Long-time readers of the blog will know that #1 hates hates hates budgeting. So she doesn’t do it.
While DH was employed, what I had been doing was funneling his take-home pay to checking and mine to savings. Back when we were still paying the mortgage, I’d move 1 or 2K from savings to checking each month if the checkbook register became negative. If I had to move more than 2K, I would re-examine our spending habits (though usually such expenditures were reimbursable and would be reimbursed). Since we’ve finished the mortgage I haven’t been having to do any moving from savings to checking. We pretty much just spend DH’s take-home pay each month, give or take.
(It’s actually a little more complicated than that since we funnel DH’s reimbursement checks and my freelance checks to Wells Fargo and I take most of the children’s lesson costs out of that account. But we can ignore that oddity. Also 529 money comes out of my take-home pay and gets pulled directly from savings.)
Of course, DH is unemployed for the full month of June, likely employed in July (but without a firm start date meaning not drawing unemployment this month, by state law), and then we don’t know what will happen after that.
We saved up for this so there’s plenty in savings. The question is how to allocate it.
My two thoughts are to either: 1. transfer the equivalent of DH’s former take-home pay to checking at the beginning of checking each month or 2. only transfer the amount necessary to keep checking in the black above our minimum requirement for the bank after bills have been figured out for the previous month.
I’m leaning towards the second option so long as the amount I’m transferring is smaller than DH’s former take-home pay because I’m hoping that will decrease the amount we spend each month. However, if it turns out we’re spending more, then I will do the first option instead and make sure we don’t have to transfer more without a really good reason. I foresee a lot of eating down our pantry in this scenario.
I honestly can’t remember what we did the last time he was unemployed.
Sigh, once again I am reminded how the way I know we’re going to have an income setback is when I think to myself, “Gosh what are we going to do with all this money?” The answer always comes. Kind of like how new referee reports know when you’ve finished the last one in your queue.
But we’ll be ok. This is why we paid off debt and have saved so much. And it helps that I’m still driving my grad school car, we don’t really vacation, and we never did get around to renovating the kitchen. A large emergency fund and low expenses mean that a potentially long-term unemployment spell doesn’t come with frightening money worries. And we will still be able to buy whatever we want at the grocery store (which is how I feel rich).
Do you budget? How do you make sure your spending doesn’t outstrip your income while still allowing for savings?