What do you think of this budget?

**jpg7n16** · 06-30-2012, 02:19 PM

Originally posted by saegen View Post

What do you think of my budget and my goals? The #s are real and are from the last month. I'm wondering if I should 'loosen the purse strings' a bit and put more in my fun categories, as I am young and single. OTOH, I think I am far behind and really need to catch up so I need to stick it out. Compared to my grad student days, I am already living better (moved to 2x larger apartment).

I like your budget and goals. Though I'd prob get a phone and clothes at some point (those aren't in your budget). Your categories seem reasonable to me.

Also good goals, and I like the order you have them in.

However, I am frustrated that, despite the new income, all of my 'new' money has already been accounted for the next YEAR or more. Part of me just wants to enjoy it...

And what does "enjoying it" look like to you? What would you do that you aren't doing now?

I see nothing wrong with having a plan for your money.

**saegen** · 06-30-2012, 02:29 PM

Originally posted by jpg7n16 View Post

I like your budget and goals. Though I'd prob get a phone and clothes at some point (those aren't in your budget). Your categories seem reasonable to me.

Also good goals, and I like the order you have them in.

And what does "enjoying it" look like to you? What would you do that you aren't doing now?

I see nothing wrong with having a plan for your money.

Shopping includes clothes. Before I got this job, I spent about $1000 on work clothes so I am good there. My iphone I've just paid upfront for a year; its on my family's plan.

"Enjoying it" would mean more room in the budget for shopping. I love clothes and dressing up (I'm female...). I think that's the main reason I am feeling deprived. Yet, I am too scared to NOT do the right thing, financially.

**jpg7n16** · 06-30-2012, 02:53 PM

Originally posted by saegen View Post

"Enjoying it" would mean more room in the budget for shopping. I love clothes and dressing up (I'm female...). I think that's the main reason I am feeling deprived. Yet, I am too scared to NOT do the right thing, financially.

Then how about new plan.

Goal 1: Fully funded 6 month EF
Reward 1: for completing goal 1, win a $250 shopping spree for yourself

Goal 2: Fully fund Roth IRA ($5k)
Reward 2: for completing goal 2, win a $300 shopping spree

Goal 3: Save towards replacement car

Concurrent with goal 3, add $50-150 to the monthly budget for shopping/entertainment.

Thoughts??

This plan would allow you to focus on the financially sound thing 1st (EF), and satisfy your appetite for shopping. Plus it only works out to another $80-100/month in a shopping category. Based on how much excess you currently have each month, I see no issues with that. You'd have a good EF in place, youd be saving 15% for retirement. Looks good to me.

Also consider ultimately raising your ret savings to 20%.

**kork13** · 06-30-2012, 03:18 PM

You're in a en excellent position right now -- You've got a good job, your budget looks great, and you're saving about 40% of your income. If you do that consistently, you'll do very well for yourself.

If you want to not worry about things so much, there are a few things you can do.
1) Reduce your savings by $100 or $200, and put that toward doing something that you enjoy, or that relaxes you. You'd still be saving over 35% of your income, which is great.
2) Automate. It sounds like you're sweating the details too much. Just set up automatic transfers and auto payments of your bills, and you won't have to worry about missing payments, or not saving enough in a month, and so on.
3) Once you go a couple more months and confirm that this budget (or any adjustments) is fairly natural and consistent for you, throw it out! Set a buffer of, say, $1000 in your checking account to cover the monthly ebb and flow, set up your automated savings/payments, and don't worry about it any further. It eventually comes to this point: as long as you know you're saving enough and paying your bills, the rest of your money is free to use however you like. Use that $1000 as an artificial floor--as long as you keep your checking account balance above that, you can use your money however you need/want to. Consider this a flex-budget plan... definitely not for someone struggling with debt, spending, and so on. But it looks like that is not the case for you, and that you have pretty good control over your spending and debt. That's why I'm comfortable offering this as an idea to you.

In your situation, there's no reason that you should be stressing over your budget. You're in a strong position, so make it work for you.

Looking down the road a bit.... do you have any longer-term goals? House, business, investments? Are your retirement savings (as they currently stand) on track to meet your future needs/goals?

