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Becoming a WAHM: Budgeting – Part 3

Once you have determined you’re willing to put in a tremendous amount of effort in order successfully work from home and you’ve streamlined your life and developed organization, you’re not quite ready to jump headfirst into beginning your business. There’s one more thing which you need to have in place in order to have a strong foundation for a successfully working from home.

What is that one thing? It is that you need to be operating on a workable written budget. I’m not speaking of a budget for your business here, I’m talking about you personally living on a budget.

Why is this so important? Well for one, I’ve seen a lot of families who think they have an income problem when really they have a disorganization and self-discipline problem. You see, if you think you can’t make ends meet and you need to dramatically increase your income and yet you don’t even have a plan in place for your money, how do you know you can’t make ends meet? Perhaps the ends would meet just fine if you’d buckle down and start giving every dollar a name.

There will never be enough money for those who lack self-discipline. Increasing your income won’t fix the problem if the problem is that you aren’t willing to work hard and wait until you can afford something.

As I wrote earlier:

Why am I such a big proponent of living on a budget? It is because I know
that were it not for our budget and the grace of God, we would very
likely be up to our eyeballs in debt right now, barely making ends
meet–just like pretty much all the rest of our law school friends are.
We wouldn’t be living comfortably well below our means, we wouldn’t
have an emergency fund of six months’ expenses in the bank, and we certainly wouldn’t be on a savings plan to pay 100% down for a home in 3-5 years.

we’re frugal (I came into the marriage frugal, my husband has learned
to be out of necessity!), but we would be miles behind where we are now
without a written budget. I know this because we’ve done the math and
we know without a doubt that having a written budget, giving every
dollar a name, and putting it on paper, on purpose (to quote a few Dave Ramsey lines) has saved us literally thousands of dollars over the last five years.

Setting up a cash-flow plan is imperative before you start a business because it enables you to make your money work for you. Instead of you being a slave to a mountain of ever-increasing bills, you are at the helm of the ship with a written plan in place for every dollar you make. Your money will go farther, your stress levels will dramatically decrease, and you’ll be in great shape to become a WAHM!

Note: If budgeting is new to you, start with this post. Then go get yourself a copy of The Total Money Makeover. Dave walks you step-by-step through a plan to revolutionize your life and experience financial peace. In addition to The Total Money Makeover, I highly recommend this DVD on Cash-Flow Planning (this DVD was one of my first exposures to Dave Ramsey and it completely won me over! If you are a visual learner, this will especially be helpful.)

Just for fun: How many of you live on a budget? What has been the single greatest benefit your family has experienced by living on a budget?

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  • Eden C. says:

    My husband & I have been on a budget (only for the past three months because we are newly married), but we are already seeing the blessings of ever starting it. It is unbelievable how much more organized your life is when you know how much you have, where you have it, where you can spend what, etc. It also gives us a sense of control. We KNOW where all our money is, not just having some mental estimation or NO idea at all.

    And we would COMPLETELY agree with Crystal about taking the Dave Ramsey course. We are in the middle of it now & it is SO worth it.

  • Sarah says:

    Dave Ramsey is awesome!!! With the help of his book we paid off $20,000 in debt in 18 months! With the exception of our two cars (one of which will be paid off by May 09)and our house…we are debt free:) He has been a blessing in our lives!

  • Sarah says:

    We live on a budget. We have been able to pay off thousands in debt in the last few years. I am able to stay home w/ my kids, and my husband makes an average, blue-collar wage. We did buy a house with a 15 FR Mortgage, but it will actually be paid off in closer to three years. We do a lot of small things to save as well (cloth diapers, scratch meals, etc.) but we enjoy knowing where our money goes and being able to do these things b/c we choose to, not b/c we have to. We also have a good concept of what money is worth. For example, my sister picks up a little toy for my kids and says “It was only $.98.” I tell her “Well, that will buy a dozen eggs on sale.” By knowing exactly what you spend, it helps you to think “Is this purchase worth it?”

