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Financial Task List

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After the last couple of weeks’ craziness, we finally had some down time last week and wow, it was great to breathe.  I think my last post The Cluttered Life was truly the fall out of my over-scheduling us.  Lesson learned!

I am happy to report that in the last week I’ve made several to do lists and marked lots of things off them – yeah!  The best part is that aside from buying 2 gallons of milk I have spent NO MONEY for the past week and a half. (I’m not counting my quick turn trip to pick up my son on Saturday as that was budgeted and planned for months ago.)  I know many write about a no spend month, but I am truly having to start with baby steps and while it’s been really hard, we’ve done it.

We are now preparing for another whirlwind with Sea Cadet and History Buff leaving for camp on Sunday and Little Gymnast and Princess attending another VBS here locally next week, all while hosting some family friends for the week….and top off the week with leaving for Texas to see my parents.  Wow, I’m out of breathe just writing that, could you follow it?

So I’ve made a financial to do list to get done before we leave for Texas…

1. Plan trip budget – this trip is really open ended as my parents want us to stay a bit longer so they can see Sea Cadet (he will be at a USN camp while we are visiting them.)  I’m not sure what will happen but need to spend some time really thinking about it scheduling and finance wise and soon!

2. List my engagement ring for sale – thanks for all your for all your feedback last week on Where to sell jewelry? I am determined to get that process rolling before I leave town.

3. Side jobs – I’ve got 2 side jobs going right now that I need to make some serious progress on.

4. Purge – I’ve listed specific locations in my home that I want to go through and purge…how do we get all this stuff?  I feel like I’m constantly purging!

5. Fall plans – I’ve got two small projects in mind to make some money this fall, as well as be school related for my kiddos so I need to spend some time working those out in my head.

I am not idle.  I am busy.  And I am loving it.  Thank you for all your encouragement last week, it was a very tough one for me!

I hope to have a numbers update up next week before we leave town for a while.  I keep thinking in my head that if we weren’t taking this trip…but I know this is important for my kids and for me.  If you want to know more about that story you can find it on my personal blog – The Village in Abandoning the Children


YNAB Update

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Now that we’re mid-month, and given that there were a handful of readers who also expressed interest in trying the free 30-day trial of YNAB, I wanted to give a little review.

Only problem is…..(CONFESSION)…..I haven’t been doing it.

I don’t know what my problem is. I think I just found it to be a bit overwhelming since its so different from what I’m used to. I honestly think it would work much better for me when I’ve already got my full 1 month’s salary saved up.

I’ve also found it difficult to keep up with since I still have a desire to keep using my regular Excel spreadsheet. This was just a one-month trial, so I didn’t want to just dump my usual Excel file and pretend like the month of July never happened (or at least, have no record of it). But it proved to be too much to try to keep up with both. Too bulky, confusing, and time-consuming.

So, yeah. I haven’t even opened it up since the first week of the month.

Part of me is considering whether I could reach out to customer service and ask for another free trial after I have my one month’s salary saved up. I don’t know why I feel like this will make such a difference, but I really do think it would help (perhaps because I’ll know exactly how much money I’m working with, given our variable and uncertain income). No idea if they would make an exception like this but it could be worth a chance to ask.

Another thing I’ve thought of doing (really I should say, another suggestion a reader had given), is to simply add my usual Excel file to dropbox (which I already have for work related things). Then I would have instant access to my budget and categories anytime I’m out, so it would function essentially the same as YNAB in terms of accessibility. Plus I get to use the software I know and am comfortable with.

I think another reason why YNAB has failed me this month is because I’ve simply been overwhelmed. The first week was spent traveling and then we come home and BAM, BAM – we have two huge and unexpected unbudgeted expenses back-to-back (many readers pointed out that these expenses shouldn’t have been fully unexpected…yet another way that I’m learning the importance of a good, solid budget). Oh, and I don’t get paid until the end of the month so right now it looks like we’re WAAAAAAY in the red (though I’m hoping husband will get another couple big checks and my check will come in, and then things will end in the black). Being in the red is a problem with YNAB (another reason why I think it’d be more beneficial if I start it once we have 1 month’s salary already saved up).

Sorry, I feel like I’m babbling. I have a stack a mile-high of work related tasks demanding my attention in addition to other “life” happenings, so I need to get going. Be sure to check back on Friday though. I’m finally going to spill the beans about a couple issues that are going to directly impact our budget (in addition to these so-called “unexpected” expenses I’ve been discussing, too). Lots of changes in the air.

