Sunday evening I was talking with two of my girlfriends about budgeting. I have never considered myself a spender, but these days with the new house, two kids and maintaining a home in general, I find that I do spend a lot of money. We used to have a budget - a long time ago - but we were never very strict about it because we always found ourselves with extra cash in the bank. Therefore, we didn't have to stick to the budget. We're both money conscious and spend our money carefully for the most part. After re-evaluating, however, I feel that it is necessary to create a budget once again. After all, if there is a smarter way to spend our money, I want to partake in that. So my questions go out to you blog readers.
1. Do you have a budget?
2. Do you keep to it?
3. How do you keep to it? (ie. envelope system, spend the same amount every month on things, etc?)
4. How time consuming is this for you?
On the same subject, there are so many options out there on how to propose/keep a budget - Microsoft Money, Quicken, Excel. What is best? We used to do it the old school way with pen and paper. I found our old budget recently from when we were newlyweds (7 years ago) and boy have times changed! What do you use or recommend and why?
*Please note picture above is from the internet and probably from some state budget as it involves millions of dollars. Clearly not what my spreadsheet would look like!
6 comments:
Funny that you ask! I literally *just* finished making Travis admire my newest Microsoft Excel spreadsheet creation. This time, I called it a "monthly cash flow plan" rather than a "buget." Doesn't that sound sophisticated:) I will take out the personal info and forward the document to you. I arranged the categories and subcategories based on some of Dave Ramsey's info, so it has a specific column for "percentage of income," because I wanted to determine that figure and compare it to his recommendations for what percentage of your net monthly income should be dedicated to each specific budget category. I use the spreadsheet to get the big picture, plan and review on a monthly basis.
For keeping up with spending on a day-to-day basis, for a few years now (off and on) I have been using an alternative to the envelope method. Travis wasn't comfortable with the idea of us carrying around large amounts of cash, so I ordered something that looks like a check register but has 12 columns across the top of each page. You assign the budget categories you want to track (or would use an envelope for) to a column and enter the total amount budgeted for that month at the top of the column. Then when you make a purchase, you enter the expenditure as you would with a regular checkbook ledger, but also subtract the amount that you spent from the specific budget category it came from. This allows you to know on any given day how much money you have left in, for example, your grocery budget. This also allows you to easily assign portions of one receipt to different categories (i.e. when you spend a bunch of money at Target, and it does not all fall into the same budget category. Just a hypothetical, I wouldn't know anything about that:). The booklet is called a "Budgetmap," and I found it online. I will bring one of these to the beach trip so that you can see it.
By the way, if you haven't currently lent it out to someone, will you please bring 3 Cups of Tea to the beach for me to read? After reading about it on your blog, I saw it in a store and read the book jacket, and was even more intrigued to read it.
we defer to you guys on this one, and i'll expect a full report and budget lesson when we come out in sept.:)
We are also Dave Ramsey converts, and our system is much like your friend Holly's. We also did not feel comfortable with carrying cash (it always seems to disappear!), so we created a "virtual" envelope system on Excel....that is set up almost exactly like your friend Holly's set-up, only on the computer. We have been using our system for about 18 months now, and it is incredible what it has done for us.(both financially and in terms of communicating about $) Dave Ramsey is big on you telling your money exactly where it is going, otherwise it will go away. Having it all there in front of us to see was so helpful....when I see my grocery budget is getting low, I know I have to plan simple (read:cheap) meals the next week--or else figure out what other category the money will have to be "transferred" from. We have categories for EVERYTHING....the funnest is to watch our savings for fun stuff (i.e. vacation, our next car, furniture) grow. Also we both have a "blow fund" for every month--a set amount that we can each spend on whatever we want without having to "ask" the other. Of course, Justin spends his whole fund by the 5th of every month, and I save mine up like a little mouse...he is so jealous of my column :)
Hmmm...you have inspired (and reminded) me. We created a budget and stuck to it while living in Dallas but never updated it when we moved to Austin & had the baby (with new/different expenses). Thanks!!! I'm not sure how I'll set it up...
i'm zero help on this one. i bugged matt for a long time about making a budget for us, but then when we did it, i hated it! :) i have a feeling we'll need to buckle down when we get back to the states as cash flow will be tighter. maybe we'll look into dave ramsey. we have used quicken in the past, but haven't since we moved here.
can someone please give percentages for the different categories? ie: house payment, groceries, household products, blow funds, babysitters, etc. i never know how much to allot to the different categories.
teri, what does justin spend his money on by the 5th of the month??? that's funny!
we are just completing the "month of discipline"!! we tried to spend as little money as possible - sort of. No eating out, no extra expenses, no extra entertainment money. we felt like we were getting too used to do just getting and doing whatever we wanted. we dont have a budget, though. i think i would be like hillary - not wanting too much structure. but i have enjoyed parts of this month - never getting too much food in the fridge or pantry (because we are eating it all every week) makes the kitchen feel much, much more organized and relaxing. eating out on the weekends isnt really necessary if you plan ahead for the week and have a few frozen meals on hand (homemade lasagne, cowboy chicken, etc). not buying kids toys or clothes they dont really need helps keep the house cleaner. I once read something like this... "every time you buy something, think about this - is it really worth it? i'll have to find a place for it and keep track of it. it will make my life more complicated." after this month, i believe that even more! less stuff is so much better than too much stuff!!!
i also learned that it's fun to wash the car with ellie - and it's FREE!! i learned that saving a dollar here and there at the grocery store really does add up (some type of bread is always on sale, some kind of tomato sauce is also always on sale. i dont have to have the same kind every time i buy it.)
some things i wont budge on at the grocery store - like milk or canned tomatoes. but plenty of things can be bought in a cheaper form that's just as good!
anyway, so, i guess we'll have a relaxed budget. a certain amount for food weekly/monthly. a certain amount for clothes/toys. a certain amount for extras. and of course, a certain amount for "blow" money! then, i'll just monitor it and see how i can improve. I dont think i'll really invite chris to join in my grocery/household items budgeting. I would feel too constricted then - like someone was watching me. i hate that. i'll just watch it on my own and see where it's all going. (it's not something we fight about, so he wont mind if he's not included!)
long winded. sorry!
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