Budgeting: Why and How

That dreaded word: budgeting. Or if you already do it, that dreaded time of the month when you "reconcile the budget." Or in my case, the one day every 3 months when your husband wants to look at the budget and then gets overwhelmed and says that we're spending too much money. It's not easy.

So then why do it? Here's the top 5 reasons I've discovered as I've budgeted for the last 4 years.

1) Just keeping track of how you spend your money will help you spend less of it.
     Years ago when we had TV, I watched a segment on Oprah where they took a couple of families who felt like they were struggling and had them sit down with a financial expert to help them learn how to manage their finances. I remember there was one family (of four or five) who spent well over $500 a month on eating out/convenience store foods. A MONTH! And the family had no clue. When they realized they were spending that much money in this area, they definitely saw it was a problem.

     So I promise you that just looking at HOW you spend your money will help you spend less of it in areas. You'll be more conscious of where your money is going instead of just whipping out the credit card and not giving it another thought.

2) Knowing how much money you MUST have to live on, as in your most basic needs and bills, is one of the most important things you can do for emergency preparedness.

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      No one plans on losing a job, but for many Americans in the last 5 years, it has happened. If you don't have a financial reserve and don't even know how much money you need a month to keep your home, power, heat, etc., then you're taking away your peace of mind in a situation like that. It would inevitably take some time to find another job and you need to know exactly how much you need to survive on during that time frame.

       The best rule of thumb is to have enough financial reserve (that means savings in the bank) to last you through AT LEAST 4 months of no income. So if you know you need at least $1200 a month to cover your bills, mortgage payment, and groceries, you will need to have $4800 in the bank MINIMUM at all times. Having a food storage could help you decrease this amount since you'd be living off most of that (for my tips on food storage, click here).


3) It isn't always depressing; sometimes it's quite rewarding. It can help you reach your short-term and long-term goals, keeping you from spending your money on things that don't really make you happy.
       In our first few years of marriage, my hubby and I would get flack from family and friends that we were penny pinchers. For instance, we lived with hand-me-down furniture, we didn't travel very much, and we tried to be frugal in all areas. To some people, it looked like we were depriving ourselves. But to us, we knew that our first priority was to be out of debt and then save money to buy a house. We were very blessed that my hubby found a permanent job even before he graduated from college and we lived in our two-bedroom apartment for another two and a half years instead of rushing out to buy a house (when people were encouraging us to buy because interest rates and the housing market were dropping).

       Because of our patience, when we bought a house in June 2009, we not only were able to afford a nicer house than the year before but we also had a good down payment (and we were lucky that interest rates and the market had dropped even more). I cannot tell you how rewarding that has been. Because we had budgeted, scrimped, and saved, we were able to reach our long-term goal. Yes, budgeting can be very rewarding.


4) It can help you get out of debt faster, which only improves your credit score and sense of freedom.

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       I have a sister who can attest to this. For various reasons, they have been in and out of debt (and I'm talking about debt other than your mortgage and car debt) for many years. It wasn't until they created a budget and followed Dave Ramsey's snowball debt plan that they were able to get out of debt.

And those debts can feel like they're looming over you day in and out. Knowing that there are many debts to be paid if you lose your source of income is disconcerting. There is a definite sense of accomplishment and freedom that comes when you get out of unnecessary debt.


5) It is empowering to take charge of your money and change bad habits.
       It is empowering to know exactly how much money you spend and save each month. It is empowering to change bad habits and see your money increase in the areas you want. And it is empowering to reach financial goals. I wouldn't say that budgeting has made me some financial expert or even necessarily good at spending my money. But it gives me a sense of peace and comfort that I know the specifics of our finances. I know where my money is going. I am prepared financially in case of emergency. And I am reaching short-term and long-term financial goals.

 
The How of Budgeting
So now that I've hopefully convinced you why you should have a budget, the question is: how do I create a budget?

The answer to that is how it will work best for you personally. You can make it as easy or as hard as you want it to be. You can make it as detailed or general as you want it. Just know that however you do it, you want to have a way to be accountable to yourself.

You don't have to start from scratch either. Here are 2 budget templates that you can start from:

Family Budget
Monthly Household Budget

The reasons I like these budgets is because 1) They give you a place to estimate costs (we'll talk about that in a second) and 2) They give you a place to put actual costs and 3) Then they show you the difference. Not all of their categories might apply to you and you can simply delete them from your Excel spreadsheet.

