by Hope
I’ve taken your recent notes to heart and did a complete overhaul of my budget. I included line items for travel, clothing and gifts. But I did combine my grocery and entertainment line items as I feel that most of our entertainment revolves around meals and this just makes sense for how to manage it.
Hope's Summer 2019 Monthly Budget
| Description | Monthly Budget |
|---|---|
| Savings | $100 |
| Rent | $650 |
| Groceries/Entertainment | $800 |
| Household (hygiene, cleaning, etc.) | $10 |
| Auto - Gas | $120 |
| Auto/Rent Insurance | $250 |
| Utilities (gas, electric, water, trash) | $300 |
| Life Insurance | $23 (paid quarterly) |
| Buffer | |
| Kids Activities | $83 |
| Gifts | $83 |
| Clothing | $100 |
| Travel | $500 |
| Auto - Maintenance/Fees | $30 |
| Debt Payments - minimum payments | |
| Car Payment | $400 |
| Credit Card | $62 |
| Collections | $0 |
| Student Loans | $100 |
| Sub-Total | $3,611 |
| Sea Cadet & History Buff's Contribution | ($307) |
| Total Personal | $3,304 |
Notes
Travel – this line item takes into consideration 3 annual trips to my parents in Texas for the time being and a couple of round trip flights per year for Gymnast to visit. It seems really high, but I believe it is realistic.
Clothing – this is high considering I am only really purchasing clothes for Princess and myself on a regular basis now. But I am going to need quite a few new clothes soon based on my weight loss. I’m holding out for now, but am preparing for it.
Gifts – I feel like $1000 annually is plenty to cover birthdays, Christmas and Easter. Those are really the only times I purchase gifts. There is a little bit of a buffer in there since I must ship things to Gymnast.
Groceries/Entertainment – since most of our entertainment involves eating it seems, I decided to combine these line items. I think this will go down quite a bit this summer and then this fall with the twins staying busier and then Sea Cadet leaving. It’s absolutely crazy to me that last August I had 4 kids at home and in just a few short months, I will be down to 2. Before I know it, it’s going to be just Princess and I.
Did I miss anything? Any thoughts or questions on this budget?
Thinking About the Future
At this point, History Buff is hoping to transfer to a 4 year school next January. He is hoping to pursue a degree in Construction Management. That is definitely subject to change, but right now that’s what he is thinking.
Gymnast is planning to complete his first year of high school in Illinois.
And Princess will be getting her Driver’s Permit this May and then driving in a year. Yikes!
I will possibly be down to one child in less a year. Boy, how my budget will be different then.
Hope is a creative, solutions-focused business manager helping clients grow their business and work more efficiently by leveraging expertise in project management, digital marketing, & tech solutions. She’s recently become an empty nester as her 5 foster/adoptive kids have spread their wings. She lives with her 5 dogs in a small town in NE Georgia and prefers the mountains to the beaches any day. She struggles with the travel bug and is doing her best to help each of her kids as their finish schooling and become independent (but it’s hard!) She has run her own consulting company for almost twenty years! Hope began sharing her journey with the BAD community in the Spring of 2015 and feels like she has finally in a place to really focus on making wise financial decisions.
It seems like that giant pot of money for grocery and entertainment is a good place to bury spending you know is extra and not contributing to your long term goals.
Not judging if you want to prioritize a meal at chick-fil-a over, say, your emergency fund, but just a reminder that your budget should help you achieve what is most important to you.
Hope…
That is a gigantic grocery and entertainment budget for 4 people. How much of that is realistically groceries and how much is entertainment? I am assuming that the older bots are not eating every meal at home now, so it just seems crazy that you have that budget set so very high.
Bots made me laugh, no offense!
Hope,
I had a differing thought on the $800 for groceries and entertainment. I have a family of four in Florida and the best I can do for food is $900 per month, by shopping Aldi’s, Walmart/Target and sales ads. Food is expensive in Florida! I worry about you cutting that budget too thin and end up bouncing the other way. I hope the $800 works. Maybe you can send along some tips.
I’m so confused about budgeting. Are these numbers just psychic predictions of how much you’re going to spend in each category, or are they past spendings from last month calculated from receipts?
I feel like it is a rough estimate, then you track the numbers and work with them as best you can!
Thanks kJ.
Sounds hard, but easy once you’ve done it a while
I mean JJ ?
Akasha, sounds like you’re just starting out. Might want to search the Net and Youtube for info on the concept of budgeting and how to budget. Maybe keep track of all your spending for several weeks to see where you actually are spending, and then determine where you can cut back. Then make a budget. HTH.
I am. I’m doing a workbook called the budget guide by Judy Lawrence. I swear by this book.
