Fast Spending or Spending Fast?

Well, I’m back on the blog to tell you about my latest project of sorts.  First, a little recap…Remember in my last post where I mentioned that I got laid off in 2015, and then I found a “great” job in 2016?  Well it turns out that “great” job wasn’t as great as I would have hoped.  I don’t want to sound dramatic, so I’ll just say it was sort of the single worst professional experience of my life.  I made it work for as long as I could, because you know, I like electricity and the ability to buy food and stuff, but it was clear from just a few months in that this was not going to be a long-term career opportunity.  I left in November for a very different kind of role with an oil and gas company that provides client-based services and solutions.  It’s hard to describe exactly what I do at this company, except to say I have clients and I provide services and solutions related to oil and gas exploration and production.  Sexy huh?

The good news is I’m really enjoying the freedom and flexibility at this company. The owner is great and has treated me with the utmost respect and kindness.  The bad news is it doesn’t pay nearly as well as my prior jobs.  The salary is split about 50/50 with bi-annual bonuses, so the potential to make my typical income is definitely there, but I have seen a steep decline in my monthly pay.  But, as has been the theme in our lives since Milton and I met, the Lord is taking care of us and the pay is sufficient to meet our needs and then some.  The bonuses will just be icing on the cake.  Fingers crossed.  I love icing.

With our new income situation weighing heavy on me, we made an effort over the past couple of months to pay down all non-mortgage debt and set aside extra savings for upcoming one-off expenditures like planned vacations or deductibles for unanticipated medical issues.  We didn’t actually have any debt besides a car loan, so we worked hard on that and paid if off last week!  Yay us!  It feels good to be out from under that payment, especially heading into what will feel like a lean year.  Now we can focus all our extra funds on the mortgage, which sincerely feels like fun to me. I’m not sure Milton shares my enthusiasm.

We already live with a very formal budget, but we have routinely blown through the discretionary spending categories over the past year simply because we were very flush with cash and we could.  It’s a problem of being financially lazy, since our needs are easily met.  We’ve let our wants get totally out of control. Our next life goal is to start a family, and with that comes additional expenses like increased health insurance and daycare.  I want us to start living like we have these obligations now so that when those bills really do kick in, we won’t feel the shock.  The best way to do this is to exercise more rigid control over our budget starting today.  Ergo, we are officially on a spending fast for the remainder of 2017.

What is a spending fast?  I’m so glad you asked.  It’s simply a refrain from all non-essential spending for a set period of time, in this case 10 months. Here’s how it works:

First you establish ground rules -

1. We will spend our current allotted budget on our “normal” expenses: mortgage, utilities, phone, insurance, etc.
2. We will continue to tithe on 10% of our gross pay – this is one of our largest monthly expenses, but you don’t get ahead by stiffing God. Ever. 
3. We will continue to contribute 10% of our gross pay to retirement savings. This amount does not include our company matches that bring total retirement savings to 15%.
4. We will still budget the same amounts for gas and groceries/restaurants, but I have reduced our cash and miscellaneous spending to just $500/month.  That probably sounds like a lot, but this is the category that gets plowed through every month on nonessentials, so this is where the challenge lies.  I feel like at that amount we should still be able to exercise some discretionary spending on experiences and unforeseen items without making ourselves feel like we live in a prison.
5. We are keeping our gym membership since we actually use it and health is important, plus it’s an activity we enjoy.  We will also still get professional haircuts, although I will be switching the frequency of mine to every other month instead of every 6 weeks.  
6. We will not spend any money on electronics and other “toys,” clothing, jewelry, make-up, or hair-care products outside the replacement of a product we have used up completely and love enough to buy that exact item again.  If we don’t love that exact item, but we sincerely need a replacement, we will seek out a cost-effective alternative.  I have cleaned out my bathroom drawers and cabinets and condensed all my sample items, lotions, creams, etc. into a few boxes with a goal of actually using those items up this year.  It’s amazing how many high quality products I had just sitting around the bathroom collecting dust.  
7. We will still purchase gifts as needed but with a significantly reduced budget – we will also be making gifts or re-gifting as much as possible, as well as shopping sales.
8. We will allow ourselves to replace work required clothing items if the prior item is beyond repair or professionalism, but in those instances, we will shop sales and only replace the exact item needed.
9. We are currently trying to have a baby and in the event that I become pregnant this year, I have set aside a modest but reasonable budget to prep for baby/nursery supplies.  

Next, decide what you’re going to do with the extra money you save – 

We already have a 6-month emergency fund and a healthy balance in savings for a rainy day or an unexpected expense, so all our extra money at the end of each month will go directly to the principal on our mortgage.  I can’t wait to see that debt shrink!

On your mark, get set, go (or I guess, stop) - 

I’ve researched the idea of a spending fast quite a bit over the past few weeks, and I found some helpful advice that said to go ahead and purchase anything that will help you feel more secure prior to beginning the spending fast.  This is not a license to buy gift cards or go nuts with the credit card, although it does feel a little like having one last party before you go to rehab.

I thought about what I really needed, and I purchased a year supply of my favorite non-store brand shampoo and hairspray at a very good sale price.  This is something I hate buying because it’s so expensive, but since it was on a huge sale, I figured stocking up for the year made sense.  I have also purchased a new pair of black office heels using a gift card to cover part of the expense.  My old pair went in the trash, so this was clearly a necessity.  My husband purchased some new Tennis shoes at a steep discount as well as a few pairs of work trousers on sale.  I'll be honest here and admit that he is not the culprit when it comes to overspending, so I won’t be monitoring his purchases as closely as I will my own. We also used a Visa gift card we received when switching our cell phone plans to cover all but $160 of our season tickets for the OKC Broadway performances in 2017/2018!  This was an obvious splurge, but it is an activity we really enjoy and should provide us some very cost effective dates this year.  Being able to use the gift card saved us almost $450, which I think is a huge win.

I’m excited to live on less and prove that we will not just survive but actually thrive.  Join me, won’t you?  Or don’t, I mean, it’s not for everyone.  But either way, I look forward to keeping you updated with our progress.