Tuesday, June 30, 2015

The "B" Word

Every once in a while (okay, sometimes more often than others), I get to dreaming about the day I can leave my "real job" to stay home and raise our (future) kids.  In order to get there though, Alex and I have to come to a place where we are financially prepared to live on just one income.  We have been "practicing" since we were married, having my paycheck deposited straight into our savings account, and his into the checking.  But if we're being honest here, there are seasons with more birthdays, holidays, or special circumstances that make that paycheck stretch a little thinner than I'd like.
Certainly there are some places we could really cut back on expenses - that $200 cable bill, for one (and we only have cable in 1.5 rooms of our house!).  We feel pretty comfortable with our savings account, insurance coverage, and investments, but we still aren't quite comfortable with taking the plunge and doing away with one income entirely.  So, when The Budget Mama asked for volunteers to review her latest book Real Life on a Budget, I jumped at the chance to hone in on some of those skills we might be lacking.

Here are a few interesting/useful concepts I took away from the book:

1 - A little inconvenience can go a long way in saving money over time.
I have been making my own laundry detergent for over a year now, and I love it.  The cost savings are amazing, and I kind of like feeling a little extra-domestic over that kind of project.  It isn't as much of a hassle as it sounds, I promise.  Next up - floor cleaner, reusable paper towels, world domination?!

2 - Be aware of all the extra "clutter" in your life.
Inbox clutter is a big one for me.  I get wayyy too much crap in my inbox and should really redirect it to some other address that I don't use regularly.  Dining out is also a type of clutter for us; since we don't have friends here, eating out once a week is our special treat to get out of the house and have a little fun.  Unfortunately, it usually leaves us yearning for more outings...more bad food...and more budget sucking.

3 - Spenders versus Savers?
We're both savers but we have a weakness for telling each other "no."  In other words, it's easy for us to avoid purchases on our own rights, but when we ask the other if it's okay to buy something, it's near impossible to stay firm in our hunches about it.  Moral of that story - we need to make an actual budget and stick to it!

4 - Half Payments, have you heard of them?
I'd never heard of such things until I read them in the book.  We're paid monthly so it's not quite set up for our pay schedules, but if we did have difficulty with living paycheck to paycheck, this could be a really good way to break that habit.

5 - 50/20/30 Framework.
Yeah, I know it sounds like the 20/20 insurance concept, but here we're talking about budgeting 50% of your expenses for essentials, 20% for your future, and 30% for your lifestyle.  This is one budgeting system that I could definitely get behind and it seems totally attainable too.  (I should probably put the pen to the paper before I commit to that statement, though.  Heh.)

Bonus - Debt snowball.
Alex and I have discussions on whether we should pay off his car (at 0% financing, attainable goal) or put a large chunk down on our house (3.375% interest, with a much larger total).  He thinks it's wiser to put money toward the house, whereas I would prefer to pay off something and have fewer debtors overall.  Jessi's theory on paying off the smaller debts first definitely makes my little heart happy, but I think I have a little more convincing to do on Alex's part.  ;)

I'm so grateful for the opportunity to get my hands on this book, and I really look forward to following more of The Budget Mama's tips as we work toward our long term goals for financial freedom.  And, if you want to get your hands on your very own copy of Real Life on a Budget, it's officially available for FREE on Amazon as of today (as of July 5th, the book will only be available for purchase)!

Happy Budgeting to ya'll!

Note:  I received an e-book version of this book in exchange for providing a review of the materials.  All opinions are my own and no additional compensation was provided.


Jen @ Into Your Will said...

We need to have our one-income chat! :) I have to say, we were never at a place financially where it made sense for me to stop working, but somehow it's just all worked out. You learn what you really could live without and you're kind of forced to stick to your budget. Just throwing that out there ;) I love the 50/20/30 idea!

Anonymous said...

Wish I would have read this before! Would have went for the free copy :)

Rosie said...

So where does tithing fit into the 50/20/30 figure? In the 50% because it's essential? We've always struggled with budgeting... Dirt poor when we were first married, then had to live on two incomes to get by for years, and finally Andrew started making enough for me to stay home!

Jessi Fearon @TheBudgetMama said...

Rosie, for me I include tithing into the 30 percent because I consider it a lifestyle choice, but you can really apply it anywhere you like. :)