Budget Series: Our Budget

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To set the stage for our get out of debt plan, I want to show you our monthly budget over the past 2 years. 

I’m sharing private financial details in hopes that it will help encourage or inspire someone else who, like me, was feeling defeated by their budget.  I recently read a blog about getting out of debt, and the author said (something along the lines of), “I wish it were socially acceptable for me to give you our actual budget and income to encourage you, but it’s not.”  Well, I’m not concerned with socially acceptable.  My husband and I have talked about it, and while we do pray that the response will be as kind as possible, it’s worth the risk for us if it can inspire someone else.

I also have to preface our budget with this:  My family is not deprived, and we are very happy :)

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With all that said, here is our initial budget, paying only the minimums on debt, except where noted (the one that looked hopeless for debt reduction):

Total Monthly Income (after tithes, offerings, and required payroll deductions): $2,013

Voluntary Payroll Deductions (money we never see)
Deferred Comp 457: $100/month
Dental Insurance: $38.30

Monthly Bills:
Mortgage ($22 extra/month): $591
Auto Insurance: $157
Electric: $175
Water: $30
Direct TV: $70
House Phone: $15.41
Cellphones: $50
Student Loan #1: $100
Student Loan #2: $192
Check Return Fee (to get copies of our checks each month) $6

Other Spending (Cash Envelopes):
Groceries/personal needs/cleaning supplies: $200
Gas: $150
Misc. Needs: $40
Spending Money (eating out, clothing, entertainment, etc.) $100

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Some notes about our spending:
Mortgage:  We were paying approximately $25/month extra from day 1, which was going to shave 5 years off our 30 year loan, and save us $10,000 in interest payments…just $25/month extra!

Electric: When I started our budget, I made our own “budget” plan with the Electric Company by averaging our bills to get an approximate monthly figure.  (I would recommend calling them first to make sure it’s okay!).   So, through the summer, when our bill should actually be $100-$125, we still pay $175, so that when we get a $400 bill in the winter, we have overage to cover it.  Yes, we could put the extra into a savings account for that purpose, but this is what works for us.  Our winter bills were killing our budget because we just didn’t have an extra $200.  Plus, it’s much easier on the budget as a whole to have a consistent monthly amount.  I did the same thing with our water bill, which also varies slightly from month to month.

Direct TV: If I were counseling someone else, this expense would be the first to go.  It’s about $780 in a year’s time, and unnecessary by my standards.  My sports fan hubby disagrees, however, so it stays.

House Phone:  We have a bare bones service.  Local calls only.  No long distance calls (we use our cells for that), no caller ID, call waiting, etc.  It’s literally local calls only. 

Cell Phones:  Chad has a cell phone for work that he can use for personal use as long as he pays for the calls, at a rate of $.10/minute.  I used to use a very simple Net 10 prepaid, limiting myself to 150 minutes/month, which was a $30/60 day card every other month.  That’s what I would recommend to someone else, but my mom was kind enough to offer to add me to her plan, so for only $5 more per month, I can talk more and have a really cool phone :)  This comes in handy for Chad to call his family, who are spread out all over.

Deferred Comp: This is something that my hubby has always been adamant about continuing, and to be honest, I had forgotten about it, since it comes straight out of his check, pre-taxes, and we never see it.

Spending Money: Our spending money seems like a lot, but it includes many things, like clothing, activities and entertainment for the boys and our family, eating out, etc.  Rather than separating it all out, I just lump some things together.  Also, having spending money helped keep up hubby’s morale back before he was fully on board with the budget.

Misc. Household Needs:  Most of our indoor needs are included in our grocery/household budget, and this includes repair and maintenance on the house and vehicles, garden supplies, lawncare, etc.

Grocery/Household: I will be posting more in the weeks to come about ways to be frugal.  I no longer use coupons, but God is faithful and our small budget has been enough.

Gas: We are blessed in that Chad works for the state (he’s a forest ranger), drives a state vehicle and has no commute.  We’ve had to become more intentional about our driving habits, but this amount is just enough gas money each month.

Health Insurance: My boys have KCHIP.  When they started, we paid a premium of $20/month, but recent legislation has changed even that, so now we have no premium at all for their healthcare.  Chad has healthcare through the state, where they pay for the lowest plan for him.  I do not have health insurance.  Yes, we know it’s a risk, but we simply do not have an extra $300+ per month to pay for it. 

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Other topics in this series:

~Debt Discouragement
~Why Debt-free? (What the Bible says about debt)
~Our Budget (Frugality is necessary)

~Frugal Living (The Grocery Budget)
-Poor is in the attitude, not the bank account.
~Frugal Living (Saving on other expenses)
~Create Your Own Budget
~Our plan to be debt free (including our mortgage!) in about 6-7 years.

(Disclaimer: I am NOT a financial advisor. I am just a mom with a family living on a single income and I want to encourage others that it is possible to live on a tight budget and still have your needs met and be content…and get out of debt! I really hope that our personal budget information will help someone.)

Please feel free to ask any questions, and I will answer them to the best of my ability.

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