by Elizabeth S.
I’ve been responding to comments from my post yesterday addressing the wild spending. As I wrote in that comment, I behaved in January like a dieter who has recently had success losing weight. They decide to celebrate their achievements by heading to an all-you-can-eat buffet or they go on a vacation and gorge themselves. I don’t really have a good explanation for how and why I justified my spending. Sometimes progress isn’t linear, and I slipped up.
It’s a bit crappy for me that the first month I successfully tracked every spent dollar, I went so off the rails. But data is data, and I will use this to help me going forward.
Let’s jump right in.
January: The Big Numbers
|Net income (after tax)||$ 7,319.91||My largest pay month ever, excluding bonus months|
|Amount spent||$ 6,668.33||An astonishing amount|
|Amount saved (not including payroll deductions)||$75||To my fun investment account which is still returning 11.5%|
|Loan and line of credit payments||$733.33||This is the bare minimum I promised myself I'd pay each month|
Upon review, it would appear there was money left over. Not (really) so. I paid my credit card bill from December for my flight out east, the extra luggage fees (my mother sent me home with family heirlooms), and Ubers to and from the airport. After that, I only had a couple hundred leftover.
Breaking Down Spending Categories
Food (including groceries) and going out with friends: $1488.37 Lumping these together as there were a lot of dinner parties at my house and friends’ houses and I’m having trouble separating all the grocery bills between what I needed and what I spent on entertainment. This also includes restaurants.
Fitness-related expenses: $179.11. My $23 gym payment comes out bi-weekly, and it came out three times this month. I also paid for Noom @ $92.50 and a session on yoga for sore feet @ $15.
Transportation: $981.23. I had three car payments this month (all my bi-weeklies came out three times). There were $156.86 of Ubers that were not part of vacation spending (I tracked vacation expenses separately). I spent $60 on gas, $55 on parking, $80 on public transit (adding money to my metro card), and $152 on car insurance. Insurance is extremely expensive where I live.
Material items: $451.48. Includes the aforementioned $225 used espresso machine, an orthopedic dog bed ($56), some clothing, cleaning supplies, and plants.
Subscriptions and events: $280.29 – $210 of which was for the Blue Jays Home Opener in March. I’m so excited!
Gifts: I have $154 of stuff in here that I bought for people, between when I was in Nova Scotia and for a friend here in Toronto.
Amazon purchases: $233.29. This kills me… I don’t like what Amazon stands for and even though I try to be very environmentally-conscious and avoid same-day delivery, I still give this corporation money. These purchases include a yogurt strainer, a viral hairdryer (no regrets, it’s life-changing for me getting ready for work), some pet supplies, a veggie peeler – a whole bunch of small purchases.
Personal care/bathroom stuff: $58
Spending on vacation: 332.60
Misc: $121 – this includes pet insurance, rental insurance for my house, and a charitable donation
I’m not trying to make excuses. I wish I could convey the guilt I’m feeling. In fact, I had a therapy session that mostly covered finance because the behavior was so wildly outside of what I want for myself. It scared me. I don’t want to fall back into old habits.
I’ve mentioned in previous posts that I budget with a budget calendar. It works really well for getting me used to not spending more than I have. The problem is this process hasn’t scaled with my income. As I’ve increased my income over the past year, I have spent a lot of that extra income. But I have a good idea of what my income will be this year each month, and I need to be significantly more strategic about how I save if I ever want to be financially independent. So, I think I will continue to use my budget calendar, but I will give every dollar a job (to borrow from YNAB lingo) for the month in the calendar.
Elizabeth is a single woman in her early 30s, working as a manager at a software company and living in the most expensive city in Canada. She hopes to blog about her journey to eliminate debt and build savings for home ownership someday. Whenever she has taken two financial steps forward, she’s always taken a step back with a bad credit card purchase (we’re looking at you, unnecessary iPhone of May 2019). Elizabeth lives alone with her fur kids, a dog and cat, and when she’s not in front of the computer, she enjoys running, camping, reading, and baseball.
As someone stated in the comments of your last post, I think you are an emotional spender. If you read back in your posts, there are several glaring examples. I think you should explore the implications of that. As for practical ideas, I think going to cash for entertainment expenses could help. Get out a set amount of cash each week and that is all you have to spend. Once it’s gone, then you are done with entertainment until the next week. Any food not bought at the grocery store should go in a separate budget category. That way you know the true cost of eating out. I would consider increasing the loan payment amount. You can obviously afford to do so. Also, what is your savings situation? Do you have an emergency fund built up? Overall I think you are making great strides. You are recognizing and trying to address the behavior component of money management. That is the hardest part. Keep it up!
I’m kind of flabbergasted. This is a lot of random spending. I’d suggest a no-spend month to get back on track. If I read correctly, you spent as much on Uber as you did on a car payment. And you spent roughly $50/day on food, which is insane for a single person, even with some splurge eating out. There will always be something that can derail a budget (for all of us). I think you need to get more disciplined about saying No/not now/maybe later/maybe a cheaper option.
I’m still not sure what you main goal is – debt free? emergency fund? savings? Once you clarify what is the most important goal you can laser focus on it! You seem a little scattered with your goals especially your fun investing account?
One of the best things we did was set up automatic savings accounts and auto pay for bills. Every paycheck, savings is withdrawn immediately (emergency fund, vacation fund, car fund, etc), and bills are paid, then we can live on what is left. If you are automatically saving, maybe you need to increase those amounts so that you are forced to spend less?
I’m cheering for you!
I think you should pull out rent, utilities, etc out of spending because those are reoccurring set amounts.
I’m just flabbergasted…….almost $50/day on food for one person. That’s just plain ridiculous.
What is the $150 on uber for? You have a car, and public transportation passes. Is it for going out and drinking? If that’s the case, kill two birds with one stone and stop drinking when you go out.
You seem to have a problem with emotional spending. Delete any online shopping apps from your phone/tablet. Unsubscribe from *all* marketing emails. On your laptop, set time limits on how long you are able to access certain websites. On a Mac, you can do this through Screentime (and works on any Apple device). On a Windows PC, you need to download a browser extension. Limit yourself to no more than a few minutes per day, or even week for *all* e-commerce sites you frequent. If part of your issue is seeing stuff on social media, and impulse buying, limit your social media usage too.
Also put a 30-day hold on items that you do not NEED. Needs are things like groceries (bought from a list), and replacements for every day use items (toilet paper, toothpaste, etc) or items that wear out (your only pair of jeans get a hole? You can get 1 new pair of jeans). If you want that new viral hair dryer, it needs to sit in your amazon cart for 30 days before you can purchase it.
I know this point has been raised, but I am worried about you investing your savings. The market could easily crash – we’re due for a correction – and you could lose half of your money. You don’t have enough cash savings to fall on to be doing that much investing, at least in assets that are risky enough to yield 12%.
What’s worked for my husband and I are separate checking accounts than our bills account- we each get money deposited into our account on Monday to pay for any spending we do during the week. Right now we have that set at $200 each. His covers his lunches out, gas for his car, and any random shopping or going out or spending he does. Mine covers groceries and any other spending I want to do. Stuff for the kids, lunches out, clothes, random shopping. It works for us to see this smaller amount each week rather than the whole amount for the month. Helps curb the money to spend feeling. Maybe something similar would work for you?