Now that all the birthday madness is over and I am starting to get over my cold I feel the need to be productive and "get my life in order." You know the feeling. Anyway, last night Ian did our taxes in record time and we found out that we were going to be getting a pretty decent tax return. Woohoo! We are still in the stage of our lives where we look forward to tax time.Anyway, today I decided that we need to have a real budget. We have never had a real one. I mean I keep track of our bills and pay them all on time. We have excellent credit, but it seems like the first thing we have to do when we get any chunk of money is pay off a credit card that has snuck up on us. This is the case with the tax return too. I have read countless articles about money management. I know the tricks, so here goes. I am feeling pretty gung-ho about it because I really am tired of being in the exact same place we were a year ago . . . every year.
Please don't think I'm whining either because, truly, we are so incredibly blessed. We have a great house, a new van, our kids can go to preschool, we keep plenty of food on the table, and we manage to enjoy more than enough other comforts, but we're not real savers. And I kinda want to be.
Things I have done today to be more financially responsible . . .
-Finally set up Davin's college fund.
-Set up recurring transfers into all of our savings accounts each month.
-Wrote out a "budget" including our fixed expenses and how much will be left for flexible expenses.
-Got our FSA account set up for the year (ok, actually Ian gets all the credit for this one).
-Tacked an envelope on my bulletin board to put the month's grocery/household receipts in as they come in so I can keep track of my spending.
-Stocked up on chicken, ground beef, and fish at Sam's Club (this may or may not be financially responsible, but it certainly needed to be done regardless).
-Called the power company and got "equal payment" set up. I have now done this with all of our utilities.
Things I still need to do to be more financially responsible . . .
-Clean out my files and allocate another drawer for additional files.
-Get a shredder.
-Stick to my budget.
-Be vigilant about ONLY putting gas on the credit card.
-Stop buying things I don't need at the grocery store (aka ice cream, chips, pop tarts, etc.).
-Keep up my menu planning.
Finally, I have toyed with the idea of switching to using cash for my flexible expenses like groceries and entertainment. It seems like such a pain, but I'm sure it would help me be more aware of what I'm spending. Have any of you done this? What are your thoughts?
So, wish us luck and keep me posted on any killer grocery/clothing deals or financial management tips you have used.
14 comments:
We tried the cash for groceries, and it worked out really well the ONE time we did it. I went without items that were not necessary, and thought of creative ways of not having to buy something (i.e. I was buying some corn tortillas for tacos, and I figured I could just bake some to make my own tortilla chips for another recipe). I highly recommend cash..
I'll do cash for a couple months, when I need to 'shape up' my spending . . . then it usually makes me more aware of how I spend my money, and I get lazy with the cash, go back to debit and it works well for months, then I get sloppy and go back to cash for a few months again :-)
This is great! It really is difficult, but it makes a huge difference. We have tried to be good about saving, but it can be hard when you're not thinking about it. It's so important to start young. I'm going to try to be better this year too. :)
We write down our budget every month, but in the beginning we wrote down everything we spent each month for all the groceries/misc./entertainment. . .everything that wasn't fixed. I still keep watch on it pretty close and at the end of the month when the money is low. . we stop spending. Also, the church has a really good online class on finances that I highly recommend. It's called "Peace in My Heart" or something like that. Go to lds.org and link to Home and Family then go to Provident Living and link to Finances and you'll see it on the right. I went through it a couple Saturdays ago and found it really helpful and just a good reminder. Most things they suggested we were doing and they work for us :-)
We just sat down and did our monthly budget (always a stressful FHE when it ends up being that--although that's my tip: always sit down at the end of the month TOGETHER and account). Anyhow, Jeremy just gave me the go-ahead to try out mint.com and I am SUPER excited. Budgeting has been a rough road for me (for many years), but I'm excited to get to move from paper to the computer through mint. We'll see how it pans out!
