Finances

Paying Attention to Money

By / October 29, 2021

I was talking to my artist daughter the other day. She described a thing she was working on and I turned the conversation to its salability. I’ve done this to her before, and it is not good because the salability conversation takes her to an anxiety place. So I caught myself and returned the conversation back to joy-in-project, which was a much happier conversation for both of us. As I thought about the conversation later, (because I always overthink conversations later) I considered how different my daughter’s creative life is from mine. She has a spouse with a day job that pays their family bills. She doesn’t have to make creative decisions with bills in mind. I do.

My entire ability to pay bills is based in the combined creative output of both Howard and I. This has been the status quo of our lives since Howard quit Novell back in 2004. I’ve had nearly twenty years of training that means the minute I see a creative thing, my brain starts considering salability and marketing strategy. The impulse to market is less when I’m at the front end of project money rather than the dwindling tail, but it is still there and it affects everything. It shapes my every day, where I spend my efforts, and what I commit to do. I would like to put out some books via traditional publishers. It would help us diversify our income streams, it would reach new readers, it would be personally satisfying and reassuring. But traditional publishing is a spec project that is very slow and ties up IP that I could turn into money faster using another means. It also uses up time and energy that I could be using on more immediately lucrative tasks. This is a huge reason why I keep de-prioritizing writing my novel or my picture books.

I am constantly looking past the point when funds run out, to think how to make the next batch of funds arrive before I can’t pay bills anymore. It is an ongoing stress and a distraction, yet even while worrying about money, I am aware of how fortunate I am to have resources that let me buffer the highs and lows. Long-established home ownership is a huge buffer even while being a money pit. That buffer got bigger with the huge increase in home values in the past year. Which just highlights to me yet another way my daughter’s life experience is different than mine. In the last year my buffer got cushier, while her possibility of ever owning a home got further out of reach.

I can’t afford to undo twenty years of training in thinking about marketing. I mean that both literally in the financial sense and more figuratively in that the energy to put into that work would be even more energy not going into paying my bills. For years I moved forward, half aware of the constant financial calculation in the back of my brain, but hoping that if I could just bring in enough money, get far enough ahead on the bills, I could buy some space for me to create work that doesn’t have to prove its value with dollars.

Then I had a conversation with Howard. It was one of our regular kitchen meetings where we talk about the work he has in front of him and I have in front of me. In this particular conversation I talked about accounting, giving him a summary of our financial state; enough so that he knows how close we are to needing to run another Kickstarter without tangling him in so much anxiety that his ability to work is crippled for the day. During the conversation I realized that I am monitoring the world situation, the labor shortages, the supply chain issues, and panicking a bit because if we do have a big recession I don’t feel financially prepared for it. I have plenty of resources to manage bills for the next several months, but I don’t have the resources to solve long term problems for a couple of my children who are currently disabled to the point that they can’t support themselves. I am panicked, not because we’re in trouble, but because I am borrowing trouble and trying to defend against every branch in the future possibility tree. It is a huge waste of emotional resources.

So while the world at large is living the consequences of Just In Time manufacturing, I’m trying to learn how to spend my stockpiles of time and effort (and therefore money) on things that are not immediately poised to bring in money. I’m also highly aware that despite the noble-ish sound of letting creative work be what it wants to be regardless of salability, I’m also playing a long game here. Because if I ever do manage to sell something into commercial publishing it will be because of work I did on spec.

The thoughts are still all tangled, and perhaps I’m circling the same realizations I’ve made before and lost track of. (This is one of the hazards of keeping a blog for nearly two decades, delving the archive and realizing that I had a very similar epiphany seven years ago.) Yet this morning I started my day with writing a tweet-sized spooky story and then this blog post before doing any work that is tied more immediately to income. For today I trusted that my future self will figure out the money stuff and let my today self find joy in writing.

Familiar with Uncertainty

By / April 3, 2020

In the past week family, friends, and even my accountant have reached out to see how the ongoing pandemic is hitting us financially. Family and friends wanted to see if we needed help. The accountant wanted to be sure that I knew about all the assistance options available from the federal stimulus bill and from Utah legislation as well. The short answer to everyone is that we are doing fine and don’t need any help right now. The longer answer is that our future is very uncertain, but we’re used to living with our financial picture being uncertain a few months out.

