Sometimes we find ourselves in family life, struggling to maintain a budget, and think we are the only ones out there dealing with similar issues. I mean, it’s easy to look at the neighbor across the street with the new truck, your best friend who is excited to spend money for the entire bottle of wine EVERY time you go out with her, and even family members that seem to have it all together when it comes to their finances.
The truth is…things aren’t always as they appear…am I correct?
I’ve been really nosey lately, asking questions about people’s financial lives…even some of the uncomfortable ones…so that we can all better understand that we are not the only ones struggling (or succeeding) when it comes to making the right financial decisions for our families, or powering through when times get tough.
It’s my pleasure to have the opportunity to feature Laura today. Laura lives in Canada with her husband of eight years and three kids, ages six, three, and one. Although Laura works primarily as a lawyer, she can also be found blogging about simplifying family life over at chaosandquiet.com.
Tip: If you want to get your budget on track for the upcoming year, grab my FREE Family Budget Workbook to get started. Find it HERE.
Income
One or Two Incomes?
Two
What’s the biggest struggle your family has when it comes to income?
Balancing the need to generate income with time for family.
What method do you use to keep track of your budget and why?
Spreadsheet, because of its simplicity.
How do you budget for kids clothing, school supplies, shoes, activities, and everything else kid-related?
Not well! I have an average budget amount in mind for these types of variable expenses, but it ebbs and flows greatly throughout the year. Our biggest kid-related expense is daycare. It’s the biggest line item in our budget, and unfortunately, it’s not going to change in the foreseeable future.
What is the biggest struggle you are currently having related to your budget?
Tracking consistently. I go through phases where I track every expense religiously, then I neglect it for months at a time.
Savings
What percentage of your income do you save each month?
Approximately 20%
Do you have an emergency savings account?
No, but we keep a large buffer in our chequing account.
Would you consider your emergency savings to be able to cover one major emergency, or to be of long-term assistance if, for example, you were to lose your income?
One major emergency. We would be able to make it work short-term on one income if we pulled the kids out of childcare.
Do you have special savings or “funds” set aside for vacations and/or other big purchases your family plans to make in the future?
Not at this time, but we will have a house fund set up soon.
Debt
Do you have debt that you are actively working to pay off?
Yes
How soon do you anticipate being out of debt?
In less than five years.
What is your current strategy (if any) for debt elimination?
Pay minimums monthly, and throw extra chunks of money at it whenever we can.
Anything else you’d like to include about debt, as it relates to you and your family?
We’re coming off 3 year-long maternity leaves in just under six years, so the goal has been to maintain basic debt repayments/savings through these low-income years. We were able to eliminate my student loans a couple of years ago, which was a huge load off our shoulders. Now that I’m back to work permanently we’re looking forward to finally getting rid of the last of our student loans.
Goals
Have you made short and/or long-term goals that you and your family are working toward? If so, will you share one or two of those goals and the steps you are taking to reach them?
Yes, we are working on getting the last of the student loans paid off by Summer 2019.
How did you come up with those specific goals?
We would like to move into a larger house in 2019/2020. For my peace of mind, the remaining student loan debt needs to be gone before we make that move.
Do you engage in a reward system for you and your family to celebrate the accomplishment of those goals?
No
Successes
What is the biggest success you have had to-date when it comes to your finances?
Paying for my own university education (undergraduate and law school), and finally paying off my student loans a couple of years ago.
Do you have other successes you’d like to share related to your finances?
Making it through three maternity leaves with a significant decrease in family income was a big success for us.
Struggles
What is the biggest struggle you have had related to your family finances over the past year?
This is a tough one. I think the biggest struggle we have is related to the fact that this stage of life is really expensive. Childcare is by far the biggest line item in our budget and affects our ability to tackle other savings and debt-repayment goals. We look back at our DINK days and wish we had been smarter with that extra money we had each month.
[tweetshare tweet=”We look back at our DINK days and wish we had been smarter with that extra money we had each month.” username=”sarahlbrumley”]If you could pinpoint one major failure you’ve had in your finances over your adult life, what would it be?
I should have started saving earlier (cliche answer, I know!). My husband and I were both in university until our late 20s, and when we finished we felt rushed to “catch up” to our peers – car, house, etc. – and then shortly after that we started having kids. If I could do it all over again, I’d make sure we were consistently putting money away towards retirement from the beginning, even if it meant pushing those goals off a bit.
Have you overcome that failure or is it something you are still working on?
We’re still working on catching up on retirement savings.
Finally…
If you could go back and tell your young adult self how to handle finances differently in the future, what is the one thing you would most like to share?
Be smarter with the extra money we had pre-kids, and specifically to max out retirement from the beginning.
How are you currently educating your children when it comes to finances?
They aren’t quite old enough, we’re just getting there with our oldest. I want to start them in the habit of saving young. I need to give more thought as to how best to handle this, as my oldest is just starting to understand money.
What is one topic you wish you knew more about, related to budgeting or family finance?
Investing
If you could share one piece of financial advice with those reading today, what would that be?
Determine your financial priorities and budget accordingly. Fund your priorities FIRST – don’t try to reach your financial goals with the money that’s left over each month (it will never be enough!).
I’m starting to see a trend when it comes to the recommendation for our younger selves: start saving earlier and invest in your retirement ASAP. I’m so thankful for Laura’s perspective on this today! If you are interested in connecting with Laura you can do so by checking out her blog, chaosandquiet.com, or by following her on Twitter and Instagram.
Tip: If you want to get your budget on track for the upcoming year, grab my FREE Family Budget Workbook to get started. Find it HERE.
