Family Budget

As I mentioned in my first post, budgeting our family food money has always been something of a struggle. When my wife and I were first married, we verbally decided on some amount of money per month for food (I don’t really remember now how much it was) that seemed reasonable and just did our best to stick to it. Needless to say, we ALWAYS went over budget and the only thing that kept us from going WAY over was usually me instigating family money arguments in addition to nagging my wife every time she bought anything at the store to make sure she hadn’t spent too much.

Also needless to say, this was a VERY ineffective and inefficient method for trying to manage our grocery budget. The next several years were a financial adventure for us, to say the least. By adventure I mean something like showing up to climb Mt. Kilimanjaro in shorts, sandals and one of those silk hawaiian shirts that you can only get away with if you’re actually IN hawaii or your back yard for a BBQ and you don’t mind looking silly. Well I did what any ill-prepared, inexperienced and under-dressed mountain climber would do: I looked around to see what everyone else was doing.

For anyone who has done even the smallest amount of reading about family budgeting and money management, I’m sure that you may have heard of the “envelope method.” If you haven’t, that’s ok, keep reading and I’ll briefly explain. It probably has many names, but the idea is to take your pay check and divide up the money into different categories such as: bills, fun, taxes, tithing, etc. Some people break it down even further and have separate “envelopes” for different kinds of bills or instead of “fun,” they may have separate envelopes for eating out and movies. Anyway, you get the idea.

Well, I came up with the perfect plan that was going to end all of our problems (famous last words, I know). We decided to create a separate checking account that was to be used only for food money. This way, there would never be a problem spending more than we had budgeted because there simply wouldn’t be more money to spend!! Brilliant! Except for one thing…

I found out that spending habits don’t change just because the amount of money in the account has changed. In fairness to my wife and me, the concept was a good one but the problem was in our execution. At this point, instead of just going over budget, we were regularly overdrafting our grocery checking account. This put us into somewhat of a downward spiral since each time we would fund the account with money from the latest paycheck, we were already starting out in the hole.

We limped along this way for a while fooling ourselves by saying: “next time we’ll do better.” Since I had, after all, come up with the perfect plan, I decided that I must have misjudged the amount of money needed for food and groceries and so devised the perfect revision to the perfect plan (famous last words…again). There was a little extra money floating around in our budget so I figured if I just added another $30 per month to the food money without telling my wife (who didn’t really keep tabs on our accounts at the time), then we would no longer overdraw the account and everything would be peachy!

Another good theory, yet somehow, almost magically, we began to consume that extra $30 per month and STILL overdrafted the account just as regularly and by just as much as before. Amazing! We certainly didn’t seem to be making any headway with our grocery budget, but we had unknowingly enrolled in a self-directed course called family money management 101. If only I’d known then that the course was going to span the next few years…