If you don’t regularly review where your money is going, now is a great time to look things over and reevaluate — before the holidays and new year hit. I am in charge of keeping our family budget and paying bills. I usually look over our accounts once or twice a month, but sometimes let a couple of months slip by without peering very closely at things like credit card charges. Then, when I circle back with my fine-tooth comb and magnifying glass, I discover a subscription charge I thought had been canceled or confirm the suspicion I had been ignoring — yes, in fact, we have been spending too much on fun groceries and treats.
I’m no financial guru, but I do know how easy it is to spend more than you make. Here’s how I look over our spending to make sure we are living within our means.
1
TAKE AN OVERALL LOOK
As a first overall pass, I check how much money we are spending on different categories—housing, utilities, insurance, groceries, vehicle-related expenses, entertainment, gift-giving, tithing, saving, etc. I pay attention to the pieces of the whole and see if any piece seems disproportionately large or if one piece has grown significantly over the last several months. If it has, say we’re spending more on gas, I look to see if we need to change the amount we are budgeting or change how we are using our car. This often means looking at the big picture of our whole budget again. We generally aim to commit 50% of our income towards needs, 20% towards wants and 30% towards giving and saving.
2
CHECK FOR UNNECCESARY CHARGES
Next, I look for unnecessary charges and accidental subscriptions. Getting rid of those is satisfying and makes for an easy win. “Hey, look at how much progress I’ve made battening down those budget hatches!
3
IDENTIFY SPENDING PATTERNS
Then I find our patterns in spending. I’m trying to locate where we may have started overspending and why. If we are suddenly accruing lots of charges at the hardware store, maybe we need to get a better handle on our home upkeep projects and decide what is important to do when. Or maybe we’ve started getting fast food more often and need to figure out a better way to plan for the days Taco Bell seems to be the easiest option.
4
MAKE A “CUT BACK” PLAN
Once I have noticed patterns it is easier to resolve to cut back on superfluous spending. Instead of just telling myself, “Ok, we need to stop getting fast food” I can say, “I’ve noticed we have been eating out on the weekends more. We often have more going on, and don’t want to spend much time in the kitchen. What are some quick and easy meals that travel well?” I can then focus on meal planning better for the weekend and add those ingredients to the grocery list to help our budget (and our overall health!).
Previously, I have noticed a category of overspending and thought that just avoiding those purchases was enough to fix the problem. It turns out that making a concrete plan to help solve the root of the problem has the potential to actually decrease our spending in that area.
In our desire to live better within our means, we have made many lifestyle changes over the years (particularly after reading this book). We have figured out how to live with one car rather than two. We’ve significantly decreased going out to eat and fancy coffee treats or bakery treats–and have added in regularly scheduled meatless meals. We’ve been surprised at how much our library has to offer in the entertainment department and have cut back on entertainment subscriptions. Everyone’s situation, life experience, income, etc. is different, so the specifics of cutting back superfluous spending will not look the same in two people’s lives.
Let’s face it, the desire to acquire and possess is pretty universal—and dangerous to our spiritual lives as well as our financial goals and stability. Come Holy Spirit, shed light on our finances! Happy budgeting!
And today we celebrate...