Do You Have An Emergency Bare Bones Budget Plan?

Your world is going to come to a screeching halt tomorrow.

An emergency will pop up, such as losing your job or being put on disability for weeks.

Do you know how to adjust your budget?

Most people don’t even have a regular budget, let alone an emergency bare bones budget plan.

You may not have a major emergency today, tomorrow or even this year.

However, I guarantee at some point in your life you will. Will you be ready?

You Never Know When You Need An Emergency Budget

Can you time travel? Can you see the future? I can’t do either. Otherwise I would have already won the lottery! Unfortunately, not everything in your future will go according to plan.

When things fall apart and your financial world comes to an end, the last thing you need to worry about is figuring out how to survive financially.

When the emergency pops up, you’ll be glad you have an emergency bare bones budget plan. It will feel like a lifesaver.

A Bare Bones Budgets Will Save Your Finances

What your bare bones budget will do is save you a massive amount of headache, worry and stress. Who needs those things when their world is crumbling in front of them? No one.

Since you were smart and came up with a bare bones budget, you’ll know what to do immediately to survive the coming months of tight finances.

Whether you lost a job, your largest client, got hit with a huge unexpected medical bill or even worse, got hit by a car, you’ll know how to take action to keep your finances afloat.

How To Make Your Emergency Bare Bones Budget

First, take out your normal budget. Next, take a hard look at your budget and pick the most important things you’d need to survive.

These essentials include house payments, car payments, food, water, heating, other debt payments and whatever you have to have to keep income rolling in the door and your lenders off your back.

See everything else in your budget? Dining out, fancy meals at home, cable TV, cell phone data packages, your entertainment budget. Those things are now gone. They don’t exist. You can’t afford them.

Your financial world just ended. You can’t go to TGI Friday’s.

Add up all of the necessities. See how much you have to spend a month to survive in a true emergency with your bare bones budget. If an emergency popped up tomorrow, how long would you last? 2 days? 1 month? 6 months? A year?

You’ll need to survive long enough to fix the emergency and get back to normal. If you aren’t confident you’d make it, start saving more money in your emergency fund or cut down your essentials even further.

If you could live for many times longer than it would take to turn your financial world around, you can add back some of the luxuries in your bare bones budget that others would not be able to afford during an emergency.

What If You Never Need A Bare Bones Budget?

Never having an emergency that requires a bare bones budget is an amazing problem to have. Hopefully no one ever has a financial emergency and you’ll never need to use your bare bones budget. Unfortunately, life doesn’t normally work that way.

Be prepared just in case. You’ll be happy should something ever happen. You won’t be nearly as stressed, freaked out or worried. You’ll know what to do.

Do you know someone who isn’t prepared for a true financial emergency? Use one of the share buttons below to share this article with your friends and family. Send them an email, tweet or tag them on Facebook with this link in a post. They’ll be thanking you for doing so when their financial lives get turned upside down.

How long could you survive if your financial world ended tomorrow? Do you have a bare bones budget plan?

How To Get Online Prices When You Need An Item Today

I hate when I need an item at the last minute.

Usually, buying an item at the last minute means I have to purchase it at a brick and mortar store.

Too many times, the prices at brick and mortar stores are much higher than the price for the same exact item bought online.

Recently, I had this exact situation happen to me.

Our Recent Experience Of Needing An Item Immediately

I was playing with my dog, Daphne, in our living room when I noticed a flea on her. She’s over five years old and has never had fleas.

I wanted to treat her immediately to prevent the situation from getting out of control so I started investigating flea treatments.

Ultimately, I ended up deciding Frontline Plus would be the best solution. Unfortunately, Frontline Plus is expensive, especially when you buy it in physical stores.

Some quick phone calls helped me determine that Pet Supermarket, a store just 5 minutes away, wanted to charge $60.99 for three Frontline Plus treatments. PetSmart, just 10 minutes down the road, wanted to charge $55.99.

At this point, I was a bit frustrated by the high prices. I did a quick Google search and found out Frontline Plus can be bought online much cheaper.

In fact, I could get it from Chewy.com in just two days for $33.24 if I qualified for free shipping.

Unfortunately, I thought about our situation and quickly realized I didn’t want Daphne to go without flea treatment for even 48 hours. That meant I’d have to pay over $20 more just because I wanted the treatment today.

I thought the brick and mortar stores had won.

I Found A Better, Cheaper Option

While Googling the online price of Frontline Plus, I saw PetSmart sold Frontline Plus online, as well. The funny thing was, PetSmart only charged $34.68 for the treatments online despite the fact they charged $55.99 in store for the same exact thing.

While reading the instructions for the product on PetSmart’s site, I saw the solution to my problem. Just above the description was the option to order the flea treatments online, yet still pick it up in the store in less than one hour.

I added the treatments to my cart, checked out and awaited the email stating my order was ready. Only 30 minutes later I received the email saying my order was ready to be picked up.

