I recently asked my husband on our weekly walk date what he though of our new budget, stating that I needed to write an article on it. Michael, USN Retired, said, “Having a budget is critical to living within your means and avoiding debt. Without a budget you are driving your car down a freeway at night without any headlights where a crash is imminent.”
All right: so there you have it. We need that thing–the budget. But how does one do it?
The SOS philosophy says: SOS: Set Our Spending (create a family budget). And families aren't the only ones who need a budget. I was impressed today, Sunday 8 November 2009, by Father Emmett Carroll’s homily in which he stated that in the time of Jesus, in the temple, there were 13 different boxes placed around for the temple offerings. Perhaps you dropped your coins into the “wine box,” or maybe you stuffed your monies into the “flour box,” or the “oil box.” So with that in mind, let's look at category budgeting.
Picture, if you will, thirteen different envelopes. This is the way families used to do it way back when and how we do our income now except without the envelopes.
1. the first envelope is tithe--10% off the top for God's purposes
2. the second envelope is housing
3. the third, food
4. the forth, savings
5. the fifth, medical
6. the sixth, household
7. the seventh, auto and auto anticipated expenses
8. the eighth, entertainment and education
9. the ninth, clothes
10. the tenth, insurance
11. the eleventh, debt
12. the twelfth, vacations
13. the thirteenth, other
Take your income and distribute your money into each of these envelopes. If you prefer to keep your income in your checkbook, then take your income and divide that earning onto thirteen sheets of paper like the above envelopes. Now every time you spend something, either pull that money from the envelope, or after you have deducted the expense from the checkbook then deduct it from the category which you penned. When you add up all of those remaining figures, then it will equal your checkbook final calculation. That is how category budgeting is accomplished.
For example, you go to the gas station and spend $50 for gas. With the envelope system, you would take the funds with you, but with the pages system, you’d deduct it from your checkbook then from the penned category. When the monies are gone, you don’t spend anymore. Period. If you need a healthy shopping spree for stress, rob a category and take $3 in change and go to Goodwill. Works wonders.
By living this way for thirty years, we have been able to understand clearly how much money is coming in, and we've be aware of what the expenses are and how to plan for them. With five children, that has been hugely important. Category budgeting has given us the freedom to minimize the stress of not being prepared for everyday expenditures. We haven’t been 100% successful all of the time, and it hasn’t always been smooth sailing, but the Good Captain has guided us well. And with a budget, you can plan for your operating costs, plan for your charitable contributions including money to The Church, and avoid living beyond your means.
Isn’t that what being a “Frugal Catholic” is all about??
The Good Captain’s Fifth Expense
Martha Wild King, M. Ed., Author
The Frugal Catholic: Learn to live on less