Tuesday, Sept. 2, 2014

The four walls of budgeting: How to provide for your household

By Mark Helgesen, For the Deseret News

Published: Sun, May 4 6:12 p.m. MDT

 So what are those basic household necessities that we should take care of first? What should we do in order to provide for our own and our own house? We call these things the four walls of budgeting.

So what are those basic household necessities that we should take care of first? What should we do in order to provide for our own and our own house? We call these things the four walls of budgeting.

(Getty Images)

“But if any provide not for his own, and specially for those of his own house, he hath denied the faith, and is worse than an infidel.” — 1 Timothy 5:8

Setting your monthly budgets can be overwhelming. When planning your monthly spending plan, it's much easier to prioritize. First and foremost, before doing anything else, you need to cover the basic necessities.

So what are those basic household necessities that we should take care of first? What should we do in order to provide for our own and our own house?

Dave Ramsey, a renowned financial expert and host of a popular talk radio program, refers to these basic necessities as the four walls.

1. Food

Feed your family.

Set aside a sufficient amount of money in the budget for food. This should include "eating out" money. I also recommend adding everything to the grocery budget that you would buy at the supermarket — maybe call it your Walmart Fund or Target Fund, depending on your preference.

It's always better to overbudget in the food category. Be reasonable when determining the amount of money your household will spend on food and groceries. After budgeting for a few months, you will have a better understanding of how much your family actually needs for food.

If your kids are fed, that's one less thing to worry about.

2. Shelter

Pay your house payment or rent and keep the lights on.

The shelter budget category should include everything needed to keep you and your family safe and warm inside your home — mortgage or rent, utilities, etc.

Never pay a credit card bill instead of your house payment. You can afford to have a little ding on your credit. You cannot afford to lose your house or have the heat or power disconnected. As Dave Rasey says, "if you have to choose to be behind on something ... choose to be behind on things that don’t matter as much."

Keeping the lights on and paying your house payment should give you one less thing to worry about.

So far, the family is fed and the lights are on. This is good.

3. Transportation

You need to keep the car moving so you can get to work and make some money.

Car payments, gasoline expenses, car insurance and basic repairs and maintenance needed to keep the car running fall under this category.

When budgeting for fuel expenses, again be reasonable. It's better to overbudget for fuel than underbudget and not be able to fill your tank with gas. After you do the budget for several months, this category will become easier to project.

Also, do some simple math to determine how much money you will need to set aside each month to cover the regular maintenance on your vehicles. That way when the car needs an oil change or new tires, you will have the money to cover it. You have to keep the car running.

Don't pay another debt instead of paying your car loan. You cannot afford to have your car repossessed.

Food is on the table, a roof is over your head and gasoline is in the car. You're OK.

4. Clothing

This category works a little differently. A large clothing budget is probably not a priority for everyone. If you're just a single guy or girl and you don't have a bunch of money, you probably don't need a bunch of new clothes. But if you have a family and kids, you need a clothing budget.

If you have young children, then you know they grow out of their clothes weekly. Or if you have kids in school then they will probably need new clothes and new shoes before school starts. Plan for this in your budget.

Project how much money you think your family will need for new clothes for the entire year, divide that number by 12 and set aside that amount of money each month for clothing. That way you will have the money needed when the kids grow overnight or when school unexpectedly starts tomorrow.

Be frugal with your clothing purchases if your budget is tight — or just be frugal always. There are a lot of ways to save money when buying clothes and shoes. Don't be afraid to hit up the thrift stores, garage sales or get hand-me-downs from your relatives, friends and neighbors. Hey, my mom made my shorts when I was a kid. I survived.

Kids are always outgrowing their clothes. Somebody somewhere is throwing out some good stuff.

The family is fed, the lights are on, gasoline is in the car and the kids aren't naked. You've covered the four walls.

Taking care of these things first will help simplify the budget and ease the stress and worry of your household finances. The rest is basically a game. If you can't pay your credit card bill or the annoying bill collector that calls and harasses you daily, don't sweat it. You will get to it.

Take care of your own first. Secure your household and family before anything else and then take care of the other things.

Family first.

Mark Helgesen is a financial counselor at Utah Debt Solutions in Layton, Utah, and a runs a personal finance blog at debtfreemormon.org. Contact him at markhelgesen@gmail.com.

1. Nan BW
ELder, CO,
May 2, 2014

Ooops, where is tithing? Maybe I didn't read carefully. From the time I married a student husband (seven years of helping keep him in two universities) we paid tithing faithfully. We didn't borrow money for anything but houses. We ate frugally; we dressed more frugally; we spent money to visit family hundreds of miles away; we have always had super modest homes and we are now retired. We have no mortgages, but we work hard to maintain several rentals so "retired" is not quite correct. We still live frugally, and we still pay tithing. It isn't all that complicated. However, I do know that paying for college is much harder than it was then so we have given modest help to several grandchildren. Money issues will always be there, but can usually be managed.

2. K
Mchenry, IL,
May 3, 2014

Tuition and fees a public university in Utah cost $7,708 a year. $7.25 times 20 hours a week times 52 weeks a year is $7,540. Gross. No taxes paid. No tithing paid. No food purchased. No housing. No transportation. No insurance. The cost of university has gone up exponentially.

3. dimelo
May 4, 2014

Self-reliance is just propaganda from the wealthy to blame the poor for their poverty -- the poor do not manage their money wisely enough. The reality is the wealth are taking so much the poor do not even have enough to pay for essentials of merely subsisting -- hence the rise in government assistance. This propaganda also makes the wealthy feel good about themselves as they hoard ever increasing piles of wealth -- after all, the poor have brought it on themselves, therefore the rich will stay their handing giving.

Just witness the Waltons, the wealthiest family who pay the bulk of their Wallmart employees far below a living wage and force them to seek government assistance to merely subsist. Effectively the Waltons are forcing the taxpayers to subsidize their vast wealth even more; but the prevailing attitude in the US is to always point at the poor -- they are the problem, and they need to manage their money better (you know, save for a rainy day even when they aren't paid enough to put food on the table today).

4. killpack
Sandy, UT,
May 4, 2014


Make no mistake, the wealthy have a responsibility to share the excesses they've accumulated in this life. Unfortunately, when the corrupt state uses police power to redistribute that wealth, instead of allowing individuals their freedom to do what is moral, bad things result, far more unequal and unjust than the inequality of free societies. Some things in this world are inherently criminal: rape, murder, theft, fraud, trespassing, etc. Why? Because they CLEARLY violate the freedoms of others; they require armed police arrest and detention if there is cause and imprisonment if proven guilty in a court of law. However, just because something is immoral, doesn't make it criminal. I find many behaviors morally repugnant. It doesn't mean I appeal to corrupt Ayatollahs to send moral police after the offenders. Armed police brutality should only occur when true criminal activity has occurred (e.g., rape, murder, theft, etc.)

5. george of the jungle
goshen, UT,
May 5, 2014

the economy was going to neutralized and should of happened when the crash happened.