I had a eye opening experience last week and I wanted to share my story in hopes of preventing others from doing what I did.
I am 30 years old, and have lived a very good life. My parents weren't rich, but as a child I never went without, and got almost everything I asked for. My family lived in an apartment most of my childhood (free of charge as my mom was the property manager), so my parents had more disposable income than they would have had if they owned their own home. They didn't seem to ever manage a budget.
My wife comes from a very well off family, her mom never worked, and she literally got everything she wanted. Her family definitely never had to worry about a budget.
My wife and I live in Orange County, have good paying jobs, a house with great equity, 2 cars (financed), a HELOC, and a plethora of credit cards (we did the whole points thing for vacations). I'm embarrassed to say that I've worked in the finance industry and barely created my first budget at the age of 30.
Fast forward to last week. My wife has absolutely no idea about finances, and I've never really given her the opportunity to assist as I've taken the "I got this, I'm the numbers guy," approach. I'm good at paying bills on time, moving money around to avoid interest, etc. She will be the first to admit she doesn't know much about finances, and has paid only 1 bill in her life, her Amazon credit card. One of her goals was to become more aware of our finances, because lately her shopping problem has gotten worse and she is worried about her spending.
This is where things get interesting. I download a generic Excel Budget and plug in our income/expenses and am absolutely shocked by how much money we have after everything is said and done each month. We make ~$8k after taxes/401k/Roth IRA contributions, and we spend $7700/mo between our house payment, taxes, insurance, utilities, car payments, 529 contribution, day care, food, and entertainment.
I knew that we weren't saving money, but I always figured we could if we wanted to, but I was dead wrong. Over the last 7 years we have been using credit cards and our HELOC to support a lifestyle we cant afford. Since last week I've cancelled our cable TV, shopped our home owners and car insurance for a savings of $800/annually + better coverage, and set up a weekly allowance for fast food/entertainment. We will be operating on a cash basis going forward. It feels good.
All I am saying is make a budget, it's eye opening in the best way possible.
Super basic budget template I used: https://templates.office.com/en-us/Personal-budget-TM10000134
Submitted January 27, 2018 at 09:04PM by Sweetdealbro http://ift.tt/2rNxaKx
