In case you missed it, I posted a question on my facebook page tonight asking people what they wanted me to write about. A fairly common theme in the questions related to finances, and how I budget my money.
Let me explain.
For the majority of my adult life, starting in college, I was always broke. I didn't manage my money well at all. If I had it, I spent it - because that's what you do with money, right?
There were a few years, before I got married the first time, when I was somewhat responsible with money. I didn't have anything in savings, but my bills were getting paid and I could go out and buy stuff whenever I wanted to, but that was about it.
Throughout my first marriage, we struggled. The kids came quickly, and so did the expenses. We lived beyond our means, and it was hard to catch up when we fell behind. I have always been incredibly anal when it comes to balancing a checkbook and so ours was always balanced TO THE PENNY - which saved our asses when we had to live for 2 weeks with 38 cents in the checking account. But, I knew that nothing was going to bounce because we had that 38 cent cushion.
Fast forward through a couple more kids and two divorces. I wasn't working, but I still had bills. I sold anything that I owned in order to pay the utilities. I had payment arrangements out the wazoo in order to keep the bill collectors at bay. It was survival of the fittest to the nth degree - but we had food and we managed to survive.
And then my second ex-husband unexpectedly passed away. Through the fog immediately following his death, I was instructed to contact Social Security about benefits for Daniel....and I found out that we both qualified. We were within days of being homeless when we received our first checks - I hesitantly deposited them and paid our rent for the following month, and then sat down with the bills.
With that money, I was able to pay our bills. I was able to pay the rent and the utilities and buy a newer, more dependable van. I contacted anyone that I owed money to and set up payment arrangements and got everything paid off (eventually).
Now, a few years later....I have a system. As I get the bills, they get jotted down in my datebook. Just an abbreviation for the bill itself, and the amount due on the due date. That way, everything is laid out in front of me. Then, when we get our Social Security (towards the end of the month), I sit down and I pay every. single. bill. for the month. I write checks for what I have to and pay the rest online, but after about an hour or so, everything is paid. It's done. And what I have left is what I have left. With that money, I can go to the grocery store or whatever else I need, but I know that whatever is leftover is it.
Most of the time, what I have left has to last for 4 weeks, but every few months it turns into 5 weeks (we get our payments on the 4th Wednesday of the month) so sometimes things get a little tight on the 5 week months - but I've kind of gotten used to that. I balance the checkbooks every few days, and then I average it out to see how much money I have left "per day" until the next payment comes in - I have a dollar amount that I am comfortable with, and if I go below that amount, then I know that I have to reign in the spending a bit.
I got lucky this year and I ended up getting a much bigger tax refund than I had expected (thank you, full-time crappy job) and that helped immensely - it all went into the savings to use for unexpected house expenses and whatnot. Any "extra" money that I get goes into the savings - I can still access it, but it takes a little bit of effort because I have to actually transfer it before I can get to it to spend it. If I happen to get any "extra" money - it goes into the savings also. At this point, the savings is strictly earmarked for house and TMOART:14 expenses (if you don't know what that is, you'll have to stick around to find out). And for the first time in my adult life, I am actually looking into investing in some CDs in order to stash some cash just a *little* bit farther out of reach, without being totally unobtainable in the event of an emergency.
In a nutshell, that is my budgeting strategy. It works for us, but it may not work for anyone else. I still struggle with the idea that my bills get paid because my ex-husband died, but at the same time I constantly remind myself that "it is what it is" - and I make sure that I make the best possible financial choices that I can for my family.