If you were using YNAB’s free 30-day trial this month, tell me what you think! Has it been working for you? If not, what did you feel wasn’t working for you? I’m curious about everyone’s experiences!!!


What’s Next?

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Did you catch the big news that we are credit card debt-free????

A couple of commenters asked the same question: What’s Next?

I have struggled with this and gone back-and-forth with the various options about a dozen times.

Even though I had committed to a plan of action, I really secretly wish I could target the car next and have no more “consumer” debts (though still plenty of student loans and other debts). But after talking to the husband, I think we’ve made some decisions.

First, we are not going to focus on the car yet. It’s just too scary. My student loan deferment ends in February and I don’t want to get stuck in a situation where our minimum obligations are so high that we can’t make them (which would force me to go into forbearance on my loans or get a deferment extension…neither of which I would like to do). Also, there is a huge difference in interest rates. My highest APR debt right now is for 2 of my student loans (at 8.5% and 8.25% respectively), versus the car that is only at 2.49% after I refinanced. We are still going to make the car priority over the student loans, in general (and will have it paid off well before the student loans are paid in full), but I want to knock out these two high-interest student loans to lower my monthly payment so, once deferment ends, we’ll be looking at a more reasonable payment. Additionally, the car loan is still pretty large (over $22,000) compared to the two smaller student loans (about $5,000 each), so I think I’ll benefit from the psychological “boost” of paying off another couple of smaller debts more quickly than I’d be able to pay off the car.

Second, husband wants to bump the license fees up our priority list. This is one of our lower “APR” debts (no actual APR, but small service fees that amount to 2.7% each transaction). I definitely support this and wanting to put that part of our lives behind us (more information in this post). It’s time to close that door.

Just FYI – I plan to do another debt update on Monday to give you more specifics on where we stand with everything (last debt update here).

Given all this, the new plan of action is as follows:

  1. License fees (goal date = August 2014)
  2. Sallie Mae 8.25% student loan (goal date = October 2014)
  3. Sallie Mae 8.5% student loan (goal date = December 2014)
  4. Car loan (now through PenFed; goal date = January 2016)
  5. Remaining student loans (will reassess in January 2015 to determine goal date)
  6. Remaining medial bills (will reassess in January 2015 to determine goal date).

If you read my old “plan of action” post (or even if you didn’t), you may be wondering why I have the 8.25% student loan prioritized above the 8.5% student loan (given that the two loans are comparably priced – about $5,000 each).

The reason is that the 8.25% student loan is a rare loan that is NOT in deferment. That means I’ve been making minimum payments toward it this whole time. I want to knock it out first so I can snowball those payments toward the next loan. If I were to focus on the higher interest loan first, its about the same amount so would be knocked out in about the same period of time, but I like the idea of having that monthly payment be added to my debt snowball (whereas, there is no current monthly payment on the 8.5% loan, so nothing to add to the snowball).

So that’s what I’m thinking in terms of our current plan of action, and an answer to the question “What’s next?”

However, I should caution that this is obviously subject to change. It seems that we keep changing our minds as things change (like when I prioritized my Bank of America credit card above the higher interest student loan, so I could have the psychological benefit of being credit card debt-free). So, we’ll see what happens but I feel pretty good about this plan.

What do you think? Would you change up the order of repayment?

Again – I’ll have a full debt update on Monday with fresh numbers but if you want rough estimates of debts you can check out this post from about a month ago.


Long Term Planning

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I am really proud of ourselves! When 2014 began, I made a full list of “goals” (I prefer the word “goal” over “resolution”). This is a technique I actually learned from a career workshop I took a few years back, called “Career Mapping” (but I applied the same principles to all aspects of my life).

Basically, you think of your longer term goals (can be 10 year, 5 year, or 1 year). I started with 1-year goals in categories such as: financial, family/relationships, career, hobbies, etc. The idea is that you first come up with concrete “long term” goals. Then you “map out” your entire year by breaking up the big goals into smaller chunks. For me, I broke down the goals by month so every month I know a small, reasonable goal that I want to attain (with the idea being that all the small goals ultimately lead to fulfillment of the bigger, long-term goal).

Anyway, when I first did my 2014 Goals (Life Mapping, if you will), I did not think we would be able to pay off our credit cards by the end of the year. With about $1,000 per month for debt payments, coupled with $10,000 of credit card debt, plus additional other debts to account for, I thought it was an impossible goal. We would be close, but not quite out of credit card debt yet.