We live from Kickstarter to Kickstarter. That is when our income arrives and then I have to make it last until we can run the next Kickstarter. Right now we’re late on delivering the Kickstarter we ran last November, and since we have a personal rule of not running a new one until we’ve delivered on the prior one, there is a giant question mark over when the next large income event will happen. There is an even larger question mark about whether our fans will have any money to spend when we do run it. An additional variable is that the daily Schlock Mercenary comic will be ending this summer and we have no idea how the lack of daily comic updates will impact Kickstarter participation. Right now we can’t qualify for government aid since we can’t prove income loss due to pandemic. (Also the last thing I need is for us to owe more money.) If there were a grant we qualified for, that would be different. As long as our tax return comes through, we’re okay for now. The future is uncertain, so we need to put in the work to manage our resources and deliver what we’ve promised our Kickstarter backers.

One of the Realities of Uneven Year-to-Year Income

By / July 30, 2014 / 3 Comments

We had a financial boom year last year, which means we had a big tax bill this year. It also means that our estimated tax payments for this year are recommended at a rate that would cover us having a boom this year too. In theory this is setting us up for a tax return next year, but I don’t count that money until I see the paperwork that says I get it back. I’m certain that there were financial moves that I should have taken last year to smooth all of this out. Last year I was also dealing with major family transitions and mental health issues for multiple family members. I did not pay attention as I should have. Howard and I have had many conversations about this and we’ve taken steps to readjust the ways that we manage our emotions and anxiety surrounding money. I still feel bad about about it. It was my job and I feel like I didn’t do it right, but I’m doing better now and will continue to do so going forward.

All of this means we’re being careful about spending this year. We’ve built in more accountability, more reports, and less avoidance. I probably won’t feel confident about my financial skills until after next tax season. The new structures have us headed in the right directions, but far more slowly than I would like, because so much money is getting sucked into that quarterly estimated tax payment. It also means that this year, when federal financial aid for Kiki’s college tuition would be very helpful, we’re unlikely to get it. Because they’re looking at the tax records for last year, the boom year. I filled out the FAFSA anyway. Now I’m off to do things which will earn money.

Recalibrating the Finances

By / July 24, 2014

I’ve been co-managing a business for more than twelve years now. Since the business continues to support our family, evidence suggests that I have at least a minimal level of competence at the tasks that I must do. However I’m constantly aware that there are huge gaps in my knowledge, because I learn things as they become necessary instead of having a comprehensive knowledge. This means that sometimes I’m doing things the hard way. Once I had a successful way to get something done, I never stopped to wonder if there could be a better one. As one my goals for this year, I’ll be trying to redress this. I’ll be learning how to make reports and graphs so that more of our business decisions can be data driven rather than instinct driven. We have pretty good instincts, but those instincts will only get better if they’re fed data.

Along with trying to make our business flow more quantifiable, I’m also re-vamping our family finances. Last year we took on some significant additional expenses (college tuition, ongoing mental health care for family members, lessons) and we changed the way that we handle paychecks. Last year we had a large monetary influx that helped us cover all of that. We won’t have a comparable influx this year, so it is time to recalibrate our monthly budget. We don’t want to accidentally run ourselves further into debt instead of slowly digging ourselves out.

Both of these projects required me to spend most of my Saturday deep into accounting. I dug into historical records to create profit and loss sheets for each book. I sorted through papers to make sure I had everything in order. I sat down and re-learned the budgeting system in Quicken so that I can be checking our status every week, month, and quarter. I’ve assigned myself additional work for each accounting day, but I’ve turned it into routine work instead of stressful work, which is important. Stressful work gets avoided, routine work gets done.

