Dillierama

Budgeting

So, John and I are trying to get out of debt.  Again.  And, if I do say so myself, we're doing a pretty good job so far.  We started getting serious about our finances in January and we've already paid off one credit card and should have another one paid off before summer.  YAY!  Of course, we have a couple more cards plus our van, but if we stay on track, I'm betting we'll be debt free again (with the exception of our mortgage) in under two years.  It took us only 8 months to get out of debt the first time, though we had two incomes, a smaller house payment and no children at the time.  Suffice it to say, our situation is a bit different this time around.

A big part of our financial plan is learning to live on a tighter household budget.  This is my area.  Since I can't contribute financially, as I have no paying job, my duty is to ensure that we stay on track.  Following guru Dave Ramsey's advice, we've decided to give the "envelope system" a try.  Last Friday we took $200 out of our account and split it up into four envelopes:

1. Groceries
2. Gas money
3. John's lunch money (John goes out to lunch every weekday)
4. Alex activities / misc.

The $200 is supposed to last us for two weeks, until John's next payday, then we'll take out another $200 for the next two weeks.  Guess what?  $200?  That's not a lot of money.  Who knew!  I did pretty good though, as of this morning I had $90 left in those envelopes.  After I went grocery shopping, we have less than $30 cash in which to survive the week. 

Living on cash only is a strange prospect for me.  I'm a debit card girl.  In fact, until last week, I don't think I'd even seen the "new" twenty dollar bill.  The twenty dollar bill people have been using since what?  2004?  It's a good thing though, because in the last week I've already seen myself being much more cautious of what I'm spending our money on.  I was never a crazy spender before, but I admit I wasn't watching our pennies nearly as closely (if at all) before I actually had to count them out when paying for something.  I'm hoping this system will help keep us on track!

Days 6 & 7 of the Budget Challenge - Weekend damage & summary

All the typical weekend stuff:

Saturday
John's golf and lunch: $47
John bought me a Mother's day plant and card: It was a gift, so I'm not asking what he spent
I grabbed a Jamocha shake and a diet pepsi while at my "Inspirational Photography" seminar: $3
Grocery shopping: $47
Dinner out:  $30
Movie rental:  Free at the RedBox

Sunday
Mother's day McGriddles: $8
Misc Target purchases (a couple of groceries I forgot to buy Sat, yard tools, sprinkler toy for Alex and a shirt that I HATE and will be returning): $104
Contributions to various mother's day gifts: Still need the final total, but it should be <$100

Budget Challenge Summary
Well, we definately spent more than I'd hoped we would, however, we were very aware of how much we spent and what we spent it on, which is an inprovement.  All in all I think this was a worthwhile exercise and I want to continue (though I probably won't post about it because I'm sure it's pretty boring to read about). 

Day 5 of the Budget Challenge - Gluttony

Admittedly, we didn't even try yesterday.  To make matters worse, ALL of our purchases were food.

We both went out to lunch (separately): $14
John spent $20 at a charity bake sale
We got take out for dinner:  $20

So we'll be pooping about $54 sometime this weekend.

Day 4 of the Budget Challenge - Technicalities

Technically, we didn't spend any money yesterday.  YAY!  I do say technically though, because money was spent, but it wasn't technically ours. 

We got pizza last night, but John's brother paid, so though technically, we didn't spend money, officially, we now have an IOU.

John also bought another Denver Bronco's jersey (Don't get me started on my husband and sports jerseys.  It's clearly some kind of obsession with him) However, he used an eBay gift card, so none of our actual money was spent.

So there you have it.  One whole day without spending money, even though we actually did spend money.  I'm really beginning to wonder if we are even CAPABLE of not spending money every day.  This challenge seems to have exposed the fact that we in fact, aren't.

Day 3 of the Budget Challenge - But I got a great deal!

We did fantastic yesterday.  That is, John did fantastic.  I, however, caved under the pressure of my desire for proper digital photo editing software.  I made the mistake of attending a Photoshop Elements seminar yesterday afternoon (which was free) and I came home desperately, passionately, wanting to digitally enhance some of my shots.  The problem is, I don't have any tools with which to do such a thing.  Well, I have Paint, but I mean, come on. 

So, I did some research and found Photoshop Elements 5 on eBay for half what I would normally pay.  HALF!  So, I bought it.  Let's call it an early Mother's Day present.  Aw, Alex is so thoughtful :)

Day 3's spending total:  $40

Day 2 of the Budget Challenge - Unexpected expenses

The day started out ok with my spending a whopping $1.50 for a large Diet Coke at the Mom's Time Out Coffee Break.  Alex and I ate PB&J sandwiches before we left so we wouldn't be tempted by the all you can eat french toast special.  The bakery owner gave all the kids free oatmeal chocolate chip cookies, so we didn't feel like we were sacrificing at all.

Then John called from the car repair shop and it all went to hell.

The car needed to be evaluated for a few hours to figure out what was wrong with it, so Alex and I drove up to get him. I figured we'd all go back home and eat grilled ham and cheese sandwiches while we waited, but John wouldn't have any of that.  He didn't want to drive all the way home just to come back in a couple of hours, so we ended up staying in the vicinity of the repair shop.  This meant we spent money. 

• First, we stopped off to pick up John's golf club that was being repaired.  Cha ching:  $30
• Then we went to a Chinese buffet for lunch:  Cha ching:  $15 plus a $3 tip because Alex made a holy mess with green jello and cheese.
  
• Still needing to kill some time, we went to the park:  FREE!
• We were two hours past Alex's nap time so I dropped John back at the repair shop to wait it out with a handful of quarters for the vending machine:  $1.50
• Car repairs and oil change totaled $100 even though we didn't get the actual problem fixed (which would have cost an additional $600!)
• Then John had to buy crab grass killer and a sprinkler for our backyard costing $17

Needless to say, yesterday was not so great with a total money spent $168

That's $218 in two days!  Good God!  John and I stayed up last night talking about our budget and how we're nickel and diming ourselves into the poorhouse.  We've racked up almost $3000 on our credit card in the last couple of months (it would take whole other post to explain why we're using a credit card and not the debit card. I will note that we are doing it as a strategy for tracking our spending NOT because we don't have cash available in the bank) and have not made a single purchase over $100.  Everything is $20, $30, $40... When we're spending the money, we're thinking it's not that much, but it adds up.  It adds up to $2700 to be exact!

This revelation has made us more motivated than ever in the Budget Challenge.  We've estimated that if we stay on track, we'll be able to pay off almost the entire balance on that credit card at the end of the week.  So that's what we're doing.  Of course living debt free will only last a short while because we still have the $600 car repairs that we will probably take care of next week.  But we can take solace in the fact that it is a necessary expense.