I hopped in the car, went to PetSmart, picked up my item and headed home to give Daphne her treatments.

Thanks to the in-store pickup option, I saved $21 and got the flea treatment medication the same day.

Always Check for In-Store Pick Up Or Price Matching

PetSmart isn’t the only store offering same day in store pick up. In fact, in store pickup is becoming quite common among retailers with both brick and mortar stores and online storefronts.

Ordering online guarantees you’ll get the online price for the item in most cases.

However, some stores will price match their online prices if you head to the customer service desk if you’re already shopping in the store.

For instance, we found out Target.com often has cheaper prices on many baby items we buy at their physical store and occasionally take advantage of this option.

If you need an item today, don’t simply give in and pay higher brick and mortar store prices. Check all of your buying options first.

Pick up in store is usually my first option, followed by price matching the retailers online site. If those don’t work, I hope I can find a brick and mortar store that is willing to price match their competitors’ websites.

Worst case I spent a few minutes trying to save $10 or more dollars. Best case, I save money with just a couple clicks on a website.

Have you ever had to buy an item immediately and found a better price on the retailers website? What did you do? Have you tried out the strategies above? Let me know your experiences in the comments.

You Should Always Compare Car Insurance Rates Every Renewal Period

I assumed that my old car insurance company, USAA, would always have the best car insurance rates.

I really liked the company. They had always treated me well so I wasn’t actively looking for a new car insurance company.

I had compared car insurance rates many years ago when I was single and once again when I began living with my wife, Tori.

However, I very rarely compared rates. I certainly didn’t compare the rates every six months, or each renewal period.

The few times I did compare rates, USAA did come out cheapest, but I never did a detailed search.

What Caused Me To Check For Lower Car Insurance Rates

When you’re completely happy with your car insurance company, very few people go rate shopping on a regular basis.

However, when I got married to Tori I called USAA to see how much my rate would go down. I was excited because I know getting married should have resulted in a pretty big rate drop for a young male.

Unfortunately, when they gave me my new rate I wasn’t at all impressed in the small decrease in premium I had received. I talked to the representative to make sure all of the proper discounts were being applied. They assured me they were.

I asked if there was any way my rate could be lowered while keeping my coverage the same. Sadly, they said I had the best rate they could offer me.

That greatly disappointed me and started me down the road of getting car insurance quotes from many different insurance companies. What I found out shocked me.

Other Car Insurance Companies Had Much Better Rates

Despite my 10 year loyalty to USAA, many other car insurance companies had better rates than USAA. Progressive, Geico, State Farm and a couple other companies all had better rates for the same exact coverage USAA had provided me.

Needless to say, I’m glad I shopped around after we got married.

While price is important, it isn’t the only thing I look for when choosing car insurance. I looked at the different companies, their customer service ratings and their financial strength ratings.

Had the rates only been a few dollars different over 6 months then I probably wouldn’t have changed. Unfortunately, the difference was much larger. Eventually I decided to go with Geico as my new car insurance company.

Geico came in at 20% less than my USAA car insurance, easily beating the 15% or more in as little as 15 minutes they quote in their commercials.

I gave USAA one last chance before I made the switch. I called them up and compared the Geico quote to the USAA policy I had and they said that Geico had them beat.

Even USAA was shocked.

USAA was very helpful and gave me a list of questions to ask Geico to make sure I wasn’t getting a teaser rate that would disappear after the first policy period.

I asked all of the questions and Geico assured me the rate they quoted was not a teaser rate. While my rates have increased quite a bit since the original quote, so have the competitors.

I’ll definitely be getting car insurance quotes at each renewal period now, even from USAA. Hopefully they can win me back one day soon.

Do you shop for new car insurance quotes every renewal period? Have you ever saved a lot of money like I did by switching car insurance companies?

Looking At Your Income And Expenses In A New Way

When people are considering making a major purchase, they usually look at it in terms of payments rather than total cost.

Usually, I prefer to look at the total cost to see how much money I’m really spending.

However, there is another way to look at your income and expenses besides using payments, total costs or monthly numbers.

This new way of looking at your income and expenses can be useful in some situations, like for controlling spending.

That said, the largest value to me of using this new method  is comparing your spending to your values.

Break Your Income And Expenses Down To Dollars Per Day

Breaking down your income and expenses to dollars per day is a relatively simple exercise if you already have a budget.

Take your monthly income or expenses and divide by 30 days for a month or divide by 14 for a biweekly budget. Yes, I know, not all months have 30 days but one or two days doesn’t make that big of a difference.

Once you’ve calculated how much your different budget items are per day, take a look at your list. Does anything look surprising?

Let’s go through a theoretical example of a couple without kids. I completely made all of these amounts up so I don’t want to hear any complaining about how inaccurate they are.

