When we initially developed our budget ^[1], we built it tight. Every penny was accounted for and had a place to go. I was so proud.

^[2]

Money, money

Unfortunately, there were some problems with habitual-even compulsive-shopping in our house. The change from “whatever we wanted” to “it’s not budgeted” was too much, too fast.

After a few months of arguments, we agreed to set up a “blow money” line item in the budget. That’s money that is absolutely unaccountable. When a purchase comes out of that fund, no questions are allowed. Whether it’s a new pair of shoes for her, or a new book for me, nobody gets to fight over it. Sometimes, it’s a nice dinner out, other times it’s another gadget for the entertainment center. It’s never a problem.

This provides two major benefits.

First, it balances the feeling of sacrifice. If my wife never gets to buy anything, while at the same time, she’s watching our friends and neighbors flaunt their rampant consumerism, it makes her feel like she is giving up the good life. We aren’t lacking for anything, but the trappings of middle-class “success” can be expensive. Having an opportunity to participate in that horrible rat-race lessens the feeling that we are missing out. Rationally, we know that the right thing is not to spend that money, but emotionally, it’s a necessity.

Second, it’s a safety valve. Our finances are under tight control, which can cause pressure. Finances are, after all, one of the leading causes of divorce. Having a way to release that pressure makes everyone happier. Habitual shoppers experience shopping the same way drug addicts experience their “high”. That includes withdrawal. The safety valve turns this from a “cold turkey” method of quitting to a weaning of the addiction.

Another minor benefit is that the blow money can serve as an opportunity fund to bridge the gap between the discretionary budget and a desired purchase. Last week, we ran across a curio cabinet that exactly matches our living room, but we didn’t have it budgeted. Out comes the blow money, which, combined a portion of the discretionary budget and some negotiating, made the new cabinet affordable, without busting the budget.

This isn’t a system that works for everybody, but it keeps us on track.

How do you handle the stresses of a household budget?

Related posts:

1. Budget Lesson, Part 8 ^[4] This is a continuation of the budget series. See these posts for the history of this series. This time, I’m looking at our discretionary budget....
2. 2010 Budget Changes ^[5] We’re making some changes to how we manage our finances this year. Our destination isn’t changing, but the trip is. All of the cards are...
3. Budget Lesson, Part 1 ^[6] Over the next few weeks, I will be going over my budget in detail. The first section is income, but that’s straightforward. A line for...