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I am good at self-denial.  If there is a book out there pro-porting to solve all of my life’s woes by just cutting back on this or doing without that, I’m all about it.  I can wear old clothes and trudge about in shoes with holes in the sole and have an internal glow of satisfied martyrdom.  I’m be a very good nun.

The Bearded Wonder and I are forever in a quandary about how to make our money stretch to the end of the month.  I am forever moralizing the issue.  My mental reasoning sound something like: we don’t have enough money because we haven’t been frugal enough, or somehow we have fallen short and now we are having to deal with the consequences.  But I’ve looked at our spending habits and am forced to the reality that we aren’t spending too much.  We spend far less than the average family of our size.  Years of guilt over not having enough money has brought me no help.   I am ready to say with a resounding “oops” that I was off.  I study books about frugality, resourcefulness, and thrift.  To me, it’s fun to stick it to the system and live a life of little waste and minimal spending.  I believe this is a good practice for all people regardless of their social standing.  BUT no matter how thrifty I am we still wind up coming short every month.  After 13 years of marriage and meticulous money management, I have come to the conclusion that we do not have a spending problem; we have an income problem.  It’s time to stop moralizing a situation that needs some tweaking.

3 Signs that tell you if your money problems are spending or income related:

 

1. You stick to a budget:

Do you budget all of your worldly dollars into specific categories prior to spending and see on paper that you still don’t have enough?  Take a good hard look at your budget.  It looks different for everyone.  If your income is small, your standard of living should reflect this.  Maybe Starbucks and Whole Foods aren’t great spending options right now.  If you are mapping out a frugal budget and there is an obvious deficit, you have an income problem.

However, if you really have no clear concept of where your money goes every month and how much it costs to feed your family, it’s time to sit down and map out a budget of necessities.  It’s time to track your spending through receipts to see what your outflow of spending is.  You will probably be surprised by how much you are spending on certain things.

2.  You Cannot Put Money Into Savings:

When I was in high school, I took an AP Government/Economics class.  A wealthy benefactor donated about $10,000 to our class in order for us to learn the stock market.  That was a valuable lesson and I am so glad I learned with real money how things actually work.  But more valuable to me was meeting the man in person.  He had us all read a book called  The Richest Man in Babylon.   The premise of the book was to save 10% of all of your money, no matter how destitute you are, and use that savings in investments.  This philosophy made our benefactor a wealthy man.  He never went to college, he simply had an entrepreneurial spirit and a vision that is much more long-term, big-picture than the average person.  As a result, he was able to use his wealth to teach the next generation.

I applied this information to my income when I was in high school and into my married life.  I am so glad that I did.  I saved our income and invested in a money market fund.  That money was a saving grace when we were living in Salem, Massachusetts and rapidly running out of money.  We drained that cash in no time flat, while desperately trying to scrape together any kind of income possible.

Since that time, every penny has been spent in groceries and essential bills.  We are on a no frills budget and still can’t put money into savings.  If you, also, struggle with this I’d call it an income problem.

*Though we are unable to put away money with each paycheck, we have been able to squirrel away money from a tax return to have $1000 for emergencies.  This is a good practice for anyone. It sure beats buying new tires on credit and payments with interest.  We are an emergency prone family (if you know us, you can attest to this) so we’ve used that fund more than once and had to replace it with odd jobs and many months of snail like saving.  For more on this see:  Dave Ramsey’s website.

3.  Your hours at work don’t meet the needs of your household size:

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Do you often say to your spouse, “Something’s gotta’ give.”?  The Bearded Wonder works 6 or 7 days a week.  We are usually $300 shy of our family’s needs.  Something’s gotta give.  How does this resolve?  It’s time to think outside of the box.  Go back to the drawing board.  And pray for wisdom in a new way to earn money.  With the internet there are new ways of generating income.  Do your homework.  That’s were we are and, rather than being depressing (like a 9-5 job that has no future advancements is depressing), it’s liberating.

 

The good news is this: regardless of the root of your money problems, there are an abundance of helpful people out there who have smart ideas about working toward resolving your problems.  The first step is identifying the root of your issues so that you can find the right medicine.

RECOURCES:

Crystal Paine

Dave Ramsey

Erin Odom

The Richest Man in Babylon

Family Feasts for $75 a week

My post: Smart Grandmothers

My post: Amy Hates to Spend Money

I hope this helps.  God bless and bless God.

Also,

Do Hard Things