on budgets

call me a nerd, but every month i look forward to putting together our household budget.  ever since our class created a stock market team in 8th grade (erin!), i've loved all things related to investing and finance.  there is still part of me that would love to be a financial advisor, but i need to get a few more gray hairs before people will take my advice seriously.

i love reading about how other people budget.  i don't think there is a right or wrong way--what works for some couples doesn't work for others.  many young couples i know operate on a cash or envelope system and it works well for them.  james and i are not disciplined enough and too impulsive to do this.  if it is may 25th and we want to have steaks over the weekend, yet we don't have much "grocery money" left, we still buy steaks.  if our friends invite us bowling and we've exhausted our monthly "entertainment allowance," we still go bowling.  you get the idea...

instead of a strict budget, we have more of a budget "goal."  at the end of each month we reactively track our expenses and classify them accordingly to measure performance.  for us this is less restrictive and fits our lifestyle.  during the month we try to live frugally, but we don't change our actions because one bucket of the budget is empty.  post-spending tracking gives flexibility with variable costs (like the price of gas) and yields freedom.

sidenote #1: we are not anti-credit cards.  i agree with most of dave ramsey's advice, but credit cards can be a very useful and profitable financial tool if used properly.  we have a capital one card (with a personal photo on it, ha) that earns a $50 walmart gift card every other month on average.  by using our credit card on expenses, we get $300 worth of gift cards a year!  there is no annual fee with the card and we make sure to pay it off fully every month.   

sidenote #2: we love automatic withdrawal options.  all of our utility bills, car insurance premiums, mortages, cable bills, even our tithes at church are automatically taken out every month (i can't decide if i like this last one, though.  our church encourages people to give by direct deposit, but sometimes it seems to lose part of the heart of giving.  however, the accountability of having it taken out every month and the heart of that decision to set it almost makes up for it).

we also automatically transfer money to parker's college fund and savings fund.  we just switched his savings fund into a mutual fund because we were sick of getting minimal interest at the bank.  any time he gets gifts for his birthday we put it directly in one of these accounts and enjoy watching them grow (oh and our names are listed as the account holders even though they are for parker--better for financial aid later in life!) 

phew.  this is getting long and i haven't even listed our budget categories.  hopefully more on that later, although i'm not sure anyone is really interested in this topic or cares.  james and i are by no means experts, but we've found a good system that works for us.  and i can't do a post without a couple of pictures of parks...he can now open doors!  ahh this was a scary day when he realized he is tall enough to reach the handles.  and i love the next pic of him, even though i have no idea whose legs are behind him (at his friend abree's 1st birthday party some of her relatives were playing with parker).  so cute!

g'nite yall. sweet dreams!