Shhh…. What do you think of that B*****?

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Now that I have your attention, you are probably scratching your head wondering why that would be on a personal finance website.  Shame on you for thinking that!! What would your mother say?  The word is in the news all over the world now.  That magical word is BUDGET.  The congressional budget, state budget, city budget, your personal budget, budget for that trip, some websites use that as part of their web address…this budget that budget… What in the world does the word budget even mean? 

According to my good friends over at Merriam Webster here are the origins of budget:

Middle English bowgette, from Middle French bougette, diminutive of bouge leather bag, from Latin bulga, of Celtic origin; akin to Middle Irish bolg bag; akin to Old English belg bag. First known use: 15th Century.

Now that I read that I can understand what the word budget means, well can’t you?  Think about it, budgeting in essence is using the available resources that you currently have, you can’t spend more than you make.  Well you can, but it is frowned upon. A bag holding your instrument of trade could be seen as your bank or wallet holding your cash!

Lately, the wallet and bank of mine have been near empty up until February of this year when my wife started working.  She was working probably harder before; she was at home taking care of our two little kiddies.  (Cheeks if you are reading this and have made it this far in the article, I love you, sorry for the shameless plug for my wife)

Here is the modern day definition from Merriam Webster:

a : a statement of the financial position of an administration for a definite period of time based on estimates of expenditures during the period and proposals for financing them

b : a plan for the coordination of resources and expenditures

c : the amount of money that is available for, required for, or assigned to a particular purpose

Taking a few moments out of your hectic routine on a monthly or bimonthly basis can help you find hidden cash flow problems (money you are spending that you may not know that you are spending) and free up some cash to throw at your retirement or any other goals you have.  Budgeting also helps you to set goals and gives you a target to work to.  Working day in and day out can become monotonous as the weeks and months fly by we wonder what we have accomplished looking back.  Well you are in luck, we can use the budget as a tool to show what we have accomplished. 

Setting a family budget doesn’t have to be elaborate or be on a fancy spreadsheet.  Write it on a napkin if you wish, but make sure that you stick to it.  Speaking of that my wife and I need to sit down and straighten out our finances now that we have 3 different cash flows!  

PHOTO BY: darek.zon

Valentine’s Day for an MBA student – Celebration

Heart made of shredded money!!

Yesterday I was sitting there pondering the meaning of Valentine’s Day you know very well about me i am MBA student which always focus on MBA study, when it struck me that it must have been made up by retailers to make it through the slow winter months.  Well at least here in the Northern part of the United States, it is bitterly cold and we tend to hibernate.

I saw earlier today on the National Retail Foundation website that the average person celebrating Valentine’s Day is going to shell out a whopping $126.03.  Men will spend about $168.74 compared to $85.76 spent by women. L

Never mind it is the women’s holiday, I would much rather see the smile on my wife’s face from something I gave her.

Ever since we have been a one income household the dollar figure has steadily declined in the gifts that we have given to one another.  When we first started dating, I was giving her a lot of jewelry but once finances became tighter that was one of the areas of excess spending that we tried to curb.  Then bring on the two little kiddies and we have curbed just about all non essential spending.

In all fairness, my wife has a pretty good start to the beginning of the year.  It goes for her Christmas, then her birthday near the end of January then Valentine’s Day.  This period of the year sets us back a little, but we have another 10 months to regain ourselves from this.

When you are tracking your family finances and you are reviewing your budget, do you budget for holidays like this and birthday parties? Or do you have another bucket where you drop the non expected but expected events?  We have been trying to put aside money for these but it is very hard on one income.  Now that Mrs. MBA is working we should have no problem setting aside some for the birthday/Christmas/holiday fund.

So would you say you spend more or less than the average?  I know when we were dating I spent significantly more but now I spend about the average…

Photo by: Lisa Yarost