When I started blogging here (in March) I set the official goal date: March 2015.

And here we are….the beginning of June 2014. And I can officially say “We are credit card debt-free!!!!!!”

It’s a fantastic feeling!

But being me, I’m always looking ahead. I wish the credit cards were our biggest obstacle, but unfortunately, that’s just the tip of the debt iceberg. The cold, hard truth is that we still have over $100,000 of debt. About $95,000 of student loans, $22,000 of car loan, and $8,000 of medical debt (note, these are approximate numbers that are being rounded off….my last “official” debt update was here and I’ll do another one probably next week).

With this amount of debt, its difficult to put everything on “hold” until the debt is gone, because we’re looking at YEARS worth of repayment.

So I want to submit a question to readers: At what point do we begin long-term savings for retirement?

I know the Dave Ramsey school of thought is not to begin retirement savings until one is debt-free. However, there seems to be some ambiguity, because I’ve also heard (on the radio show) Dave tell people that if their debt repayment is going to take a significant amount of time (though what constitutes “significant” is not clearly defined), that they should not forego retirement savings for the entire time.

Currently we are 30 and 31, respectively, and have a reasonable EF (approx. $11,000), but no official “retirement” savings – no 401K, Roth IRA, etc.

This also begs the question of what constitutes an EF versus retirement. Some of our funds (about $6,000), which I have considered part of our “EF” is actually tied up in money market mutual funds. Although technically liquid, if we were to dip into it we would have to pay taxes on money made from their sale (dividends are currently reinvested) and my plan has been to NOT touch the money. Given these circumstances, wouldn’t this be better referenced as “retirement” funds as opposed to an emergency fund?

Right now I think we would like to keep up our Gazelle intensity with debt repayment. We need to knock down some of our debts so that once my school loan deferment period ends (February 2015), we will comfortably be able to make the huge payments. But at that point, I’ve always said I don’t feel the same “intensity” to eradicate the student loans as I have with our other debts. Would it be wise, at that point, to begin saving some toward retirement?

What percentages would you be putting toward retirement versus debt? Obviously, we’ll have minimum payment obligations so we’ll have to abide by that, but anything above minimums – would you put 50% toward retirement and 50% toward extra debt payments (as an example)??

I’m just trying to think these things through and come up with some sort of long-term “game plan” for what to do with our money.

Advice and suggestions welcome!


Monthly Income

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Remember when I first “auditioned” to start blogging, and I said our monthly take-home pay averaged $5,000/month?

Then, aside from that first month, our income has been WELL over the $5,000 mark and every month I talk about how this is very atypical and much higher than average. I have stressed this because I don’t want readers to think I was lying in my original post. I certainly was not. I track all of our income and expenses (even before starting to be strict about a budget), so here’s a little snippet of our (net) income for 2013 versus 2014 comparing the months since I started blogging here about our debt.

 

  2013 2014
February $3795 $5465
March $882 $7595
April $5232 $8290
May $4883 $10965

 

We had several months with abysmal income in 2013. I was still a graduate student so I made very little, and Chris’ income could fluctuate wildly. In March 2013 he actually had a net negative income for the month due to a myriad of business expenses, so our income was tiny. There were also a handful of months with income only in the $2,000ish range. By comparison, you can see that our 2014 income has been steadily rising every month. One reader asked a great question – “how will you keep your income up?” I want to address that here.

There are a couple important changes that have taken place that will hopefully provide a big positive impact on our income. First, I’ve already mentioned how I have taken on additional work. This is great because it has helped balance out some of the “ups” and “downs” of our unsteady income. Just as an aside, I did not get paid this month from either University A or University B (my two contract-based jobs). I’ve continued doing work but this is just a timing thing with the schedule of payments. But, instead of making nothing, I was able to bring home that giant paycheck I mentioned. So our income had a bit of a “buffer” even though I didn’t get my two regular paychecks. I have also continued to take on little side-ventures to earn a hundred dollars extra here or there. Everything adds up over time. So I have taken great strides to increase my income.

In addition to the pay I generate, my husband has also taken some strides toward increasing his income. Remember that he owns a small wood-flooring business. Until recently, it has only been him and one other employee and he has done everything himself (e.g., placing bids, doing scheduling, and completing the actual work). But at the end of March he hired two additional workers. Now he has 2 “crews” of people to complete jobs. Instead of only being able to do a single job at a time, he can be on a job with his “helper” (it’s called a “helper” in his field, but you could also call the person an apprentice or simply an employee), while another crew (“boss” and “helper”) works simultaneously on a different job. By being able to work on multiple jobs at a time, my husband has increased his business profits and has started bringing home additional money.

Nothing is guaranteed and things can certainly change. For instance, all of the research I do for University B is grant-funded by large government grants. When the funds are gone, they have no way to pay me. So far, they have excelled at obtaining grants so my work has been steady, but there is no guarantee of future work

And my husband’s job has even more potential volatility. The second crew he has working for him currently have been great. They do good quality work in a timely manner and my husband has been pleased with their progress. But, without going into too much detail, my husband had tried to expand his business once before (about two years ago), with disastrous consequences. He hired too many people too quickly and was unable to oversee everyone properly. People did poor work and it ended up costing my husband thousands of dollars to replace entire floors (since he warrantees his company’s work). This was a painful lesson to learn. He had to let everyone go (except his one “helper”) and go back to a small 2-person business. He’s trying not to repeat mistakes and this time around he took great time and care to select a skilled and highly qualified person to run the second crew. So far there haven’t been any problems, but there are still no guarantees (and, of course, even good employees can always quit or leave, so even if the crew does good work the income generated from them is still not guaranteed).

Where does this leave us in terms of our income?

Well, we’re not really sure what our new monthly “average” income is. The plan is to continue operating based on our standard budget, which assumed we made only $5,000/month (although, note, we have increased money allocated toward debt and savings so our total budgeted expenses actually amount to $5272/month). The hope is that if we can keep our spending down and continue bringing home a larger-than-usual income then we can keep funneling extra money toward debt every month.

For reference:  Our new budget (reflecting some of the changes mentioned this morning)

Place Funds Budgeted
Rent 1055
Electricity 150
Water 75
Natural gas 25
Sprint (2 lines) 115
Cable/Internet 85
Car Insurance 90
Health Insurance 350
Trash 35
Debt 1697
Miscellaneous 250
Groceries 380
Baby Purchases 600
Gasoline 100
Saving for Irregular Expenses 265
Total Budgeted 5272

What does all this mean for the month of May?

We did well! Best month on record for our pay! We earned $10965. Subtract $8967 (for our expenses…note this is a hugely inflated number due to massive debt payments, plus going over on our monthly envelopes), and we are left with $1998 surplus for the month of May. Two things to note:

  1. This means I don’t have to dip into June money in order to “pay myself back” for the huge payment I sent to Wells Fargo in May (recall that I had sent a huge check and thought that if our May surplus wasn’t enough to justify it, that I would use funds from June to “pay myself back.” Since our income was high enough in May, I won’t have to dip into June funds to cover this money).
  2. Even after paying a HUGE quantity toward debt, we still have some excess to the tune of $1998. Guess what guys….this means BoA is 100% for sure GONE this month! I currently owe $2154. I have the $1005 regular payment + I can use $1149 from the May surplus to pay off Bank of America in full. I’ll still be left with an extra $849 that I believe will be sent to savings (though it may also be allocated toward debt. Need to have a budget meeting with the hubs).

I cannot believe I am so close to being credit-card debt free!!! This is a huge accomplishment and one that deserves a bit of celebration. I talked to my husband about it and although definitive plans have not been set yet, I think we’re going to take a mini-trip to visit family in Utah for 4th of July. My Dad has been asking us to come and graciously offered to cover gas money (plus allow us to stay with him, instead of getting a hotel). With gas covered the costs would be relatively minimal. The largest cost would be in missed work for the husband (although, he does have that second crew now, so he will continue bringing in at least some income). We’ll discuss the details, but I think we may plan that as a celebration of being out of credit card debt. We still have a LONG way to go until we can say we’re totally debt free, but this is a big milestone and I want to celebrate it in some way. A short family trip to Utah seems like a good way to do it without breaking the bank.

Whew! That was a long one! If you stuck around the whole time you deserve a gold star!

Give me your thoughts!

Our variable income has been on the rise. How/when would you conclude what your new “normal” is? If we can say “we now make an average of $6,000 or $7,000 per month” (or whatever) then we can allocate more funds directly toward debt (rather than waiting until the end of the month to make snowflake payments). How would you handle this? How long does it take to determine our new normal?