  • robin says:

    We recently went to the Total Money Makeover event and were wowed! We feel like living on a budget has given us tremendous freedom, yes, FREEDOM! Spending without guilt is a new concept for us. It feels so great to have goals in place and finally have some control over our finances. Your site has also served as such a source of encouragement and help for me as we navigate these new waters of frugality – thank you!

  • MaryAnn says:

    Amen and amen, Crystal! I found Dave Ramsey in January of this year, and his teachings have changed my life. Neither my husband nor I had any idea where our money was going every month, we were behind on bills of all sorts, except the mortgage, and we always angry with each other. Six months later, we live on a written zero-based budget, we no longer use credit cards for anything ever, we have $1000 in the Emergency Fund, we have knocked off 5 debts, and we have begun paying off the rest of our credit card debt.

    The best part of living on a budget (and I cannot believe I just typed that!) is that we are now a TEAM. We are working this plan together in order to reach our goals, and it has been such a blessing to our marriage as well as our finances. We will be attending his live event in Tampa in the fall, and we can’t wait for that shot in the arm!

    Now if only Money Saving Mom would go on tour! 🙂

  • Lydia says:

    My husband and I have been using a budget since we got married 1 1/2 years ago. Even though at times it can feel a little cramping, I would never change to living without a budget! We have been able to save lots of money because we know exactly how we are spending our money and limit ourselves to only a certain amount for every category each month. I feel like it had made us responsible spenders and I think twice before I buy something because I know it will leave me with only so much to spend in that category…which minimizes unnecessary purchases.

    If you haven’t tried a budget…start today and I almost guarantee that you will see the rewards if you can stick with it 3 or 4 months.

  • Martha says:

    I’ve only been on a true budget (knowing where every dollar is being spent) for about 3 months. I’m pretty sure between the budget, CVS, and couponing, I’ve cut my grocery expenses by at least half. And while these things take time, I look at it like a second job, just like you explained a while back. And this “job” can be done any time I want, and probably pays better than any real second job I could get (which I can’t being a single mom). So I thank you for all the time you put in to helping other people. You are a true, true blessing, Crystal. May the Lord bless you abundantly for helping so many people.

  • Amy says:

    Living on a budget has allowed me to quit a 55K a year job to be at home with my son for the past 8 months and not have to change our lifestyle that much. When we started budgeting and went back and looked at our spending I was appalled! Now that I will be going back to work part time, my mind is just whirling with where we can put that money! IRA, 529, Fully funded HSA here we come!

  • Mrs. Querido says:

    We live on a budget…doin’ our Dave Ramsey thing…lol! The best thing we have gotten because of our budgeting? For me to be able to stay at home with our three children and only live off of my husband’s income (which is lower than most) while owning a home and two vehicles! We are living the American dream and paying off debt while doing it! We are blessed…God is good!


    Mrs. Q

  • Katie L says:

    We’ve been living on a written budget since we got married 5 years ago, and have really been serious about following it (for us, this means cash instead of debit cards for most purchases), for the last year. The biggest benefit is that since I left work to stay home with our daughter, we’ve paid off our cars and student loans and planned out our savings to pay cash for seminary in a few years. What a blessing for my husband to be able to accept a call to ministry without the burden of loans!

  • I’m a stay-at-home mom with 3 young kids so we have been in budget land for quite a while now. It’s good though- we have a system that works for us (I get a specific amount for gas, groceries and eating out for each week- when it’s gone it’s gone). I think that one of the best things about being on a budget is that it’s teaching our kids money skills at a young age. For instance we usually hit McDonalds on Tuesdays for lunch (it’s our little tradition), but this week we’re going to see a movie on Wednesday. They have to choose if they want to have lunch or a movie- they won’t get both. We’re hoping to build a good financial foundation with them (they’re 5, 3, and 2) so that hopefully they won’t make some of the mistakes that we made.