We have been pretty good for about a year at budgeting groceries, including diapers, cleaning supplies, and hygiene items. 50 dollars a week, no excuses. If I know something will cost more (like if we have a birthday coming up or I need diapers), then I have to spend less the weeks before to save up for it. Menu planning is essential. I usually gestimate how much an item will cost (it is easier to do this once you've been shopping for that item in the past), then I make sure my plan doesn't go over 50. When I get to the store, I keep track of how much things are costing(just in case my guesses were way off) and carry a calculater to add everything up as I go along. Then it is just a matter of disciplining to not excede the budget. Just last week I had to put back a bag of oranges, marshmallows (we were planning on hot chocolate after date night), and some supportive inserts for shoes. It'll have to be another week. I don't think it is essential to use cash only if you really keep yourself accountable.
oh, btw, we had our budget 'talk' last night for 2010. We are going to cut out 5,000 from our spending this year. That will take the discipline we've been using for groceries and carry it over into EVERYTHING. We'll see how it goes. :)
Here's our financial plan for the last 7 years:
Pay Tithing. NEVER balance the checkbook, it simply wouldn't add up.
We were always fine.
Now we actually have a real income and we're facing growing up and really having a budget. This is our first month with a mortgage payment. We'll see how it goes.
And good for you for setting up a college fund. We paid for (or went to Miss America for) our own schoolings, so we're really not that anxious to hand over our hard earned cash to twenty-something kids. Are we terrible?
Go Shannon!! Your plan sounds great. I usually budget an amount for groceries and then just stop spending when I know it's gone. For example, we get paid every two weeks and I budget $300 for two weeks. I shopped at the grocery store and spent $78 on Friday, then Costco was $117 on Monday. So there's about $100 left for next week when I need milk and various other items to fill out my menu plan. I think it works the same way as the cash method....if you stop spending when you reach the limit. ;) I love you Shannon, good luck with your financially responsible efforts.
this is always my struggle. :) i use cash most of the time (divided into sections in my wallet according to the budget), but then when i start using the card (usually cause i forgot to go to the bank) things always get away from me and i have to get back on track. i actually just found this website though (although i guess everyone else knows about it!) called mint.com that makes tracking and budgeting SO much easier, especially if you are using cards. anyways, it's awesome - i just started using it, but i highly recommend it!
UPDATE:
We actually have had mint.com set up for over a year. We found that its great while it works, but for some reason, the connection to our bank account breaks too frequently to be worth the hassle... also... we just wouldn't check it... (hence going to the notepad and and cash system to force us to be good for a while...perhaps when we are ready to go back to cards we will give mint another shot)
Go You! Good luck with all of your goals. I always wondered if equal payment was worth it.
Are you following any budget saving blogs? I like this one:
http://iloveagooddeal.blogspot.com/
but I know there are more that may be more on top of things.
Way to go Shannon! We have a budget set up on an excel spreadsheet for monthly expenses, and we enter every single expense in it. Keeps us on our toes, because we both check it fairly regularly and then go "what the heck did you spend $47.22 at Target on?" We keep each other in line that way. :)
We do cash for most of the flexible categories- pet care, groceries, date night, medical, gasoline, probably a few others I am forgetting. It really helps me. I have a bad habit of "treating" the pets. I go to buy food, and buy a new toy and a bag of treats and this and that. But when I have the cash, I am better able to say no to myself. The dogs don't need new toys or new other stuff. They just need food. And occasionally more treats. Groceries are really hard for me. I tend to just spend what I want regardless. I am trying to be better about that in the next few months. In most of my other categories though, we are good. I pull out a certain amount each month to use specifically for baby needs or medical needs. Of course, if you get sick, you have to go to the doctor whether you have the cash or not, but it helps to know that there is a bit of a surplus there if I need it. Alann and I also budget together. We finally have a real actual budget. Since we are one (or no) income now, it's easier to sit together and figure it out. When we were both working, it ended up being "mine" and "yours". It's good to have one person who is in charge of the finances so that the bills get paid on time every time, but you need to be talking to the other. That has really helped us.
As far as mint goes, I prefer my own excel spreadsheets. They always tell me way more than anything else. I can send you the one I use some time if you like.
(And don't forget to budget in some fun!)
What??? Ice cream, chips, and pop tarts are not needs? Yes they are!
Good luck with the cash thing. We have a separate account for groceries to keep it in bounds -- same concept, different approach. It's not too hard to stay in budget when you plan it. Oh yeah, and I love coupons.
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