certain expenses and you always try to squeeze too much out of a dollar.
In the beginning of our budgeting days, we fell down and got a lot of bruises. A budget is like riding a bike – it takes practice. The more you ride the bike the easier it becomes. The longer you live on a budget the easier it will be to maintain. So many people feel a budget is “too restricting.” They fear they will have to survive on “bread and water” and give up “having fun” in life. But that is not true at all. A budget is just a plan. It simply puts you in control of your money, rather than having your money control you. People assume that it takes the excitement out of life, but in essence, it does the opposite by eliminating stress and conflict and allowing spending to be enjoyed guilt-free. You can create a budget that allows you to eat filet mignon every day as long as you plan for it!
My wife and I have been working from a budget for six years now. It only takes me about 10 minutes a month to get our budget set. I can practically do it blindfolded. I’ve read multiple books and paid for a variety of software and apps to get our budget under control. If you will join me on my journey, I will share my mistakes with you so you don’t have to make the same ones. I’ll also let you in on the secrets of which software and apps are worth your money. There is so much freedom in being in control of your money. Once you get the hang of it, you won’t have to stress about money ever again. In just a few years of making the decision to actively organize and manage our finances, my wife and I are down to the last of our debt, which is around $4,000, plus our mortgage. But the relief from daily stress, the sense of empowerment, and the strong teamwork in our family are worth even more.