Updated: May 18, 2021
I am Lisa Lambert co owner with my husband Jonathan of Absolute Bearing Coffee Company. We began our journey with our coffee company about 1 and half years ago. The idea of running a business was fun and exciting. The first step for us was how to run the budget for the company. We were excited when we read the book Profit First written by Mike Michalowi. This allowed us to set up a budget similar to our personal home budget that would allow us to be profitable. As we have moved through 22 years of marriage, we have learned how to consolidate and make the best decisions for our family to be successful.
Learning how to budget finances can be intimidating and scary. But it’s a necessity if you’re going to reach your financial goals and dreams. When Jon and I got married we each came to the table with debt between credit cards, loans, car payments, etc. We decided at that point to consolidate every thing into one payment and get that paid off as quickly as possible. In order to help me to better understand the idea of debt snowball, I reached out and read The Total Money Makeover: A Proven Plan for Financial Fitness by Dave Ramsey. This book started with breaking down into what is the easiest to pay off first and once that is paid off, roll the next amount to the next smallest.
I then started breaking down what are my expenses and when are they due. I used to take the idea of the grace period as a reward, instead now it is the due date. I build what needs to be paid when based on the that due date. In the spreadsheet below, I put the amount for the month based on the income and amount of the bills. I then hold onto the balance each month to account for fluctuations throughout the year. For instance, there is less oil used in the summer verse the winter but if you build it each month you don't get a huge bill as a surprise.
This is an example of our budget. All types of budgets can be found in Microsoft excel or in numbers for Mac. Just search under the budget template for your platform. The best part is many of these files the formulas are already setup for you to just plug and play. Great right?
I budget twice a month on the 1st and the 15th faithfully. It is a time when I sit down, re-evaluate the budget, and make changes if needed. There was also the issue of unexpected events, especially once we had cars and purchased a home. I have created items in the budget that we save for each month so that we are not caught off guard. Don't get me wrong it still happens, but the blow is not as extreme. Just like in Profit First, we make sure that we pay ourselves each month with a variety of different mechanisms. This includes dinner out once a week, treats on the weekends, and date night.
Our Daughter is a senior in college and graduating in May. While she was home over the holiday break, we had the heart to heart about the ins and outs of rent, car, expenses, food, phones, insurance, medical, and the list goes on. There was the whole idea that I will deal with it when I graduate, which we encouraged was not the option. She had her own pre-conceived ideas how much things were going to cost. But as she took the lead and started making phones calls and building her budget she quickly was able to build a budget that would be sustainable. At one point she says this is not that hard. Those times that you taught me about building a budget growing up have paid off. To help our children understand budgets we used the series also by Dave Ramsey called Financial Peace Junior Kit. This allowed the children to understand the whole concept of Keep, Save, and Give. These three principals are what we follow in our personal budget as well as the company's.
The hardest part of starting is just the starting. Once you start there will be times when you fail. There will be times that are better than others. There will also be times where is it awesome. When I first started there were struggles, but I knew if I picked up and started again it would work out. The hardest part is sticking with it, Once you follow the budget enough and just have to tweak, it becomes muscle memory. The more that you do something the easier it becomes and the less work you have to apply. I have learned over the years, with lessons from other resources, that it is the journey that makes the difference not the one time event. So if you have a budget try tweaking it and if you try once and feel unsure try again. Just keep trying and moving forward.