If you look back on previous months, what are you actually spending on groceries on average? I have a family of four (2 adults and 2 teens) and I spend $600-650 per month, so I do think you could trim that category. And I would not combine necessary grocery money with unnecessary entertainment. That’s an easy way to let your “entertainment” budget get out of control.
Also, $6000 a year in travel is excessive considering the amount of debt you have. $750 should get you two round-trip flights for your son (based on the cost of his most recent flight), and gas from Georgia to Texas should be around $200 round trip (you budgeted $1700 for your last trip in November—which seemed high then—did you actually spend that? I don’t think we saw a breakdown of where that $1700 went).
Hope, I hope this budget reflects that you have cleared the collections amount with your former apartment owners. If your landlord does sell the house where you are, it would make it much easier to be approved for an apartment or other rental with that small debt behind you.
Things I am happy to see: You have line items for things like travel and savings. Yaay! You are paying enough in payments to cover interest on your student loans and credit card as well as have that car paid off by early next year. Good for you!
Things I am a little confused about: Your credit card which you stated recently you are ready to attack with a vengeance has a minimum next to it which covers interest(so hooray it won’t grow) but does not have much in terms of headway for the next three months. In three months time you will maybe shave $100 off that $2500 using this(which is okay as long as you understand that these three months are not you attacking debt with a vengeance or pulling you closer to debt free by year end).
Things I am less than happy about: That savings line item in three months won’t even cover a typical auto insurance deductible. In the last few months you had to replace a tire and lean on your auto insurance. Without that emergency fund you would have been royally forked. You need more than $300 in that fund in three months if you recently had $2000 cleaned out by emergencies that you just had planned for three months prior. At least figure out how to pull $75 out of gifts, entertainment\ grocery,clothing, and some of the more fungible categories(I’m looking at you travel category that is heavily funded) to get this number to $500 in three months(175 x 3 = 525)You NEED to have money for emergencies and I am pretty sure you know in your head that $300 isn’t going to cut it. It’s too low.
Overall: I don’t think your budget is a horrible. It reflects what you find important. However, it does need some tweaks to reflect your reality. You are a self employed person who needs to ensure you have back up funds if a contract falls through or if an emergency strikes.(You’ve been down this path before don’t let it detour you by not considering it happening again) Your housing situation may require you to move if your landlord sells. Your car, oh that car, has recently been a money pit. You need to have the means to cover a deposit on a new place should you have to move. You need to have money to deal with car issues. All of these things point to requiring you to do more in your savings category. $100 a month is fine for a maintenance fund if you already have a few thousand sitting in the bank, it’s less fine if you only have a few hundred sitting in the bank(Using this budget I would not be happy to have less than $3500 in the bank) You are hopefully only a year or so away from creating a budget that is more maintenance and less dealing with credit cards and loan payments( how nice would it be to replace auto loan line item with a small Hope’s dream home down payment line instead?)but you need to figure out how to get there first. Savings is key because it would allow you to not have to take out large loans or use the card which just puts you in a cycle of paying off debt over and over.
Is it possible to earn more money working in another job, ie: not self employed? I feel like your kids are big enough that you don’t need to be ‘at home’but I think you prioritize self employment regardless of the income
She started working as a substitute teacher in addition to her self-employment.
Hi Hope. I think that entertainment and food should be separate because food is a need, entertainment (including meals out) is a want. Lumping them together will allow you to mask the amount that you are spending on something that is a want. My family has a grocery category for Food and household items (soap, shampoo, cleaning supplies). We also have an entertainment category which includes eating out. We get a set amount of cash out of each check for entertainment and only spend that cash for entertainment. This help to keep us from overspending. I think one of the most important money management skills is seperating needs from wants.
I’m glad to see you’ve put a line item in for things like travel and gifts. The only glaring missing spot I see is medical. Surely you have doctor bills and prescription copays over the year, and you have said Medicaid is coming to an end.
My other thought is $562/month in debt repayment isn’t much when you owe over 30k. Would it be possible to decrease the groceries/entertainment, clothing, and travel? Travel is important in your situation and I’m glad to see a budget for it but that seems high.
This is your spending budget. Do you have a budget of how much you predict your income will be per month? If you make more, will you pay off more debt, put more into savings, etc.?
I agree Sarah. Hope, a budget needs both incomings and outgoings. You must have some idea of what you’re bringing in each month as a minimum.
Is there a snowball? Is this budget over or under what you’re actually making?
I’m also very concerned not to see a line item for medical. You are going to have medical expenses. Everyone does. Your kids play sports – even more risk of medical. Have you looked at options for medical at all yet? I’ve heard of Christian Healthcare Ministries – maybe that’s more up your alley than insurance?