Now how do you come up with those estimate costs the first time around? My advice would be to round up the last 2 months of bills/receipts and then use those to estimate. Granted, if you're not on a set payment plan for things such as power and gas bills, you may need to look over the last year and put varying amounts on each month. When it's a new month, you simply add another page to your spreadsheet with that month and year labeled.

If you've never saved bills/receipts then simply guess. BUT THEN start saving them the next couple of months. You'll need them for not only adding them up and putting them in your spreadsheet, but it will help you know how much to budget for in each area. If you hate saving little receipts, then pull out your credit card bills when they come and enter the amounts into your budget all at once.

My system to recording receipts

Since I am a little OCD, I save every little receipt and bill and faithfully enter it into my budget each month. I like to enter them in throughout the month so that I know if I'm running out of entertainment budget or grocery budget so that I've refrain from either until the next month. It helps keep me on track of where I want to be. The picture above shows my two drawers next to my computer monitor that I use for these receipts. "Need to be recorded" is where I put receipts until I have a chance to enter them into my budget. "Recorded" is where they go after I've entered them in. Then at the end of the month, I rubber band all the receipts and file them away for a couple of months just in case I need them for returns.

Where I put all my bills/other papers until I file them away.

Sometimes it's tricky to separate categories. For instance, I do most of my shopping at Wal-Mart since it's one of the only stores in my city. But the things I buy there could fall under multiple budgeting items (groceries and miscellaneous and gifts all on the same receipt). Again, since I'm a little OCD, I break them up on the receipt and put them under their respective areas. Or you can just limit your categories so you can put that receipt under one area.

Don't get frustrated or hung up on the logistics. The main point is that you're trying and you're keeping track of how much money is coming in and how much is going out.

In my budget, I also have our total savings broken up into different categories. So we might have $5000 in savings, but under the savings section of my budget, I have different categories for long-term goals or non-monthly purchases that don't really fit under my monthly budget. To give you a better idea, these are our categories:

Emergency fund (that we always keep a minimum amount in that we've decided upon),
Auto maintenance
Home improvement (someday we hope to have enough here to finish our basement)
Gardening (my husband is a big gardener)
Vacations (Glad I have this budget or we'd never go on vacations! My hubby isn't a huge traveler)
Clothing
Gifts (Birthday, Christmas, Baby showers, etc.)
Insurance
Preparedness
Service
Miscellaneous (AKA anything that doesn't fit in the monthly budget or the above listed categories)

So when we want to do home improvements, we look at our home improvement savings and see if we can afford what we want to do. I have our budget set up so that it will take our income, minus all our monthly expenses and then split the remaining amount (the money we put in our savings that month) into the different categories (you can do this either by percentage or set amount). Then I put in what we spent that month under these areas and carry each end-of-the-month total into the next month's budget of my spreadsheet.

The reason I do all of this is so we don't just blow all our savings at once, without thinking what we may need it for in the future. I want to make sure that when it comes time to pay insurance twice a year, we have enough for it. But I also want to make sure that I'm saving money to spend on my short-term and long-term goals as well.

Oh boy, I hope I haven't lost you all by now. If you're mind is swirling and you just want a copy of my spreadsheet (with all of our amounts deleted of course), just let me know. You can e-mail me at sweepsalot@gmail.com (for all those who know my personal e-mail address, you can send it there too).

I hope that these tips help you create your own budget and take control of your finances if you haven't already done so. I promise it's worth it!

Don't Forget What Easter is Really About!

Am I the only mom who realized on Friday that she hadn't really planned what the Easter Bunny was giving her child? Oops. To make it even worse, in our house we have the Easter Bunny come on Saturday so that we can focus on the true meaning of Easter on Sunday: Celebrating the resurrection of Jesus Christ and what it means for us.

So I wish I could say that I spaced the Easter basket all week because I was too focused on what Easter is really about, but that's not exactly true either. So Friday night, I decided to shape up, get that Easter basket in order, and then focus more on the Savior.

But no matter what day you ask me, I will bear testimony of this truth: Jesus Christ really did live and die for us. He atoned for our sins, died on the cross, and then was resurrected the 3rd day. And I will eternally be grateful for this. Not only can I be forgiven of my sins through the Atonement, but I can also be resurrected at the last day, along with every other being who has ever lived. Because of Jesus Christ, I have the knowledge that I will live again and the hope that I can live again forever with my family. I know this is true.

