Wednesday, June 1, 2011

New Budget Strategy...

I've been experimenting with different budgeting strategies to figure out what works for me. I've done the excel spreadsheets, tried mint.com, the put it all on credit cards and pay off the credit card at the end of the month, but nothing has seemed to fit.

I love to shop. Like love it. Like, I may be borderline addicted to it. If I'm bored, I shop. If I'm sad, I shop. If I'm stressed, I shop. Clothes, accessories, home accents, kitchen tools, the list goes on and on. If I see it, and like it, I buy it. When I was working and living with my parents I had a pretty disposable income. I was making decent money and paying no bills. Sure I saved quite a bit, but I had plenty to spend, so I did, and I'm feeling the repercussions of that choice now. While I'm thankful I planned and saved enough to make it through student teaching without working, I forgot to include the shopping addiction into that savings. So, now, I am trying to figure out how to adjust and make things work.

I read a variety of blogs, and a bunch of them have ideas on how to save money, clip coupons, find deals, and so on. But until recently none had any information on how to budget and save when you have to spend, it was all on just how to save when you spend. Now, I'm not knocking any of their hard work, they're great blogs, with a great purpose, but it wasn't exactly what I was in need of. So then, I came across this blog: The Frugal Find, and this post: Saving Cash by Using Cash. I proceeded to read the blog and realize this is exactly what I needed to do. I've been justifying using my credit card with the fact that I get rewards points from spending, but then finding myself dipping into my savings a little further than intended to pay it off each month. So finally, I realized the amount of reward points I am actually getting back from the card really isn't worth it.

So, this month, I have started saving cash by using cash. And it is hard. It is really, really, really hard. I'm not used to carrying cash, I'm not used to constantly asking myself if it is worth the money. I'm not used to not letting myself shop whenever I want. But, I know it is important, I know it is worth it, and I know that the excess spending is completely unnecessary.

Basically, what the writer of this blog suggests is that you pull cash out (weekly, monthly, whatever you find to work for you) and budget it in labeled envelopes, once it's out, it's out. You can save money and let it roll over to the next month, or you can use it all up.

She provided a list of suggested envelopes but I tailored her list to fit my needs. My list includes: groceries, toiletries, clothes, gifts, eating out, activities, vacations, hair cut, and school supplies/events. I listed them all on the envelopes and taped them to the back of my bedroom door, I did this just for this month, I might change it next month, but for now it is really nice to have it laid out and easily accessible/viewable. I also stuck coupons in any envelopes that I had for that specific activity.

[back of my door...please ignore my tutu, haha]

So far, so good. It's been hard, but a week in I'm feeling good not seeing my credit card number raise up higher and higher. I found some good "investment" deals too...for example, I budgeted $10 for clothes this month, anticipating saving it up for next month, but found a groupon for Old Navy - bought for $10 to receive $20 to spend. I'm saving up for a hair cut (hoping to have enough by August, before I start student teaching), and had a little extra left over from groceries thanks to Memorial Day weekend sales!

I realize I am only a week in, and I'm hoping that the next 4 will be just as painless as this one has been. We will see how it goes, here's hoping for the best!!!

No comments: