Why does the thought of budgeting make me physically ill?

[griz7674]

I'm so sorry for my first post to be this one but I don't know what else to do at this point. I'm 37, married to the love of my life and have 4 beautiful children at home. I run an insurance agency that for the most part is profitable. This past year the agency took some hits so our profit margin was eaten up but we're gaining again.

With that said, the thought of doing a budget literally makes me physically ill. I avoid my CPA like the plague as I associated him with everything negative to do with taxes. We are roughly $30,000 in the hole with credit cards. I attended the Dave Ramsey course with my wife but stopped going after the first few weeks as I could not stand being there. I know a budget is needed but I just don't know how to get over this huge hurdle in my life.

I'm afraid of what the future will look like if we don't get things under control but I'm also deathly afraid to actually sit down and figure a budget out. Why? My stomach is turning right now as I type this. That's how bad this gets.

The money I take home each month from my agency is enough to take care of our family and pay the bills. I don't put anything away into savings or retirement as the value of my agency is my retirement. I know people have it far worse then I do but I just do not know how to remove this hurdle from my mind and get control of it.

Bob

[disneysteve]

We are roughly $30,000 in the hole with credit cards.

The money I take home each month from my agency is enough to take care of our family and pay the bills.

These two statements are contradictory. If your take home was enough to pay the bills, you wouldn't be $30,000 in debt on your credit cards. That alone should be a bit of a wake up call to you. It sounds like you intellectually understand why having a plan is a necessity. The question is why you don't want to be in control. I don't know the answer to that. All I can tell you is that you will sleep much better at night when you control your money rather than letting your money control you.

I'm curious what turned you off about the Dave Ramsey classes. Dave Ramsey is definitely not for everyone. His plan is pretty extreme, which is exactly what some people need, but others need a more gentle approach.

Try this. For the next 30 days, write down every penny you each spend on absolutely anything. At the end of that period, sit down together (this must be a joint activity) and divide that list of spending into two - wants and needs. Then take a look at how much income came in during the same period and compare that to how much went out. When you see the numbers in black and white, perhaps that will open your eyes to why things need to change. And you'll already have that list of wants spelled out so that you know where the cuts need to be made.

[disneysteve]

The word "budget" intimidates a lot of people. What you have to realize is that in personal finance YOU (and your spouse) are in charge of the budget.

I agree. People often associate a budget as something that will control them when that couldn't be farther from the truth. The whole point of a budget is to put YOU in control.

How about dropping the word budget all together. Instead, come up with a spending plan. As artwest said, you can choose to spend however you'd like (within the bounds of your income and financial needs of course). Having a plan doesn't mean you can't have fun or do things you enjoy. In fact, having a plan can ensure that you do have money to do those things.

Don't think of making a plan as requiring sacrifices. Think of it more as aligning your spending with your personal priorities.

[skydivingchic]

The good news is you recognize this is a problem and needs to be fixed. Thats a good first step and often the hardest. But the fact of the matter is no one can do the hard work of getting out of debt but you and your wife. So basically you are just going to have to face your fears, deal with the discomfort, and build a better future. Ignoring the problem because its no fun to deal with will certainly not improve matters and is likely to lead you further into the red.

You have come to the right place for help with setting up a budget. There are lots of smart people here who are more than willing to help. But only you and your wife can do the hard work and make the hard decisions. The basic advice for any sound financial plan will be the same - develop a budget that has you living below your means, pay off all consumer debt, save for a rainy day, and save for the future. Advice on the exact order things get paid off and other details may vary but the basic ideas will not.

You really have to decide what is more important to you - a sound financial picture for you and your family or avoiding the discomfort of facing and dealing with the problems. The choice is yours.

I'll give you an example from my own life. When I was younger I had a debilitating fear of needles - to the point that I would pass out after receiving shots or having blood drawn. I avoided needles at all costs, up to and including having a cavitity filled without novicaine (I don't recommend it). I would get worked up and feel physically ill before getting a shot. Then I had the opportunity to go to Africa on safari with a class for college. The only problem was that it required me to get some additional immunizations. I decided then and there that the experience of the trip was more important to me than avoiding the needles involved. So I sat down and told myself that my fear was completely irrational and that I simply was NOT going to put up with the passing out and such any longer. I managed to get all the shots required without passing out and without the horrible feelings beforehand. Since that time I've dealt with a good number of needles. I still warn the nurse that I don't like needles and I still ask to lie down and look the other way. But now I bounce right back up and am not a complete nervous wreck beforehand.

You CAN do this. It likely won't be easy or fun, but it is absolutely worth it. Sit down tonight and decide which is more important to you - your financial future or avoiding the fear. If you decide it is your financial future, suck it up and face the fear.

[snshijuptr]

You might be afraid of budgeting because your afraid of what you might find out. It sounds like you are very loss averse, fearing all losses of money. Remember, ignorance is not bliss. Ignorance gives you this horrible pit in your stomach at what you might find out. Bliss is knowing and loving the your situation. Some months our budget and savings progress makes me feel a little ill, but then we work hard to identify overspending and control it. The months when things are looking good, and I can identify progress toward our spending goals makes me exceedingly proud.

Try finding positives in money. Pay down your credit card debt and track your progress. Set some savings goals such as college savings or a vacation. Find a good friend/relative who will support you and be happy to hear your progress. I was telling my parents about our savings levels, and the praise they bestowed upon my husband and me made us feel very good. If you don't have someone in real life to share with, then share your progress in the forums or blogs. I just updated mine and the praise from my fellow SAers felt really great. Your current associations with money are taxes, credit card debt, and loss of freedom with a budget, not the happiest.

[bjl584]

Budgeting isn't really that exciting, but it isn't really that hard either. I would do as was already suggested and write down every penny that you spend for one month to establish a baseline. You need to see where your money is going before you can cut expenses. You are obviously overspending unless the 30K of cc debt is old and you have since changed your habits.

[ActYourWage]

How about dropping the word budget all together. Instead, come up with a spending plan.

Don't think of making a plan as requiring sacrifices. Think of it more as aligning your spending with your personal priorities.

Yes. I agree 100%. In fact, that is what I call my "budget", a spending plan. I got a raise when I started my spending plan. Not at the job, but based on the fact I was saving more money and cutting out unnecessary items in my spending plan. I told my money where to go, not the other way around.

[ActYourWage]

I'll give you an example from my own life. When I was younger I had a debilitating fear of needles - to the point that I would pass out after receiving shots or having blood drawn. I avoided needles at all costs, up to and including having a cavitity filled without novicaine (I don't recommend it). I would get worked up and feel physically ill before getting a shot. Then I had the opportunity to go to Africa on safari with a class for college. The only problem was that it required me to get some additional immunizations. I decided then and there that the experience of the trip was more important to me than avoiding the needles involved. So I sat down and told myself that my fear was completely irrational and that I simply was NOT going to put up with the passing out and such any longer. I managed to get all the shots required without passing out and without the horrible feelings beforehand. Since that time I've dealt with a good number of needles. I still warn the nurse that I don't like needles and I still ask to lie down and look the other way. But now I bounce right back up and am not a complete nervous wreck beforehand.

You CAN do this. It likely won't be easy or fun, but it is absolutely worth it. Sit down tonight and decide which is more important to you - your financial future or avoiding the fear. If you decide it is your financial future, suck it up and face the fear.

Great story. It is easy to blame something else for our situations and not just face it. I too have to face my fears and overcome.