Friday, July 8, 2011

An easy household budget

So, I've been doing a lot of research on household budgets and finances, and can I just say... It's no wonder Americans are in debt up to their earballs...{Yes I said earballs... Don't ask, It's just become a Hicks household word... Its a cross between your ears and your eyeballs... } Well, It's ridiculous the information that is out there. Now keep in mind, I'm not an accountant, or a finance guru, But I do know how to stay out of debt. The first thing that bothers me...

These pie charts.... This one in particular is a "get out of debt" chart. I personally think it's way off! 35% of your gross income on housing? That's outrageous! There's no way in heck that should be the number... That's way too much if your truly living below your means, and not just within your means. I'm not going into detail on what percentage ours is, but it's nowhere near that. And even when we buy a house it won't be anywhere close to that number, and It will be a 15 year mortgage. Second, Transportation, at the prices of gas these days, I just don't see it realistic for  the average household income to be spending just 15% of their income on car payments, gas, car insurance, and repairs. I filled up my van today and it was $65. That will last me maybe 5 or 6 days. Plus our car payments, plus insurance and we don't even have to pay maintenance. It's not cheap. If I could convince my car salesman of a husband to pay cash for a used mini van and an old Camry, I would, but I've tried and it ain't happening in this life time. So in comparison, to how low all of our other percentages are, Unfortunately our transportation is a bit higher than I'd like it to be... I'd like it to be just our gas and insurance, But that's never going to happen. Savings? 10%? ummmm, I've got a HUGE problem with this. If that's supposed to cover your long term savings and short term emergency fund, You're going to be working until you're dead. I would feel comfortable JUST putting away 10% if I were completely out of debt, no house payment, no car payments, and had my retirement set already. There's just no way that we could live the kind of life we want to in 30 or 40 years just saving 10%.  Um and where's the important stuff on the pie chart like Tithing, and retirement and investing? Or the help others fund? I'm not saying we have it perfect, But we are constantly changing and adapting our budget to fit our needs and whats best for our family. I will say that tithes and offerings ALWAYS come out first. And they did when it came down to the hard decisions, "do we pay our tithing or do we pay our electric bill?" The Lord always provided, and our needs were always met. Savings comes second. Right now, we are diligently saving for our next house, and we are making sure that we put away enough every month that we know if something happened and Mike lost his job or were hurt, we wouldn't have to live house poor, or paycheck to paycheck. I don't think that there is a certain percentage for every category of expenditures. Needs change from month to month, electric bills fluctuate, unexpected medical bills come up, grocery prices fluctuate and Gas continues to cost a freaking arm and leg. I think you set a budget every month according to your needs and stick to it. If there's something you "need" that isn't in the budget that month, well, wait, and add it to the next months budget, and cut something else out to make up the difference. And I still think this is your best place to find information on budgeting and finances... I did a post on it previously...

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