Sunday, August 21, 2011

Anatomy of a Road Trip Budget

My husband and I deeply enjoy driving. The "road trip" was somehow built into the core of our relationship, and travelling is something we've always done.

As much as I wish our road trips were always to exotic or adventurous locations, for the most part they seem to be visits back to where our siblings and parents live, or to visit friends that have been posted across the country. With gas prices increasing, we've shied away from taking a lot of trips for "us," and instead we tie our love for travel into knocking off visits to loved ones. (I know the "knocking off" part sounds unloving, but there's quite a few of them spread across cities, provinces and countries. We have to be deliberate to fit them all in.)

The financial approach to the road trip has varied a lot over the past few years, but we've seemed to develop a system we're both pleased with. Here's the steps we took last trip to keep the budget in check:

1) Apply the food budget from the days we'll be away to the trip.
Of our withdraw of $350 twice/month for food, transportation and incidentals, a good chunk will go to the grocery jar. If we will be away for five days, we will then take out the equivalent of 5 days worth of groceries and put it towards food for the trip. The same goes for gas. If we end up eating out a bit with family, or driving from person to person to person, we'll spend more away than we would at home for those 5 days worth. That extra money will come from our kitty, which is point 2.

2) Use the kitty.
We set aside a portion of each pay to a specific bank account that covers our miscellany. Basically the things that come out of it are clothing, gifts, and smaller-scale trips. One rule of the kitty is that we have a discussion before we dip into it, and we both try to keep it rare. Once it's gone, it's gone, and if the account ever got to 0 we'd be stuck with very little flex until we built it up again. So we try to make sure that doesn't happen.

3) Plan expenditures ahead of time.
The town we live in is teeny-tiny, with very little "shopping" to speak of. So whenever we go away, we generally end up picking up a thing or two we've been putting off for a trip. Those items are discussed, and a tentative number is settled on for how much we will actually be spending. Sometimes, of course, that number will be off, but for us actually sitting down and looking at a schedule of days can give us a pretty good budget idea.

4) Eat in when possible.
The easiest way to lose control of the budget is to eat out a lot. Again, with a small town, things like ethnic foods and high-end restaurants are hard to come by, so it's a big temptation when we're away. We tend to save the trips out for celebrations with friends and family. (This past trip we celebrated our 4 year wedding anniversary at the place we got married. Some things are hard to put a price on.)

Mostly, it comes down to planning, and being honest about numbers. The more you know ahead of time about where you'll be and what you'll get up to, the more firm and realistic a budget you can produce!

Saturday, August 13, 2011

Just visiting

Today, my very first guest post at a friend's blog was published. It was kind of exciting to write about something non-financially related for a change, and while I was nervous, the very candid author reassured me that, "If I had thought you'd suck at it I wouldn't have asked you." It actually helped a lot.

When I started blogging, I felt like having a topic would keep me grounded and focused, and it's a practical enough subject that life-examples and posts will constantly come up in my life. I ALSO think it's something that not enough people talk about openly. We could all save ourselves and loved ones a lot of heartache if we just talked with candour about those hard-to-talk-about subjects, like personal finances. That's just my opinion.

Lately though, I've had situations in my life that aren't financial in nature, that I have the desire to write about. It's been on my mind if maybe I should explore some unchartered writing territory.

Whether or not I leave the financial district or not, I want to say a sincere and heart felt "thank you" to everyone that's read along with my blog, stuck it out, and cheered me on. You guys pretty much rock.

Friday, August 12, 2011

How we keep all these kids in clothes without losing our shirts: Part 2

Lindsey continues her series on affording to live on a single income with a full brood of little ones. Some of her do-nots surprised me.

Her conclusion is the epitome of "the hardest simple, straightforward fact about money." So tough. So true.

Thank you Linds!


You might not be so surprised at the tips in Part 1 of this post, as any financial website would likely give you similar advice. Surprisingly though, the money gurus suggest some things that I won’t do:

  1. Have a budget. I have an Excel spreadsheet that I use to keep track of our expenses month by month – more to see our progress. But I don’t allot a certain amount of money for each item. That’s very constricting and it causes me to obsess.
  2. Clip coupons. At least, not regularly. I don’t price match either. See point #1, the obsession part.
  3. Give up our lives. Entertainment is an essential part of anyone’s life, and we don’t cut it out just to save money. We do activities on the cheap (like, we don’t pay theme park admissions when we know the kids would have just as much fun at the park up the street) and dine at kids-eat-free places and go to events where admission’s free, but we do still get out quite often.
  4. Always pay the lowest price. I used to be that guy who would drive ten extra kilometres to save an extra fifty cents, but now I realize that my time is valuable too. I’d pay 50 cents to not have to haul three kids to another store. (The dollar value I now place on my time is what eventually stopped me from cloth diapering, too.)
  5. Worry. At least I try not to. I find that the more I worry about money, the more we spend. We recently had to replace the lawnmower and dishwasher, two unexpected expenses that made the bank account look kinda sad. This is where trusting God to provide for us comes in – the money is always replenished somehow and we make it through to the next month.

