Our Budget

I've joined the "Financial Shape in 2008 Challenge" over at Crystal's blog Money Saving Mom . Michael and I have been thinking a lot about then next step. Last year we paid off all debt, except the mortgage, what a freeing feeling that is. We also made a couple of serious upgrades to the house, paying cash for them. Our next challenge is to save our Emergency Fund. We also want to budget for a couple of larger items this year one being my sister's wedding and the other a move (we can always hope!!!) neither of these things are hugely expensive but we want to have the extra so that we can have fun while doing them not thinking about what everything costs as we go.

The first thing Crystal wanted us to share was our budget and while I don't think Michael would want me to share details we do live by one and are living slightly below our means. I personally like knowing where all the money went. We are fortunate because he is on salary with paid overtime, so we can base our budget on the salary and save anything comes in for overtime. Last year he worked a lot of overtime because they were short staffed. He has just recently taken a transfer to a new unit, and we aren't sure about the amount of overtime if there will be any, so sticking to the budget is all the more important this year.

One tip that has worked really well for us is to take bills, like property tax, that only come in once or twice a year and divide it up into 12 or 6 equal payments and each month put that amount away in an account so when it come time to pay them all we have to do is to transfer the money to our chequing (the Canadian spelling for that word) account and write the cheque. The amount of stress it saves is incredible. Maybe everybody knows this already but it made a real difference for us.