Budgeting

Starting our Debt Free Journey…Again

Budgeting. It’s that time for us. After purchasing our first home in June of 2015 we racked up some serious debt. Yes, we knew better. We had gone through Financial Peace and eliminated virtually all of our $20,000 in consumer debt. Even after all of that penny pinching we blew the budget up…like, it went nuclear. We moved from an apartment that was barely 1000 square feet into our lovely single family home and it was BARE. It was empty; we had one couch and no kitchen table and the walls were bare. So we did what any sane person would do….we opened quite a few lines of credit to spruce the place up a bit. That’s what people do right?
 
We got the house all bedazzled. We bought enough furniture for the family room, kitchen, dining room, school room, the master bedroom and my daughter’s bedroom. We also dressed up the yard, put hardwood flooring in, and got the house painted. There were many shopping trips to fill up our home with STUFF.
 
Well, apparently, that added up. It added up a lot. It added up to the tune of $57,000 big ones. Yes, you read that right. So now that we’ve dug ourselves very very deep into consumer debt we have to dig ourselves out….again.
 
I wanted to share with you how we do this. We did take the Financial Peace classes, but we don’t do it exactly as he’s laid it out. First off we have an extremely detailed and intuitive budgeting program that my husband put together. Other budgeting software and printouts were not working for us at all. Yes, we could allocate all of our money and tell it where to go, but we couldn’t see what our actions today were doing in the future. So my wonderfully tech-savvy husband painstakingly wrote a program for us. This helps us to see if we put extra money towards something now, if it will have positive or negative repercussions down the road. It also calculates all changes automatically, tells us how much extra we have at the end of the month after each change we make, automatically shows us when things will be paid off, and much more.
 
We took a while to get all of our newfound debt in the budget properly and all of our new expenses with the house. When we got all of our financial pieces pulled together we sat down and went over EVERYTHING with a fine toothed comb. What we found was jaw dropping. Even though we were previously frugal and saving like crazy, we are now at a place where we are spending more than we make! Big no-no!
 
Here’s a little bit of our plan. First, for the month of June, there’s nothing we can do. We were in the red to the tune of over $1000. That sucks. We had to move some things around and quick! I am pushing out my hair appointment until July, we’re paying our HOA fees late and my car is going to have to sit in the garage for a little while because we can’t pay for the registration this month.
 
After we pushed everything out to a happy place where we wouldn’t get in trouble, but we could actually afford it better, we started to look at what we still had to pay even though we technically didn’t have any money for. We went to the credit cards for those. I know, I know….credit cards are big no-no’s, but we have no other choice for the month of June. That being said, we are paying far more than the minimum balance on the cards and are technically paying off way more on them than we are spending with them this month. So, that’s a step in the right direction at least.
 
We paid for pretty much everything that is not already scheduled as an automatic payment coming out of our main bank account on credit. That includes my BLS/CPR renewal that I HAVE to complete for work, food, gas, etc. Once we did that our budget squeaked into the black, by about $16. Score.
 
We’re participating in the community garage sale next weekend to hopefully squeak out a little more cash to pay for my daughter’s glasses. Don’t worry, she has a pair from last year that’ll do if the sale is a total bust, but it’s worth a shot.
 
Thankfully my husband gets a bonus from his company in July, which we can use to fund our emergency fund, which is currently at zero, and pay off at least one or two of the credit cards so that we can breathe enough to not have to use them. Another big part of our plan to get us to a good place over the summer is me picking up extra shifts at work. I work 2 shifts each week at a hospital, so I can pick up one full shift each week and one partial shift which will almost double my income. Since its summer I imagine it won’t be too hard to get people to part with their shifts. In fact, I posted an email today offering 6 full shifts and 3 of them have been scooped up already! That gives me hope that by the time I need to go back to part-time to homeschool our daughter we should be in a slightly better place financially.
 
Our goal by the end of summer is to not use the credit cards to spend more than we earn and have a few of them paid off as well.
 
I put together a big list of 51 free things we can do as a family here in the Denver area. That way we don’t feel like we’re losing out on too much by scaling back significantly. I also crunched our food budget down to $400 per month. That may not seem like a food budget crunch to many, but it is for us since I love to play with new ingredients and supplements regularly. We don’t have too many discount grocery stores in our area either, so that doesn’t help. I’ll share my list of free activities on this blog and I’ll post some meal planning and food hauls on my YouTube channel.
 
Please leave any debt busting tips below in the comments!

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