Pinmimic: Pillowcase Dress

This pillowcase dress came from LBG Studio and it has two different versions. Maybe I'm totally bias, but I think my version is better. Just because that flower print is my favorite fabric of all time. That I've found so far at least. :)

The funniest part is I made this over a year and a half ago, just because. I didn't have a girl and it turned out so darn cute that I couldn't bear to give it away. So I've saved it. Now that I know that I'm pregnant with a girl, I'm excited to know it will be used... in another 2 years when it fits her. Hopefully it will still be adorable then!

I made my own bias tape so it took a little more time, but if you don't, you can definitely sew this dress as a beginner. Believe me, it's actually not as hard as it looks. And it's worth it, don't you think?

For the original pin and instructions on how to make this cute little dress, click here (if you click on it in Pinterest, it will have a pop up that says there's inappropriate content on the website. That is untrue so click "continue to link").

My Design Work and My Talented Sis-In-Law

I was a busy woman the last couple of weeks. I've been working on a project that I've been excited to share with all of you!

If you don't know it already, my sister-in-law Deborah is a writer. And I'm her book designer and one of her editors. She published her first book, The Gifted, in March 2011. At the end of this month, she is publishing her sequel, The Betrayed. So without further ado, here are both book covers (and backs):

Two and a half years ago, Deborah entered The Gifted into the Amazon writing competition and made it as a finalist. She made it to the top 100 books! So you know it's good. And honestly, her sequel would have won if she had entered it into the contest this last year (but I'm pretty sure they don't accept sequels). I'm proud of her. Writing a novel is on my bucket list, but she has already written and published two!

I recommend both books to anyone who is interested in YA Fantasy. I really liked the sequel especially (which comes out in less than 2 weeks so you have time to read the first one before it does!).

To order books or to at least check out Deborah's author website, click here.

This is the kind of design I love doing. I wish that I could say I made the brushes used on the book cover, but I didn't. It's a goal of mine to learn how. But, I love designing and I enjoy editing so these two books were the projects for me! And now after who knows how many hours, I will have TWO books on my bookshelf that I have been a part of. Thank you Deborah for giving me the opportunity and for always telling me that I'm awesome. :)

Pintest: Homemade Laundry Soap

So I resisted Pinterest for a long time. I didn't want to get into anything that would be obsessive (knowing my personal tendencies) and so I just avoided it. Then I got really sick of hearing, "Did you see the pin..." or "I got it off Pinterest." So I gave into the "dark side" as my husband likes to think of it. I'm slowly winning him over though I think, with the help of my friend Shauna.

When I first started using Pinterest and saw some people with 5,000 pins, I thought to myself, "Holy cow. I'm never going to let myself get that obsessed." It wasn't so much that I wanted to not pin things, it was that I didn't want to pin a lot of things and then not use them or even look at them ever again. I wanted to feel like Pinterest gave me more ideas that I would actually INCORPORATE into my life (so that I could justify that it was productive, right?). So my goal was to have at least 10% of my pins be ones that I accomplished and liked (under a separate board of "Pins I Will Do Again"). I was doing pretty well for awhile... but now I'm quickly becoming a hypocrite with (as of right this second) 1,519 pins and only 90 under my finished pins board. To give myself some credit though, I've tried more pins than that; the 90 are just the ones I tried and liked.

So in an attempt to motivate myself to get off my lazy pregnant duff and inspired by Jennifer at The Craft Patch (okay so I'm totally copying her), I've decided to do my own Pinterest Test Series. My posts will be either Pintests or Pinmimics (and yes I totally made up both of those words). The bonus is that if you have the same thing pinned, you can learn from my successes/failures so you do/don't have to do the same pin if it's one of your thousands!

After that super long introduction, here is my first post:

I have tried out 2 different homemade laundry detergent "recipes" from Pinterest. The first one I didn't like so much. So you can imagine my hubby's surprise when he came home one day and I'd made another homemade laundry detergent. :) What can I say, I'm persistent about trying to be frugal.

So here are the two I tried (there are a lot more recipes out there):

Now if you look at the two pins, these are almost the same recipes. But I feel like for me, the How Does She tutorial wins.

The first thing you have to remember is that neither of these detergents are "sud" detergents. Meaning, the water doesn't get all bubbly when it hits this soap so you wonder if there's something wrong. But did you know that non-sudsy soap is better for your washer? And because these don't sud, you can use them in place of HE detergents.

That was the first thing I had to get used to. The reason I stopped making the first detergent? Because I felt like it did the job, but I missed the good-smell of store-bought laundry detergents. It wasn't as if our clothes smelled bad, they just didn't smell like anything. And let's be honest, the only rewarding part of laundry is pulling out those clothes from the dryer and smelling that wonderful clean-laundry smell.

