Who has a budget and tries to do right by it?

[IfIOnly]

How do you do it? Any tips?

It's been some time since I've tried budgeting, but I'm starting up again this month. Hoping to bring my spending under control and use extra money more purposefully and wisely. This month is more about tracking all my purchases and mostly sticking with needs and the bare necessities (know this is very individual and can change) just to help figure out first what my monthly budget should at the very least be. Maybe that's a weird way to approach it, but it works for my brain and could be helpful if we need or want to spend as little as possible for whatever reason.

I'm guessing I've under budgeted for November but am not stressing and will adjust accordingly next month and am not including rent, utilities, insurance, gas, and vehicle upkeep and repair. This is just more everything else. I've started spending and tracking November's allocated money today.

Using a free app, my budget categories are:

Activities

Animals

Cleaning

Clothing

Coffee and Drinks that are not homemade: coffee on the go, flavored waters, store bought kombucha

Eating out

Entertainment

Gas

Gifts 

Groceries

Gym

Haircuts

Health

Holidays

Home Decor

Hygiene

Non-food Items: Ziploc bags, dishes, parchment paper, etc.

Office supplies

School

Shoes

Feeling good about things and am already being more thoughtful with a bigger picture in mind regarding spending.

 

 

Edited October 29, 2020 by IfIOnly

[Carrie12345]

Disclaimer: my budget has *poofed* these past few months, so I don’t want to pretend I’m adhering to it right now.

Someday I’d like to be better about micro-categorizing, but I don’t believe that’s the place to start with budgeting.  Too many categories in the beginning can make things fall apart.

I handle the bulk of our money management and try to keep it as simple as possible. All the moneys get divided into savings (long and short), debt (if/when applicable), bills, and spending.  Whatever is left after the first three categories is my budget for spending, not the other way around.

It doesn’t really matter what I spend on ziplock bags vs. coffee or home cooked meals vs. take out as long as I’m staying within my spending budget. People have to be fed one way or another.  I’ve generally got gas, which I try to remember to fill on payday, pet supplies, which are auto shipped so more like a bill, groceries, which I consider anything that gets purchased at a supermarket or drug store, and “other” which could be coffee, office supplies, something cool from Amazon, or someone’s kid’s fundraiser.

Things I know will come up but aren’t needed every week or even every month just come out of short term savings. Clothes, copays, birthday gifts, school supplies, etc. To keep them in my weekly or monthly budget (other than as a whole to set aside) would, for me, take up too much mental energy when they aren’t even “active”.

 

[Soror]

I think you are wise to start by tracking spending first, we tend to underestimate how much we spend, better to start looking at what you actually spend and then go from there.

My thoughts would be- try to be realistic based on history. Keep an eye on it. Be flexible (I'm not great on that one). YNAB really encourages adjusting as you go, so you overspent on that category, ok where is it coming from to cover it.

[Familia]

I will second @Soror that tracking for a few months is the way to see what your spending categories are.  Although, the next two months are not representative of regular monthly habits here because of holidays, entertaining, and birthdays, but still important to have a history of.  

Also, YNAB is perfect for us, as DH and I can both have the app to track spending as we go.  It is like having digital envelopes, clearly showing you how much left in each category every time you make a purchase - LOVE YNAB!  Since I pay the bills and do most of the spending overall, I found it easier to simply give DH his own category with a set amount to spend each month.  This has helped so much, as I could never track his spending very well/remember to get his receipts, etc.  He picks up the occasional milk, etc, but I do not worry about that, as those are little expenses compared to his purchases for home improvement or car repair - basically, he just logs all of his spending under “His Name Category” to keep it simple for him and me. 

[JustEm]

For me budgets only work when they are loose. Using your categories as an example, i'd lump non-food items into the grocery category.  Dog food and diapers also go in the grocery category.  Impulse coffee and end of the isle drinks go under eating out.  I don't know what cleaning it.  If that is paying for a cleaner then it is its own category but if it is cleaning supplies it goes under grocery. Shoes would go under clothing. 

The key part for me when budgetting is to automate my savings.  So, I set a goal of where I want to be savings wise for retirement, holidays, emergency, vacation, etc. Divide by 26 and then set that amount to come out immediately.  Then I create my budget around the after savings are pulled number.

[PeterPan]

I don't think I have the brain power to keep up with all those categories, lol. I'm also uneven in my spending for things. Like I might spend more on groceries this week, more on Christmas gifts next week, buy stuff for the house another. So instead of a budget, I have a discretionary (debit) account that gets weekly deposits from the main bill pay/savings/emergencies account. I'm motivated to spend less, because I can save that money for something I want (cruise, cruise, dh doesn't cruise) and dh gets what he wants (very clear, consistent spending levels each month).

Dh has his own spending (clothes, guy toys, eating out together), but he has this marvel of a brain that always knows exactly what he's spending. Nuts, he even knows what *I* spend even though he doesn't see the receipts! LOL I don't know how he does it, lol. For me, the physical structure of it's in the debit so you can spend it or it's not so don't has been PERFECT. Love it. 

