Living frugally is paying off...

[tgavin71]

On the 15th of Feb this year I started writing down every cent I spent. Rounding it up to the nearest dollar for spending and down to the nearest dollar for income. EG Milk and two loaves of bread is $4.89 I write down $5.00.
In preparation for refinancing of our mortgage ( we need to borrow to do renovations) I have gone through my spending log and was pleasantly surprised at the results.

Income $19292
Spending $16055

Difference $3237

Spending includes
Utilities $491
Groceries $1055
Miscellaneous $2590
Entertainment $807
Debt Payments $3454
Transport $1284
House $3900
Savings $592 ( wanted to get cc back to $0 first)
Hubby allowance for work $1688
School $194

I am very happy. Not bad for a family of 2 adults and 2 kids on a single income. Hopefully we will have no trouble getting an extension on our loan.
Wish us luck!

[Haku]

Running a tight ship, eh? Good for you!

[Writer@Large]

It's amazing what happens when you begin writing down a budget and cashflow. I never really got into the habit as a college student--so long as there was more cash in the bank than I was spending, I was happy. Then the financial hard times hit a couple years ago, and suddenly there wasn't as much there as I needed!

Dave Ramsey has made the observation that creating a budget makes it feel like you've gotten a raise, even though you're making the same amount of money. It's so true, too! I'm surprised at what I've been able to do now that I track my spending and have adopted saving habits.

--W@L

[cbmeeks]

Originally Posted by Writer@Large

Dave Ramsey has made the observation that creating a budget makes it feel like you've gotten a raise, even though you're making the same amount of money. It's so true, too! I'm surprised at what I've been able to do now that I track my spending and have adopted saving habits.

--W@L

Hey, say what you will about DR but he is correct.

We officially started the DR plan on April 25th of this year. With almost nothing ($100 in savings).

A week goes by and it's May 1st. We had $32 in the bank and $100 in savings and that was IT!!. That is literally all we had.

Now, it is approaching June 1st, ALL bills are paid for May, everything is current, and I project that we will start June 1st with about $900 in the bank. In a previous post, I had predicted $1500 but I took almost $300 out and paid off a debt. And I put more into savings.

So:
May 1st: $32 in checking account and $100 in savings.
June 1st: $900 in checking account and $600 in savings.

His plan works. Budgeting works. We have tracked every penny. Went to envelope method and now we are coming out ahead.

cbmeeks

[debtdude]

You've done an excellent job! You are showing that your mindset and your actions must work together to be successful.

Have you set any savings goals? Goal are a great way for the mind to work towards a goal.

[Trillian]

Whatever WORKS, you know?

I was putting all our finances into a tracking program, I had to stop because my SO observed I was becoming obsessed in a not-good way.

However, we were able to look at our budget, find where the leaks are, see places to pare down, and find some expenses that we werent actually including... so now we have a much clearer picture.

And, I gave up eating out for this whole month *sweat* Almost to June... Almost to June.

We have a new thing too, we have a weekly goal for how much entertainment money we want to spend when we DO go out -- slimmer than before, an amount that makes us really tighten up the belt, which is $5 per person. $10 outings allow us to have SOME fun, but challenge us to look past the things we were doing. And we're trying to have 1 a week or less....and so far, we have been successful.

For $5 each, we can go to the movies using coupons.
For $5 each, we can take a hike and stop and get a snack on the way back.
For $5 each, we can get ice cream AND play a few games of air hockey!
For $5 each, we can eat out using Restaurant.com certificates we were given.
For $5 each, we can go to the zoo on free days, and get lunch at the cafe.

Plus, if we have a "free" week where we spend no money, it rolls into the next week's budget. Our plan is to put all the money we save from our previous budget into our
House fund --half into the NOW house fund-- the one for making the apartment we have more spa-like, and half into the LATER house fund -- for the home we want to own someday.

My spa-like goals: My favorite parts of vacation are
* fancy hotel showerheads that massage on different settings.
* taking time to relax and listen to romantic music by candle-light.
* fancy matching bed linens and pillows.
* indulgent bath goodies

So, those are goals that once we meet those, the money left will all go to the house LATER fund

[cbmeeks]

Originally Posted by debtdude

You've done an excellent job! You are showing that your mindset and your actions must work together to be successful.

Have you set any savings goals? Goal are a great way for the mind to work towards a goal.

Thanks.

Yeah, our number one goal is to be debt free.

Basically:

1) debt free except house
2) Nice vacation in Paris
3) debt free including house

[shelbylovesmelby]

My dh took out my spread sheet because I was tracking the bills! GRR! I just wanted to make sure we had enough $ when the bills came due.

We are on a super tight budget so being frugal is what keeps our ship afloat!

[Ima saver]

I have been on the envelope method all my life. Someone mentioned Dave Ramsey and the envelope method. I did read the book, but it was many years ago. I did not remember him mentioning the envelope method. Did he?
It took several years before living frugally paid off and we have been there for a while. The funny thing is; once you get to the point that you can afford almost anything you want to, you really find that "things" are really not important. We don't want things we don't have, we want the things we have now![Automated by GetSmile]

[billybob]

cbmeeks
not that its any of my business, but it looks to me like you have an awful lot of debt tied up in vehicles. Have you considered selling one or both and buying something used for much cheaper? Just seems to me like with all the debt you have, $25,000 in vehicle debt seems extraneous. Is the joy that your new vehicles provide you with really worth 25k?

[wwjdmsl]

Frugal living is awesome...I think its all about becoming content with what you have been blessed with and realizing your true needs vs. wants. Great Job tgavin ....hopefully you are on the road to becoming debt free !

[cbmeeks]

Originally Posted by billybob

cbmeeks
not that its any of my business, but it looks to me like you have an awful lot of debt tied up in vehicles. Have you considered selling one or both and buying something used for much cheaper? Just seems to me like with all the debt you have, $25,000 in vehicle debt seems extraneous. Is the joy that your new vehicles provide you with really worth 25k?

Well, you are correct. I *SHOULD* have bought cheaper/used cars.

The minivan ($13,200) is for my wife and kids. They all love it. It is used. We needed a van or large car and honestly, the price of the van was very reasonable...it's the interest that is killing us.

My car is a little pricey for what it is. But then again, it has 5,200 miles and I owe less than $12,000 on it. Sure, I could get a used car with 60,000 miles for $4000-$5000. But, I've kinda fallen in love with it. :-)

cb

[Ima saver]

Good dependable cars are very important to me!

[billybob]

Me too!
I have a 94 Honda accord that I bought 7 years ago for about 8K.
It's been great- has about 150K miles on it and I expect to have it for years to come.
It's been wonderful not having to worry about car payments for 4 years... and hopefully for years to come!

[cbmeeks]

That's funny. I JUST had a 1986 Honda Accord. It *had* 162,000 miles on the original engine. I paid (in CASH) $2000 for it about 5 years ago. I put about $800 in repairs and it was great.

Then, I left work but my oil didn't. HAHAHA. I left a nice little pool of oil there.

So, I took it to the shop. $1300 to fix the FIVE oil leaks and no warranty.

So, I broke down and bought my first, NEW car. Stupid move, but not the dumbest. I love that little car. I get 34mpg clocked.

The weird part? My 86 Honda got 32 mpg! So, from 1986 to 2006, not a lot has changed in fuel consumption!

[boefixepa]

2001 Hunydi Elantra - Paid for!!!
31-36 MPG - All freeway I can get close to 40, but that doesn't happen often
66,000 Miles
Less then 400 a year for insurance - Full coverage, no personal medical (my HMO will cover me)
And I budget $50 a month for repairs so the money is there when needed. It just sits there and builds up. When the timing & other belts needed replaced it was no big deal the money was already there!


I just can't rationalize going back to a car payment....I can't...I won't....NOOOOOOO!!!

[Ima saver]

I am taking the payment that I use to make on my husband's work van, and saving it in a car fund. I have over $7000 in it already.

[cbmeeks]

Originally Posted by boefixepa

And I budget $50 a month for repairs so the money is there when needed. It just sits there and builds up. When the timing & other belts needed replaced it was no big deal the money was already there!


I just can't rationalize going back to a car payment....I can't...I won't....NOOOOOOO!!!

That's smart. It's like a car HSA. A CSA. :-)

We do the same but we don't seperate it for just a car. I've managed to put $250 this month into savings. :-)

cbmeeks

[boefixepa]

Yes, it works great having the dedicated repair envelope....we all know it's coming, it's just a matter of when and for what...

I have a 'new car' envelope but I am not putting any money in it right now as I am focusing on getting the HELOC paid off as fast as humanly possible or faster if I can swing it. Oh well...eventually.

[cbmeeks]

the envelopes work.

We have started a Christmas evelope too. Like DR says, Christmas doesn't sneek up on you...it comes the same time every year.