So that is why when I found the How Does She tutorial and saw that it called for Purex fabric softener crystals which smell really good (and actually help clean your clothes), I decided to try it again. And I feel like it is not only cheaper and better for my washer, but also pleases my nose as well. Besides, I agree with her friend that it looks super cute in the Purex container, which is important to me since I don't have any closed shelving in my laundry room.

The only tip I have that she doesn't mention in the tutorial (I think) is this: Mix it in the bucket outside. I did this in my kitchen and it stunk up my kitchen for 2 days. And not in a pleasant laundry smell, but an overpowering aroma.

As you look at the tutorial, you'll most likely wonder the same thing as I did: How in the heavens did she have enough patience to hand grate those bars of Zote (I used Fels Naptha instead by the way). I have no clue, but I'm lucky enough to have a food processor (one of the necessities for me when I make my own spaghetti/salsa to can). I hope you have one too if you want to try this!

Ramblings of an Imperfect Mother

(Disclaimer: I fully recognize that I have a wonderful child who I love and cherish. I would never give up being his mom for anything. Nor can anything compare with his unconditional love for me. But in my quest to keep things real on this blog, I must say the following is true.)

Being a mom can be hard. There are days where you think there is nothing else you'd rather be doing. And then there are days where you think, "I need to get the heck out of here." And I only have one child so far. I like to think that my patience capacity is just going to magically expand with each child I have because then I won't go completely out of my mind on the hard days. Please no one burst my bubble.

It would be easier if children came with a handbook. "Turn to page 14 for temper tantrums. If these ideas don't work, turn to page 18 for ideas of where you can hide before you throw a tantrum of your own."

But they don't. And really, each child is uniquely their own. What works for one, may not work for another. So you feel like you're reinventing the wheel with each child. Sometimes, it's just so refreshing to see another mother say "I have no clue what I'm doing, but this is what Heavenly Father wants me to do and I sure love my kids deep down inside."

Sometimes the only way to keep cool is to have some humor. One of my favorite mothering memories is when a friend at church had her sobbing daughter next to her, whining about one thing or another and my friend said to her, "Child, let's go find your mother." (Janelle, you always crack me up.) Sometimes you've got to laugh or otherwise you'll cry.

I don't think I've ever met a mom who isn't hard on herself or isn't thinking that she's failing as a mother in one way or another. It doesn't help when you get negative reinforcement from your kids yelling, "You're a bad mom!" or "I don't love you anymore!" every time they're upset. (My 4-year-old does both without ever being taught it). Or when you have other moms laud their superior mothering techniques or tell you what would work better for you and your child (as if they know your child better than you do). Bottom line is even those women are thinking that they'll never reach the lofty "good mom" status.

And this is why I laughed at this quote from Pinterest:

 How true is this?

What's a "good mom" anyways? I can bet that each mother's description is vastly different from the next and full of reasons why they do not fit this "good mom" category. We look at the next woman over who's sitting there in church, her children quietly paying attention to the speaker and you think, "Now there's a good mom." What you don't know is that she totally had a breakdown the day before because her 2-year-old pooped in the corner and then smeared it all over the wall, her 6-year-old cut his own hair, she yelled at her 9-year-old when he broke her favorite vase playing soccer inside, she burned dinner cleaning up the aforementioned calamities, and then she forgot to pick up her 12-year-old from a birthday party and the neighbor had to bring her home.

The worst thing you can do is compare yourself to the other moms around you. I promise you that it doesn't make you feel any better because you don't know what their life is truly like and besides, you're always comparing your weaknesses to their strengths. So when I'm at my wits end and I'm feeling like the worst mother in the world, I have to remind myself of this:

I am enough for my children. I am doing the best I can and that's all that's asked of me. I am doing the most important thing a woman can do in this world. And Heavenly Father will help me because they're His children too.

Now if only I could remember all of that when the going gets tough and I wonder, "What have I got myself into?"

Heavenly Father is Real

I love the following video from Mormon Messages. It shares the message of fatherhood -- fathers on earth and our Heavenly Father. I know that there is a God and that He is our Father. I know this because I have felt His love as I've experienced life.

Thank heavens for fathers who give so much and I am especially grateful for a Father in Heaven who has given me all that I have. And I know that I'm a daughter of God who can inherit all that He has if I stay faithful and endure to the end.