Changing behavior with money is the key to budgeting. Paraphrasing one of my favorite quotes by Charles Swindoll “Life is 10% what happens to me and 90% how I react to it” reflects how I feel about money. Its amazing how funding an emergency fund changes our reactions. I’ve experienced its unwise to make financial decisions after a divorce or a death, and let our emotions guide the decision.
After my divorce, my son called me a shop-a-holic once, of course I was standing in the kitchen with several plastic bags from a well-known retailer in both hands so I couldn’t argue the observation. I was shocked because I couldn’t see this in myself.
Money is also about relationships, we spend money on what’s most important to us. When our kids ask to borrow twenty dollars, we don’t lend it. If we have it, we give it as a gift, not a loan. My daughter tells me she has the twenty to repay me – I tell her “Keep it, spend it on your kids.”
Yesterday, I wasn’t expecting the text I got from my former life insurance agent. We dropped our whole life policies with her company saving $180 on our monthly expenses. (We both have term life policies in place for a lot less money). Her accusatory reaction reflected how we behaved before starting our debt-free plan. I don’t hold it against her, she’d been over to our home a few times and we had some nice conversations. I had contemplated how this would affect her, and her reaction reinforces how much we were over paying.
Saving a few dollars but harming a relationship is something to consider. I have been going to Gracie Mae salon for my hair over three years. I tried a manicure with gel polish, but after months of trial and error it didn’t work out. I decided to get pedicures at Gracie Mae instead because this is her business and we’ve built a relationship over the years. I’ve followed her to different salons and now she owns her own salon out of her first home. Sure, I could save a few dollars on my budget – but I value the relationship more.
The most important relationship we have with money is with our spouse or partner. My husband and I had our first disagreement over the budget this morning. Saturday morning was our second budget meeting, and we made several revisions to make our budget and actual numbers match. We have different ideas, he wants to pay the credit cards down for an emergency, but I showed him we have the emergency fund started. This is not easy, but its worth it!