It's Guest Blog Time!
I think the expression "throw money at the problem" was written by a Foreign Service or Military family. Whenever we PCS, our family and friends are always confused about our complaints of the cost, "Isn't your move paid for?" Well yes, packing up and shipping our stuff is paid for but there is so much that feels impossible to manage when it comes to budgeting.
As we are gearing up with our community to PCS, we want to help you find resources for managing your budget during your next move. Heather is a budget coach, professional educator, trainer and seasoned diplomatic spouse. We asked Heather for her financial tips that can help you start to focus on a financial roadmap for your upcoming move.
Guest Blog by Heather Emerick
We’ve all been there: you're about to embark on a new adventure at a new post, but it means leaving behind the home and community you've grown to love. You're excited about the possibilities but overwhelmed by the long list of things to do and all the costs involved. How do you ensure you have enough money to cover everything you need for your PCS without breaking the bank? The answer is simple: a well-planned budget. In this post, I’ll share some tips on creating a budget that works for you and helps reduce the financial stress of PCS season.
You Need a Budget
Whether you use an excel spreadsheet or an app like YNAB (You Need a Budget), creating a budget is a financial roadmap that can help you plan for your short-term and long-term expenses. Writing everything down helps you see what you need during your PCS. Once you’ve estimated your expenses and compared them to your expected income, you’ll know if your plans are realistic. If not, it’s ok. Scarcity brings clarity and will help you prioritize the things most important to you and avoid creating debt. When you know you can cover your upcoming expenses, it reduces a lot of financial worries.
PRO-TIP: Include a “stuff I forgot to budget for” category to cover those expenses that might sneak up on you.
Be Ready to Roll With the Punches
For a budget to work, it needs to be flexible. Plans and priorities are subject to change, especially during PCS season. Think of it this way- you’ve planned to go to the beach over the weekend. You learn that the whole weekend is forecasted to be stormy and rainy. Do you still need to go to the beach just because you said you were going there? No! New information changed your plans. Maybe this is a good weekend for a museum tour instead.
Budgeting works the same way. Maybe you have allocated a certain amount of money to dining out at your favorite restaurant, but a friend offers you a concert ticket to a show you’ve always wanted to see. With a flexible budget, you can move money you’ve set aside for dining out and use it for concert tickets. You are still living within your means, but your priorities have changed. A budget that accommodates changing priorities is a budget you can stick to.
PRO-TIP: Always have a category for fun in your budget. A budget should be a tool that helps you achieve your goals; it shouldn’t feel restrictive or punitive.
Start Planning Now for Your Next PCS
PCS season is expensive. Some people call it homeless leave for a reason. You are paying not only for the transition from one post to another but all the things you need to set up your new life in your new post. Fortunately, your next PCS is predictable. Once you hit your new location, start putting a little money aside in your monthly budget for your next PCS. Look at your last PCS cost and divide that amount over the time at your new post. For instance, if your PCS was $5000 and you are at post for 36 months, try setting aside $150 a month. When you PCS, you’ll have the cash ready for your next transition.
PRO-TIP: These big but predictable expenses like PCS, car repairs, vet bills, or holiday gifts are true expenses. You know they are coming, so why not prepare for them by putting aside a bit of money every month? When that car repair comes, you’ll be ready.
Planning and budgeting ahead of time make the transition to your new home a smoother and more manageable experience. Good luck with your PCS!
Heather Emerick is the founder of DiploBudgets, a service for ex-pats who want to create a solid financial foundation to help them take advantage of the adventure of living overseas.
As a family member in the Foreign Service (aka EFM) and mother of three, Heather knows that living overseas comes with tremendous benefits and myriad challenges- money stress shouldn’t be one of them. In 2017, after feeling frustrated and never in control of their finances, Heather discovered YNAB (You Need a Budget), and after some hard work, everything fell into place.
Using YNAB four principles, Heather and her family weathered an ordered departure, traveled during every tour, completed several moves, and bought a house in D.C. without worrying about finances. Through it all, Heather learned tips and tricks for making YNAB work with the ex-pat lifestyle. She’s excited to share her experience with other DiploBudgeters!
When she’s not sharing her love of budgeting, she is an expert talent development consultant specializing in designing, creating, and facilitating engaging learning programs for clients, including Brown University, Dartmouth College, Conservation International, and Sunshower Learning. Heather also serves as an adjunct faculty member for the Foreign Service Institute, the training school for the U.S. Department of State, teaching courses in management and leadership.