february finances update (day 6)

This is harder than I had anticipated…and we’re only 6 days in. What we didn’t account for in our budget was all the unexpected spending that comes with being an grown up. For example, today we had to pay $45 for an Air Care inspection for our car. Something that wasn’t a luxury, something that HAD to be done, but something that also wasn’t in our budget. It was no big deal because we’re just pretending this month – but if this was not just a pretend exercise, but real life, I really don’t know where that $45 would have come from. But I can tell you where it would have ended up: on our credit card.

Ugh. I understand that credit can be a very useful and necessary tool, however, I just really hate it. I’ve learned my lesson on being fun and fancy free with credit and that’s a lesson that I don’t NOT want to have to learn again.

So, I guess it’s back to the spreadsheet to figure out how to incorporate an “unexpected expenses” category for each month. This is a good thing though, and just another reason why it’s such a good idea to test this new budget while we still have a safety net. I’m going to say it once: Hubby, you were right (that almost killed me).

february finances

2013 seems to be the year of finance.

Today, January 31, 2013, Hubby and I are starting a month long financial challenge.  We're cutting my income down by almost half (53% to be exact) and putting the remaing 47% into savings/paying off credit (we don't have much debt, so most will go into savings).

I know, we're nuts - but in a good way.

We're challenging ourselves to see how little we can really live on.

Can we really go with only eating at home, and not spending money on entertainment?

Can we really be disciplined enough to stick to our budget and not over spend?

We'll see, I'll let you know how it goes...

2013 budget tips

Welcome to 2013!

Yes, I do know that 2013 started 13 days ago, however, it seems that I'm just now getting back into a healthy, regular routine again.

Back to the gym.  Back to eating healthy dinners.  Back to not drinking every day.  Back to not spending money like we're millionaires.

I never really make New Year resolutions.  I find that they too often get broken before we even hit February.  So, I usually just mentally list out my goals for the year.  

In 2013 I want to:

keep living a healthy, active lifestyle

lose the last 15 lbs (always the hardest, see above)

save money so that when then time for a baby comes, we'll have a little bit tucked away

Pretty standard goals, right?

Hubby and I have had a budget for a number of years now, and, as with all good budgets, it's constantly evolving.  I mean, what's the point in having a budget if you don't actually follow it?

We were notorious for spending hours perfecting our budget in our Excel spreadsheet, however, we still always seemed to be living paycheque-to-paycheque.

Just recently, Hubby and I  recognized that the majority of our over spending was happening in the restaurant and entertainment categories in our budget.  It would start with us going out for sushi on a weeknight when we didn't want to cook, or had nothing in the fridge for dinner.  Then we'd go out and have dinner and drinks with friends over the weekend.  Before you knew it we were regularly spending three times our budget each month.  Not very productive in saving money.

In order to keep our spending in check, we implemented a system that goes something like this:

• we created three envelopes (labelled groceries, entertainment, and restaurants) 
• each time Amanda gets paid (twice a month) we put $100 into each of our restaurant and entertainment envelopes
• each time Amanda AND Trevor get paid (works out to once a week) we put $100 into our grocery envelope
• ANY spending we do on restaurants, entertainment, or groceries has to come out of our envelopes - period.  We're not allowed to use our debit/credit cards for spending in the categories
• we are allowed, however, to use money from one envelope for another category (example: we can use the money from our entertainment envelope to pay for groceries that we're buying to host a dinner party
• any money left over in the envelopes stays in the applicable envelope and we can take it out and use it for whatever we want

I cannot even begin to tell you how well this system in working for us.  We usually end up with money left over in the envelopes before we replenish them.  Plus, it's actually become a little bit for a challenge for us.  Do we really want to go out for dinner and spend they money, or can we just whip something up at home and save the money?  More often than not we end up just saving the money.  Plus, eating at home usually means that we eat healthier (which will also help with my first two goals).  

Do you think this might work for your budget?  Maybe give it a try!