Family Financials

Isn't it funny how life has this strange way of throwing things at you just when you need them? Actually I have a theory about that. We have so much information coming our way that we can't possibly effectively process it all. And so we filter out the totally irrelevant stuff and ignore it. Then there's the vaguely interesting but still practically irrelevant stuff that we glance at, maybe read but then forget (e.g. Rare Moon Mineral Found In Western Australia). And then every now and again a little nugget shines through the detritus and shouts out "Look at me! Look at me! I'm really relevant." And you think, "wow, it's almost as if that was put there just for me."

But of course, if you hadn't been at the stage you were at it would just fade away with the rest of the irrelevant or vaguely interesting stuff.

Today on Facebook I read a reference to an app called EEBA (Easy Envelope Budgeting Aid) and I thought "wow! That's really relevant. It's almost as if that was put there just for me." Because yes, the time has finally come, after years of putting it off or making half-baked or over-ambitious attempts, to finally get our household budget underway.

Really, we've left it too late. We've already had to sell shares to pay our credit card bill. This single income malarky ain't all it's cracked up to be. But one thing it definitely is, is a challenge. And I love a challenge.

Before Christmas I joined my old colleagues on a workshop. The theme of the workshop was Life Balance and one of our tasks was to set a goal using the SMART (Specific, Measurable, Achievable, Realistic and Time-bound) criteria. Typically I don't give finances much thought. So long as there is more money coming in than going out I'm happy. I am beginning to realise this is not a very balanced approach and that money, whether I like it or not, is a big part of my life and needs just as much attention as family, work, fitness and all those other things I give priority to, such as perfecting the foam on my coffee and making soft toys and ribbon blankets. If I don't start actively planning my finances I will not be able to achieve some of the things that are important to me, such as visiting my family in the UK and retiring comfortably. Not to mention the fact that children don't get any cheaper as they get older.

So, with this in mind, my goal is to have between $20,000 and $30,000 in our offset account by the end of January 2013. I'm not sure whether this is achievable or realistic so I have some work to do to figure that out. I was originally inspired by reading Planning With Kids by Nicole Avery (see Nicole's great planning blog, and online resources). Next I dug out an old book that I never finished reading called Your Money or Your Life by Joe Dominguez and Vicki Robin. (Check out Vicki's blog of the same name.) I'm enjoying reading this book again as it reminded me of some of my core values that I seem to have forgotten lately. They're all about simplification and reducing excess and clutter; sustainability, environmentalism and consumer awareness; and active prioritisation of needs and wants rather than impulse buying. Sometimes these values feel at odds with the world I live in and I don't always feel happy living them. But I definitely feel restless when I ignore them, as I have been doing and bringing them to mind makes me feel excited and hopeful about what I can achieve when I put my mind to it.

I started putting some of this into action anyway a few months ago when I began to declutter some of my clothes. It felt so good to drop off bags and boxes of unused items to the charity shop. I still have a long way to go with that, but it's an ongoing thing as my body changes post-baby and I decide what I still want to wear. And naturally Other Half and I started to think a bit more about what we spend our money on: going out for coffee less, temporarily cancelling our organic produce delivery, buying on special and being more aware of what we're eating. OH in particular has an "if it's there, eat it (and don't stop until it's gone)" attitude to food. I am still fighting with him to adopt a menu plan system. I much prefer to know what I'm cooking, have a shopping list, stick to it and then know that we will cook and eat everything we've bought. He, on the other hand, has decided to only buy things that are less than $3 a kilo. And as I'm currently doing most of the cooking, some nights it's a bit like Ready Steady Cook.

I loaded the EEBA app onto my iPhone today with the intention of using this as one of my budgeting tools. From what I've seen so far EEBA allows you to virtually stick cash into envelopes, log your spending from a particular envelope and then stop when the money runs out. This is exactly how my financial mind works and in fact, pooling all of our resources into one offset account, rather than having separate savings accounts, has been a real challenge for me and is one of the reasons I've budgeted so poorly in recent years. I've already started to implement a sort of envelope budgeting system by paying in cash at the supermarket. No, really I have actually been doing this. For most groceries Aldi is cheaper and of equivalent quality but they charge for using a credit card. In the past I've ignored this charge as it really is minimal. But then I realised that if I only want to spend $30 on groceries, then why not just take $30 and calculate the total as I go around the shop? It sounds like an effort but really, even with Phoebe in tow it wasn't that hard at all.

So follow me on this journey. I'll make regular updates as to how I'm doing and what steps I've taken and maybe you'll learn some new tricks that might help you too.