Show Me The Damage!

Posted on January 17, 2008 by Melissa
Filed Under Budgeting

C'mon down! I’m finished with the postmortem accounting of the last two months. I ended up tossing my budget out the window during the move and was putting off doing the math to see how bad the damage was. After crunching the numbers I’m pretty surprised!

First off, let me say how difficult it was to do my detailed accounting after the fact. It took me an entire half day just to get current! It’s so much easier when you stay on top of things. Especially when your husband forgets to keep track of some of his receipts and you have to try to remember what was spent on groceries vs. household. :-)

November

I did go way over budget in several areas: Dining Out, Cash, and Household. In the months before the big move we kept ourselves on a very strict food allowance, only giving ourselves $20 for dining out. We blew that away in November, spending more than $300 over budget. We also withdrew more than the $50 I allotted for cash - $400 more to be exact. Buying cleaning supplies and other related essentials catapulted the household category to $200 over budget. A total of about $900 over budget. Ouch! That’s pretty painful.

Despite those horrific figures we managed to do ok. Actually, we were more than ok - we were still in the black for the month. I couldn’t believe it! Turns out, we came in under budget for many of our other bills (utilities, phone, etc), vet, groceries, and personal care by a whopping $500. That’s very unusual for us and those areas helped to make up for the other indiscretions. But the big thing that kept us in the black for the month was the extra paycheck in November. Typically, I pretend those extra paychecks don’t exist as a way to save extra money and simplify my budgeting. This month I made sure to count it in our income to help defray the overages.

December

As expected, we also went over budget in December and even the leftovers from the extra paycheck in November couldn’t keep us above water. To my surprise, it wasn’t the dining out budget that did us in - it was the household budget! All of those trips to Home Depot and Target to get tools, supplies, or whatever we needed really added up to the tune of about $1000 over budget. Thankfully, most of that can be considered moving costs and can be paid for with the money we saved up in our house fund. We did go over in the Dining Out and Cash categories by $250 and $450 respectively.

We had many expenses related to getting the new home ready for move in, like the exterminator, garage door opener, alarm system, and deposits for new service. December was the first month we incurred double household expenses, too. We had to start paying two utilities, two mortgages, etc. You get the picture. Pulling from the house fund helped cover these “carrying” costs as well.

After covering the moving/house related costs (~$4K) with the house fund and factoring in the rest of the extra paycheck we still ended up overspending our budget by about $425. We used the cushion we keep in our checking account to cover those costs. We keep about $800 as our non-emergency emergency fund for overages like this.

The Bottom Line

We are still financially secure despite the temporary budgetary meltdown. We have enough money left in the house fund to cover several more months of carrying costs associated with the old house. After we pay back the $425 to the cushion in our checking account we might even have enough left over in the house fund for a sprinkler system if we stay on track. But we won’t look into that “want” until all other priorities are met.

Even though we didn’t go into debt from the experience, losing our commitment to stay within our budgetary guidelines was not a positive thing. We need to be able to stick our budget during times of stress, too.

Looking back, I probably should have formulated a special budget for these two months. I could have pumped up the Dining Out and Household budgets and funded it with money from our savings ahead of time. That way it wouldn’t have felt so much like I lost control of our spending. It wasn’t that we didn’t anticipate these added costs, we just didn’t use our budget to help us manage these unusual purchases.

If we hadn’t built up our house fund over the last year we could have been in real financial trouble by this episode. I actually thought the monthly totals would be much worse, to tell you the truth. I guess when you lose track of how much you spend you might begin to imagine the worst. I’ve learned that being aware of my financial standing (for better or worse) is much less stressful.

I’ve decided I’m not going to feel bad about it any longer. I’m keeping a positive outlook and I’m excited to see what financial goals we can reach in 2008. I’m working on revising the budget to fit the current home and it’s new (larger than anticipated) utility bills. Once that is fine tuned I expect it to be smoother sailing for sure.

Comments

5 Responses to “Show Me The Damage!”

Mar on January 17th, 2008 11:37 am

I think you did very well during a very stressful, busy time.

What did you decide to do with the old house - rent or sell? I may have missed that ultimate decision if you published it…
Kacie on January 17th, 2008 2:35 pm

How do you keep your budget? In Excel? A software program? Maybe there is a better system out there for you that won’t be so time-consuming.

Personally, I use Mint and it works really well for us.
Money Blue Book on January 17th, 2008 3:29 pm

I certainly hope we can all hit our financial goals for 2008…with recession concerns, it’s going to be a tough year for many.
dawn on January 18th, 2008 1:22 am

You can’t change the past so why feel bad about it… good choice focusing on a positive attitude!!!
SavingDiva on January 21st, 2008 2:28 pm

I also killed my budget in December. I’m trying to get back on track, but I’m just so used to spending!