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So, like the rest of America, you are looking at your credit card bill and your bank account — and wondering what happened. You may even be looking at your savings account and thinking, “But, we started off so well.”
I know that feeling. I know how it feels to wake up at 4 AM thinking about the bank account or wondering what the credit card bill will look like (wondering because your are too scared to look and thinking the surprise may be better). This is usually followed by looking at your spouse or partner and trying to come up with a reason as to why this can be their fault.
At any rate, by the time they wake up at 7 AM, you have come up with ten reasons why they have destroyed your family’s future — mostly because they weren’t awake at 4 AM worrying with you.
On that point, you are correct. If you want to start off 2012 with a budget and finish 2012 with success — the whole family must be included. That means you look at bank statements and credit cards statements together. That means if one member is brown bagging lunch, the whole family is brown bagging lunch. That also means that everyone writes down what they spend and everyone takes responsibility.
So often when I talk with people about a budget, it’s one member saying, “Help me fix this!” They are all excited and determined, yet they go home and realize their partner could care less. Three weeks later, they come back as failures. He or she went out and bought something. He/she did not play by the rules. I will say it again: you can’t succeed at budgeting without it being a joint effort. If you try, you are setting yourself up for fights and failure.
So if you are one of the million of us going through the post-holiday blues, quietly worrying how to tell your partner that eating out may be a bad idea, here are my tips:
1. Sit down with your partner and tell him/her your concerns. Begin by telling them why your current state of finances is a concern. Perhaps you don’t like going to zero each month or maybe you want to buy a house in 2 years or plan for a baby. Whatever it is saying, “I can’t handle this money or I am so stressed out,” does not fix anything. Sometimes our partners are too busy working and dealing with their own life that they don’t even realize what is happening. It’s not their fault if you have taken on the burden of being the money person.
2. Set out a goal for your savings and budgeting together. Do you want to pay off debt, save for a house, and/or plan for a baby? Both people need to sign onto the goals together. Otherwise, all the pressure will be on one person.
3. Map out your expenses and revenue. Before you put together an actual budget, you need to see where you are currently. After you see what your current situation is, you need to make tough decisions. Are you spending more than you take in? Start cutting. Are you not saving enough? Start cutting. The real question you have to answer is: where is your money going?
4. Build a timeline to meet your goal. Before you can put the final budget together, you need to decide when you want to make your goals happen. That will determine how much of your money goes to paying off debt or to savings. Your timeline is going to help you decide how much cutting you have to do. The more you want to save, the more you need to cut. I only suggest getting second jobs when there is not more cutting to do. The reality is that most people who get second and third jobs don’t save the extra income. Instead, they keep the same lifestyle up. The problem is people can’t work 20 hours a day forever and eventually burn out seeps in.
5. Cut, Cut, Cut. Cut cable, cut cell phones, cut house phones, cut entertainment, cut new clothes, cars, gas and food. Make the cuts your new lifestyle requires. If you think these cuts are only for a few months, you will find yourself back in the same mess a few months later.
6. Finalize your new budget. Write out your new budget, hang it on the refrigerator, and make it your computer’s background image. Do whatever you need to do to make sure you see it daily. Create a budget diary, writing down every day expenses. Total all of those expenses up and use that to help you make weekly money decisions. Make Friday nights your review night. Predict your monthly budget and adjust the weekly budget based on past performance. Whatever you do, don’t make promises you can’t keep. Saving and paying of debt can be wonderful experiences when you meet your goals. They are horrible burdens when you fail on a daily basis. Be honest, be real, and lengthen timelines if need be. Just don’t lie to eachother.
Anna Domzalski is a staff writer for the Financial Bin. Anna will soon begin her role as Dean of Financial Bin University and will conduct online budgeting classes beginning in February 2012. She can be reached via email at Anna@FinancialBin.com.
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