Creative budgeting (Part I)


This lovely fortune came from a fortune cookie I opened in March after eating some delicious Kung Pao chicken from Chin Chin, one of my favorite Chinese take-out restaurants. I took it as a sign from God that things would be fine if I decided to leave my job. I know it sounds a little silly, but this fortune really did remind me that money isn’t everything.

But money sure does help to pay the bills.

As I mentioned last week, no job means no paycheck. Surprise, surprise! The best way to handle living off of one paycheck for the time being is to cut expenses and to possibly eliminate bills that are not necessary. These may seem like obvious solutions, but the truth is, my husband and I are going to have to get a little creative with budgeting in order to be as comfortable as we possibly can be until I start working again.

Now, I am not a financial planner, but I did work in the credit union industry for more than six years. I worked with a lot of people who were in great, not so great and scary financial situations. I learned a lot about budgeting and the importance of building and maintaining a high credit score. And I had to be able to look people in the eye and explain to them why I could not approve their loan applications or why I could not approve their ACH transactions when their checking accounts were in the red. These experiences made a huge impression on me. Working at a credit union turned me into a saver, and it made me realize how a few poor financial decisions can be detrimental to one’s financial stability. I understand that my decision to leave my job was not the best for my family when it comes to finances, but it was the best for our happiness and I am determined to make sure this period of unemployment does not harm my family’s stability.

Creating a new budget for our situation: Where do I begin?

When my husband started grad school earlier this year, we acknowledged that we would both have to make some big sacrifices. My husband had to miss out on numerous family functions and family time at home. I was responsible for more home chores and had to significantly reduce my “me” time. But we both committed to making these sacrifices, and my husband passed his first semester. Woo hoo!

We are going to have to make more sacrifices now that I am currently not working, but I am confident that as long as we commit to making changes in our spending and saving habits we will be just fine.

This Monday marked the beginning of my third week of unemployment. We haven’t felt the effects yet since all of our June bills were already paid before my last day of work. I also have our accounts set up so that the current month’s paychecks are stashed away and used for the next month’s bills and regular spending. My student loan payments also went down last October when interest rates were lowered, but I continued to stash away the remaining money that would have been spent on student loans in another account. This means we have some “extra” cash we can use for July when we will begin to feel the effects of living off of one income.

I also like to buy necessities in bulk, which means we haven’t needed to buy much in addition to groceries these past few weeks. I have been stashing away money and necessities for a few months. I did this because I like to limit trips to the store and because I like to save. I am glad I did this because we now have some extra items and a little extra cash on hand that will make this transition much smoother for us.

Although we do have some extra cash and items on hand, we started making our sacrifices after my last day of work. We haven’t created an official budget yet, but we have created some simple rules while we figure our new budget out. Our first rule: Do not buy it if you do not need it. Second rule: DO NOT BUY IT! Okay, okay, we do need to buy some things.

To start working on creating a budget, we made a list of the things we spend most of our money on. Our list is probably very similar to yours. Here it is:

  • Bills
  • Food
  • Savings
  • Gas
  • Home projects
  • Entertainment
  • Gifts
  • Car repairs
  • Vacations
  • Clothes
  • Charity
  • Miscellaneous

Looking at this basic list and the past few months of our checking account transactions, it’s easy to see where we can cut spending. We can spend less money on going out to eat and on fast food. I can make fewer trips to Target. We can limit activities and outings that cost money. We can choose cheaper or free entertainment events to go to. We can be smarter about how we shop for our groceries and how we plan meals. We can get rid of some convenient but not necessary services. And we can make a commitment to spend less money overall on things that are not necessary. We are not out-of-control spenders who rack up the credit cards. In fact, we have no credit card debt because I was traumatized by the amount of debt I regularly saw on credit union members’ credit reports. However, we do like to spend money on our kids. And my husband and I do like to treat ourselves to something new every now and then. These purchases need to stop. No question about it. Not buying things we do not need will save us money and make it easier for us to make ends meet while on a tight budget.

Not spending money is a hard thing for many people to do (including me). But when you look at the big picture and plan for the future, it is easier to understand that the sacrifices you are making now are only going to help you out in the long run. I want to be a happier person and I want my family to be happy. We don’t need to buy entertainment or other items to be happy. All we need to do is focus on what we already have and each other. Spending money is convenient at times, but since I am not working I certainly have time to find ways to cut spending.

If you are looking for a way to cut your expenses and to save more money, I challenge you to make a list of what you spend your money on. Then I challenge you to look at your checking account transactions from the last six months. Do you see any spending habits that could be adjusted? Do you buy lunch at work every day instead of packing a lunch? Do you buy coffee every morning instead of making coffee at home and putting it in a travel mug for your daily commute? Do you buy books and magazines instead of going to the library to check out a book for free? If you can afford to do these things, then go ahead! But when you are on a tight budget or when you are trying to save more money, remind yourself that these little expenses will make it take longer to save money, and these unnecessary expenses will make it more difficult for you to buy the things you do need.

To spend as little money as possible, I am making a game out of it. I am making some simple substitutes here and there, I am repurposing items, I am digging through the garage and basement, and I am paying more attention to the price tags at the grocery store. It’s actually quite fun not to spend money and to think of ways to spend less on necessary purchases.

Reviewing our checking account and making some simple adjustments is just the beginning of creating our budget. Now it’s time to thoroughly analyze each category and see where we can make specific adjustments to make ends meet while living off of one income.

In the meantime, I am curious to learn more about other saving and budgeting techniques that really work for families and individuals. What do you do to save money or spend less? Do you have any tips for living on a tight budget? What do you have to do to stick to your budget each month? What do you do if you end up cheating a little bit?


2 thoughts on “Creative budgeting (Part I)

  1. Hi Aimee, I just came across your blog! Love this post, it really makes you think about the role of money in life, what’s important, and how much we really need….. I’m a college student who moved back home after I went broke living on my own at age 18…….I commute to school(Cleveland State)- I did my first two years at community college. So, I guess my form of budgeting/ living on the bare minimum is:

    -living at home with my folks (which I don’t mind-my family and I get along) even though it’s not really “cool” right now- most of my friends are in their first apartments right now- I’m 23.

    -opting to go to a cheaper school, even though art school was my dream for awhile

    -not going out to bars every weekend- once a month tops, and usually I don’t buy a drink since I’m the designated driver–

    -cooking at home

    -using the local library for all forms of entertainment-music,movies,books,magazines etc…

    -reading the local free publications & internet in search of free events

    -opting for a basic phone plan instead of an iphone-no internet on my phone

    -shopping at the thrift store (which I think is really fun).

    My job is babysitting 3-4x a week and selling the occasional painting, so I don’t make as much $ as my friends who mostly work at restaurants or are in their first “white collar” jobs right now.

    Anyway, sorry for the lengthy comment… but I look forward to reading more of your blog! 🙂


    • I really appreciate your comment, Teresa! It’s great that you are so conscientious about spending/saving. It can be tough, especially if you have friends who like to go out a lot and spend money. And I love your list of tips for spending less! Thank you so much for sharing your ideas here 🙂

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