Reflecting On Lessons Learned In 2020Submitted by WWA Planning & Investments on January 6th, 2021
I’ll confess. I am not good with budgeting. I have a rough idea of what I should spend, but often get distracted and don’t pay close attention.
My husband and I are to the point in our careers where day-to-day money management does not affect our overall financial situation. We have developed sound financial habits, contained fixed expenses and put automatic transfers in place for savings. Over the years, I have found that I spend whatever is in our checking account, and the key to staying on track is to not keep much in the checking account.
To compensate for my lack of discipline, one of my year-end rituals is to examine spending and see what bad habits we— and I really mean I—have developed over the year. We also decide what major projects are on our five-year list. These can be house projects, cars, travel or, lately, the gap between planned spending for college and actual spending.
Our priority for 2020 was travel. We had trips planned for Boston; Vienna, Prague and Romania; Los Angeles and Napa Valley, as well as a much-anticipated family trip to Yellowstone between Christmas and New Year’s Day. All abandoned or put on hold. Those forgone trips combined with no Cincinnati Reds games and less eating out compensated for the 20% pay cut my husband had for six months.
In addition to reviewing my yearly spending categories, I am also taking time to reflect on what spending lessons I’ve learned from the pandemic and which ones I’ll try to keep moving forward.
◗ Planning weekly meals and limiting trips to the grocery store. I love the online grocery apps where I can start a list and add to it, schedule a time to pick up the groceries and avoid the extras that find their way into my cart as I cruise the aisles. We are also throwing out less food and not always scrambling with, “What’s for dinner?” This is a two-fer— spending less and eating better.
◗ Evaluating spending on streaming services, faster home internet and online media. This year, we added a couple of extra movie channels, Kindle Unlimited, Curiosity Stream, Audible and a couple of online newspapers. I have found it is very easy to add services and forget they are there. All the little subscriptions add up and a year-end review highlights the annual costs and makes me reflect on whether they are worth the money spent.
◗ Really looking at what expenses and purchases bring us joy. We are spending more time at home and in the yard. I stopped going to the gym, so my husband and son created a walking path in our woods and added mulch from a city program for $10 per truckload. I use it almost every day and can almost forget I am still in Indiana. We have been keeping the bird feeders full and have done some much-needed landscaping.
One of the keys to my family’s financial survival through this pandemic has been lifestyle choices made early in our marriage. We have always saved at least 15% of our income. We bought a home based on one income, pay cash for vehicles and drive them until they drop. Managing our fixed lifestyle expenses has allowed us to have more discretionary spending and not stress when finances take a hit.
2020 has been a difficult year. 2021 will bring its own set of challenges. I hope you take time to reflect on your personal priorities, what positive habits you have developed or been forced to adopt and make changes that will help you reach your goals. Life is about trade-offs, but sometimes the future does not work out as planned. Expect the best, plan for the worst and adjust along the way.