About one and a half years ago, the Kingsley family had a 5 month stretch where we rivaled the U.S. Government in insolvency. Our 1996 Saturn SL1 had more than a little to do with this. Isa being born also played a leading role. Add to that a broken down washing machine, some general spring time expenses, and who knows what else and you’ve got a recipe for some serious leakage of the ol’ emergency savings fund. We’ve noticed that we are in another one of those stretches right now (although not at all to the same extent). Getting ready for baby #2 plays a big part in this. The other factor is that it seems that we just have more expenses during the spring and early summer than in other times of year. Landscaping projects account for part of this.
As a financially conscious person, negative balances are never welcome. However, there is a big difference in a negative budget as a result of discretionary spending and one that results from the ebbs and flows of life. Our negative budget has stemmed mainly from necessary expenses that happen to all be coming up at the same time. I’ll admit that there are some chosen expenses as well, but these are not the main contributors. While spending more than we make is completely unsustainable in the long term, I am more comfortable now than I used to be with the reality that there will be some stretches where this happens. As long as this is not as a result of an unrealistic change in our spending patterns and philosophies, I realize that we’ll get back to positive cash flow sooner rather than later.
The fact is, there is a reason that we say when it rains, it pours. I know that there is no scientific explanation for this, but it’s true. Things come in bunches. After our five disastrous money months, we strung together 7 or 8 consecutive positive money months and ended up close to back to where we started with our savings account. I have mentioned before that Gretchen and I have been living with the same income for long enough that we know what fits and what doesn’t fit when it comes to extra spending.
There are a few potential pitfalls that can present themselves in the midst of a negative balance stretch.
- Throw in the towel. Broken budgets are especially discouraging for households who are new to budgeting and trying to get in control of their finances. Motivation can really get crushed by early hiccups. I always warn people that this type of hurdle will almost inevitably come sooner rather than later and that they may as well expect it. We design budgets because they will work when consistently applied. Don’t throw in the towel just because of some abnormal months. That being said, a negative budget always merits some examination to determine whether there are some issues that can be addressed to solve it.
- Go wild. When you are working hard and not seeing results, there is always a temptation to just go on a destructive binge. If we’re just gonna lose money anyway, let’s LOSE MONEY! This proclamation is followed by a trip to Vegas. Contrary to the expression, what happens there doesn’t stay there. The credit card bill finds its way to your permanent address. There is a big difference between a little broke and seriously broke. Don’t make the mistake of thinking that one equals the other.
- Over react. One thing that I love about lifelong farmers is that they tend to be amazingly laid back. I think that it is because their living depends, in large part, on factors outside of their control. I bet every farmer spends a few years trying as hard as they can to will the weather to cooperate and then finally just accepts that it is what it is and will be what it will be. No need to get all out of sorts. Even with a good crop, they can’t control the prices. When things aren’t going according to plan, take inventory of your patterns. Are you doing a good job of controlling the things that can be controlled? If so, go hang out with some farmers. No sense losing sleep over things beyond your control. Now, if the thing causing your shortfalls is a permanent change in your situation, then something has to give, and it is time to bring up the D word (“d#wns@ze” –be brave, soldier).
- Denial. If you have a big smile frozen on your face and you say GREAT!!! before a person can ask how you are doing…well…this whole budget thing is really tearing you up.
Try and keep perspective as you do your finances. There will be some bad stretches. During those stretches, double check that you haven’t abandoned the money philosophy that has worked for you in the past. If it really just a case of raining and pouring, keep plugging away and doing what you know works for the long haul. None of us can determine or direct the different seasons of life.
One of my basic beliefs with both money and life is that responsibility and good intention will be rewarded. This belief keeps me on track when downward spirals seem to be beginning. We may have a down crop this year, but next year will be different. Keep a sense of humor. It’s better to be broke and happy than broke and miserable!
How’s your budget doing?
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This post was linked to Welcome Home Link Up at Raising Arrows, Titus 2 Tuesdays at Cornerstone Confessions, WLWW at Women Living Well, Simple Lives Thursday at Gnowfglins, Frugal Fridays at Life as Mom