One of the things I have come to realize is that I am actually rather horrible about dealing with our family budget. This realization has come over reviewing our spending over the last 9 years.
When we arrived at New Home in 2009, we had the two older children in a relatively inexpensive private school (as private schools went) and one in a pre-K program, our housing bill was within $200 of what we pay now, and I was making $10,000 less than what I made before I got laid off. It felt like - felt like - we were making it fine.
Fast forward to today. My income over the intervening years has gone up about 25% from our move date and The Ravishing Mrs. TB brings in a reasonable income as a part time employee - so our income on paper is almost 63% higher than in 2009. Yet our debt levels have soared and, as we are finding as we try to truly adhere to a budget (maybe for the first time) we truly seem to have more month than budget.
What happened? How did this get missed?
I mostly blame myself.
I had constructed a safe little world view in which we had outflow and income, and everything was going along smoothly. I did not pay the attention I should have to what we were actually spending - mostly, I suspect, out of a wish to avoid the actual realization that things were much worse than they were. The difference was being made up, quietly and out of sight - until the whole thing finally became something I was willing to look at.
And so, we start fighting our way back out of the hole.
The budgeting process has helped a great deal, if for no other reason than to begin to get us to think in terms of money being allocated. It has also made us begin asking the hard questions about other aspects of how we are spending our money and if we are really getting value from spending it.
Ultimately, of course, I am hopeful - both because there is really no other choice and I do believe that we can rise above this and come out in a far stronger financial position. It has been quite a humbling experience, however, to realize the extent to which one can consciously go to deceive one's self.
Hi TB :) I get what you're saying...I have done it, not wanting to face the budget because I deep down knew that I was overspending. It is humbling, and I went through it 2 years ago. I am usually quite...anal, for lack of better word with the budgeting but a few years back we just acquired too much debt due to moving twice, then all the pets, car trouble... I have an accounting background and maybe I'm more obsessed than most. Now I have every penny accounted for, on an Excel spreadsheet, it's cumulative and it's a 5 year budget. I go through it every few months to update cost increases and new expenses...but I pretty much open it and update it daily. I need to know where the money is going so I can plan for the time we buy our home. I'm getting serious about savings and debt this year and the spending is going to decrease for both Alex and I so that we can get ahead a little.
ReplyDeleteIt all depends what you're going into debt for. If you are using debt as a tool and mastering it rather than the other way around - suck it up, pay it off and smile. Sending your kids to a private school is a darned shrewd investment, and one I sincerely wish I had been able to take advantage of.
ReplyDeleteRain, it comforts me that we are not the only one. It has taken us a long time to get to this point - hopefully, in the next two years we can see some progress. I am getting to the point that once the children have finished their schooling, I pretty much wish to be done with my current career track.
ReplyDeleteYou are right of course Glen - although to be honest, it has more been our master than servant.
ReplyDeleteI am glad we held to making sure all of our girls went through 8th grade at a private school. It was a sacrifice, but it has continued to pay dividends far beyond the cost of the schooling.