**kork13** · 06-30-2012, 03:23 PM

Originally posted by jpg7n16 View Post

Then how about new plan.
...
This plan would allow you to focus on the financially sound thing 1st (EF), and satisfy your appetite for shopping. Plus it only works out to another $80-100/month in a shopping category. Based on how much excess you currently have each month, I see no issues with that. You'd have a good EF in place, youd be saving 15% for retirement. Looks good to me.

Also consider ultimately raising your ret savings to 20%.

Just saw JPG's post after finishing my own, and I agree 100%... A "reward" system for meeting your goals is a great idea. And as I sort of alluded to in my last line, should consider increasing your retirement savings to 20% or so (added to your 401k or whatever your employer plan is). Although 15% works, 20% gives you some added "future security".

**phantom** · 06-30-2012, 03:31 PM

I think the plan jpg7n16 proposes is a great one. You're really doing pretty well right now, but you don't want to burn yourself out. Planning little celebrations when you meet financial goals is a great way to do keep your spirits up and to really help you realize that all your efforts are paying off.

Additionally, I would look for ways to make the money that set aside for fun stretch a little farther. I'm female too, and I know that when I buy a great new outfit, I always enjoy it the most when I get a great price. When you go out shopping, go armed with a coupon, and make sure to hit the clearance racks. It will take a little longer to find something awesome, which prolongs time you get to have fun shopping, and it will save you money, which will increase how often you can afford to go shopping.

**saegen** · 06-30-2012, 04:36 PM

I agree with the reward system. That does sound like something that'll keep me motivated. Thanks!

As for a buffer, I am following the YNAB philosophy of using last month's income for this month's expenses. So in addition to my current savings (Savings account), my Checking account has 1 full month's expenses in it at the moment, since tomorrow begins the new month. There is also a $100 extra buffer, in case an unexpected bill/fee comes up. So my 6-months of expenses will really be 7-months. Sorry if this explanation is unclear!

I would like to increase retirement but not right now. Maybe later on, at least after I've secured the car fund. The thing with the car is that, I'm reallllyyy wanting a sports car that retails for $45,000 and is seldom available used. I guess I'll cross that bridge when I get there. For retirement, I'm not sure if I am on track because I'm not sure when I want to retire. Right now I just try to do the best I could with it. My current job gives me stock options that may one day be valued at over 6 figures, my family may leave me half a million, it is all up in the air at this point. Also, my salary should increase in the next 2-3 years as I gain experience (I have a PhD but didn't have experience when I got this job). Or who knows, perhaps I will meet a billionaire...

**LivingAlmostLarge** · 06-30-2012, 06:15 PM

Then build in fun money. Don't save $1400, save $1200/month or $1k and use $200 for shopping and $200 to go out with friends or car savings. You have to balance life with savings.

$1k = 4 months till EF July-Oct
$1k = 5 months for Roth IRA Nov-March, then 2013 April to August for 2013 and start for 2014 Sept to January 2014.

Things to consider doing because also you may want to try dating and I bet it's not free, sure people will say "men pay" but I've found that men like equality and women who give and not just take. Dates don't have to be expensive but they do cost more than $0 I've found.

Hiking, but hiking boots, extra gas in car, packing lunch/wine in backpack. Kayaking (we personally love) cost of renting kayak, biking same as hiking, or camping. Coffee, touristy date things. I have membership to couple of museums, zoo, aquarium, etc. Even cooking can be more expensive as you invest in better quality foods or take cooking classes. My DH wants us to do a date night cooking class. You could also spend money on night clubs, wine bars, or a concert. We used to like live comedy shows and sporting events (last year I bought stanley cup tickets for my DH for father's day I think it was $300/each and our first night out in 6 months at that time).

At least everyone i know that is still single spends a lot more than we do going out probably because they can and probably because they have the time to go out.

Just my thoughts on the budget. Even if you are seeing someone I always found that we enjoyed doing activities, not necessarily eating out, but just doing things together. My BIL (single) takes classes to improve himself like public speaking, yoga, ice skating, jewelry making, cooking, pottery, ju jitsu, etc. I always laugh but he has a super busy social life both with friends and dates and tells me it's not cheap.

What do you think of this budget?