Just a Spoonful of Hope Helps the Reality Check Go Down.

The comments following my 2012 budget recap were awesome. I’m motivated to invest more by spending less.

A few commenters were a bit down on themselves for where they are currently at financially, which is what spurred the following thoughts.

Reality Check

Some time late in 2003, Julie and I found out we were pregnant. (The pregnancy was intentional.) We had been married less than a year, and the due date was June of 2004.

The fall semester of 2003 was also the start of the Junior Core in the accounting program at Brigham Young University. The accounting program there is extremely competitive, where your first semester’s grades can, a lot of times, determine your options for an internship. And that internship determines your job.

I was teaching German on campus part-time, making $10 an hour, and Julie was working full-time as a social worker with the adult mentally ill. She was making $11 an hour.

We had been following YNAB (which hadn’t yet been named) and the Four Rules since April of 2003.

Financially, everything was working out fairly well. It took us several months after getting married, but we ended up buying a car. I would take the bus to school, Julie would take the car, we could go grocery shopping without borrowing a friend’s car. Things were pretty good. We were actually saving money.

We wanted Julie to stay home with the baby once he came. So there was a night somewhere between finding out we were pregnant, and our baby arriving, that I remember sitting at the desk in our basement apartment, running my Dell Inspiron laptop that weighed more than the iMac on which I type this.

We had a pile of savings that was the product of some extreme frugality, we had two and a half semesters of school left, and I didn’t want to borrow money or have Julie continue working once the baby came.

I divided our savings by our monthly expenses (which I could predict with an uncanny accuracy because of our budgeting), calculating that I could continue to work 20-25 hours for the duration.

I ended up with a run rate that was far short of when our schooling would be over, and I could earn a full-time income.

So I went a little more generous on my assumptions. I cut our expenses a smidge (pretty naive considering the fact that I wouldn’t have known how much MORE we would spend with a baby in the family), resolved to work 30 hours per week, and also work during each Christmas, where we received pretty good overtime pay.

Even given those rosier assumptions, the money was still running out far earlier than school was ending.

I could feel myself growing pretty frustrated and, to this day, can still picture the desk I was sitting at, the cooler I was sitting on (it was a massive Dr. Pepper can-cooler, one of my favorite wedding presents we received), and the spreadsheet I was using for the number crunching.

It wasn’t fair. We had been living on the cheapest of cheap, and our only option was to borrow money to finish school.

My Spoonful of Hope

Unless I could figure out a way to cover our rent. It was $350 per month and included utilities. It also made us sick the entire time we lived there (probably mold).

Over the course of several weeks I wracked my brain over different ideas.

“People make money in real estate, right? Maybe I could flip a house or two?” (I am not a handyman, I had never purchased a home…this was so ludicrous it’s laughable.)

“I could sell security systems or pest control over the summer.” (I had a few friends do this very successfully, but that would mean that I wasn’t going to be doing summer school. And the summer school was what was enabling me to finish a 5-year degree in 4 years.)

“Maybe I could sell the budget we’ve been using.”

Julie said it wouldn’t work. I will never let her live that down.

Hope Floats (Us Through School)

Our son was born in June of 2004, and YouNeedABudget.com launched in August of the same year. The site looked like this (pardon the broken images) and thankfully, despite its horrid looks, and aimless sales copy, we made some sales.

The earnings from YNAB weren’t massive, but they did keep us from having to borrow any money from school, enabled me to take a month off work post-graduation to study for the CPA exam, and several years later, let me jump ship from an 85-hours-per-week-family-killing job to what I do today.

Your Budget Giving You that Reality Check May be the Best Thing That Ever Happened to You

I was frustrated and down on myself when I realized our savings wouldn’t get us through school without any debt. Had we never been budgeting, had we not had a system in place that gave us the reality check, who knows where we would be today? I wouldn’t have felt the need to market the system, I would have likely borrowed “to make ends meet,” and I’d likely still be working at a job that wasn’t too fulfilling.

I know reality checks can be tough. But staring reality in the face can be just the push you need to dig deep and figure out exactly what you can do to change that reality. It doesn’t happen over night, or even over several months. But years of being acutely aware of your money will give you practice in facing reality down and will breed in you a self-reliance and confidence worth far more than your paycheck. It will make you a survivor.