The Budget

We did it!  My wife and I finally sat down, together, and hashed out the budget.  It was a good, candid, conversation about the reality of our finances.  We looked over last months spending (Dear God, it was bad.  We spent more than we made!), forecast what we needed to spend money on this month, and set what we feel are reasonable limits.  This month we decided to save extra in our emergency fund.  And we even planned meals for the next week.  I'd say it was a very productive hour.

I'm not going to be going to be covering my loans and utilities in too much detail this post.  They are all at a fixed rate and I have enough to cover them.  They won't be changing any time soon unless I can pay them off.  There will be a post coming up soon that will cover all our debts and how we plan on repaying them.  What I am going to be covering are the variable expenses and savings.

Budget

Our budget is broken down into three main parts to try and keep it simple.  Income.  Spending.  Savings.

Income

For the most part our income is pretty steady.  The primary job's income is pretty fixed.  I also collect a drill(Air National Guard) check once a month.  We're rounding my wife's income when we do our budget. She works in retail so her income fluctuates a little bit with how many hours she's given.   Thankfully, her hours are fairly steady.  My wife also babysits occasionally.  This is a bonus income and it will go towards our savings goals.  For our budget we are assuming that we each get paid twice in a month.  Those, magical, two time a year we will have that extra pay in a month? That is tentatively going to debt repayment.  Fun, I know.  But, for now, it must be done.  So our income breaks down like this:

Me: Civilian pay - $3,659.70/mo
Drill pay - $400.62/mo
Wife: $2,000.00/mo
Total - $6,060.32‬

Spending

Our spending categories are probably very typical.  We have loans, utilities, and all of the other variable spending a normal household has.  Our variable spending is broken down into 6 categories.  Groceries. Dining Out. Gas. Dogs. Medical. Recreational.  This is how our spending for the month of March should break down:

Loans - $2,716.19
Utilities - $532.05
Groceries - $450.00
Gas - $350.00
Dogs - $175.00
Recreation - $150.00
Medical - $60.00
Dining Out - $50.00
Total - $4,483.24

Savings

We haven't been doing a bad job with our savings.  5% of my pay is deducted for my TSP(like a 401k) with a 5% match.  We also contribute to a individual taxable account and a savings account (emergency fund) through Betterment.  Also, we have what I call revolving savings categories. These are things that you pay for at different times throughout the year.  For us, these categories are:  car maintenance, home repair/upgrades, vacations, hobby/fun stuff, and clothes/gifts.  Each category gets $50 a month for a total of $250.

Usually we throw at least an extra $400/mo to paying down debt. But, this month, we decided to focus on boosting our emergency fund.  I decided to do this because my wife needs to experience how to save.  I started to save for our emergency fund and revolving savings before we were married.  The rate at which we saved for these items has remained unchanged since before we were married.  My wife has never had to think about these savings.  She didn't have to focus on saving.  If she wanted something, she got it.  I like to think that's how she got me, ha!

My suggestion was that we aggressively save $1000 for our emergency fund.  She was a little confused by this suggestion because she knows we have over $3000 saved right now.  So I explained to her what I just explained to you.  To my surprise, she took to this pretty willingly.  If we stick to our budget we should be able to handle this goal pretty easily this month.  This is how this months savings should break down:

Betterment ITA - $100
Emergency Fund - $100
Revolving Savings - $250
Bonus E-Fund - $1000
Total - $1450

The Bottom Line

Our budget is actually quite a generous one.  With what I've laid out we should have an extra $127.08 left over.  As a further incentive for her, we decided anything saved beyond the $1000 for the E-Fund can be put into our home repair fund.  We have plenty of projects she would love to have finished.  Though if we succeed it'll mean I'll have less time to write.  Sigh, the things we do to keep our loved ones and our wallets happy!  In early April I plan on writing the follow up piece to this.  Hopefully I can say that we hit all of our savings and spending goals!  Wish us luck!