Ashley’s New Plan of Action

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In case you’re a new reader – welcome! Thanks for stopping by!

To catch you up….

I first started blogging here in March (Intro post here).

At that time, my #1 goal = eradicate credit card debt IMMEDIATELY!

And, not to toot my own horn, but I’ve done a pretty good job (and thanks to YOU for all the invaluable advice along the way! I’ve learned so much already!)

So as a follow-up to this conversation and trying to decide the next course of action for my debt-reduction plan, I wanted to give you a quick follow-up, along with my new goals:

Order of Debt Repayment (now that WF is paid in full, woot woot!):

  1. Bank of America credit card (goal date = paid by July 2014)
  2. Sallie Mae 8.5% student loan (goal date = paid by September 2014)
  3. Sallie Mae 8.25% student loan (goal date = paid by November 2014)
  4. License fees (goal date = paid by January 2015)
  5. Carmax (goal date = paid by January 2016)
  6. Remaining student loans (no goal date yet because I want to reassess in January 2015)
  7. Medical bills (no goal date yet, see above)

I was originally going to pay the higher interest student debts first, but I can’t do it. I’ve GOT to pay off the credit card debt for my own personal satisfaction and sense of accomplishment.

Next, I will try to get rid of the two high-interest student loans. Getting rid of debts #1-3 will free up $218 in minimum monthly payments (which will be invaluable when my deferment ends on the student loans in February). I’m still a little undecided regarding #4 and #5. I feel like I’d get more personal satisfaction from paying more toward the Carmax loan, but the license has a balance of about $5,500 versus $23,000 for the car, so its a huge difference. We could feasibly pay off the license fees before my student loan deferment ends (in February), but in contrast, there’s NO CHANCE I’ll have the car paid off before deferment ends. Again – I’m trying to free up those minimum monthly payments so they can be applied to the student loans and other remaining debt.

Notice my new “goal dates” for paying off these debts. I have to say as a disclaimer that these are really optimistic dates. Keeping those dates will have us paying about $3,500 toward debt each month (as opposed to the $1500/month we have budgeted). This means we HAVE to keep pulling these big income months like we have the past couple months. This may be possible….I mentioned how “I’m getting a raise” (by teaching additional classes….which started this week so its already “in effect”). Additionally, my husband has hired a new crew of workers so his income will also receive a bump from the work this new crew is able to complete. But at the risk of sounding like a hypocrite (given this morning’s post)…I don’t want to count our chickens before the eggs hatch. I think it will take a few months of my new income + my husband’s new income for us to really know what what we’ll be bringing home each month (in terms of pay). I hope it stays steady with what its been the past couple months, but there’s no guarantee. Only time will tell.

So, yup. Just an update on my new plan of action and goal dates for debt-eradication. I really appreciate all the suggestions and feedback! For example, I had NO IDEA that student loans can’t be consolidated for a lower APR. No point in consolidating then! So those will all be staying separate. I do still plan on trying to refinance the car loan, but I want to wait until my recent huge Wells Fargo payment gets updated with the credit reporting agencies (as I believe it should help give my credit score a little bump).

Hope you all have a great Memorial Day weekend!

 

 


Ashley’s April Debt Update

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I’ve seen lots of comments (on all the bloggers) asking for more openness and transparency. Hopefully this post provides you with that (but, as a result, its a long one so maybe get a quick snack ready!):

April Debt Amounts and Payments

 Place APR March End Balance April End Balance Monthly Payment
Capital One CC 17.9% $0 $0 $0
Wells Fargo CC 13.65% $7429 $5705 $800
Bank of America CC 7.24% $2198 $2175 $35
Carmax Car Loan 7.75% $23736 $23385 $470
License Fees 2.7% $5720 $5672 $55
Mattress Firm 0% until Sept 1st $1281 $181 $100
Medical Bills 0% $8328 $8228 $75
Total $48692 $45346 $1535

 (See the starting balances from when I first started blogging here) A couple notes: Remember that I’m also paying low monthly payments toward my student loans (not in table, but can be seen here. Amounts to $87/month), so our monthly debt payment actually amounts to $1622 (not $1535). Additionally, we made 2 big snowflake payments at the beginning of the month (with extra money from last month since we had a higher income than normal – discussed here). We paid $2,000 in snowflake payments ($1,000 each toward Mattress Firm and Wells Fargo), for a total of just over $3500 toward debt in the month of April!!! (that’s the $1622 “regular” payments + $2,000 in snowflake payments).