Part of this recalibration is shifting our spending habits downward a bit. We don’t have to go into crisis mode, but I do need to dust off some of my frugal living habits and make sure that we’re using our resources wisely. This means I need to be paying attention on a smaller scale than I have been for the past while. I need to be pausing before buying. Sometimes I’ll buy anyway, but that pause is important because it allows us to prioritize. To use a metaphor, we don’t want to spend all our money on popcorn and not be able to afford movie tickets. At the end of all the mucking around with numbers, I feel better. I have a clearer picture of where we are financially and where we need to be headed. Now I need to go make dinner instead of waiting until the last minute and then buying one.

Stress is not Logical

By / August 9, 2013

I woke up this morning stressed. I was stressed yesterday, but not at a drive-all-my-thoughts-and-actions level. Somehow the fact that it is Friday and I have almost run out of week tipped me over. There are all these things I need to do with various due dates.
Today
Contact the GenCon hotel and arrange for pre-payment
Count invoices and boxes to make sure we won’t run out of anything on Tuesday

Before Monday
Design flyers
Prepare house and yard for clan home evening (guests in the house)
Do all the laundry
Pack Howard for GenCon

By Tuesday
Set up the new 4G iPad, hopefully it’ll arrive in time to make the trip to GenCon. (Except I may need it here to set up Worldcon Point of sale system. Make a decision.)
Transfer my old iPhone to the Kidphone number (Maybe? think about it. It could be a credit card terminal at GenCon.)
Restock from the storage unit
Fill some wholesale orders of books
Ship the wholesale orders
Prepare the paperwork for GenCon (informational papers for on site folks)

Before WorldCon (Aug 27)
Sign up for the point of sale system
Buy peripherals for point of sale system (in time for them to be delivered and tested)
Set up point of sale system
Test point of sale system

Very important, Do as soon as possible so you don’t forget, no specific deadline looming
Weekly accounting
Finish setting up my phone (I need those contacts back)
Email people regarding the Jay Wake Book
Work layout for the Jay Wake Book
Call Adobe and shake a license number out of their customer support personnel because there is a snafu with Kiki’s product registration

In writing this post I am able to sort and categorize, but this morning all of those things were pounding in the front of my brain and jockeying for position. It seemed like I should start with the Must Be Done Today things, but my brain wouldn’t settle. So instead of trying to figure out what should come first, I asked myself which of these things was causing me the most stress. The answer was Accounting. We’ve spent a lot of money in the past few weeks between convention prep, a new HVAC system for the house, various medical expenses, and the college tuition/housing payment. My rough math told me we were covered, but my brain would not let it go. So I sat down and did the accounting. This is when I discovered that yes we are fine, BUT I really needed to make some payments to the credit cards today because while we have funds to cover things, both cards were nearing their limits and nothing would be likely to cause more stress in the next couple of weeks than the temporary inability to use a credit card. Logically accounting could wait until later, except for that one piece. Bills are paid, all is clear. And now I’m able to look at tasks by due date and proceed.

Interestingly Howard was feeling similar levels of stress this morning. It was also because a lower priority item was the one causing him the most stress. Brains are weird.

Thinking About Vehicles

By / June 22, 2013 / 2 Comments

I took a deep breath before exiting my car, preparing myself to enter enemy territory. Not that anyone was going to overtly attack me at a car dealership, but I could not be certain which sort of salesman would appear to show me cars. I was fortunate. The man was quite nice and not particularly pushy. We had pleasant conversations as I test drove three types of vehicles. In the end I found myself leaning toward the smallest option, the Mazda 5, which felt like driving a car rather than piloting a tank. It is short on cargo space when full of people, but my need for people hauling space is going to be reduced in the coming years. Compactness and good mileage appeal to me. Howard drove one for a week while we were in Chattanooga and was very impressed.

As I was taking a last look before departing, the sales manager arrived and I realized that I might have been subjected to good cop, bad cop. He was in full hustle mode, trying to convince me that I want to sell my old car to him, or through him to the people who want to buy it. It would save me money, he said, while not costing them an extra penny. It sounded like an extra hassle to me, because I already have a probable buyer for my old car. They are nice people and I see no need to inflict Mr. Hustle on them. If I end up buying a car through that dealership, I hope to work with the first guy and not Mr. Hustle.

