Joel and I sat down to a long-overdue business meeting this morning and hashed out our budget. Actually, our first step was to list our one-year goals as a couple, including family, financial, personal, and professional goals. These goals may or may not have included "no more back pain!" and "get a normal job!". I won't tell you which goal was whose.
This was a great experience. I'm reminded of a well-known piece of wisdom: Begin with the end in mind. If you don't know where you want to end up, how will you ever get there? It was neat to envision where we want to be in another twelve months. We also hope to do the same with five-year goals and perhaps longer-term goals than that, but this was a good start.
When we had listed our financial goals in particular (though some of our personal goals are related), we realized that our next priority had to be examining the budget. We have been sorely remiss in not evaluating our financial situation monthly, or even bimonthly, in the recent past, with the result that we weren't entirely sure where we stood in relation to our financial goals.
Enter Operation Snowball.
I don't know whether you're familiar with the Snowball philosophy of getting out of debt. It's from the Dave Ramsey school of thought, I believe (if not him, then someone similar with perhaps a different hairstyle). You write a budget that involves minimum monthly payments toward each of your debts, and look to see whether you have a monthly surplus or deficit. We found ourselves extremely fortunate to have a modest monthly surplus - the advantage of going from one income to two, and downgrading our housing for this year. This is where the Snowball philosophy kicks in.
As we looked at putting all of our monthly surplus toward the debt with the lowest monthly payment, we realized we could be rid of that one by January (!!). Roll the monthly surplus and what we had been paying toward that debt into a payment for the second-lowest-monthly debt, and we can be rid of debt #2 by May! Wow, this is really working! And miracle or miracles, when we take all of the monthly surplus + debt 1 payment + debt 2 payment and put it toward debt #3 each month, we'll be done with that one a short time later. Voila, financial goals #1, 3 and 4 passed and surpassed with style.
We are really, really motivated to stick with this, but we sometimes have trouble with willpower. Therefore, we decided to dub our aggressive budget plan "Operation Snowball". Any time we feel tempted to splurge on something outside the budget, we will squint menacingly at one another, yell "Operation Snowball!" and exchange fist pounds (the exploding kind). Should you ever witness this, you are welcome to participate by throwing your hands in the air and waving them like you just don't care. Perhaps then we will be able to resist the siren song of the strawberry kiwi Gelato from Rita's.
I'm not so optimistic about resisting the Sesame Chicken from Zhuang's Garden, but like I always say, baby steps, people.
2016 Books: 3Q
8 months ago