Since we moved to San Francisco, I took over keeping track of the family finances. At first, I had to go through quite a learning curve since Joshua has everything in Quicken and I had never used it before, but now I’ve got a pretty good handle on things. The more I learn about personal finance, the more interesting I think it is. I’ve even found several good blogs that I follow on the subject.
My hard drive crashed right before Christmas last year, and hadn’t been backed up since February. While the most painful loss was months and months worth of photos, I also lost all of our financial records, since they were kept on my computer. I was able to rebuild all the transactions using online bank statements, but I couldn’t account for all the categories we were using.
The frustrating part is that I base each year’s budget on how much was actually spent last year, regardless of whether we actually met last year’s budget. To build this year’s budget, I had to guesstimate in several categories, like groceries, drugstore, household items and clothing.
I don’t want to have an unrealistic budget, and want to make sure that the budget accurately reflects what our actual expenses are. For example, I don’t want to say we have a $100 budget category when we really spend $200 a month in said category and are always going over. Especially since we’re in the midst of a recession.
Joshua has a good, well-paying job with benefits, but we are always conscious of the fact that we live in the second-most expensive city in the country, and we do it solely on his income; I don’t bring in any money at all. I realized recently that for what we pay for rent in two years, we could have bought our friend’s house in Waco. That’s just insane!
Now I’m not complaining about the cost of living, though it’s probably worth ranting about. We knew what the financial stakes were when we came here, and we’re fine with that. We have a nice flat with lots of space that met all of our needs and wants (except that getting a pet part, but I’m not being picky): we have a garage, a storage unit, our own washer and dryer, one and a half baths, good size-bedrooms, a large living room, the biggest kitchen we’ve ever had, and a dining room. Oh, and a backyard garden. With GRASS for the kids to run around on. We’ve got a good space, and hopefully we’ll be able to stay here for several years.
But living here definitely makes managing the family finances tricky. I am constantly tweaking the budget, especially since I had to guess on so much for this year. I started reading personal finance blogs and checking out books from the library on how to manage money and all that kind of stuff. I realized that we were in a decent position to start from, and can hopefully only improve on our situation.
We don’t have a mortgage or student loans or credit card debt. We have a car payment, but that’s the only debt we carry.
We have half a month’s worth of emergency fund socked away in a 1-year CD. When I started this, I knew NOTHING about investments, and this is the second CD we’ve had. It’s a good start. The other half a month of fund was in a savings account that I recently closed to cover medical expenses - Joshua needed a crown and Mary Judah had a scary, though happily-ending, hospital visit that I’m expecting a bill for any day now.
In recent weeks, Joshua got his crown, Mary Judah went to the hospital and had a follow-up pediatric visit plus labwork, both kids had dental visits, I was due to pay for a ten-visit round of chiropractic care, I booked our flights to Texas for Taylor’s graduation, and our health insurance premium doubled, that’s right DOUBLED. So a lot of things have hit us all at once. While some of these things are in the budget, they’re divided out over several months, which makes things really tight right now.
Right now, I’m trying not to panic, but rather be smart and process through this as I can.
At the beginning of the year, we doubled Joshua’s contribution to his 401(k) from a really, really dismal amount to just a really dismal amount. Between that and the increase in insurance premium, his paycheck has gotten smaller. We also just opened an HSA that will make his paycheck even smaller, but will hopefully help in the long run. It all makes the stimulus increase to his paycheck have a tinge of irony.
We don’t quite know what all the changes to our monthly income will be, and hopefully will be able to iron it out in the next couple of months. Until then, things are gonna be weird and we’re trying to save money anywhere we can.
Why am I telling you this, you ask? Because one thing I have discovered is that hearing people’s stories of what they do and how they handle their finances is the most helpful thing in figuring out how to go forward. And it helps me to feel not so alone in all of this. So while I don’t plan to turn this into a personal finance blog, it’s a topic I will address more from now on.
After all, I think one of the reasons our economy is in so much distress right now is because of the taboo we have about money. We don’t talk about it and so many keep it shrouded in secrecy that it ends up blowing up in our faces. People lose their homes, their marriages and their lives over their finances. I want to be a voice with a healthy perspective on money.
I’ve never left politics or religion alone, right? I’d love to hear your thoughts and if you’re willing to share, your stories as well. I think I have some readers left!