It’s time for our weekly spending report! I’ve given up on the theory that there is ever such a thing as a “normal week”. Really, it just doesn’t exist. Some weeks are uneventful and quite while others are filled to the brim with special occasions. I doubt we’ll ever see a spending report that doesn’t reflect something not “normal.”
In the case of the spending this week, our “unusual” expenses were related to a couple of travel days for me, and a purchase to prepare for an upcoming special event. A couple of weeks ago it was the dog coming home from obedience school. There are just always things that make you want to say “this isn’t a normal week of spending” — but that’s just it, that’s the normal part. Those things are always there, they just change.
And if you don’t have the extra wiggle room in your budget, those things can absolutely put you in a bind.
We’re really thankful to have that wiggle room right now, but in the past, not having it has busted our budget to pieces. And it seems that those surprise expenses are how a lot of families end up behind financially.
During my visit to Wichita this week I had a great chat with my friend Erin about this (seriously, check her out over on YouTube and Instagram). She’s been busting her butt to pay off debt for the past year or so and is currently working on building sinking funds. Over the course of our financial plan comparison, I realized that there really just isn’t a “one size fits all” solution, despite what Dave Ramsey and his fans will tell you.
I will firmly stand behind having a small emergency fund to shield you from small financial hiccups (I actually call this a buffer), and paying off high-interest debt is a great priority, but I will advocate all day long for sinking funds early on in your financial plan as they will help get you off the hamster wheel caused by those “not normal” spending weeks.
These items tend to fall into three categories:
Things I Forgot to Budget For
I keep an ongoing list for when things like this pop up and then I prepare for them when I think they’re going to come around again. It’s things like vet and grooming appointments for our dog, new clothes for our kids, wedding gifts, and homeschool supplies.
Things I Want to Say Yes To
These are things that I know may come up, but I can’t put a time frame, too. And these things reflect our family values. When they pop up, we want to be able to say yes to them without having to overhaul our budget. For our family, this is weekend trips to visit friends and family, homeschool outings, or purchases that will help us with our RV-life or no-waste goals.
Things I Need to Be Prepared For
These are the ones that aren’t fun, but you can’t afford to be caught with your pants down when it happens. If you’re an online entrepreneur like me, it’s things like a slow month in your business or a dead laptop. It’s things like having the money for your insurance deductible set aside (especially if it’s more than your emergency fund). If you’re a homeowner, it might even be money to replace for your 15-year old furnace when it finally dies.
Obviously, your current budget space, chapter in life, and family values will affect what these sinking funds look like. Personal finance is, after all, quite personal. The important thing is that you recognize the need for these, and where they fit into your plan.
For us, right now, our need to fix our truck supersedes our needs for most of these sinking funds, but I have them in mind for once we pass that milestone. The flexibility of my income and our current expenses also downgrades the urgency of having them.
If your income isn’t flexible enough to absorb some of these things when they pop up, sinking funds are highly important to keep you from going in a hole.
Weekly Spending Report
-$120 train tickets
-$178.78 dress and shoes for an upcoming event
-$120.97 transfer to savings
-$92.9 life insurance
-$8.54 lunch for me
-$10.72 lunch for Josh
-$6.5 tea and snack on the train
-$3.71 transfer to savings
+ Payment for Client Work
-$92.9 life insurance
-$89.76 RV insurance
-$1.75 transfer to savings
-$157.83 truck insurance
-$5.25 tea and snack on the train
-$7.27 movie rental
-$7.78 business expenses
Truth be told, I’m really excited about this week’s report. Our overall spending wasn’t that much less than the previous two weeks, but we cut our dining out by nearly 80%. I’m sure me being out of town for three days helped with that, but I’ll take the win.
I was less than thrilled about paying for life insurance twice this week, but somehow automatic payments were turned off last month and I failed to notice. Life insurance is a priority, so fixing that was a no-brainer. (And that also alerted me to a hole in our financial tracking that needs to be fixed, more on that coming soon.)
And if your eyes bulged a little bit at what I spent on a dress and a pair of shoes, I understand. This is an area where family and personal priorities come into play. Downsizing my wardrobe came with the territory when we downsized from our huge house to our travel trailer. I took that opportunity to really look at what I had and make decisions about what was important to me about clothing. I own about 1/5 of what I did before, which was already much less than most women I know. And anytime I add a piece to my capsule wardrobe, I’m very mindful of comfort, quality, sustainability, care requirements, and flexibility. This ultimately means that I buy a lot fewer pieces and am very thoughtful in the process. And it often means those pieces cost quite a bit more than if I’d just gone into Target or Old Navy and grabbed something. Not to mention things bought there wouldn’t last nearly as long and would need to be replaced more often.
If you’re still shaking your head about this, I suggest applying Amy Pohler’s quote: “Good for her! Not for me.”