Friday, January 23, 2015

Adventures in Budgeting

Okay, maybe not adventures. I'm kind of bummed about the whole deal right now. See, I've been thinking for quite some time that I needed to get a better handle on my budget. I'm certainly not in debt like some people, but it seems like I do a lot of taking two steps forward and then one or two (sometimes three) back. I don't feel particularly ready to make big budget cuts yet, but it is an area where I would like to figure out how to move forward instead of bouncing around so much. Moving forward requires taking a step in the right direction... My first step is to track my money. Figure out what I have and where it needs to go.

I have tried this before, with mixed results. When I do it somewhat well (if inefficiently), I like knowing how much money I have when the bills come in and I don't have to try to do the math in my head to remember if there is still money that is on it's way out that I forgot about. However, I tend to only get so far before I start to forget to add things, or I start to ignore it because there's something that I want, whether the budget says so or not.

I have enjoyed some of Amanda and Jonathan's posts on budgeting, like this one. I will admit, it's one of those things that makes me look at people that are younger than me that are much, much closer to where I'd like to be than where I am, and makes me wonder what I've been doing all this time! However, although it wasn't listed, I'm pretty sure never getting started will derail the budget pretty quick, too. Plus, they made some very drastic choices that I admire, but (as I said) I don't yet feel prepared to make. However, even if I can't go back and make better choices, and even if I'm not ready to radically alter things, I can do better than I'm doing now. You have to start somewhere!

My absolute favorite part of their post is that they linked the YNAB (You Need a Budget) software. I wasn't getting anywhere with my inefficient tracking (I tried both paper and pencil and tracking on the computer... Too much for me to keep track of!) I decided to give the free trial a shot. I love the way this is set up and the way that they recommend budgeting. It's perfect for me. It has you take a look at the money you have, and assign that money to the categories that will require payment before the next time you get paid. None of this figuring out what your needs might be and what your income might be (mine fluctuates).  I'm a visual person, and after I filled out where I was, and was able to add categories for most of my goals (even though I couldn't put money in many of them), I could see how I was doing. I'm better in some areas than I thought and worse in others.

My former attempts at tracking things have not been in vain. It helped me see how much it could help when done right. It helped me see what I felt that I needed in order to track things more efficiently. It also helped me see that YNAB is a fantastic fit for me. I love the idea of the envelope system, but that is never going to happen for me. I'm just not going to be consistent with the cash thing. This lets me do the same idea, but digitally, so it's something I'm likely keep up with. I think I'll buy the software, but I'm going to wait a couple of weeks. First, I want to make sure that I continue to like it as much as I do after the initial set up. Second, it's not in the budget this paycheck!

What I'm bummed about is that I do not get to go cross country skiing tomorrow. It's a beautiful day, the mountains are beautiful, and I just want to get out and enjoy them. The part about budgeting that makes us all cringe is the part where you don't always get to do what you want. In the end, though, budgeting is not about denying yourself (though it can happen in the short term), it's about getting what you want. Having more stability and awareness of my money is really important and occasionally having to say no will be worth it.

10 comments:

  1. Love, love, love this post. But you probably knew that…I may not be a crunchy granola type mom, but I do love crunching numbers. Ha, ha…I know lame, right? :)

    Anyway, I haven't personally used that budgeting tool, but before you mentioned I was going to recommend accounting for your ins and outs on the accrual method. Which sounds exactly what that tool recommends you do. Basically, I still do the old fashioned check book that I balance to the penny every few days or so using our information via online banking. Right after my DH gets paid, I put in the bills that are auto-withdrawn he month on the same dates. So, the 1st paycheck of the month (it will vary because he gets paid every two weeks) goes towards mortgage and cell phone bill, the 2nd paycheck goes towards insurance (car, homeowners, etc.) and utility. Other bills that I have to write manually, I fit in around those dates.

    Another thing that I like is automatically having a certain amount taken from my checking account each week and transferring it to an online account, I use Capital One. It is an online bank and I can still get the money if needed, but it may take a couple extra days vs. drawing money out of the ATM from our brick and mortar bank in town. Out of site, out of mind and I will have a nice little savings built up. We have a rather large life insurance pmt that is paid annually in December ($1000) and that is obviously not a great time to write a check out for $1000 for something that especially is not related to fun things like Christmas presents. So, this year, the small amount I transfer each week and for which I started at the beginning of the year, will more than cover that pmt at the end of the year.

    Whew…I could probably go on all night about this stuff…I love this kind of stuff. Best wishes in your budgeting endeavors!

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    1. We also have a regular savings account at the same bank as our checking account and we put money into that account as well. The Capital One account was just for that extra savings I want to use for a special purpose and by the very nature of it being harder to get at, it helps with the temptation to "oh let's just borrow a little and we will put it back later"…not that we have ever done that with our regular savings account…right.

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  2. We are entering the world of Actual Grown Up Budgeting too, and yeah. Not the most fun thing ever, is it?

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  3. It really stinks to have to say "no", doesn't it? A few days ago, the band director for the Small Town HS & his wife popped up on the Yahoo! Home Page. They just paid off $92,000 (not a typo!) in debt in just 2 1/2 years! In the article, the band director said that the hardest part for him was telling friends that they couldn't go out.

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  4. Budgeting is tough. I have tried so many ways myself. I do like Dave Ramsey, but like you said, the envelope system isn't working for me. I never seem to have an envelope when I need it. I've tried the computer, but went back to paper and pencil.
    Now, I have one sheet where I write down all major expenses and the other sheet where I keep track of the minor categories like Groceries, Eating Out, Misc, Vet, Gas ...etc. Then I save my receipts in a little basket until I enter them on the "minor category" sheet and keep track of how much is left.
    My system is definitely not foolproof, as I sometimes wait awhile before I enter the receipts on paper to track things ... then I have to add here / deduct there ...
    I will have to look at the YNAB software ... you have me intrigued!

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  5. Thanks for this. I have been trying to get better at budgeting. I was considering taking a Dave Ramsey course but I have too much other stuff going on right now and I've been looking around at other options. Thanks for suggesting YNAB! I am using the free trial now and so far I like it.

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  6. We started using YNAB last year and love it. Its nice that it syncs with multiple devices. Good luck.

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  7. I use Excel, though we don't have a formal budget. I just enter every single purchase into Excel, into my custom categories, which helps us know where our money goes and where we might need or want to cut back.

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  8. It does stink to have to say no sometimes. But budgeting really does force us to prioritize the things we want to do and purchases we want to make. We can do the things most important.
    I always like hearing about people being responsible with their money. So glad you are getting this figured out while you are young. It will make your life so much easier when you are older and have fewer options.

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  9. Good for you! I think the most important step is finding a system that works for you.

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