by Ashley
I have been dreading this post. Like – dreading it!
This month has not been great in terms of our budgeting. I’ll show you the numbers in a second and I know they’re higher than our average numbers, but I also don’t feel like we went crazy or anything.
In basically all categories, our overspending was due to known expenses that I had failed to plan for. Basically – no big surprises came up (no crap river or emergency dental visits). Instead it was stuff like needing to buy the girls new swimsuits for their free swim lessons (they grow too fast! I tried to put them in last year’s swimsuits and the resulting atomic wedgies indicated it was NOT going to happen). Also, I mentioned that my mother-in-law and grandmother-in-law visited for four days. While here we paid to take them out to dinner one night in celebration of MIL’s birthday (and to thank them for their visit). That single dinner blew our entire month’s eating out budget. I should have increased it for the month since I knew this visit was coming up. Same thing happened with groceries. Aside from the one big dinner out, we did most of our eating at home and I hadn’t adequately planned by increasing our grocery budget.
At the month’s end we were over budget by nearly $400.
This is where YNAB comes into play and – again – why I have loved it so much (see my full review here). Going into the software I was easily able to move some monies around. I’d originally planned to put some money toward savings for dental/vision and annual fees but I re-allocated that money to different categories. Additionally, I had to tap into some of my Capital One 360 savings accounts. I didn’t want to pull all the money from my Emergency Fund (more on that in a minute), so I pulled about half from the EF and the other half from my semi-annual fees account. This move was partly psychological and partly strategic. It didn’t feel like as big of a “hit” when I spread the money out (instead of taking solely from my EF). That’s the psychological part. How was this move also strategic?
Sigh…
Here’s the part I’ve REALLY dreaded of this post. I have to tell you guys that this month did not go well for husband’s business. In the past when we’ve had lower income months I’ve gotten all introspective about it and been very public with what I think our mistakes were and how to correct them. But in the interest of keeping some things just between hubs and I, I’m not going to go into reasons this month (though he and I have discussed them endlessly, so its not for lack of analysis).
Long story short, Hubs’ business came up empty-handed this month. Completely. This isn’t the first time, though it’s the first time in a looooooong time (first time since I’ve been blogging). In the early days of his business some 4+ years ago this happened more frequently. There were even some months where he’d lose money! (Yes. As in, we’d have to take money from our personal checking/savings to cover his business losses). On the overall, his business’ trend has been upward. But this is life owning a small business. Some months are awesome! And some months you may not make anything. You hope the awesome months are more frequent and the crappy months are few and far between (and, in general, that’s the trend his business has been taking). But this month was a crappy one.
So how will we survive?
Well, fortunately, I still get paid from my job! And with the shortage we’ll be forced to raid our EF. However, we’ve also been trying to sell things to minimize our losses. Husband has sold some of his shoes (it’s funny, but he has a larger shoe collection than I do!), and has sold a nice watch he owns. Our regular pay will still be business as usual (being saved for the following month since we live on last month’s income). But with any side-money we receive from selling things, we’ll use it to supplement the current month (June) to minimize the amount we have to take from our EF to survive the month.
So there you have it. Last month’s overages and the plan for next month.
Now, onto the actual numbers.
| Place | Amount Spent |
| Rent | 1055 |
| Electricity | 127 |
| Water | 61 |
| Natural gas | 18 |
| Sprint (2 lines) | 119 |
| Cable/Internet | 99 |
| Car Insurance | 58 |
| Health Insurance | 394 |
| Trash | 35 |
| Preschool | 1024 |
| Gift-Giving | 29 |
| Restaurants | 162 |
| Entertainment | 10 |
| Groceries | 550 |
| Gasoline | 71 |
| Medical | 11 |
| Household Goods | 100 |
| Clothing | 20 |
| Toddler purchases | 60 |
| Work Purchases | 47 |
| Rainy Day Savings | 130 |
| Savings Goals | 500 |
| Debt Payments | 1708 |
| Total | 6388 |
I hope your May was more fruitful than ours! Here’s to hoping we knock it out of the park in June!