April turned out to be another good month financially. Our take-home pay after taxes was $8290. I just want to say that these really good months are NOT “normal” for us. Our annual average is right at about $5,000/month so this was one of our best months….ever! We’re going to talk about what to do with the surplus and will update with our May Debt Update (since the snowflake payments won’t occur until during the month of May). Right now, I’m thinking 2/3 or 3/4 will probably go straight toward debt (paying off Mattress Firm and the rest to Wells Fargo), and the other 1/3 (or 1/4) will go toward making a debt-sinking fund. This is something Adam and Emily did and a commenter suggested it, too. The reason is that summer is Chris’ “busy” time at work and I worry about what happens when winter rolls around and we start having more “lean” months again. The idea is that we keep some money in a savings account but once it reaches a certain dollar amount, I make a big snowflake payment. In hypotheticals, I could save a portion of our income until we get to $5,000 then take half ($2500) and put toward debt, then save back up again and repeat. That way we always have some extra cash on hand in case Chris’ business has a slow month, but if things continue going well we can siphon some off and put toward debt, instead. I will update (in the May Debt Update) with exactly how this surplus was handled. I hope this isn’t confusing. Basically, anything “left over” after paying our basic bills has been used as 1-time “snowflake” payments toward debt, but it doesn’t get applied until the following month (since our income is variable, we wait until the month is completely over to assess how much “left over” we have, so our snowflake payments are always a month behind the pay, if that makes sense). Now, onto the budget:

How We Fared in April

We ended up coming in at- or under-budget in all categories except one.

Category Budgeted Actual Spending
Rent 1055 1055
Electricity 100 62
Water Bill 75 53
Gas bill 75 25
Sprint (2 phones) 150 150*
Cable/Internet 85 85
Car Insurance 90 90
Health Insurance 350 350
Waste Management (trash) 35 35
Debt Payments 1500 1622**
Groceries 400 398
Baby Purchases 600 566
Gasoline 100 57
Miscellaneous 250 355
Savings for Irregular Bills 190 190
Total 5055 5093

*Remember, I got a deal on our phones, but I won’t see the savings until our next bill.

**This was our “normal” debt payments (minimums for everything except Wells Fargo bill), but does not include large 1-time snowflake payments (because those were paid using leftover funds from March)

Quick re-cap:  In April we made $8290 – $5093 = a surplus for the month of $3197

As you can see, we barely slid in under budget with groceries, and I want to try to reduce this category so I’ll have to pay close attention to figure out why we’re barely making budget ($400/month). I’ve switched to making so much homemade (bread, bagels, tortillas) and DIY (cleaning spray, baby wipes) that I feel like we should be spending less on groceries, but for some reason we’re not. I’m going to examine this closely during May and figure out WHY. Soooo, the one category where we went over-budget: “miscellaneous.” I budgeted $250/month (down from $350 last month) for this category and broke it down into 4 sub-categories:

Category Budgeted Actual Spending
Entertainment $20 $19
Eating Out $75 $110
Personal Maintenance $30 $7
Other $125 $219
Total $250 $355

Clearly we went way over budget (by more than $100!), with the culprits being “eating out” and “other.” I think some of this was growing pains. I just slashed the budget in this category by almost a third, and you can see that our spending was definitely in-line with our “old” budget(<<link to old budget).

I’ll admit it – I hate the envelope system. I don’t know why (bulky? annoying? inconvenient?). But I have to admit, I think it may help with this situation. If I look in my envelope for “eating out” and there’s only $5, I can’t say “screw it, order a pizza” when I’m exhausted and don’t want to cook (confession: that happened once last month). Instead, I’ll suck it up and make dinner. If for whatever reason I really can’t handle it then we’ll eat PB&Js and live another day. It’s a mindset-change from what I’m used to but it needs to be done.

So….May = Month of the Money Envelopes I’ll let you know how it goes.

Envelopes:

  • Groceries = $380 (trying to cut it by $20, down from $400)
  • Entertainment = $20
  • Eating Out = $75
  • Personal Maintenance = $20 (trying to cut it by $10, down from $30)
  • Other = $125

Have you tried the envelope system? If so, did it work for you? What other system(s) do you have in-place to curb over-spending? Given our current debts and APRs, (and also knowing our variable income and wish to do a debt-sinking fund) how would you appropriate the surplus $3200 from April?