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Budget Time

Posted on October 20, 2013 by under Money, Tips.    

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It’s that time of the year. Whenever we start talking budgets at work, that’s our cue to do start working on our household budget also. Brian and I sat down and did our 2014 budget the other day. Hopefully we’ll actually stick to it next year.

We’ve had to deviate from our budget over the last couple of years. We planned on paying off my student loan by end of 2012 but got derailed and didn’t actually make the last payment until the beginning of 2013. Buying a house brings with it some additional expenses, which we expected, but didn’t really budget for in 2012 because we originally planned on waiting until our lease expired in May 2013. We were supposed to pay off my student loan first, then buy a house once our lease was up. We just ended up doing it backwards. Things didn’t quite go according to plan, but it all worked out in the end.

We wanted to put 20% down on our house last year but we closed on our house on our 10th wedding anniversary, which was a couple of months before our CD at Intrust Bank matured. It makes me sick that we’ve had to pay PMI over the last year so Brian and I and promised each other that as soon as we found a good time to do it we’d make a principal payment that will drop our mortgage balance enough so that we wouldn’t have to pay PMI anymore. I’m so happy that we finally made that payment the other day so I’m looking forward to slightly lower mortgage payments each month going forward. Hurrah!

For 2014 we’ve had to tighten the budget a little because we’ve got a couple of things that we’re saving for — a new car for me, which I plan on paying cash for in 2018, and down payment for our next house in 2016. That means no extravagant vacations and frivolous purchases over the next few years.

Brian thinks I have a shopping problem and I agree that I have a difficult time passing up a good deal but I think we can do it. We’ve tightened out belts before (when we were paying off all of our credit card debts eight years ago) and we got through it. We were actually completely debt-free within a couple of years. So I am completely positive that we can do this.

Anyway, I highly recommend sitting down once a year to create a budget if you’re not already doing this. Brian and I have done this over the last few years and it has really worked well for us. We set pretty high goals for ourselves so even when we don’t quite make it (such as in the last couple of years) we’re still in great shape.

Our annual budget gives us a good road map to follow for the coming year so we’re not all over the place. Having a plan also allows me to look forward to the coming year with less apprehension and much more peace of mind. This may not work for everyone but it works for us. So come up with a plan, stay focused on your goals, and best of luck to you in the coming year!

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