I came home and cleaned out my van. It is strange to picture myself driving a different vehicle. I’ve had this one for almost twelve years. It has been good, but it is aging and our needs are different than they used to be. I no longer need the built in child seat nor quite as much hauling capacity. Later in the afternoon the potential buyers came to look at the van. I detailed its flaws and the recent maintenance that we’ve done. Mostly though I stepped back and let them discover its features, watching them as they pictured their family inside it. This van I’ve been fond of may have a chance to be a vital part of a different family’s life. I think it is time to put it into new hands.

Early next week I need to speak with our accountant to figure out the best way to arrange the finances for the purchase of a different vehicle. There are dozens of options, just as there are dozens of car buying philosophies. This is a good thing because everyone has different financial situations and emotional needs when approaching a large purchase. Some people need to feel like they got the best bargain possible. Others just want a particular set of features no matter the price. Some people love to haggle, research, and ponder for a long time. Others decide very quickly. Some people like to buy from a dealership and get a warranty. Others prefer to buy used direct from owners. There is no choice that is right for everyone. Next week I get to do the math and pick what is right for us.

Things I am Stressed About

By / August 4, 2012 / 1 Comment

I have decided that rather than letting all these thoughts swirl around in my head, I will pin them to a list. Once I make them hold still I have a better chance of figuring out which ones actually need my attention.

Gleek goes to camp next week. This will be her first away from home, away from family experience. I’m sure she’ll have a fantastic time and that all will go well, but it hasn’t gone well yet. My brain keeps worrying over Things Which Could Go Wrong much in the way that a dog will worry at a favorite chew toy.

Kiki has not yet finished her big summer commission. She is completely capable of doing it. It is her job. She is handling it responsibly and making steady progress. She is going to get this done on schedule. Yet my brain can’t stop tracking the progress and noting that it is not yet complete.

School is coming. I don’t know how the onset of school is going to unsettle everyone. I’m gathering my mental energy to try to launch us into the new school year, but it is not launch time yet. So that pent up energy keeps getting funneled into “preparing for school” which probably doesn’t need that much focused energy.

Money. The finances are actually fine. Before the end of the month we’ll have sales from two large conventions. However we’ll also have bills attached to those conventions. My brain keeps trying to reach out and do future math to balance estimated sales against probable bills. The truth is that my inner financial squirrel is never happy unless she has enough money stashed away to pay all of the incoming bills for the entire rest of the year.

Laundry.

Gardening. I thought I’d do a better job of getting outside regularly to keep my few flower beds under control. Instead they’re currently overgrown and weedy. This makes me alternately sad and grouchy.

Organization in various stages of completion. I’m still in process on a lot of organizational tasks. Unfortunately this means that I have boxes or objects stacked in odd corners around my house waiting for me to find the time to send them to their final destinations.

Cleaning. I did lots of cleaning in the past few weeks. Unfortunately the new cleanliness of some areas makes me see the mess in other areas. I keep seeing it and I keep not getting around to getting it done.

Writing. For the most part my writing brain is locked down so tight I can’t even see what is in there. I keep feeling like I ought to be opening it up. I ought to be airing out those thoughts and starting to mentally prepare for the writing retreat at the end of September. But digging into that tight knot feels difficult and scary. I’m afraid that it will be pandoras box, filled with all sorts of emotional stuff that I’ll have to dodge, manage, or internalize.

My brain continues to spin trying to convince me that I chose wrong in deciding to go to the retreat.

Link has turned another developmental corner. He and I spent over an hour last night talking about friends and friendship. Link is beginning to learn that the shape of his childhood friendships is no longer enough. He needs friends he can talk to about grown up things, but he is only just learning how to do that. I’m completely confident that he will work this out and find his people. He may even discover that many of his childhood friends are his people. But the process is going to be difficult and I can’t make it any easier. I just get to watch, throw out advice where he can grab it if he wants, and then wait for him to sort it out himself.

I need to go to the doctor for another thyroid check up. I don’t want to have to deal with it. I just want to find medical stability and hide there for awhile. I want a month where no one has illnesses or pain. I want a month without an excess of psychology to navigate. I want calm, order, and work done.