  • Leslie says:

    My husband and I went to Dave Ramsey’s Financial Peace University a few years ago and we have been living on a budget every since. One of my favorite things is paying for food, meals out, gas, etc. with cash. This has cut down tremendously on the number of receipts that I need to keep track of and enter into the checkbook. It is great not having to pay credit card bills every month too!

  • Stacy says:

    When I met my husband in 2001, he gave me a copy of Financial Peace. At the time, I had a car loan and several credit cards and was struggling every month. I immediately went on a budget and began paying off the debt. When we got married in 2002, we began attacking the cards one by one and then the car. My husband had always been a huge Dave fan and actually works for Dave now. We love paying cash for things and money has rarely been a source of stress in our marriage which has been a huge blessing.

  • Trixie says:

    Our budget is our best friend! If you think you have money problems before being self employed, think again. If you are not organized and in control of your money before starting a business things will be twice as bad after starting one! My clients will tell you that:)

    Another very helpful thing is to NEVER mix up your personal money with business money. If you start a business and rightfully expect to live off the profits there’s no problem.Just transfer the money out of your business account on a regualar basis into your personal checking. Be sure to keep everything very well documented.

    One big pitfall as a business owner is that sometimes you have large deposits into your business accounts. It seems like “free money” and you could use it to hmmmm… pay down personal debt, buy a couch, car or take a vacation. Do not do it unless you are sure the business expenses (including taxes) are met first.

    Take Care,


  • christy says:

    we just started to budget cause we had to we have to pay child support now and its a lot (long story not going there) but before we seemed to always be broke and we were in debt bad but we changed everything and have all credit cards paid off and paid cash for my older van and we are working on paying my husbands truck off and we always have money left over and saved something we never had before because of all the eating out and just spending money on things we did not need so i am very thankful for the budget we have now!!

  • Marie says:

    We have been on every penny has a job budget since February 2007 or 17 months. Before that I had a general budget that worked fine but counting every penny has wrought miracles. Basically we have been able to avoid lifestyle creep. My spouse really wants cell phones but he can see what that would do to our savings. We don’t have cable and we don’t have a second car – because we’d rather not have nother loan. We have a good amount of breathing room in our budget so we can have me stay at home and not worry. We have 5 weeks in our e-fund and we are working on getting it to 12.

  • deano says:

    House and all…
    Feels great, but it’s always a challenge to stay on a budget. Just goes to show, you can’t out-earn your own stupidity! Even without a mortgage, my wife & I still have budget meetings on a regular basis!
    Sarah, where do you find $.98/dozen eggs? 😉

  • kendra says:

    We’ve been living on a budget for about four years now and like a previous poster, I left a $60K a year job to stay at home with my little ones. Seeing where our money goes each month has made us really financially saavy. Plus we’ve been using the idea of paying ourselves first and that’s built us up a really nice nest egg.

    If anyone would like the budget spreadsheet that I use, you can find it here:

  • Shannon says:

    Learning what God’s word says about handling money and then applying those principles have helped us not only be able to budget and save money, but to be content where God has us. It is not easy to stay at home when things are tight, but knowing that God will always provide for those things that bring him glory(raising Godly children)is a great truth to learn!

  • Phoebe says:

    We attended FPU through our church in Sept. 07. At that time, we were using credit cards monthly and really had no set plan for our finances. Today, we are in a completely different place. We do not use credit cards for anything, we use cash for almost every purchase, we have an emergency fund in place, and actually have paid off over $12,000 in debt! It is absolutely AMAZING what happens in your life when you have a plan in place, every dollar has a name, and you know exactly where your money is going..before it goes there. The stress in our family life and marriage has almost disappeared. Living on our budget has made us truly realize just how much we are blessed. Before doing Dave Ramsey’s plan, we thought we would be in debt for the rest of our lives…on our current plan, we will be debt-free in a few short years. That is priceless!

