With the month of March coming to a close (that was fast), my wife and I sat down yesterday to hold our monthly budget committee meeting. It occurred to me that in the sixteen months or so of writing here I’ve never mentioned them before. I’ll save you all the boring details, but will share a few of the types of things we discuss that help keep us on track going in to the next month.
Budget Committee Meeting Minutes
Balance checking account. The first item addressed is our checking account, which by this point in the month could usually use a quick balancing and reconciliation with our online account. We make sure all outstanding checks are accounted for before “closing out” the month’s final balance and begin tracking the new month.
Review last month’s budget. It is also at this point that we perform a final review of our budget categories together to determine where we missed the mark, and where we were successful. The review for March revealed I spent too much money on eating out. My excuse was that I was on the run a lot visiting my mom (who remains hospitalized), but really that’s a poor excuse – I could have packed something to eat or waited until I got home. Sometimes you just can’t account for everything when setting a budget a month in advance.
Update personal balance sheet. If we have stuck to the plan this part is always something to look forward to, but if we have spent more than we should, or not saved as planned, we usually dread this review. Take an inventory of all your debts and update their balances in whatever format you use to track your net worth. We use a simple Microsoft Excel worksheet with a column for each month and a list of debts and assets down the side. Looks like we are on track as our debts continue to get smaller, and our savings continue to grow.
Modify budget amounts for next month’s expenditures. Some months we just carry forward the budget amounts from last month, but it’s rare. There always seems to be something happening, especially when you have kids in school. Yearbooks, camp registrations, clothing, and spring pictures were all mentioned yesterday and affected a couple categories.
When my wife and I first married I handled all of the bills by myself. After a couple years my wife began to take a passive interest in the finances, but was never particularly interested in knowing all the gory details of debt, account balances, etc. Basically she just wanted to know how much was in the checking account at any given time. I recognized that to pull off our financial turnaround I would need her support, and started holding these monthly meetings to discuss our finances.
At first the budget meetings seemed like a chore, but over time my wife enjoyed having input in the process, and I certainly appreciated her input. With us working together we were blindsided far less by unexpected expenses.
If you are not currently doing something similar with your spouse, I highly recommend sitting down tonight and reviewing finances together, even if it means missing the latest episode of Desperate Housewives. That’s what TiVo is for!