Do you/have you ever had a variable income? How do you handle the fluctuations? Our variable income is one of the main reasons I loved YNAB’s idea of living on last month’s income. It’s also one of the main reasons we have a larger emergency fund than the $1,000 beginner EF recommended by Dave Ramsey. That’s way too low for my comfort level given the sometimes unexpectedly low income months we have on occasion.
Note: My YNAB and CapitalOne360 links are refer a friend links. If you join it doesn’t cost you anything extra but I do get a small compensation for the referral. All opinions are 100% my own and I joined paying my own money so this is not a sponsored post and I received no discount or anything for mentioning them. Particularly for YNAB, I’m just giving them a shout out because their budgeting system really has made a HUGE impact on getting our financial house in order!
Hi, I’m Ashley! Arizonan on paper, Texan at heart. Lover of running, blogging, and all things cheeeeese. Freshly 40, married mother of two, working in academia. Trying to finally (finally!) pay off that ridiculous 6-digit student loan debt!
You know, this happens sometimes. At least this time, you have the information in YNAB to understand what happened. It is defeating and let’s hope next month is better!
Before blogging and paying off debt, how would you have handled this and would you have known there was a problem? I guess you probably would have because of no income from hub’s but I wonder.
The short answer? Debt. Absolutely.
When he first started his business I was a grad student making $300 a week. So we didn’t really have the money in the bank to cover any loss of income or business expenses. I would have been forced to rely on credit cards for our basic living expenses (I even one time put our rent on a credit card), and we’d use whatever cash we had to pay the business expenses.
It didn’t happen a lot, but that’s how things would have gone.
It’s crazy to think that was just a few years ago and how things have changed. Obviously it’s still a big hit and it sucks. But we have plenty of cash reserves. Not only do we have the EF, but if it were to bleed dry we still have additional savings (like money I’ve set aside for car repairs, dental work, and annual expenses) that we could take from if we really needed the cash. The idea of having to pay for things with debt (on credit cards) does not even enter the thought process. It’s a whole new mindset.
You and your husband seem to have very pragmatic approaches to handling this situation. You’ll have the advantage of just dropping down to minimum payments for everything (and thank goodness so much of the car loan is on “prepaid” status!). Hopefully your husband is out there continuing to drum up business as the short term lack of cash flow isn’t a huge deal if he’s still focusing on long term prospects.
I grew up around the family business and some months were definitely tight! We ate through the pantry, focused purely on needs, and didn’t even think about going places that might tempt us to spend.
There are ups and downs to life, you know? And you’re in such good shape now to weather them. And you STILL sent $1700 to debt? That’s pretty awesome. You can try to tighten up some things for next month, or just continue on. And think of this month when you have an awesome one down the line.
Ouch, I’m so sorry to hear about the tough month. I wish I had helpful advice about dealing with cash flow issues like this, but I don’t think I would do any differently than you!
Hoping that things get back to “normal” soon, even while not taking things for granted…
I’m sorry to hear about your rocky month but just think about how stressed you would be if you didn’t have your financial house in such immaculate order. And you paid a great chunk toward debt in May. Hopefully your next month will be exceptional! I’m sending you good thoughts and I’m excited to hear about the ways you get creative with the tighter budget month!
Thanks!
I just stumbled across this site (don’t ask me how) and see that you use YNAB! I’ve been using it for several years and love it.
My variables are gas (car), electricity, & gas (house). I account for fluctuations by moving money around on seasonal basis. For example, gas (house) is cheaper in the summer, so I use the “extra” money to cover unexpected expenses, higher electricity, and other things.
You followed YNAB’s third rule: you rolled with the punches! No shame in that.
Thanks, April!
I was wondering if you menu plan, use coupons etc as that would cut down grocery budget by a bit, just wondering what some of the expenses are like “toddler expenses”…eating out why would you do that when you can cook better meals at home and you could also make them and freeze them for during the week etc…that is a lot of money for one month…you are doing good…also I have a folder that I have my yearly budget in and it is done befoe the year begins, it shows me what is due when like once a year bills etc, shows me what I need to pay each month before it gets here and how much you need to make each month…by doing this the last couple of years we are finally down to paying off our last bill in the next few months…good luck…will be worth it in the end