  • Holly says:

    Our household has been “working the baby steps” for almost 2 years now. We’ve paid off thousands in debt, incurred NO new debt, and I was just able to quit my full-time job to stay at home with my two (soon to be three) kids. Its going to be a while before we’ll be debt-free, but the knowledge that we have a plan and a workable budget every month is priceless!!

  • SmlTwnLdy says:

    We have lived on a rather strict budget for 3-5 years. We’ve lived on a Dave Ramsey, cash envelope budget for 1 year. I was doubtful and thought we were doing fine before going to cash, but it has been a blessing. We actually wrote a $2,000 check towards the principal on the car we are paying. It’s as if money appears out of nowhere because now it has a name, ie. car pay-off fund, clothing, Christmas, savings, etc. I used to be the biggest anti-budget person, but now I know how much money we have for any type of expense.

  • Yeah, Sarah, where do you get $.98/dozen eggs? 🙂

    We live on a budget, counting every penny. My husband makes a very generous salary and, although we’ve lived without a budget before, being on one means we actually know where our money goes. And it gives us FREEDOM. Freedom to be generous. Freedom to know that in XXX months we’ll have the money to buy a car with cash. But it also means we don’t waste money. I hate to think how much all the unaccounted trips to Starbucks or McDonalds added up to. It also is a tool for us to see exactly how much an extra $20 a month in savings adds up to. Do we really want cable? Umm,, no!! That’s almost another mortgage payment!

  • Lisa Fischer says:

    Blah blah blah…we’ve been on the DR plan for over a year now & have done great (family of 6 with one small income of 35k/year) as far as I’m concerned.

    Here’s my problem. We have it in the budget to go on a vacation (15 yr wedding annv) come October. We planned around $3000 for this trip. So a few months ago I was surfing the web & trying to pick a place to go. Wasn’t getting ANY input from my husband & so I finally just quit looking. Well now it’s only a few months away & he said he just can’t stand the idea of spending THAT much on a week’s vacation (even if it IS in the budget!!)

    So I said fine, forget it, guess we won’t be going anywhere. He wants to go on a train ride (amtrak or something I guess) which I really don’t have a desire for…I was thinking caribbean all inclusive.

    Happy Anniversary to us, huh!?!?

  • Kasey says:

    I am a budget believer! I firmly believe that our greatest fears stem from the unknown, and if your money is unknown, then you are afraid of it! I would much rather face the facts and know where my money is going than to not know and live in worry and fear. Having a budget means that I can meet all of my financial obligations and still have money left over for fun. And then that fun really IS fun because I’m not worrying that I’m using money I don’t have.

    My other great blessing from budgeting is the way that my mind has been stretched with creativity! I am so amazed at the way God can inspire us to think outside the box when we are in need. Even now that our budget is not quite so pinched, I am still in the habit of trying to find new and better ways to save a few bucks. Couponing has become such a fun and rewarding hobby for me that I don’t know that I would ever give it up- even if I won the lottery and became rich overnight!

    There is no better feeling than to have peace in your heart knowing that you are able to meet your financial responsibilities and have a reserve for a rainy day. Nothing you can ever buy can give you that feeling.

    So much thanks for all you do, Crystal!

  • Alexis says:

    Before my parents were married, they purposed never to get into debt…and 25 years later, they’ve still kept their promise to each other and to God. I am one of 14 children, and some people ask, “how do you do it?…you must be rich”. No…we’re not rich, it’s just that trust a great God who has enabled us to live on a budget. We would never have been able to buy our home debt free, or pay for all of our medical bills, if a budget was out of the picture.
    “A man deviseth his ways, but the Lord establisheth his steps.”-Ps.16:9

    Alexis from Florida

  • Brian says:

    Wet noodle for Michele! you wan’t to spend nearly 10% of your annual income on a vacation??? Are you debt free? Do you have 3-6mos in a EF? Are you socking the 10-15% for retirement? Unless you can say yes to all of the above, I would have to agree w/your husband….please call Dave TODAY! he will let you know what you should do, and I think it will involve several wet noodles…

    We’ve been DRheads for five years. It took us four years to pay off nearly $80,000 in consumer debt. NOT INCLUDING the house. Our income is about $40K after taxes, and DW is a SAHM. Without a budget, we would have continued on a downward spiral.

