As Becky mentioned, we will start a new Financial Harmony post every week, but not to worry. Just jump into the current post and add your thoughts, questions, comments just like you did at OrganizedHome. We will talk and write throughout the week as we did before.
I know, change is hard and we usually avoid change whenever we can. But hey! We can have the same community feeling, banter, caring, sharing, and support in this Financial Harmony section as we did in the one at OH!
Come on. Jump in, the water is fine!
KT aka CrochetAddict
10 comments:
Jumping in...
Since the beggining of September I have applied a new method to handling my budget: I have set a daily minimum I need for everything except bills and other fixed expences, and take this out of the bank. The rule is that I have to get by with that money only. If there is leftover at the end of the day, then the amount is moved to the next day and so on...
Well, so far, very good! Unless something extraordinary happens until the end of the week, I have managed to live with half of what I would normally spend! This rolling the leftover money over to the next day has helped me be frugal, as the more careful I am the more I will have at the end of the week. As I result, I managed not only to cover food, house supplies and entertainment, but I also had enough to pay the gym and the dentist (normally those two should have been payed by the fixed expenses and the emergency fund respectively).
So I am happy...
I have had somethings pop of this week. Hope I don't bore you with the drama. Just tell me if I do.
Dsil will not be sitting. May need surgery...still has a job...but won't be paying rent....I may need to buy groceries. already out 15. So trying to save for a new car. Which my tire was low and my radiator needed fluid again so this is a real event on the horizon.
You know, OCD, that is exactly how I have been working with my finances for about 50 years! And I can tell you that it works! The more complicated things are, the less chance that a person will stick with it.
As you shared:
1.Determine income amount.
2.Determine fixed expenses.
3.Subtract expenses from income.
4.What's left is all that can be spent (or not).
You have gone the extra step by setting daily limits. You said "minimum", but did you mean "maximum"? That is, you have set a maximum limit and won't go over that amount?
KT aka CrochetAddict
KT, I meant minimum.
Based on a normal day (on which I don't cook and eat take out), I have estimated what I need for cigaretes, food, and the occasional coffee or drink with a friend for a day. That's my minimum.
I multiply that by 7 and take that from the bank. Then I might go to the supermarket for supplies either for cooking proper meals or just coffee, milk etc.
The rest I divide by 7 and that's my allowence for each day.
So if I am a good girl and take the time to cook instead of order, avoid snacks etc, I don't spend the day's allowence and I get to carry it to the next day. So my allowence increases. By the end of the week I usually have enough leftover allowence money to buy myself a gift, such a book or a CD, or a clothing item, and enough to buy next week's groceries or fill up the car with gas etc.
So far I have noticed three advantages to this method:
1. Since this is the minimum and not the maximum (ie income minus bills divided by 30) it leaves me a nice temporary security cushion for a bigger monthly expense, such as clothes for a special occasion, a gift etc. I don't have enough records of past months expenses and my lifestyle changes constantly, so I cannot estimate and budget such things (plus I find it complicated)
2. The results of being carefull with my money are immediatelly visible, today's choice is evident in tommorrow's money, literally, in my purse (and not in a spreadsheet or in a bank statement)
3. I don't have to keep track of hoe much I spend on food, coffee out entertainment and then tweak those numbers, keep my mind on prices etc which I wasn't succesful doing.
I only did this for a month and it was a normal month, without a lot of invitations or needs for special things, or any houseguests or anything. But so far it seems to work, and I have almost half of my disposable income still untouched...
OK, KT, I just re read your post...
yes, maximum in the sense that I have set the max I can spend in a day
(blushing emoticon)
minimum in the sense that this is what I need to survive...
Gotcha, OCD! I understand. (wink)
KT aka CrochetAddict
Hi guys, is this the new home for the Financial Harmony Challenge that CA used to do on OH. ??????
Nishja, yes it is. We probably won't have much traffic here until later. I will still start the monthly threads at OH until the end, I guess.
KT aka CrochetAddict
Hey everyone!!
September didn't turn out ANYTHING like it started! But, it's really a good thing!
I've just been SO busy lately with everything (new job, getting things taken care of with mom, etc etc)
I'll be ready to go for October, though!!
So-- when does this start?
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