  • Income – $5,000/month – $166.67/day
  • Rent/Mortgage – $1200/month – $40.00/day
  • Car Payment 1 – $450/month – $15.00/day
  • Car Payment 2 – $300/month – $10.00/day
  • Car Insurance – $200/month – $6.67/day
  • Food – $600/month – $20.00/day
  • Gas – $250/month – $8.33/day
  • Cable/Internet – $150/month – $5.00/day
  • Cell Phones – $150/month – $5.00/day
  • Electric – $100/month – $3.33/day
  • Water/Sewer – $60/month – $2.00/day
  • Other Random Expenses – $150/month – $5.00/day
  • Fun Money – $200/month – $6.67/day

Based on this theoretical example here are some key takeaways I’d see.

I bet this couple didn’t realize that every day they pay two twenty dollar bills just to live in the house they’re living in. It is cheaper than a hotel and probably a lot nicer.

This couple spends $40.00 a day on their two cars which is just as much as they spend on their rent/mortgage. After all, cars are more than just the monthly payment. You have to include gas, insurance, maintenance and other costs, too.

Are your cars worth as much to you as your house is?

This couple might want some more spending money.

If so, they could almost double their fun money if they cancelled their cell phones or their cable/internet/home phone package. Alternatively, this theoretical couple could cut down on their food spending by not eating out as often.

Are their cell phones really worth as much to them as their home cable and internet? Do they need both? They could easily get cheaper cell phone service using Republic Wireless. Our phone bill is just $20 per month per line.

How awesome would it be if the couple wasn’t spending $25.00 a day on car payments? It is possible. They just have to keep their cars after they are paid off and save up and pay cash for their next cars.

The List Of Ideas Could Go On For Quite A While.

The big takeaway is that when numbers are larger, sometimes we lose perspective on how much things cost relative to each other. When it is broken down into smaller pieces sometimes it is easier to see the big picture.

If you want more reasonable numbers that are closer your budget I have a novel idea… do this exercise for your budget. You may be surprised at what you see.

Have you done this exercise before? Are you doing it now? Either way, were you surprised at any of your per day numbers? While I don’t expect anyone to list them below, general comments would provide some great insights.

5 Reasons We Don’t Keep Separate Finances After Marriage

My wife and I decided to combine our finances when we got married.

It simply made the most sense to us.

Some people argue couples should also keep their finances separate. We respectfully disagree.

Here’s why we decided against keeping our finances separate.

We Have the Same Financial Goals

I don’t know about you but I wouldn’t marry someone who doesn’t have the same goals, financial or otherwise, as I do.

My wife and I just want to live a decent lifestyle while making sure we are prepared for the future. We don’t want to incur debt unless absolutely necessary. We want to be able to retire comfortably and are willing to save a decent chunk of money now to be able to do so.

If you and your future spouse don’t have similar goals when it comes to your finances, you’re likely going to get in a few money fights.

Even if your finances are separate, you’ll eventually have to face the music if your spouse isn’t on the same financial page as you.

We Don’t Want to Create Resentment

If we kept separate finances, we’d likely get tired of the income inequality between us.

What would happen if my wife becomes a major saver due to having a higher income? I might decide to spend all my money because I would know she has savings.

I might expect her to treat me to dinners and vacations because she has money available in her savings when my account balance shows $0. That wouldn’t be fair to her but it’d seem like a good alternative in my eyes.

We’re A Team – Our Money Should Act That Way

On a more basic level when you become married you become a team for life. If you’re a team for life why wouldn’t you want your money to act like a team as well to maximize its potential?

Often, separate finances means little communications about finances. Having separate finances could easily lead to duplicate effort or a non optimal use of each person’s money.

Separate Finances Makes It Easier To Hide Financial Problems

If you keep your finances completely separate, chances are you’ll never talk about your financial situations with each other. Even if you do, chances are that you’ll never see the complete picture of the financial situation your spouse is in. Why?

You kept your finances separate for a reason.

If you can’t co-mingle your finances and agree how to spend money together, you’d probably hide the part your of your finances your partner would argue with you about. After all, those fights are why you keep your finances separate right?

It Wouldn’t Work For Retirement

Retirement is even messier with separate finances. Unless we both had the same goals for retirement and we both saved a good chunk of our separate money for retirement, it just simply wouldn’t work.

We’d likely end up retiring at significantly different times. We’d retire with different sized nest eggs that would lead to different amounts of money to spend.

If we were able to deal with the financial fights, one person would probably end up supporting the other person, at least to a point. There would probably be at least a bit of resentment.

Wouldn’t you be upset if you saved aggressively for retirement and then gave most of your money to the other spouse so they can keep spending like they have their whole life? You’d never reap the full benefits of all of your hard work saving for retirement.

Separate finances just didn’t make sense for us.

So what do you do or plan to do? Do you have separate finances? Do you combine your finances? How does it work for you?