Live Within Your Means

Our society is consumer driven and materialistically focused.  I have noticed, however, in the past months that people are becoming more financially concerned and are beginning to make changes in their lives to accommodate their financial situations.  The country’s recession is beginning to teach people the importance of budgeting, spending less, and living within their means. Indianapolis counselors would tell you the same thing.

My husband and I have been financially focused since the moment we were married.  We prepared to manage our money by taking a financial budgeting class during the two months before our wedding.  What a blessing to our marriage!  We have not had a single fight about money in our first year of marriage and have worked together as a team to accomplish our financial goals!  It has been amazing for our relationship and amazing for our checkbooks!

Thanks to Dave Ramsey, creator of the Financial Peace University budgeting classes, my husband and I have learned invaluable details about living within our means and gaining the peace we’ve always wanted.  The steps we’ve taken to live within our means are listed below.

Step One:  Emergency Fund

The term “emergency fund” is used by Dave Ramsey and refers to an amount of $1,000.  He recommends saving $1,000, placing it in the bank, and leaving it there in case of emergency.  An emergency to Dave is having a car break down or a washing machine die.  It’s not taking $100 to see your favorite band or buying a brand new TV when your old one becomes unexciting.  My husband and I actually saved $2,000 for our emergency fund just to be extra safe.  I’m glad we did because my brakes went out and needed replaced.  We were able to fix them with the money we had in the emergency fund and not charge the repairs to a credit card!  How liberating!

Step Two: Evaluate necessities and non-necessities.

To us, necessities are food, clothing, utilities and shelter.  We make sure that we can eat every month, pay our rent and utilities, and have clothing to wear.  What has helped us significantly in living within our means is not having cable or internet access from home.  I know this sounds crazy to some of you, but we haven’t needed it.  We won’t die without cable and we both have internet access at work.  I challenge you to think about eliminating these non-essential items from your list of necessities.  The money you save each month from these items could help you pay off your credit card bills.

Step Three:  Budget

Each month my husband and I sit down together and write out what will be spend in the month to come.  We calculate our income and expenses and work with our budget to not overspend.  If you are spending more money each month than you are making, it’s seriously time to reevaluate your expenses and create a plan to start spending less than your income.  Be creative with your expenses.  Start taking your lunch to work and only eat out once a month.  Rent movies instead of going to the movie theater.  Buy off brand groceries and toiletries.  Sell your car and buy an old but reliable vehicle.  Do whatever you need to do to keep your expenses less than your income.

Step Four: Pay off debt.

Once you have a surplus of money each month, begin paying off debt.  Start with your smallest debt and eliminate it.  Send any extra money for the month toward the debt.  Don’t spend it on yourself.  Then when your smallest debt is paid off, move to the next.

Step Five:  Work together.

Working together as a couple or family to live within your means will give you a sense of great accomplishment.  I believe my husband and I have grown incredibly close, built trust, and created new patterns of interacting because we have been able to celebrate our triumphs of budgeting together.  We have not worried about who is spending money because we already know at the beginning of the month where our money is going.  Continue to be a team and work together as you budget and make sacrifices for your family.  You will be extremely glad you did as you watch your family benefit from living within your means.

Following these steps has been incredibly beneficial for my husband and I.  We have seen tremendous growth in our relationship and financial situation, and I encourage you to make changes in your lifestyle now that will greatly impact your future. 

Written By: Kristie Watts

Kristie has her Masters in Marriage and Family Therapy and is passionate about relational health, personal growth, and empowerment of individuals, couples, and families.  Her desire is to reach couples, families, and individuals in the Indianapolis, IN area through the writing and practice of Marriage and Family Therapy.