42 minutes ago, hjffkj said:

The key part for me when budgetting is to automate my savings.  So, I set a goal of where I want to be savings wise for retirement, holidays, emergency, vacation, etc. Divide by 26 and then set that amount to come out immediately.  Then I create my budget around the after savings are pulled number.

Yes! All our bills are on auto, and dh handles making sure that amount in that account covers bills, savings, emergencies, investments, etc. 

I think the financial dudes are right in that sense, that to get it under control you start with what has to happen (bills, savings, emergency funds) and then go ok make my ideas work with what's left. If you start with what you want to spend, haha, that could go up up even when you're very modest. I always have more ideas. I just tell myself those ideas can happen NEXT WEEK, lol. 

[Alicia64]

It has helped me to keep an on-going log in One Note for each month's expenses. Dh pays the house, insurance bills. My on-going log looks like this:

October 2020:

 

10-2 -- Tiger Tails Max, $19.

10-9 -- MM pizza after meeting oral surgeon, $26.

10-12 -- Gas, $20.

10-13 -- Trader Joes, $125.00

10-13 -- Visa statement arrived today.

10-14 -- Pay Bryan for Oct. and Nov. piano, $140.

10-15 -- A's bday See's, rain stuff, $46.

10-15 -- Good Will, $14.

10-16 -- Xmas gifts. $50.

10-19 -- Mom's bday , $

10-31 -- SAA (theater class), $270.

Total -- $685.00

 

Putting it all into various colors really helps! 🥰

W.

[Annie G]

My biggest focus isn’t on categories like pet food, cleaning supplies, haircuts, gas, diapers (when we had young kids), because those expenses aren’t things I would overindulge on. They’re necessities and we buy as needed. Sure, we are mindful to use all the cleaning supplies we have before buying new things, or making sure we conserve gas by combining errands instead of going out every day.  

 I really focus on things like grocery costs- menu planning, shopping sales, using all the food we buy instead of throwing unused food out. We make sure we leave the house with a full water bottle so I’m not thirsty. (I do that religiously but still have a budget line for CFA diet lemonade).  Dining out is an area we’re super careful about. We do eat out but it’s planned, not the spur of the moment ‘we’re out and we’re hungry’.  

I think what I’m trying to say is that some spending is essential and other spending needs to be more mindful. I’m unlikely to go wild and get my hair cut three times a month, but I do have to reign myself in to keep from drinking my beloved CFA tea or lemonade three times a week. 

I’d identify a category or two that you’d like to improve and work on those. And when you come in under budget SWEEP that money into savings or use it towards paying down debt if that’s your goal. 

[SereneHome]

I did budgeting for a living for both corporate and personal. What I learned from corporate and told my clients doing personal - you need to do an annual budget, you need to do it from the bottom up and do a zero balance budget.

[IfIOnly]

8 hours ago, Soror said:

I think you are wise to start by tracking spending first, we tend to underestimate how much we spend, better to start looking at what you actually spend and then go from there.

My thoughts would be- try to be realistic based on history. Keep an eye on it. Be flexible (I'm not great on that one). YNAB really encourages adjusting as you go, so you overspent on that category, ok where is it coming from to cover it.

 

7 hours ago, Familia said:

I will second @Soror that tracking for a few months is the way to see what your spending categories are.  Although, the next two months are not representative of regular monthly habits here because of holidays, entertaining, and birthdays, but still important to have a history of.  

Also, YNAB is perfect for us, as DH and I can both have the app to track spending as we go.  It is like having digital envelopes, clearly showing you how much left in each category every time you make a purchase - LOVE YNAB!  Since I pay the bills and do most of the spending overall, I found it easier to simply give DH his own category with a set amount to spend each month.  This has helped so much, as I could never track his spending very well/remember to get his receipts, etc.  He picks up the occasional milk, etc, but I do not worry about that, as those are little expenses compared to his purchases for home improvement or car repair - basically, he just logs all of his spending under “His Name Category” to keep it simple for him and me. 

Tracking for a few months is where I'm at. I feel like a need a baseline to know how much I should realistically plan to budget and save as well each month.

 

[SereneHome]

8 minutes ago, IfIOnly said:

 

Tracking for a few months is where I'm at. I feel like a need a baseline to know how much I should realistically plan to budget and save as well each month.

 

May I make a suggestion?

It really is great knowing where you money is going, but your budget should not be based on what you are spending, it should be based on what you WANT to be "spending" it on (including savings). Otherwise, it's not a budget but just a  record of your cash activities.

[IfIOnly]

Thank you for sharing your experiences!

4 hours ago, Annie G said:

My biggest focus isn’t on categories like pet food, cleaning supplies, haircuts, gas, diapers (when we had young kids), because those expenses aren’t things I would overindulge on. They’re necessities and we buy as needed. Sure, we are mindful to use all the cleaning supplies we have before buying new things, or making sure we conserve gas by combining errands instead of going out every day.  