Food. Why can’t healthy food just materialize in front of me without me having to think it up and perform the work necessary to bring it into being?

Next week I’m expecting four hundred pounds of t shirts. I’m going to have to turn around and ship about half of those out to customers. So next week is a big shipping week. The GenCon shipments are all done, but World Con shipments also need to go out asap. I keep kicking myself for not getting the WorldCon shipping done last Monday when I meant to do it. All week long a piece of my brain has been berating me for not getting it done.

There is probably more, but I’ve got children hovering and asking what I’m going to make for dinner.

Accounting

By / January 9, 2012 / 1 Comment

I looked at the number on the credit card bill and my stomach both clenched and dropped. It was a big number; the cost of shipping more than a thousand packages during the month of December. My heart rate picked up, feeding adrenaline and oxygen into my brain in nature’s own emergency response system. I began to run calculations in my head; checking account balance plus expected income minus bills. The numbers slipped around each other and I was not quite able to line them up. Through the mess of miscalculation, one clear thought surfaced.
We’re going to be fine.
Later in the day, when I sat down with my accounts, the numbers were all fixed into their proper places. I was able to see how I’m going to have to juggle things. I was also able to see what gaps we’re going to have to arrange to fill over the next few months. I don’t like juggling finances. I much prefer to have a large reservoir from which to draw. We’re getting there. I’m not going to have to juggle frantically (the way I did in 2009) just attentively. It still turns up the stress-o-meter a notch.
We’re going to be fine.
I’m very grateful for the calm clear voice in my head which tells me this. Because time after time the voice has been right. I just need to remember to stop and listen to it instead of to that automatic emergency system which wants me to run around flailing. The calm voice makes me calm. Then I can plan clearly my path through the months ahead.

Things Which Help Me Be Happy

By / November 7, 2011 / 1 Comment

Based on the experimental evidence from the last month there are some things I need to make a more regular part of my life to increase my happiness.

Spend more time with people who are glad to see me. This past weekend I got to see several people whom I like very much, but whom I have not seen in a long time. Each of them lit up and faced me with a smile to greet me. Spending hours talking over everything small and large was truly enjoyable, but that instantaneous glad-to-see-you reaction was an instant mood lifter. I could hear it in the voice of a friend I talked to on the phone as well. It made the self doubting voices scatter and find somewhere else to be.

Seek out more new things. Going to Antelope Island was marvelous. Going to the art museum with Kiki gave my brain all sorts of new thoughts to think. Even the trip to the dump was interesting and sparked new trains of thought. New experiences engage my brain and feed my creativity.

Teach more often. I’ve taught some art lessons in kids’ classes as part of a volunteer program. Preparing was fun, teaching was fun, and I walked out feeling energized. A local conference has invited me to teach next spring. My brain has been happily percolating plans to make those classes the best ever. I love teaching. I love the moment when I look out at the audience and can tell that my words have been interesting or useful.

Embrace my organizational talents. I plan and organize almost reflexively. Even when something is clearly not my responsibility or not my problem some part of my brain will latch onto it and think through how it could be solved or done better. This is valuable and essential in our business. Yet somehow I wanted to discount this gift. I wanted to be appreciated for my creative efforts not my administration. But pulling organization out of chaos is a huge creative act. When I see my organization as creative it becomes a soul-filling activity rather than a draining one.

Save money to fund dreams, not just fend off bills. I’m not really sure how I forgot this one. I used to do it all the time. In our early marriage every spare bit of money was put away so that some day we could afford for Howard to quit his corporate job. Then that dream arrived and all the money went toward making sure we could keep it. We have kept it, but I lost the habit of stashing money into savings. This meant that when an unexpected expense came finding the money to cover it required juggling and stress. Three months ago I decided I wanted to fund a family trip next summer. I started stashing money away for it. Last month I raided that stash completely dry to pay a medical bill and was grateful that dreaming had preserved funds which otherwise would have disappeared somewhere less important. Today I stashed away money for that trip again. I honestly don’t know if we’ll get to take the trip, but saving for it makes me happy. Having a financial buffer to pull from makes me happy. Either way I am less stressed. Saving money is a good thing.

