Budgeting Woes

Luc and I are awesome at  budgeting. We just really suck at sticking to a budget.

We’ve got binders, lists and ledgers. We’ve got spreadsheets, software and apps. We plot, break down and categorize our income and expenses like nobody’s business. We could tell you, on any given day, at any given time, exactly what our net worth is. And little by little, we’re bringing down our debt. But we still have budget woes.

The only time in our 20-year history together that we had a financial plan and actually succeeded at following through on it was when we were first married and wanted to buy a house. We knew we’d need a substantial down payment so we made a comprehensive plan. Here it is in its entirety:

1. Stop spending.
2. Save everything.
3. Buy a house.

Sounds simple, right? And it was, mainly because it was just the two of us and we had a common goal. It was easy to say, “Let’s stay in tonight,” or “No, we don’t really need a new bed right now, we can make do with our futon,” or “A trip can wait for another year.” Ultimately it came down to asking ourselves every time we were about to spend money: “What do we want more? This (INSERT DESIRABLE YET COSTLY ITEM HERE) or a house?” And the house always won.

I don’t want to blame the kids for not being able to follow a budget these days, but they do complicate things. Because, let’s face it, kids cost a crap-load of money. Sports. Extra-curricular activities. Childcare. Food. Clothing. Medical expenses. And it’s not as easy to say, “We’re just going to let that hair of yours grow for another month or so, OK?” or “Sorry, Sport, no sports for you,” or “No Sweetie, you can’t go to (INSERT NAME OF CHILD WE’VE NEVER HEARD OF)’s birthday party because we can’t justify spending X amount of money on a gift for some little girl you’ve never once mentioned but now that you’ve been invited to her super-cool party is your new best friend.”

Of course, the kids aren’t completely to blame. There are a few more reasons why Luc and I have trouble sticking to our budget:

• We’re often budgeting in hindsight. We’ll figure out everything we spent in the past month down to the most specific of categories (e.g. “Coffee for Jen at Starbucks”) but we’re always doing it after the fact. Then we freak out about how much we spent (as in “Oh my god, woman, how could you possibly pay so much for COFFEE?!?”). Then we feel guilty and try to find ways to cut back (for example, “OK, FINE! I’ll get my coffee at Tim Horton’s even though it’s swill and not worth the cost of the cup it comes in.”) Then we gradually fall back into our old habits (along the lines of “Coffee break? Sure! Count me in for a grande non-fat latte!”) Then we do it all over again the next month. We really need to learn to set the budget for the month ahead for planned spending, instead of over-analyzing the money we’ve already spent.
• We’re “restaurant co-dependent”. We both love to eat out (and order in). We also know this costs us a ridiculous amount of money every month. So every time we take a close look at the budget to see where we’re over-spending, it’s easy to target restaurants as a place to cut back. The problem is each other. One of us will drop a hint about ordering in (or eating out). The other will self-righteously protest. Which makes the first one feel bad about even mentioning it. Which makes the second one feel bad about making the first one feel bad. Which ends up with us ordering in a large meat-lovers pizza with extra cheese, half a pound of wings and a small poutine to make us feel better. Until we look at our spending the following month from the previous month (see bullet above re: budgeting in hindsight). If anyone knows a good therapist…
• We’re still surprised by surprises. We’re often taken by surprise by major expenses related to maintenance or repairs for the house and the vehicles. Surprisingly, we’re often surprised by expenses that shouldn’t really be a surprise too. Like taxes. And Christmas. And while we know we can’t plan for everything, we have yet to find a way to budget for those big annual expenses that are most likely going to surprise us on an annual basis for all eternity.

We’re heading into a new financial phase in a couple of weeks, going from two salaries to one for an unknown period of time. I’m sure this will bring its own set of budgeting woes as we try to adjust. But we’re already working on a comprehensive plan. So far it goes something like this:

1. Stop spending.
2. Save everything.
3. Hope for the best.

We’ll let you know how it works out.

Here’s what Luc has to say about budgets.