We’ve mostly been blessed to have plenty of money to take care of our family of 11, but when COVID-19 hit the economy, we found ourselves scrambling to figure out how to live on our newly limited income. Here’s how to shift your money mindset and still afford the essentials!
Money is a sensitive topic but I wanted to share our experience with living on a drastically limited income in hopes that it can help another family who may be struggling!
Luke & I have never been the best of budgeters, but for the past 8-10 years, we’ve been blessed to make enough money that we could afford to be a little lax in our spending. Alas, we learned our lesson in 2020 when COVID-19 hit and a full 30% of our income was gone, almost overnight (Luke works sales in the travel industry and when no one’s traveling, that’s a big problem).
At first I was pretty panicky, but after making some serious adjustments, we’ve been able to improve our money management, and actually better enjoy the money that we do have. I’ve begun to recognize this little crisis for the blessing that it is, because now we’re so much better at making each dollar work for us.
Here are a few of the mindset shifts we used to cut down on wasteful spending:
Communicate with family members
The first thing Luke and I did was sit down and look at the numbers together so that we could figure out exactly how much less money we had to work with each month. I’m so glad we did this up front, and not after 2-3 months of overspending!
Secondly, we sat down with the kids and explained a few things. First of all, we talked about how lucky we’ve been in the past to have had plenty of money for fun experiences like going on vacations or to the movies.
Secondly, we talked about how COVID-19 has affected our income and won’t be able to spend money on unnnecessary things like fun experiences or eating out.
Finally, we explained that this could be a great chance for us to practice having fun on the cheap and getting creative! We also expressed our desire to see the kids learn to earn their own money, outside of our home.
Their response was seriously awesome and there have been almost no complaints when we simply explain that buying Chik-Fil-A or going to the trampoline park isn’t in the budget right now.
Take a hard look at budget categories
In the past, our budget included plenty of not-strictly-necessary-but-nice categories like gifts, camping supplies, vacations, entertainment, babysitters and more.
When we started to trim the fat, we realized just how much of this could be drastically cut down, without sacrificing much of our quality of life. For example, while we cut out the home decor category for now (no more random trips to Target, sadly), we kept our gas and grocery budgets the same.
We’ve even learned that while some strictly unnecessary categories really are a luxury (gym memberships), some are essential to sanity (date night).
We also took advantage of the special Jordan Page was running on her Budget Boot Camp this year and took the course’s advice to heart. It was an amazingly unique look at budgeting and I highly recommend it to anyone who’s struggling to manage their finances.
When most of our kids’ birthdays rolled around in June & July, initially I felt guilty that we couldn’t afford a huge party with expensive gifts and lots of friends. But guess what? We tempered the kids’ expectations ahead of time and every single birthday was a hit! Most of them involved the child’s favorite home-cooked meal and treat (these are the cupcakes that almost everyone chooses), 1-2 inexpensive gifts and a whole day free of chores. What kid wouldn’t LOVE that??
I’m personally a huge fan of eating out (pretty much any excuse not to make dinner is my favorite), but feeding our family of 11 at even the cheapest fast food place costs well over $50. So I started getting better at meal planning, working in more exciting foods that I looked forward to, and now when we get the urge to eat out, we simply stay home and make cookies or a special meal together.
Basically my point is this: no matter what pricey traditions you currently have, there is a cheaper (or free) alternative. And staying home to watch a movie in blanket forts can be just as exciting as going to a movie theater!
Overall, we’ve been really grateful for this experience that’s required us to use our money more wisely. Since we’re doing our best not to touch our long-term savings during this uncertain time, our current goal is to slowly save up a good-sized buffer amount to account for unexpected repairs or emergencies.
I’m also super excited about when everything goes back to normal (isn’t everyone?) because I think we’ll be able to stretch any extra money SO much farther now!
Do you have any tips for how to seriously shift your money mindset? Share them in the comments!
You might also be interested in our podcast episode on How to Afford Kids or this one on Getting Unstuck with Your Money with guest Emily Burnett.