Budget smudget revisited

So here I stand in December staring at the costs of a new heating and air system, Christmas for the family, my daughters 10th birthday and the trip to Europe in a less than a month.  I'm a bit franticA few months ago I wrote about the pain of having to start living by a budget. It was a necessity since I’m planning a trip to Europe in January and my air conditioner was on its last legs. I thought if I could just make it through the summer if the air went out the price of replacing it wouldn’t be so painful. Well the air conditioner made it through the summer but now it’s completely down and it took the heating system with it.

So here I stand in December staring at the costs of a new heating and air system, Christmas for the family, my daughters 10th birthday and the trip to Europe in a less than a month. I’m a bit frantic.
I think the best course of action is to take a deep breath and carefully consider my options.

Here’s what I’ve come up with:

  • I considered cancelling the trip to France but I’d lose a good bit of my deposit money
  • I have $1200 saved in my “France account” but that is to offset the costs of the trip
  • I have 5 month’s salary in savings but I’m hesitant to take that out in case of a bigger emergency
  • I have room on my home equity account to pay for this, but it’s just enough
  • I could just purchase a lottery ticket – that would take care of everything – right?
  • I could look into financing the cost of the new system but if the interest rate isn’t as low as my equity line that wouldn’t make sense
  • I could go without heat but it’s gotten a bit chilly down here and the kids are cold blooded

As I look at my list I realize I’m pretty lucky. I have options that some folks don’t. I can choose any one option or combine a few different ones to cover the costs. Either way I’ll be ok. I’ll keep my budget in place with maybe a few tweaks to pay off this new cost and I’ll prepare for the next time an unexpected cost comes my way.

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One Response to Budget smudget revisited

  1. Anonymous says:

    Ideally, a budget should include setting aside money for household emergencies. For example, we set aside money each payday for inevitable care repairs. We have enough saved now to completely replace the transmission by paying cash should it go out. That way we’re not dipping into money saved for other things. A home warranty plan in place would also take care of the A/C having gone south for the price of the service call.

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