At the end of the day, raising a brood on a single income successfully depends on your priorities. If you want to make it work, you will do what it takes to not go into debt. It’s not always easy and sometimes I do want that cool thing that the neighbours have. But that thing hasn’t yet been worth going into debt over.

Tuesday, August 9, 2011

How we keep all these kids in clothes without losing our shirts: Part 1

I am pretty fortunate in my life to have a few friends who know what they're doing with money. Usually my hubby plays my go-to example of financial smarts, but hearing and seeing DIFFERENT ways of making things work thrills me. Best of all it makes us look over how we do things, and starts discussion on what we can sharpen and improve.

I have a real-life-and-bloggy friend who is fabulous, and who has agreed to share her perspective with us. In two parts she'll describe how her large and growing family keeps themselves fed and debt free. I hope you enjoy reading as much as I did!

How we keep all these kids in clothes without losing our shirts: Part 1

Last fall I posted here and here about ways our family saves money. Ally’s asked me for a more indepth look at what our family does do be able to support (soon-to-be) six people on one income, without going into debt.

We’re a military family and my husband is the sole breadwinner in the house. Our kids are 4, 2 and 13 months, and Numero Quattro will be making her arrival in October. (Yes, I’m busy.) Before we even married we discussed that I’d do the SAHM thing – it’s very important to us to raise our own kids. And we really couldn’t afford childcare for four of them anyway.

We’re completely debt-free and I’m pretty proud of that – particularly because when we married we were swimming in it. We both had student loans and hubs had a car payment, to the tune of over $25K owing altogether. I didn’t sleep well at night.

Two deployments (which bring in extra cash) and a tight fist around the purse strings is what got us into the black, even amid a stack of babies. Here’s how we do it:

1.Tithe. Yup, it’s 10% of hubs’ gross income that goes right back to God – that’s a few hundred dollars monthly that people usually can’t believe we donate. And it keeps us from wanting, as promised in the Bible. Malachi 3:10 says

“Bring all the tithes into the storehouse so there will be enough food in my Temple. If you do,” says the Lord, “I will open the windows of heaven for you. I will pour out a blessing so great you won’t have enough room to take it in! Try it! Put me to the test!”

I’m not gonna not tithe after reading that. It’s always worked for us, and I don’t dare stop.

2. Buy used. Wherever possible. (I think this is becoming trendy now. Upcycling, right?) We don’t have designer furniture and clothes and housewares, primarily because we have a pile of little kids running around trying to break stuff. They don’t care if their clothes and toys are hand-me-downs or secondhand – they’re still new to them. I buy my clothes and household stuff used where I can too – we’ve gotten some excellent deals on nearly-new furniture, appliances, toys – you name it. We swap with friends and neighbours and donate or sell what we don’t need, using the proceeds to buy the kids’ “new” toys.

3. Go without. This sounds like deprivation, but to me it means to do without the material crap that fills our house and electronics that keep us “connected” 24/7. We did a lot of self-denial when we were first married, and I don’t really miss the things we don’t have. We still don’t have a second vehicle, a boat or camper, cellphones, a big-screen TV, or even a satellite dish. (People ask me what analogue cable is, like I’m fifty years old or something. Seriously?) On Twitter last week someone was shocked that I’m even alive without a cellphone. Yes, it’s possible.

4. Do what’s free. When I owned a business I taught myself basic HTML so I wouldn’t have to pay for a full website design. (Please no one ask me for design help – I’m still awful at it!) I make some of my daughter’s clothes and I do my own hemming, auto and small appliance repair where I can (I’ll have to post one day about ordering parts for a gas dryer), and I cloth diapered for over three years – anything we can do for ourselves saves us paying someone for it.

5. Put up the money where it’s required. The cheapest item isn’t always the one you should be buying. Batteries and cling wrap are good examples – the dollar store ones just aren’t as good. We don’t scrimp on household appliances and kitchen stuff, shoes or healthcare stuff (i.e. dentist/glasses/prescriptions if we need them). “Middle-of-the-road” is a good rule to follow for this stuff. We also buy a CSA, which is far more expensive than grocery store veggies but the quality and experience it grants us is worth it.

Basically, we only spend money where we have to. The first step in balancing a budget between six people is to clearly differentiate between needs and wants, and divide the fun money equally between us all.

Check back for the second part of this post, where I will share the top 5 expert-recommended things I won’t do when it comes to handling our big family’s finances.