By Derek Reimherr
When we moved to Atlanta, we encountered a major problem.
I got a great new job opportunity, and so did Maggie. Commission is part of her pay structure, so for a little bit we’d be working off of just her base salary. But our household income was still very respectable for a young couple in their mid-20s. We didn’t move to Atlanta for jobs, though. We came back because we missed our people! And the first few months were great.
We fell in love with our new workplaces and we fell back in love with having more of our friends around (but shout out to our amazing Boston friends, we still miss you).
Wait, none of this sounds like a problem. Well, what I’m leaving out is that we were so excited about being back in Atlanta that we were doing all of this:
- Living in an expensive, bigger apartment in one of the most desired areas of Atlanta
- Decorating our new apartment because we wanted to host our friends as often as possible.
- Hanging out with our friends 3 or 4 nights a week
- Eating out at all of our new neighborhood restaurants 3-4 times a week
And then on top of that, all of this was also going on:
- Had major routine maintenance done on our existing car
- Paid off THREE tickets that a jerk New York State Trooper gave Maggie
- Bought a new car (more on that another time)
- Booked our fall trip to Denver
As you can imagine, you throw all that together, and we were having major cash flow problems. We were still saving money and contributing to our 401Ks, but we were wasting a lot of money.
Enter the Weekly Budget Meeting.
Some people like to make dates out of their budget meetings. Some people do it on Friday before the weekend starts, some do it on Sunday before the week starts.
The Reimherrs? We grab a seat at our kitchen counter every Tuesday night at 9pm. We figured we would rarely be out of town on Tuesdays and neither of us have standing Tuesday night commitments.
So how does this thing work? Do we sit around and talk about our five year plan and pick index funds to invest in? Nah, y’all give us too much credit. We spend 15-20 minutes looking at our budgets in Mint. That’s it!
We’ve recently pivoted from having little budgets for everything to going to the Zero Sum Budget model or as I refer to it, the Flex Spending Budget. It looks like this:
Income - Mandatory bills (rent, utilities, student loan payments) - Flex bills (groceries, gas) - Monthly savings goal (yes, you should have one) = Flex spending amount
Here’s an example:
$2,000 - (Rent - $400, Utilities - $100, Student Loans - $200) - (Groceries - $200, Gas - $100) - ($400 - saving goal) = $600 flex spending
Our idea is that we want to put all of our dollars to work before we go out with friends, buy some new shoes, or plan a trip. So during our weekly budget meeting, we look at our spending over the past week, ask questions, categorize transactions, and discuss ways we can improve.
- Hey, what was that $40 on Amazon?
- By the way, I have a doctor’s appointment next week. Our co-pay is $30 and I think the medicine will cost about $40.
- Let’s not go out this weekend so we can save more for our Harry Potter World trip (SO EXCITED) in the spring.
The goal is to have an open, honest discussion about finances. Talk about the things that are coming up soon. Look to see if you’re wasting any money. Spot trends in your expenses.
You will be AMAZED by the headway you can make on your finances when you take the time. This is crucial for us to avoid incurring interest on the various credit cards we carry. In fact, today we canceled several subscriptions and changed our PlayStation Vue package, giving us $100 more to save each month.
What strategies have you tried with your finances? We’d love to hear and try them out ourselves!