If you’re serious about being a stay-at-home mom, you have to figure out how to make it work financially. You have to make sacrifices, and you have to put at least a little bit of thought into what to cut out of your life and what to keep. But it doesn’t have to be painful, and it doesn’t mean spending hours every month balancing spreadsheets and deciding where every last penny will go. The hardest part is when you first start out, and we have two great posts (and a free workbook) to help you with that:
After you make the initial effort to figure out exactly how much money you have (or will have) coming in, and what you absolutely have to spend on necessities each month, I don’t think that the time and energy that goes into setting a monthly budget and dividing it up into cash envelopes and tracking all of your expenses and creating sinking funds and having 15 different bank accounts is worth it. I respect and admire many things about Dave Ramsey, but I am a Financial Peace University dropout. In fact, I respect and admire anyone who is dedicated enough to put that much energy into managing their money. But it ain’t me, and it’s okay if it ain’t you either.
No budget? No problem.
In fact, I manage our family finances without using a written budget at all. I don’t even balance my checkbook. Really. (Although I did use the nice little leather checkbook and check register holder that came with my Financial Peace University course for quite some time. I just never actually recorded anything in it.) And we still have a great credit score and a decent bank account balance, all on one income. If you’re hesitant to quit your job because you don’t think you can manage on a lower income, or you dread the idea of budgeting and penny pinching, keep reading to find out how I keep us afloat with a very minimal amount of bookkeeping or stress.
So, what’s my secret?
It’s simple: I changed the way I thought about money.
I decided that I was no longer going to make my life a quest for more and more money and more and more stuff. Once you kick money off of the center stage of your life, it’s pretty easy to live within your means. It’s like when you stop eating sweets or carbs or processed foods, and your body actually stops craving them. (To be totally honest, I’ve never actually given up sweets or carbs or processed foods, but friends have told me that this is what happens. We’ll just take their word for it.)
There was a time when I thought that the amount of money and stuff you had was how you measured your success as a human being. When I had that mindset, I was always looking forward to getting more money and buying more stuff, because I thought that meant I was a little bit closer to really “having it all.”
But somewhere along the line, I realized two things:
1. I’m not very good at making money. At the rate I was going, “having it all” was never going to happen.
2. More money and more stuff weren’t making me happier. It was starting to seem like NO amount of money or stuff could do that.
So, rather than accept the conventional wisdom that I was a failure and my life was doomed to be miserable, I decided to rethink my ideas about making money, and spending money, and success, and happiness, and the purpose of life.
I decided that instead of fixating on what I might be able to buy if I had just a little more money, I would focus on enjoying what I DO have and figuring out how to get the most out of the things we already own. And you wouldn’t think that would really work, but it did. I think the challenge of reusing things and fixing things up and finding bargains can refocus that competitive, “keeping up with the Joneses” energy and give it a better outlet. I also started to be more generous with our money and giving to those who have less. It’s harder to feel bad about the new laptop you can’t afford when you get letters each month from people who live in cardboard shacks and eat one meal a day.
I still want things that are silly and extravagant and way out of our means (if we had $20,000, for example, I know exactly which camper we would buy), and sometimes I buy things that I regret or cut it just a little too close at the end of the month. But for the most part, it isn’t hard. And I’m not more virtuous or disciplined than you are, I promise.
What about savings? College? Retirement?
There’s one other component to living budget-free that I feel like I have to address: we aren’t saving huge amounts of money for the future. We don’t have a whole year of income set aside “just in case.” We are not on track to pay for our children’s college education (in our case, this would literally be a million dollar expense) or to retire early and travel the world (another million). But we made those decisions together based on our priorities. For us, having me at home to raise our kids is a much better investment than a 401k or a college savings account. And, according to my math, no amount of budgeting or manipulating or penny-pinching is ever going to be able to send our 8 kids to college or sock away a million dollars in a retirement fund. If they have to find a way to do college on their own, and we have to work well into our golden years, so be it. No degree or vacation or retirement village can stack up against the precious time I get to spend with my kids when they’re young.
Some practical tips
There are also some practical things I do each month that make my no-budget lifestyle run smoothly:
- I pay off every bill as soon as I get it. I’ve learned that if I wait, I will lose the bill or forget to pay it.
- I pay off my credit card balance once a week. Well, I TRY to pay it off once a week. At minimum, I pay it off before the end of the billing cycle to minimize the interest fees.
- I try to keep a cushion in my checking account, because when I used to transfer all of my savings into a separate account right away (“pay myself first”), I would always cut it too close and bounce checks.
- I set up as many bills as I can on auto-pay. Just make sure that you don’t set them all to come out during the same week. I try to spread mine out so that some hit the first paycheck of the month and some hit the second (my husband gets paid every other week).
- I glance over my bank account and credit card account transactions probably once a month or so to make sure there aren’t any surprises. I’ve never actually found a surprise in my bank account, but I’ve found several on my credit card. Mainly because subscriptions to various things renew before I remember to cancel them. It’s worth the effort.
- I avoid window shopping, browsing stores online, and watching ads as much as I possibly can. It’s harder to want something if you don’t know it exists.
- Once a year, usually when we do our taxes, I look over all of our income and expenses and figure out a) how much we need to donate/tithe for the coming year, and b) whether we need to cut back on our spending in any particular area.
So here’s my action plan for those of you who are like me when it comes to managing money:
- Spend some time with your husband talking about your overall money philosophy. Try to get on the same page with him about your money goals – and life goals. We have a really great workbook to help with this part on our subscriber freebie page. (Subscribe to our newsletter and you can access everything on that page for free!)
- Refer to your new personal money philosophy every time you’re about to buy something you know you don’t absolutely need. Ask yourself if it would be consistent with your philosophy to buy this thing.
- Embrace what works for you. If, like me, you can’t keep track of your bills unless you pay them right away, do that! If you find that you actually enjoy setting up a filing system for your bills and paying them right on time, do it that way instead! Whatever system you use will work so much better if you tailor it to accommodate your unique strengths and weaknesses.
What’s your favorite budgeting or money tip? Share it with us in the comments!