 I really focus on things like grocery costs- menu planning, shopping sales, using all the food we buy instead of throwing unused food out. We make sure we leave the house with a full water bottle so I’m not thirsty. (I do that religiously but still have a budget line for CFA diet lemonade).  Dining out is an area we’re super careful about. We do eat out but it’s planned, not the spur of the moment ‘we’re out and we’re hungry’.  

I think what I’m trying to say is that some spending is essential and other spending needs to be more mindful. I’m unlikely to go wild and get my hair cut three times a month, but I do have to reign myself in to keep from drinking my beloved CFA tea or lemonade three times a week. 

I’d identify a category or two that you’d like to improve and work on those. And when you come in under budget SWEEP that money into savings or use it towards paying down debt if that’s your goal. 

I love this approach! 

[IfIOnly]

1 minute ago, SereneHome said:

May I make a suggestion?

It really is great knowing where you money is going, but your budget should not be based on what you are spending, it should be based on what you WANT to be "spending" it on (including savings). Otherwise, it's not a budget but just a  record of your cash activities.

I hear you and have an amount I'm trying to stick to this month. I just I don't know if it's realistic at this point. It's on the low end of what I *think* will cover our needs without depriving us of some birthday and holiday fun and Netflix and a few other wants like my makeup (just what I wear normally, not fun spending) here and there. I'm pretty serious about cutting back and saving and have a few specific things we need and want to save for in mind. So I'm doing a bit of both to help me figure out this all.

[SereneHome]

Just now, IfIOnly said:

I hear you and have an amount I'm trying to stick to this month. I just I don't know if it's realistic at this point. It's on the low end of what I *think* will cover our needs without depriving us of some birthday and holiday fun and Netflix and a few other wants like my makeup (just what I wear normally, not fun spending) here and there. I'm pretty serious about cutting back and saving and have a few specific things we need and want to save for in mind. So I'm doing a bit of both to help me figure out this all.

Good luck!!! It's hard, it really is. Let me know if I can help in any way

[IfIOnly]

Do I need to join the Frugalistas? I'm wondering if that would be a good fit to help curb spending.

I want a table runner for the dining table and a somewhat coordinating table cloth for my desk/craft table/6' utility folding table that's in the dining room as well. 

Even with a 20% sale- the runners are $18 at the store. BUT I know I can sew one easily (truly) and for much cheaper.

Tablecloths are 20% off too and I like a vinyl one, which would $8. It's good quality, thick, and no smell, BUT it's plastic and could cost more in the long run if it gets ripped it torn and needs to be replaced.

Just spending and not thinking through purchases is so much easier and quicker, but..  goals! 

Edited October 29, 2020 by IfIOnly

[WendyLady]

I really like the theory behind YNAB (You Need a Budget). You budget the money you have - giving every dollar a job, you do not budget what you might have coming in a week or two (until you actually have that money.) You work toward funding real expenses (so you don't have surprises that hit you, like Christmas or annual car registration.)

I use their program and it has been great for our family budget, but the same idea can be done on paper. https://www.youneedabudget.com/the-four-rules/

[IfIOnly]

32 minutes ago, WendyLady said:

I really like the theory behind YNAB (You Need a Budget). You budget the money you have - giving every dollar a job, you do not budget what you might have coming in a week or two (until you actually have that money.) You work toward funding real expenses (so you don't have surprises that hit you, like Christmas or annual car registration.)

I use their program and it has been great for our family budget, but the same idea can be done on paper. https://www.youneedabudget.com/the-four-rules/

Thank you! This is the basic approach I'm taking, and these are helpful suggestions. Plan on reading more articles on the website. I'm too cheap to pay for a service though, at least for now. 

[Familia]

You have gotten great ideas.  YNAB is overkill for some, I imagine.  If you do go the more formal budget route, though, my opinion is that less categories are best.  So, I do not break out paper goods or dog treats or toiletries from general groceries...for that matter, in our case, it is all under ‘Food: In or Out’, to simplify things.  

I think it is awesome that you are already asking yourself whether or not you need to spend on a particular purchase.  Awareness is so important.

ETA, DH & I got by fairly frugally our married life by watching purchases as we made them, without ever tracking purchases.  Then, when eldest when to college, I really had to keep to an exact amount each month to pay our portion of his bill (room & board).  YNAB was added a few years later as a help to pay off the house ASAP.  What a difference it would have made using it sooner when exact amounts were needed.  Well, at least for me.  I love doing a budget on paper, but seeing the ‘envelopes’ (categories) of YNAB, pushed me over the edge to try it, and held me accountable. 

Edited October 29, 2020 by Familia

[WendyLady]

1 hour ago, IfIOnly said:

Thank you! This is the basic approach I'm taking, and these are helpful suggestions. Plan on reading more articles on the website. I'm too cheap to pay for a service though, at least for now. 

I think it is more of a mindset than a program - it is doable using whatever free app or spreadsheet that works for tracking expenses. They have a book, too, that I have read (from the library).