Build My Budget

Don't lose sight of your financial goals.

When you've been married for a while, it's easy to become accustomed to who you're with--even to the point where you think you know their financial goals inside and out. You've created a budget together, you've outlined your goals and created a plan, and now the plan is on autopilot.

To a point this is very comforting because you know exactly where you stand with your partner and your financial goals.

The challenge is when something changes.  People can change their mind about their financial goals, outlook on life, or practically anything.  Sometimes it's a sudden change, but usually it's a gradual change due to a change in thinking. 

Often these gradual changes are so subtle you may not even realize something has changed in your marriage.  if you're not careful, you may wake up to find a person that you barely know next to you.  Of course there are many serious implications in such a scenario, including your path to your financial goals.

There is only one way to prevent this from happening and that is to talk.  Talk about your jobs, your goals, your friends--talk about everything in your marriage and include your finances on a regular basis.

Keep the discussion going.

You can start by having a monthly discussion to discuss where you are heading financially.  Review your budget, talk about any recent overspending or other financial mistakes, and review upcoming expeditures and milestones. 

Also take a moment to review your overall financial plan and long term financial goals.  Your goals will change over time and your five year goal today may even be different from what it was a year or two ago.  It's only natural that we learn and grow as people and this growth brings accompanying changes in our goals.

If you were to assume your partner's goals were the same as they were say, five years ago, as they are today and kept working towards these goals without talking to them you may find yourself disappointed once you reach the goal. You would then realize that although the goal was important then, your partner's goals had changed slightly and they wanted something slightly different.  That would be frustrating, but wouldn't it be more frustrating to realize you and your spouse weren't on the same page?

These moments of disconnection can wreak havoc on a marriage over the long term.  They can steadily erode the bond of trust you have formed and the connection that made your marriage ironclad to begin with.The solution is simply to talk to each other.

Talk about creating a budget you can stick to.

Talk about the future; talk about your goals and dreams; talk about how can get to where you want to be.  Talk frequently, because it's one of the simplest things you can do to ensure a strong relationship and alignment as you move forward together in life.

Recently my wife and I returned from a European vacation to Dublin, London, and Paris.  We traveled with six other friends, meaning there were eight of us running around trying to catch taxi's, trains, and flights together.

The trip was amazing.  We visited many places that have been on my bucket list for quite some time, including Stonehenge, the Eifel Tower, Giant's Causeway, and the Tower Bridge in London.  Each was more breathtaking than I imagined it would be, especially because my wife and I had been looking to the trip for so long.

We drank Guiness in the Gravity Bar  in Dublin, sipped wine on the lawn of the Sacre Coeur in Paris, and watched the changing of the guard at Buckingham Palace.  Like I said: amazing.

On our last day of the trip, we set out to have breakfast in the Luxemburg Palace gardens in Paris.  By this point, we were all pretty tired after climbing what seemed like a million stairs during our travels.(Which consequently helps explain why Europeans are so skinny!) 

We found a quaint restaurant called the Les Fontaines and tried our best to order off a menu written completely in French.  My wife and I ordered a salad, crepe, omelet, two coffees and one glass of orange juice.

Like all the food in Paris, it was truly delicious and quite a memorable meal.  It was outside in the gardens on a cool, clear day and there was nothing to worry about except perhaps the health of some obese pigeons who seemed to be permanent residents of the cafe.

Then came the bill.

Now the exchange rate at the time was $1.56 to one Euro, so it was already expensive to begin with.  Add to that we were dining in the garden of a palace in the middle of Paris and wa-la, our breakfast cost around $90 with the glass of orange juice alone costing $18!  My heart immediately went into palpatations knowing that we had already drastically exceeded our budget, but then I realized two things.

First, I was with a great group of friends in a place none of us will ever forget.  We'll always be able to share the experience we had at that cafe and laugh about how each of us could have bought six half gallons of orange juice for what was spent on a single glass.  It wasn't a special day because we spent it in such a fancy place.  It was was special because I was with my wife and great company.

The second thing I realized was that we could do whatever we felt like doing, with only a few suitcases to worry about.  We were a continent away from any worries in our lives. This was following a period in which I had worked long hours for several weeks and desperately needed a break from the grind.

While we were in Europe, there was no working late.  There were no emergency tasks that had to be completed or problems to solve.  There was just me, my wife, our friends, and a lot of simple and enjoyable things.

Looking back now, I realize that the location could have been almost anywhere and it still would have been an amazing ten day trip. We could have just thrown two changes of clothes into the back of our car and driven away and it would have been delightful.

Even though we went ridiculously over budget at this breakfast and our trip as a whole, I wouldn't change a thing because the experiences were priceless.  It'll take a little longer to pay off the trip, but it was worth it.  You might run into broken hotel beds, scalding hot shower handles, or forget a power cord or two...but hey, that makes the trip just that much more memorable.  Great memories don’t come from expensive trips or meticulous planning. They come from spending time with little obligation other than to enjoy yourself. 

This blog doesn't focus on the usual money saving tips or why it's important to know where you are heading financially.  Instead it recognizes that every once in a while a relaxing break is just as important.

Keep Budgeting!

Chris

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Ok, so I was reading the latest issue of Business Week and came across quite a substantial article about rethinking retirement. Of course, we all know what’s happened in the stock market and have probably been avoiding our 401k statement as a result.  Or at least I can say I have been avoiding mine.

One individual who contributed to the article put it all out on the table by saying “If I put it in the market I’m going to lose it, and if I put it in the bank I won’t make any money, so I might as well spend it.”  Is this you?  Are you thinking the same thing?  If so, you need to stop and seriously think about what you’re saying!  There are many ways you can compensate for the damage you have incurred in your 401k or other investment accounts.

Happy New Year to you and yours! Monica and I have established a few goals for the New Year which we think are pretty attainable…if neither of our cars explodes and the economy doesn’t claim one of our jobs. Our primary focus is on increasing our emergency fund and saving towards a down payment on a house. Hopefully the two vacations will still fit in our budget, but attending five weddings in four months isn’t going to be much of a help (cheers to those getting hitched!!!).

For 2009 we have six main goals: