Back to the Budgeting Basics

by Kelly · 11 comments

in Concepts in Frugality


Confession time: I used to keep a budget. And now I don’t.

One of the best ways to manage your money is to keep a budget. You know this, I know this, anyone who reads any sort of personal finance books or blogs knows this. So why aren’t I doing it?

I’ve definitely gotten out of the habit of keeping a budget. Every day I checked my bank balance, entered in the spreadsheet the payments that had cleared the previous day, thus having a precise image of where we were financially at any given moment. I knew how much we had left to spend on groceries, on gas… which holidays were budgeted for, when the cats had to visit the vet for their check-ups.

And then I got out of the habit of doing so. Mostly because my life became busier, as I started graduate school, but also because of sheer laziness. Not to mention that maintaining that high level of concentration can be exhausting after a while!

I’ve got to get back in the habit, however.

We have a different rent payment now. One car has been paid off and we’re about to take on another car loan payment. My salary has increased (!) and both my husband and I get subsidized restaurant vouchers from work, reducing our eating out costs. Our nanny costs have gone down, but we now have to budget for school lunches… there are so many new variables that it’s hard to mentally keep track.

One of my goals for this week, therefore, is to update my trusty excel spreadsheet. A new month, a new budget, if you will! I hope to be able to share it with you next week.


1 Eleanor December 2, 2009

Hi Kelly- Great post. My husband is a big fan of using his Smart phone for this. He has some little app that has his budget in it (including money allocated for savings, travel, etc.) and after dinner, or at the store or when he buys something online, he always whips it out and enters the money he has spent. He constantly has a running tab of how much money he has left for the rest of the month. I’ve been meaning to start doing this for, well, years now!

2 Kelly December 3, 2009

Yeah, husbands are usually good sources of geeky toys!

3 Katie December 2, 2009

Ugh, this is what I need to do also. I quit maintaining th budget when I stopped working full time. The money is there as I’m spending less but, I forget to pa bills and they are sent in late. I HAVE to get back to the budget. It keeps me on track!
Love your blog, I’ve picked up so many tips and reminders of frugal was I’d forgotten

4 Arlene December 2, 2009

Recently found your blog and am enjoying it very much.

Like you, I used to keep a budget. But over the past two months, the husband changed jobs and so did I. So now there’s changes in when things get paid, etc. I need to sit down and redo my spreadsheet as well. Good luck with your own spreadsheet!
.-= Arlene´s last blog ..Reading reading reading…. =-.

5 Craig December 2, 2009

I keep track of my monthly budget with BudgetPulse (Disclosure: Marketing Director) but I do not track specific items on a day to day basis. I don’t have the patience and just want to have an overall idea of my spending to make sure its on plan.

6 Amy Reads Good Books December 2, 2009

Great post! I have a budget and am usually pretty good about writing everything down. However, last month, I got out of the habit and went about $300 over budget! Eep! This month, I’m re-committing to writing it ALL down!
.-= Amy Reads Good Books´s last blog ..Teaser Tuesday =-.

7 Finavigation December 3, 2009

These days, there are several sites and mobile apps that can help you with budgeting. Part of the reason it’s hard to stick to though, is because being on a budget is more than just forecasting what you’re going to spend. It requires discipline, and that’s where most people fall short.

As mentioned in the post, you get too busy to keep track of the spending, and then the budget goes out the door. Even with all the technology nowadays, I’ve had success with keeping a somewhat vague budget and using the envelope method.

What I mean is that I’ll figure out that I tend to overspend on going out (food, drinks, cabs, movies, events, etc). So I’ll get an envelope, write “Going Out” on it, put a certain amount of money in there for the month, and then that’s all I allow myself to spend on going out. I can spend it on anything that has to do with going out, but when there’s no more money, I can’t go out anymore until next month.

By doing this, I don’t have to obsess over the details of how much I spend on what. It forces you to plan, not overdo it, and saves you money.

Hope some people find this helpful. 🙂
.-= Finavigation´s last blog ..Making Good Financial Decisions =-.

8 Aspiring Millionaire @ December 3, 2009

Excellent post. Recently, I wrote about how I budget using here:

In addition, I got the incredible courage to put my 2010 budget up for everyone to see and give me feedback.

What’s been amazing is how my readers have been emailing me with suggestions, support, and even disagreeing with items they saw.

Keep up the good work.
.-= Aspiring Millionaire @´s last blog ..My Tithe is My Top Priority =-.

9 Lulu December 3, 2009

Why don’t you enter the items in your spreadsheet as you spend them instead of waiting for them to clear in the bank?

I enter my receipts as soon as I buy something because I have found that the bank clears items at any old time according to the shade of blue the sky happens to be. By entering as soon as I get home I have an even more accurate picture than the bank does.
.-= Lulu´s last blog ..Tracking My Finances In 2009: November Recap =-.

10 Kelly December 3, 2009

@ Lulu, excellent point!

There are two reasons. The first is that the items usually clear my account in a day or two, and the second is that I’m always paranoid about missing something. And then I have a huge pile of receipts sitting on my desk waiting to be entered, which I have to cross reference against the bank statement anyway so that I can make sure I got everything… it just seems easier!

11 Jerry December 5, 2009

This is so true and your post has ignited a fire and we are going to start our budget again. We have been wasting money on little things. We are now consumer debt free but we’ve been spending up to what we make each month and not saving. Not good. Our insurance for our future is living consciously and below our means to meet our financial goals. That is the only thing that will lead to real change.

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