On Budgeting

One of my friends requested that I make an entry about budgeting, since I'm so good at it. And I had to laugh. First, I am new to this whole budgeting thing. Ok, so maybe I've never been rich, but at least when I was single I pretty much went shopping whenever I wanted to and bought anything I wanted to. Crazy, I know. Part of the reason I could do this is because I was born with frugality in my bones (thanks Dad). I really hate spending money, but I love shopping (thanks Mom!) The first thing I think before I buy anything is it worth $x.xx? Considering I don't think I've ever paid more than $20 for a pair of jeans, usually the answer is no.

First, before I really start this blog entry, I should confess that we've totally blown our budget for the month of April. Sure I factored in extra for gas for our trip. However, I didn't consider a $300 speeding ticket. Luckily, our overall budget still comes out ok, because I over-budgeted for Ben's books by about $300 (thank-you professors who use online resources). And I did some stocking up on diapers, which normally would have meant not using the diaper budget for next month, but due to a week of diarrhea, we've used twice as many diapers as normal (actually more like 3 times).

This is how I do our budget, which is probably different than most people, because we are in a weird situation. We pretty much are living off savings, and earning very little money, so I had to figure out how to make the money last. I made a super complicated Excel spreadsheet (that really frustrates Ben). It keeps a running total of how much money we have in savings and checking. Then it adds how much we are getting in grants and scholarships. Then I add up our fixed expenses - insurance, rent, utilities, tuition, books (I guessed). Then I subtracted the expenditures from our funds, leaving what we had left for everything else. Then I figured out how much we could spend monthly. Then I divided up that monthly amount into categories of spending- groceries, gas, diapers, household, prescriptions, health and dates. And then I cried, because it was super unrealistic. Then I played with some numbers. And yes, I actually used algebra, so you might need to brush up on your math skills. I figured out what a realistic monthly budget for us would be- using records of what we had been spending as a guide, and then subtracting as much as I thought I could get away with. Then I looked at the difference between the two budgets (the realistic and unrealistic) and figured out how much money we needed to make (or win or find) to make it work. And that number was actually doable.

And then I factor in how much money I think we will be making this semester from various jobs, minus tithing (which is 10%). As we actually get paid, I subtract that money from total. This leaves us with how much money we have to make during Ben's 7 week break in school. I update this spreadsheet whenever something changes (we get paid, we pay rent, etc.). I don't think Ben really likes the way I do the budget (because looking at the spreadsheet confuses anyone but me), but it works. And that's the long term budget.

Now for the monthly budget. We take out all of our monthly budget in cash. This doesn't include any of the set expenditures like rent or utilities, because those are all paid online or through Ben's school account. I labeled envelopes with the categories and I stick the amount of cash we've budgeted for that category for a month in each envelope. So we pay cash for most things. I still use my debit card for gas (uh, it's really not worth trying to get Kennady in and out of the car and prepaying). I just take that money out of the envelope when I get home and put it in the envelope I marked "spent." That cash rolls over into the next month, so we don't withdraw as much from our accounts.

This system works really well for us, because I can see before I spend something how much we have (I suppose that's the idea behind a checking register and balancing your checkbook, but, let's face it, I never remember to do that). Plus something makes it harder to spend cash. Maybe I just like the smell of money. Plus I can do transfers without math...ok, so I still have to count, but no subtracting. Sometimes I move money from one category into another. Sometimes I'll take money out of the upcoming month's budget if there is a really good sale on something I know we'll have to buy (diapers, spaghetti noodles, the next bigger size shoes for Kennady).

I do stock up on things when they go on sale. But only if it is stuff I know we will use. We can do this because we have an awesome pantry to store things in. But you can also store stuff in creative places (under beds, above cabinets, in furniture, in the toilet tank... whatever works). I also started using coupons. Uhg. Really, I don't like it. It takes a lot of time and patience (including patience from my child, which I rarely get). But I've been keeping track of what I've saved by doing this, and it's enough to make it worth it. I get most of my coupons online. I like it because I only print out coupons that I think I'll use. And I sign up for coupon booklets to be mailed to me. I don't get the newspaper, because it's expensive and for us I don't think the coupons would make it worth it. I keep all my coupons in an envelope (anyone know where to get some heavy duty envelopes??) that I accidentally left in Oregon. Ooops. I also check ads every week from our local stores to see what is on sale, and I plan a meal list around this. And I subscribe to quite a few blogs that spend a lot more time than I do keeping track of sales and coupons, and a couple our local, which is nice.

For clothes for a growing kid, here's what I do: First, we have a lot of help, because Grandmas like to send their little girl clothes. Then I hit WalMart $1 clearance. I have no idea when they do this, but I just check every time I am at WalMart, and sometimes I get lucky. And we do thrift stores. And we take whatever hand-me-downs we can get our hands on. And then when we go to Oregon, we hit the grand-daddy of all thrift stores, lovingly referred to as "the dig." It's a Goodwill outlet and they throw everything in big bins, which you have to dig through. A thorough hand washing (up to the armpits) is necessary when you are done. You pay for clothes by the pound. Ok, so I guess we've never actually paid for them, because Grandma Nelson's always picked up the tab. Pretty sweet. I buy pretty much everything on clearance and then just hope that it will fit during the correct season. If I have to buy something out of season (like shoes, because I have no idea how to figure out what size she'll be in a year from now, because she has big feet) then I try to at least get it on sale.

So, yeah, that's pretty much it. I just tell myself no a lot. Budgeting is more about self-control than math, otherwise I'd probably be better at it. One big thing for me is to make sure that I budget in fun things, so I don't go crazy and throw the budget out the window because I am bored. I budget in dates for us. I budget in vacations. And sometimes we eat potatoes a few more times for dinner so we can go out to eat another night.

Wow, what a long and boring post. Maybe I should budget my words.