One of the Best Things

One of the things that led up to our CH7 decision was the series of layoffs we both experienced.

However, the most recent layoff was one of the best things that could have happened to us.

I was pregnant and two weeks away from my due date when my husband got laid off. We spent those weeks playing cribbage, finalizing stuff around the house, cuddling, and really enjoying our time together. It was at the end of the year and there weren't many companies to send resumes to or temp jobs to apply for. So, we decided to enjoy the time.

Part of the reason we were able to do this was because the layoff before that one resulted in a small severance package. Between that, my hubby's disability, and unemployment, we were okay for three months.

Hubby resolved to start looking in earnest in mid-January and we settled in to wait.

I had my baby. A homebirth, in case anyone's interested. My daughter was born just before Christmas.

The next ten weeks were amazing. My husband fell in love with our baby and became a doting father. He helped me recover from the birth, held my hand through the difficulties I had with breastfeeding (moderate-to-severe mastitis in both breasts!), became a whiz at changing diapers (pun intended), and bonded like crazy with her.

He got a job offer right before our savings ran out.

Notice that there is not a "regrets" label on this post. We are so thankful for this time. Yes, we would be in a financially better place if we could have used our savings to pay off debt or put a bigger down payment on our home, but in hindsight the time together was far more valuable. Not all layoffs are bad things. Sometimes they're a gift.

Regrets: Not Planning

I didn't find out about various ways of budgeting until a few years ago. When it was too late. I used to just say, "these are the bills that happen every month, we'll pray for windfalls to cover the rest." Okay, I didn't actually say that, but my actions did.

I currently like two theories of budgeting:

Zero-Based Budgeting and FSA Budgeting

Zero-Based is the kind of budgeting that would have kept us out of debt. We used to look at our account at the end of the month and say, "Hey, all our bills are paid, we have an extra $40, let's go out to eat again."

With Z-B you figure out all your income, all your expenses, and then make the total 0 at the end of the month. EVERY dollar is earmarked for something. And if you find your electric bill was $20 under what you had budgeted, that $20 immediately gets allocated to something else.

For years we would spend the "extra" without really thinking of it. Even though we had big expenses coming up, things we needed to plan for, debt to pay off, we'd spend it. I can't tell you how many $20 Target items we've added onto our household good shopping trips because "we could afford it".

FSA Budgeting--probably not the correct technical name, but it's what I call it--means taking all your non-monthly/irregular expenses and breaking them down over 12 months.

Let's say my normal bills total $2000 a month. But then I pay my car insurance every 6 months ($600) so that I get a bigger discount, get my teeth cleaned twice a year ($80 each time) plus an exam (another $50, let's say). I also need three oil changes a year ($30 each) and new windshield wipers ($20).

Car Insurance ($1200) plus ($160) plus ($50) plus ($90) plus ($20) = 1520.

1520 over the course of 12 months is about $127.00.

So my expenses aren't really $2000 a month or $2127 a month, but the latter gives me a chance at making sure all my occasional expenses don't fall through the crack.

Some of my actual FSA categories are:

HOA Fees
Dentist Appts
Car Maintenance (oil changes, wiper blades, etc.)
Car Repairs
Car Replacement
Doctor's Visits
Christmas/Birthdays/Holidays/Gifts
License Renewal
AC and Large Appliance Replacement

Now... have I been putting anything into my FSA account? No. I'm falling far, far, short of what I need. That's part of the reason I'm having to file. Not only are we living paycheck-to-paycheck, we're only paying our basic expenses and minimum payments.

If I had the same combination of Z-B and FSA budgeting that I use now, things would have been really different.

Can I consider this a very expensive financial education? I guess.

Do I wish I had done many things differently? Hell yes. I would have less clutter, less stress, and far less debt.

So my regret is not planning beyond my immediate comfort and needs.