Prior to our current circumstances, my husband and I were rocking and rolling Dave Ramsey’s financial freedom budgeting system. Small backstory: We spent a lot of time in our twenties getting ourselves into debt. You know from student loans because we were supposed to go to college, to swiping credit cards because the economy tanked circa 2008-2000 forever and we were living on one income with one, then two, then three babies, and then all the unexpected medical expenses that arise with a large family and so on and so forth. We resolved that 2020 would be the year that we knocked out some serious negativity on the budgeting forefront. But as we all know, COVID-19 decided to interrupt our plans and although we are both still working, our income has taken a hit because hours just aren’t the same and the security of whether jobs will be available has diminished. On the bright side, we have learned from our twenty something selves and all things that bring on debt, like credit cards, are an absolute no-go. We are having to find ways to cut our budget and save all the dollars we can. Of course, it becomes challenging when cars decide to stop working, tires hit potholes, plumbing decides to wreak havoc, appliances go caput, or you know basically everything around the house falls apart.
Oh, and as a family of seven and the amount of food that is required to feed five kids three square meals a day as well as 13,304 snacks (I wish I was exaggerating) is more per month than our mortgage. Needless to say, we have had to come up with clever-ish ways of reducing costs and preserving income.
If you find yourself in a similar boat, let me share with you a couple of gems we have discovered.
Meal planning. This is hands down the biggest way we save on our grocery budget. You never would have convinced me that having a plan changes cost, but I’m here to tell you it does. Let me just tell you that when we go to Sam’s without a plan and with an appetite that we spend roughly two times our allotted grocery budget for a week’s worth of groceries. Then it becomes hard to make adequate meals for the week and we chow through our pantry snacks in a record breaking three days. However, when I go with a plan, I stay on budget track and the food lasts for the duration of the week. Our meal plan is a weekly calendar where we plan breakfast, lunch, dinner, and snacks for seven days. Not only is everyone happily fed but it also ensures that my mind doesn’t have to rack itself every night to pull together random ingredients to make an acceptable meal. It’s all laid out for me, the family, and the budget.
Good-bye cable. I honestly don’t know if anyone has cable any more or if there is anyone out there who’s not privy to this non-secret, but there are tons of streaming services. For as low as $5.99 a month and you can watch your favorite tv shows and movies on repeat. We are fans of Netflix (who isn’t), Disney Plus, and Hulu, or the Three Musketeers if you will. Now, most of us probably have an Amazon Prime membership and their streaming service isn’t too shabby. A lot of their shows are included with the Prime membership, but to be honest, all the good movies cost extra. Regardless all of these services together cost us a fraction of what a monthly cable bill used to and there is still nothing to watch; just like when we had cable.
Post-poning payments. This is a decision we have not taken lightly. I do not like to use absolutes, but in my experience, all companies who are postponing payments are tacking that payment onto the end of the loan. But, it does minimize the temporary financial burden of monthly bills we are experiencing. In order to do this, I had to contact each company and inquire about their COVID-19 relief programs. Some companies were as easy as asking for it, others require multiple phone calls and forms, while others automatically put our payments on forbearance after a certain period of not receiving a payment. I encourage you to check with each company to inquire about their programs in place and what that means for the long run so that you can make an informed decision if this move is right for your budget.
Say “no” to impulse purchases. In times of stress I find myself browsing for all the things I don’t need. I am an emotional shopper which also makes me an impulsive shopper. To be honest, I have had to go through many an hours of counseling to learn how to manage my habits so why not share a few coping strategies that have been helping me. For starters, ask yourself if it is a want or a need.
SPOILER ALERT: almost all online purchases are a want.
However, ‘needs’ and ‘wants’ may vary from person to person. I usually ask myself, “Can wait until an undefined later?” and if I can give it an honest “No, it can’t,” then I will proceed with my transaction. However, if it could wait but really can’t wait, then here’s a life hack for ya. Fill up your your carts with all your desires; get that impulse out and look at that total. Then, let them sit for the next several hours to the next several day; come back and see if that cost is still worth the time you are sacrificing in exchange for those dollars. When I do this, I find that I come to the conclusion all on my own that I don’t even want it mostly because my emotions are fleeting. For me, it really does satisfy that inner impulse without breaking the bank. I don’t know what a therapist would say about that, but also I am not one.
Coping mechanisms. When all else fails and it is just too much, find things that eliminate that energy and calm your mind that don’t cost a dime. For me, rage cleaning and yoga have greatly improved my mental health when shopping online seems to be the only alternative. It will take that energy and also things look better when they are clean so it resolves that need to get something that looks nice and new.
Plan. Plan for what you can. If you know expenses are coming up, save for them. This includes seasonal clothing, household items, pet care needs, birthdays, I would say haircuts, but salons are likely still closed; basically anything that seems to sneak up on you every once in a month and items you like to splurge on like random Amazon purchases or ordering out for dinner. Be strategic in where your money goes. Much like a meal plan, make a budget plan.
Set short term goals that reflect your long term ones. Of course our ultimate goal is getting out of debt, but we also know that is not going to happen this week, this month, or even this year. Even in the absence of a global pandemic, our debt will take quite some time to eliminate. So we have had to set goals that honor where we are now. Ask yourself, “what are your goals?”
Not to increase debt? Be able to pay this week’s bills? Have enough money for groceries or your mortgage? Whatever they are, write these goals down and implement a plan in order to fulfill them.
Be consistent but flexible. Making a plan is easy, executing it is the ultimate challenge. Know that you will have times where your plan doesn’t work out. Where you caved on that impulse purchase or something unexpected reared it’s ugly head. You know, where things go off course despite your best efforts.
Just breathe, reevaluate, and pick back up where you left off. Your plan is not going to be the same today as it is next week; we are all living day by day during these times and our plans need to reflect that grace while also giving ourselves the comfort of knowing that if all goes well, we have a plan.
And there you have it. Financial advice from a novice. I probably should have inserted this disclaimer sooner, but I am no Dave Ramsey and I am definitely not a money- saving- budgeting- expert. I am a middle class mom on a debt free journey who has had to make some major modifications to my spending habits in order to pay down said debt.
We are still a long way away from our long term goal. The lovely COVID-19 has pushed it back further, but in a time where we could find ourselves more in the red, we are finding ourselves managing. The credit cards are still closed, the bank accounts are not empty, and our debt is not increasing. We are calling that a win all on it’s own. Managing the unexpected without furthering debt is a valid part of a financial freedom journey. I don’t know about you, but I doubt this is the last time something unexpected will deter our paths; but with a little faith and a lotta resolve, we keep going.