Snuggle and hug the kids. I sometimes forget the power of touch. When I hug my children regularly fights are less frequent and less severe. Snuggling little kids is instinctive, it is easy to fall out of the habit when they get bigger, particularly when they are bigger than me. I can’t snuggle my teens, but I can pat a shoulder as I walk by. I can hug them before bed. I can remember to focus my attention on them when they need something. All of these things remind me that being with my kids is fun, not just a series of challenges which need to be tackled.

I’m not going to try to organize a systematic plan to fit all of these things into my life. Instead I’ve written them on a page in my River Song journal. Since I’m thumbing through that book at least a couple of times per week, I’ll keep running across the list. Bit by bit I’ll absorb and internalize these thoughts. Then they will naturally express themselves in my actions. I’m also watching to see what other things I’ve missed observing that make me happy. It is like a scavenger hunt where I compile the list as I go.

Budgeting 101

By / October 15, 2011 / 5 Comments

The basic concept of budgeting is this: Dividing your estimated earnings into assigned categories for spending. If you are on a fixed salary this process is fairly simple. I’ll cover some basics, and then talk about some more difficult cases. I am addressing this primarily to people who are not in dire financial need or poverty. People in those situations need to seek out local resources for help in finding solutions which are tailored to their particular situation. This post focuses on budgeting on particular. I’ve got a more general post about financial management that might be helpful to read first. Onward we go.

The mechanics of budgeting can be as simple or as complex as you wish to make it. If you never overspend and always have money waiting for emergency expenses, then the system you’re using is working for you. Stick with it. If otherwise, here are some places to start in putting together a budget.

Pick some categories and assign dollar amounts to them, making sure that the totals don’t add up to more than your salary income. We have categories for groceries, gas/electric, water/garbage, auto insurance, life insurance, medical, auto repair, auto fuel, clothing, dining, entertainment, savings, and assorted other categories which are more particular to us. What you name your categories is not as important as making sure that you have one to cover every way in which you spend money. I use a lot of categories because my financial program (Quicken) makes them easy to track, and then I can run reports to tell me exactly how much we spent on comics in the last year. If you’re new to budgeting, fewer categories might feel less overwhelming. However it is best to make sure that your fixed expenses, like utility bills, are not in the same category as discretionary expenses like eating out at restaurants. One of the most important things that a budget can do for you is to make sure that you don’t spend your rent money on going out to see a movie, but it can only do so if rent and movies are not in the same category.

A useful way to visualize budgeting: When I’m teaching my kids about budgeting, I use the envelope method to help them visualize. They divide their allowance into several envelopes or jars. This lets them plan ahead for how much they want to spend on the various things in their lives. If the Candy envelope becomes empty, the only way to spend more money on candy is to borrow from another envelope, or wait for a new influx of income. The kids borrow money from envelope to envelope all the time, but the act of pulling it from another envelope helps the kids see that if they spend all their money on candy, then they will not have any left for books or for what ever cool toy they’ve been coveting. In my budget, I loan money across my discretionary categories all the time. I do not pull money from the fixed expense categories like Mortgage Payment.

Pick a tracking method. We keep all our money in one checking account and just track the categories in our financial program. When money is really tight, I keep a little tally in a notepad that I carry with me. Then I can refer to it at a moment’s notice when making buying decisions. If I buy socks I subtract it from the Clothing category on my tally. I know a friend who issues himself a cash allowance for fun spending, essentially applying the envelope method for everything except bills. What ever method you choose for tracking, always refer to your budget tracking method before spending money. If you don’t have money in an appropriate budget category for those lovely new curtains, don’t buy them. Not even if they are on sale.

Knowing how much to put in each budget category can be tricky if you have never done a budget before. Start by looking at bank statements, bills, and receipts from the last few months. This can teach you a lot about where your money is going. Add up the amounts you spent in the various categories. I’m usually shocked by some category of spending that I did not realize was adding up to so much. Use whatever information you have to make some guesses and then get started. It is more important to start training your brain to think about how you spend, and whether you should spend, than it is to get the numbers right. The numbers are your measurement tools, not something which will be graded by others. You will goof up. That’s okay, learn something from it and do things differently next time.

