I thought that since it’s the end of the week, I’d do a little round-up of this week’s Better Budget Challenge participants. (Thanks, by the way, to those of you who joined in!)
The first challenge was meant to be an activity to help us think about our experiences with budgets. Coming up on Monday, we’ll talk more nuts and bolts of budgeting.
After that, I plan to move on from the “budgeting proper” posts and on to things everyone can do to slash their spending. And, if you have ideas for challenges, be sure to e-mail me (sensetosave AT gmail.com)
Kimberly has a goal of retiring by age 30. She’s 22 now. She tells us how she used to have $1,000 to spend on various things each month, but it didn’t work because “Life wasn’t built around $1000/month.” Excellent observation!
Chayil has a goal of being completely debt-free. She writes, “I would also love a system that keeps tracks of the misc bills and their due dates so no more late-fees have to be paid. Another thing that would be wonderful is to lower our spending on groceries.” She thinks that establishing spending guidelines, rather than tracking every cent, would work best for her famiy.
MysterHK had an interesting system for his budget: He worked two jobs, and one paycheck went straight to the bank, and the other was disposable income. Those jobs took a toll on his health, though, and now he’s back to one job.
Lisa at Hopewell started out using the paper-and-pencil method. She tried listing every thing she could possibly need to spend money on, but it overwhelmed her. She’s faced some major financial obstacles recently, and is working hard to get her finances back on track. She plans to use Dave Ramsey’s “zero budget” and envelope system and keep on praying for guidance.
Sara and her husband use an Excel worksheet to track their budget. It’s working well for them, but she says it failed when they didn’t set fixed prices on their clothing category. Their ultimate goal is to live frugally and only have a mortgage debt.
Stephanie says she mentally budgeted for her fixed expenses (regular bills, etc.) but she found that she wasn’t making any progress on building her savings account. She wants to create a system that will help give her room for unexpected expenses.
Joanna and her husband kept track of their expenses for their first few months of marriage. That helped them set realistic goals so they could establish a budget that actually works for them. For some areas, they use a cash envelope system. She puts it well when she writes, “I want our budget to be a living document and able to change as our needs change– after discussion and agreement, of course. It cannot be rigid- but it must be guidelines we agree together to follow…”
Milehimama says she loves budgets. She’s used different programs to manage them, but says she and her DH weren’t on the same page, so it didn’t quite work. Now, her goals are ““to see what we are spending with an eye to reducing it. Also, to get a better handle on where the money is going. We are so used to living paycheck to paycheck, that now that we have a slight bit of breathing room it just slips through our fingers because we don’t have a plan.”
Melissa stuck with Microsoft Money for about 8 minutes, she writes. It was just too complicated to work for her situation. She wants a system that will help her be accountable for her spending. “If I have to see how much I spend for my romance novels or to eat out or to buy hair products, I might be able to curb the spending for what I don’t need the next time around,” she writes.
Paidtwice has some excellent advice warning us not to set up an arbitrary spending plan. She says that “the more flexible a budget is, the better it will work.” She points out that “Once you understand where your money is going, then you can split it up into categories for spending purposes. In fact, I’d argue as long as you are keeping track of all your income and expenses in detail, and you are consistently meeting your spending and saving goals, that’s close enough to a budget if it consistently works for you month after month.” Absolutely.