Budget

We  are *almost* owners of an acre of land in North Pole, AK so we can build this.  We just need to sign and return the paperwork.  Then it's done.  Final. 

 No refunds, no exchanges, no returns. 

Now what?  we've been asking ourselves.  Now it's the time to realize we have something big to accomplish and we need to face the facts:  we need to cut back on spending.  Sound like you're tuning into a news program about the government? 

Before coming to law school we were good about keeping a budget.  It worked like a charm and we stuck to it.  We made a chart, sort of like a punch card, and hung it up on the fridge.  Here's an example:

Each variable expense goes up with a set dollar amount.  Then below, in the "punch card" area, is the exact amount divided between $1, $5, $10, and $20 cells.  As we make a purchase, we take the receipt up to the chart and mark off what we've spent as we're usually not paying with cash.  We would usually round up to the next dollar amount (so a $7 purchase became a crossed off $10).

There were a few times where we only had $5 to spend in groceries and a week left of that month.  We made due with what we had.  So now, we're back in the game.  We looked at the last 3 months' spending average for each category and cut it by at least 25-50%. 

I believe we're not in an economic downturn, but that this may be the new economy for the next 10-20 years*.  Our time to be frugal and realistic is now.  And having a family budget is our step towards being more self-sufficient.
How do you set up your budget?

*The Fourth Turning by Strauss & Howe