Updated: Nov 1, 2021
We started with the concept of budgeting when we were aiming to pay off my student loans, and 2 years later all $115K IN LOANS IS GONE, so now we budget for the rest of life.
I am in no way saying that we know everything, or that our way is the only way. I actually am writing this because we are still learning and while we do, I'll continue to share with you. I simply am proud of the fact that we crushed paying back our loans, and that we continue to live an adventurous life even as 'adults'.
So how to the Haizman's do it?
First off, we aim to live with "low expenses"- meaning everything that we pay each month. We never want this number to go too high or else if disaster hits we wont be able to stay afloat. Many people will say different things, but our rule of thumb is that we have enough saved that we could live for 6 months if we both lost our jobs. BUT ALSO, that one of our incomes could pay all of our expenses if one of us were to lose our job. We never touch our savings, and we adjust when necessary.
Our first decision for our budget was where we would live. Did we want to buy a house and pay a mortgage? Did we want to rent? Did we want roommates? Etc.
We decided as newlyweds we wanted a 'house' of our own, but were not yet ready to purchase one- therefor we rent. Searching for a house to rent is HARD, because even though its a rental, it was our first place of our own- and we wanted it to be special.
We made a list of priorities- and searched for months!! (We had the luxury of taking our time since we were living at home with my parents). Our priorities included LOCATIONS, GARAGE, and COST. We desperately wanted to live close to Alexanders grandparents, which is a beautiful place to be- but definitely on the pricier side. So while we could find places in our price range, it was hard to find ones matching our other priorities. On the other hand we could easily find our other priorities if we gave up the location. But ALAS, we found one that hit all 3 of our priorities and our patience paid off.
I have to note that our COST priority was hundreds of dollars under what we could actually afford. But we talked a lot about the pros and cons of paying more for a 'nicer' place, or using that extra 5K a year for other things (like vacations!).
So we settled on a small place thats a bit worn down and really rolled up our sleeves to make it a beautiful home. Doing this 'saved' us $400 a month, around 5K a year, and looking back I am so happy we did this!! Again, this concept of 'low monthly expenses' starts with things as expensive as rent!
Our next decisions were made for us
Gas, Electric, Water, Garbage, Phone bill, Renters Insurance, Health Insurance, Car Insurance, Internet, Car gas, and tolls.
While yes, you can shop around to find the best bundle and deals- its all money that you most likely have to spend. We made sure to OVER budget for these, yes some months gas is less or garbage will be more, but whats the highest we will ever pay and let's budget that every month. Cheers to you if you know your patterns, but we are new house owners so finding a nice average is great for us- and great for my mental health! :)
0% is a friend of ours!
We both were in desperate need of new, reliable cars. While my dream is by our first child we will have a beautiful SUV with all the bells and whistles- that's not what we needed right now. We both need a RELIABLE car, that we knew wasn't going to break down on the side of the road, and we could foresee the money that would need to be put into it. (We are NOT car people, and I truly don't even want to do my own oil changes.
Conveniently enough, Toyota was offering 0% loans and we snatched up TWO Toyota Corollas. Dependable, safe car that also comes with a manufacture warranty and extended care package meaning for the next 5 years I'm happily dropping my car off for maintenance and never have to worry. This stress relief and 0% was fantastic but this added A LOT of money to our monthly expense list- $700 to be exact.
My point here is- we all want nice things, but again the priority for us is LIFE, and the car I drive doesn't need to be the top of the line for me to be happy- so we went for basic and reliable while making a 'low expense' decision.
Making these huge decisions with our monthly budget in mind- yielded us with relatively low monthly expenses.
So now what?
TRACK IT! Below is what we use to track our budget. It includes our monthly expenses, as well as our income so we can see just how much we are earning, spending, and saving.
We also have a savings spreadsheet so that we can determine what exactly the money in our savings account is for.
While there a billion resources available that automatically track, we have found that this spreadsheet works best for us. I'm all about creating things from scratch so they are perfectly made for our needs. Click here to download an excel template that you can customize for yourself!
We sit down at the beginning/end of every month and go over everything. We have an in depth conversation about:
-what we earned (with both of our jobs, our income fluctuates greatly) and its either nice to see how much extra we made because of working our butts off, or if we need to pick up some slack.
-our normal expenses (whats been decided for us). This conversation can be about hey, we barely were able to pay our phone bill (luckily this never happens to us) or wow our water bill was crazy high this month. While these things are technically "decided for us" if we were really in a pinch we could make changes in this area to save more, but being aware helps us so much!
-extra spending... this might be our biggest conversation. We are in a lovely phase of life where like I said, we have high incomes and low expenses. This means we spend WAY MORE on fun then we probably should. While we want to "live it up" before having kids, etc.. it's important to maintain healthy spending habits AND save while we can. So we are constantly reflecting on our purchases but also making sure to discuss all of our purchases with each other.
-our savings. Currently, at the end of the month we are able to save a good chunk of money. So we also have to sit down and decide where we want to put that money. Do we want to invest? Do we want to save for retirement? Do we want to save for an upcoming vacation? This is a conversation we have at the end of the month to make sure that we are being conscious about our money and intentionally saving for things that are important to us.
My biggest tip for budgeting and saving?
talk about it.
This might be my advice for everything but I honestly think its what works. If you really want to succeed at something, especially when involving another human being- you must be open about it and talk about it thoroughly. You cannot succeed at something that you don't set a goal for.
So sit down.
Make your budget.
Schedule time to reflect.
Hope this helps!
L E T ' S B E F R I E N D S !
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