  • Single greatest benefit to living on a budget?


    Ok, so we’re not QUITE debt-free yet, but we’re SO close I can taste it! There is something radical and fantastic about telling your money where to go instead of having it tell you where to go!

    We have been on DR’s plan for about 15 months and have paid off over $15,000 on one income in that time! We love Dave!!!!!

  • Rachel says:

    We have embraced the budget in our home! It has been such a great blessing and has strengthened our marriage and communication. I love knowing where the money is going and feeling like I know where the bank account is at each week. My husband loves knowing that each month, we are making progress towards our goals. We paid off our car in early May and are know working on those nasty student loans!!

  • Jenn says:

    My husband and I are newlyweds. We have budgeted down to the dollar every month for over a year since we married and amassed about $25,000. Our biggest challenges are his lack of earning capacity and need for an advanced degree and the high cost of housing. Why is the government proposing a mass bail out of fiscally irresponsible persons while the rest of us scrimp and save and still cannot afford these overpriced homes in our areas??

    Dishearted but budgeting along (and grateful to Dave’s wisdom before our marriage)

  • CKR says:

    I wrote a post about budgeting at my blog not too long ago. We have found our budget very freeing. We know how much we have to spend in each category and it really takes the worry out of our daily finances. It also helps us to make tithing and saving priorities…both are accounted for in the budget.

  • Jennie from AZ says:

    The best blessing we’ve received among MANY is PEACE. Peace of conscience, peace knowing we have a plan, peace knowing that we won’t have to worry about when that car registration comes up once a year, or now even planning for Christmas!

    I used to worry a ton since we live on student loans and we have to run a very tight ship. I was feeling guilty about any necessary purchases I was making, just because I knew it was spending money and I didn’t know if we would make it to the end of the quarter (we get loan disbursements quarterly).

    By budgeting ourselves, I have found that we have enough to live on and to save for future expenses. I no longer feel guilty all the time about spending money because I know how much I’m alloted each month and have learned to just say “no” to purchases when the money in that category was used up.

    I couldn’t have done this without a supportive husband, and Heavenly Father and Jesus Christ.

    Of course, CVSing and coupons have made this all possible too! Thanks for all you do Crystal! You have blessed us so much!

  • Rebecca says:

    We’ve really just had to start clamping down on a budget when we realized how much CC debt we actually have! It’s scary. We’ve got a toddler and another on the way (due next month) so we needed to find a way to make sure we could pay all our bills- buy groceries and still put more than minimum to the cc. We’ve got the dave ramsey book on request from the library. I hear it’s wonderful. But this site has really been super! Thanks so much!

  • Iva says:

    I don’t work during the summer so that I can stay home with the kids. Without a budget in place, we wouldn’t eat! A budget really is liberating – even if it’s the point of, “Well, we’re broke again – but at least bills are paid!” kind of thing.

  • msallen says:

    We have lived on a budget for 14 years, ever since we got married. It was one of the best pieces of advice we were given! We have only had one fight about money in all that time- DH wanted to go to TX to be in a friend’s wedding, but we had twin babies and one modest income. This particular expense just didn’t have a budget category to cover it. Thankfully, God stepped into the discussion by having my grandparents send us an unexpected gift that covered all of the wedding trip costs.

    Having a budget helps avoid unnecessary spending because you can see if the money is available or not. DH and I also have a rule that purchases over $30 need to be discussed first. One look at the computer can make the decision for us both.

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