Saturday, March 26, 2011

About our Budget

Figuring out a WORKABLE monthly budget here in France has been a complicated but rewarding endeavor. It has taken patience, determination, and high level mathematics. We are constantly working in two different currencies with fluctuating exchange rates. In the midst of moving and setting up house in a new country, it was a long time before we had what could be considered a "normal" financial month.

I am so thankful for Dave Ramsey's Financial Peace University, where we learned years ago that a budget never works the first month. In fact it takes several months to get the kinks worked out and to find a system that truly reflects the family's needs, values and goals. I think we are getting close to having a monthly budget that works for us. Here are some of the challenges we have had to work through to get to this point:

Grocery Budget: In the United States I had a monthly grocery budget of $600. On that amount, we ate quite well; that is to say, we ate a wide variety of fresh, healthy foods. Mealtimes are an important part of our family culture, and we are a family who has a broad culinary palette. We like flavorful, colorful, seasonal foods. We do not eat extravagantly, but we do eat well. We sit around the dinner table 5 or 6 nights a week and we have lively dinner conversation. In the States I shopped carefully and paid attention to sales, but I did not skimp on quality when it came to food. With $600 a month I did just fine.

The French eat a lot of fresh, seasonal foods as well. Culturally, it was not at all difficult for us to adapt to shopping and cooking in France (though we do miss Costco from time to time). But the price of food here is significantly higher. We have finally settled on a workable grocery budget, and it is shockingly more than what we spent to eat in a similar fashion in the US: 800 Euros/ month, which at today's exchange rate is $1,127. Almost DOUBLE. We have heard that the average French family spends 1/3 of their monthly income on food. It must be true, for it simply costs that much to eat here.

Gas/Diesel Budget: In the US we lived out in the country and we had two cars. Gas was a HUGE expense for us, as we easily spent $600 per month filling our tanks. Here we have one car, and it takes diesel. We drive a lot less, which is a good thing, because diesel costs a whopping 1.30 euros per liter which is equal to $6.77 per gallon. Even with the high cost of gazole, we spend much less on fuel here than we did in the States. A budget of 150 euros/month ($211/month) seems to be sufficient.

Savings: In addition to retirement savings, we like to save for both longer term and shorter term wants/needs. For example, when we go on furlough in 3.5 years, we will need to put a new roof on our house; therefore, we are putting aside a few hundred dollars a month to save for that major upcoming expense--a longer-term goal. At the same time, since we are living in Europe, we want to avail ourselves to the amazing opportunity that we have to explore this historic continent. To that end, we are putting another bit aside each month for trips that we want to take in Europe. Traveling here is incredibly reasonable. Airfare between major cities is often less than $150 round trip! We pay cash for all our adventures, so we use a shorter-term savings philosophy for our vacation expenses. It took us over six months to be able to determine the amounts that we are able to save each month, and then another few months to determine the amounts we wanted to dedicate to each of our goals.

Are any of you out there BUDGETERS? I mean do you, like us, write out income and expenses every month? I would love to know what challenges/successes you have had in creating and adhering to a budget. Do you use cash? How and for what do you save money?

Are any of you out there struggling with your finances? We strongly recommend finding a place to take Dave Ramsey's Financial Peace University class. I am not exaggerating when I say it changed our lives. He teaches from a Biblical perspective, but he is full of grace.

1 comment:

  1. You know we are Dave Ramsey fans :-) Finally, getting a handle on our food budget (I think).
    Love to you all! Laura