Some good practices for budgeting:

  • Pay your bills first, as soon as you can. That way you’re less likely to use the money for something else.
  • Don’t use your checking account balance or your credit card balance as a measure for whether you can afford something. Use your budget.
  • Build savings into your budget. Keep an “in case of emergencies” fund. But also, pick something you want and save for it. It can be anything: college, retirement, a trip, a car, being debt free. It needs to be something you’re willing to sacrifice for. Put that money aside until you have enough to pay cash for your dream. This fund will probably be raided in times of emergency, but then you’ve made your emergency less financially catastrophic.
  • Pay down your debts as fast as you can. Debts weigh on you and limit your financial possibilities. The interest you pay on debt does not add anything to your life except stress.
    Be extremely cautious about acquiring debt. See above.

Some questions and answers about difficult cases:
What if your income is irregular? Not everyone has a bi-weekly paycheck, which can make budgeting seem difficult. However most bills are on a monthly billing cycle. If you set up your budget on a monthly basis, then having a budget can help even out the bumps. Average out your expected income over the course of four months, then divide that by four. I would recommend low-balling your estimated income per month. Some months you will have more than this, others less. Sticking to your budget in times of financial plenty will help you fill in the times when money is scarce. If your income is irregular, stashing money into savings is crucial.

What if money is always scarce? If the total of your estimated expenses by budget category is greater than your estimate income, you are in financial crisis mode. It is time to sit down and seriously look at all all your financial commitments to see what can be eliminated. Being able to eat is more important than having 300 channels. Find every way you can to reduce expenses: cancel subscriptions, pick less expensive foods, sell a car. There are a lot more than you might think. I recommend reading books like The Complete Tightwad Gazette many of the methods inside won’t apply, but the mindset of “I can do this cheaper” is important when money is tight. If you can’t bring yourself out of financial crisis mode within a couple of months, look up local debt management resources. There are often free resources out there to help people get control of their finances.

What if you get hit by an unexpected expense? This happens all the time. Medical bills and car repairs are the biggest culprits. In a solid budget there is some planning ahead for these things. Create a budget category for “in case of emergency” and stick money into it each month. This is what savings accounts are for. Planning ahead means that the unexpected expense is merely annoying instead of an emergency.

What if you have an expense which is not monthly? My auto insurance comes due twice per year. Property taxes on our house are due once per year. I take the amount I’ll need to spend on these bills and divide it by the number of months between payments. Then I put that amount aside each month. To use some made up numbers: if $100 per month is allotted to Car Insurance, then when the $600 bill comes due I have money waiting. If the $600 insurance bill was an annual bill, I would only need to set aside $50 per month. Put this set aside money where you can not accidentally spend it. I routinely put this into my savings account and then transfer it back out when time comes to pay the bill.

What if I goof up and forget to track my budgeting? I do this all the time. This past year I hardly checked my spending against budget categories at all. I was too busy and distracted. The result is that we over extended a little bit, but not much. The reason we did not over extend is because all the years of practice I’ve had in tracking a budget trained my brain to think about money in ways which kept me in check. The act of tracking your budget is training your brain to be financially responsible. Like any sort of training, it takes practice. Just start up again and keep going if you forget for awhile.

What if it is just too overwhelming and stressful to track all those numbers? Then your budget needs revision. Simplify it. Break down to something that is one step more organized than you were before. Adding little pieces of financial organization to your life can make a huge difference over the years. I revise my budget about once per year to make sure that my categories and tracking methods are still working. Systems fall apart, just use the good pieces from the old system to build a new and better system.

And that is enough for now. There are lots of good books on budgeting and financial management that you can get from your local library for free. Your librarian will be happy to help you find them.

When I get Financial Management for Creative People 102 and 201 written up, I’ll link them here.

Take time to read the comments below. Lots of additional good ideas there.