Happy Friday to my fiscally responsible Abrahams out there. Also, good day to my wildly irresponsible amigos who are somewhere between mildly interested and downright determined in becoming fiscally responsible. You’re all welcome here, we don’t discriminate on the basis of your annual deficit.
This is going to be a silly fast shot in the arm for anyone who has struggled with specific categories of their budget. You see, Mrs. Abraham and I just got back from our annual goals summit a couple of weeks ago, and LIKE WE ALWAYS DO, we had to have some conversations about why there are a few categories of the budget that we just can’t seem to keep reigned in. For us, that would be groceries and kids activities. It seems like no matter what, we have a tendency to spend more than we planned on in those two categories.
For you, it might be something different. Perhaps you just can’t reign in that clothing budget, or maybe for your family it’s the breakfast meats and rolls budget that will sink you ever time. If I lived in the greater Cincinnati area, I know that at least a fair portion of my monthly income would be spent on goetta as well, so I’m not judging you. Let’s not even think about the annual dollars that would be blown on kolaches if I was to land in East Texas. All this to say, we’ve all got our budgetary struggles and temptations.
Sometimes, a continual overspend in a budget category just means that you need to rework your budget. We have yet to emerge from a goals summit without tweaking a few categories, but here’s an important caveat: we only increase a budget category when we consciously decide that we should be spending more of our money in that category. Said in the reverse – we never bump up a budget category just because we keep whiffing, if, upon close inspection, we think “we really shouldn’t be spending any more than this on ______” (the blank could be ‘kolaches’ in your case).
And this year, we found ourselves in the position of having gone (supremely, fantastically) over budget for many months in a row on our grocery spend. And yet, when we took a hard look at our grocery budget, we felt like it was appropriate. We know it could be plenty for our family because we’d kept to it in the past without want for food.
Given our recent history of grocery deficit spending, we decided to employ this trick that I”m here to give you today for fixing a leaky budget category. Are you ready? Take a minute to be sure you’re alone – if the Russians get their hands on this we’re sunk.
One of the most effective tools for fixing a budget category that you keep overspending on is to simply swap out the spender for that category.
So if your lady is the usual grocery shopper, guess what bub? You’re up! Does this sound crazy? Let me support my bold claim if you will. First, fresh eyes tend to see places that may have become automated for whoever in your family was previously doing the shopping. It’s not rocket science. You’ll notice that the generic mustard works just fine for your crew, and you’ll bank a 24 cent savings. Two, I think that in a household with a couple of married folks, you should both be capable of some basic management tasks like acquiring and preparing food, thinking up healthy meals for the family (meal planning is another grocery budget supercharger, but we’ll save that for another day). You may be operating under the (false) assumption that you, Mr. Husband, wouldn’t know your way around a grocery store and can’t cook to save your life. Or perhaps your spouse hasn’t ever tried her hand at planning a family vacation. In either scenario, swapping roles allows you to employ new perspective on the spending ruts that you may have fallen into while also developing useful skills in the management of your outpost. And number three, we all tend to hide away our favorite little splurges, be they sneaking a favorite (pricey) snack into the grocery cart or opting for the fancy car next time we need a rental. By switching roles, you’re sort of issuing a challenge to the new manager to hunt out all the loose ends and restore discipline to the family unit. At least until the new manager finds their own favorite splurges, but I’ll get to that in a moment.
Do you believe that this simple switch could produce results? When I ask financial planning clients to try this in a category or two, I frequently get amazed reports of how the newly delegated category manager somehow found hundreds of bucks a month in slush. The proof is in the patriarchal pudding, gents.
Two are better than one, because they have a good reward for their toil. Ecclesiastes 4:9
If you’re tracking with me here, let me blow your mind one last time. Let’s say you try this technique, find yourself amazed by the effectiveness of the switcheroo, and then, months later, are dismayed to realized you’ve once again returned to your old ways of busting that grocery budget? I have good news – this trick works AGAIN! Just switch back – after a break from the kolache shopping, Mrs. Abraham comes back to the table full of new ideas and tastes that will keep that budget in line. She doesn’t care that you gradually fell in love with the expensive granola and cave-aged gouda you found while you got re-acquainted with the grocery store – she ain’t buying that crap! In fact, I’ve found that you can rotate who owns which budgets as frequently as quarterly and keep seeing positive results.
So that’s it. A simple tip to keep your budget healthy and functioning as the freedom-giving tool it’s meant to be. Now go forth, grease up your shopping cart wheels, and delight in the knowledge that you’re moving towards order in all of your domain.
*Mark Parrett is one of the founders of Abraham’s Wallet. When not blogging for you here, he’s raising a family in Salt Lake City, UT and working as a financial planner at Outpost Advisors.
