Having finally — and for the second time — dug ourselves out of credit card debt, we have this new phenomenon: extra money.
Various factors caused us to fall back into debt and, even if we had grudgingly started an emergency fund, we still would have had to put a lot of things on the card: car repairs that came to about $700 in a single month, various supplies for his mom’s visit and, of course, the most expensive cat adoption ever.
I cannot bear to add up what Patches has cost us, lest I start resenting her. I know it cost us $130 to vaccinate and microchip her. Then, when we discovered the burned paw, we started weekly vet visits for antibiotics and rebandaging. I know that the first couple cost over $100. After that, I get (probably willfully) fuzzy. But I do remember that the biopsy was over $200.
So, point is, we stumbled, but now we’re setting up a budget that seems reasonably acceptable/realistic.
For that reason, I sat down and started drawing up a budget. Then I checked my math because the numbers couldn’t be right. But they were. After taxes, groceries, takeout, utilities, gas, medicine, etc, we had a significant amount of money left over.
We agreed to some fun money for each of us. We agreed to $300 a month to a repair/replace car fund. Tim petitioned for a travel fund to be started, so we allotted $150 per month for that.
And we still had money leftover.
My mom pointed out that I wanted to increase my retirement contributions (currently a whopping $100/month) and have Tim start an IRA. That, of course, took up most of the remaining money, but that’s hardly a bad thing. We won’t be able to max out our IRAs this year, but we’ll each put in about 3/4 of the maximum. Talk about surreal!
All of this, by the way, is exclusive of whatever Tim’s disability check will be. We still don’t know the amount he’ll be getting, but I’m guessing it’s around $700-800 a month. Tim and I agreed to put the whole check into a house fund. I recently checked housing prices and 20% would only be about $25,000 for a perfectly nice house.
I guess we’re now officially middle-class citizens. It’s a strange shift of perspective, as I realize that we have “enough” now. We don’t make $100,000 (plus freelance) like a friend of ours does, but we have enough to live comfortably — if within reason — and still put money away.
In fact, we are able to give Tim’s mom $200 for a scooter she’s hoping to buy. The seller is willing to break it into two payments of $200. But her disability check has already been used for necessities. This way, she can get the scooter now, rather than waiting until the start of next month.
This is all still a little surreal — and will probably stay that way until March. Next month, we can’t fully implement the new budget. I have to take out about $900 to cover the rest of the taxes I owe for 2010, and we’ll be replenishing the $200 we’re giving Tim’s mom.
But we’ll be able to start down the path to saving money instead of throwing it all at debt. That’s a relief beyond words.