Need help with a budget - single mom

[Reggie]

Okay, I am recently single and need a little help. I've never really had a budget before and need to really get my crap together. I've been reading the posts and believe I know what needs to be done as far as coming up with a budget.

My first question is, should I pay off my loans (cars) or save money? Which is more important?

Another question, should I make a monthly budget and just pro-rate non-monthly expenses? What should I do with the money that isn't in the budget like excess? Unless I do something different, I am just depositing my checks in my account which also contains my emergency fund and then just paying the bills. I'm not sure how having a budget changes this.

Yes, I'm fairly clueless about this.

I get child support but it's such a small amount that I feel like telling the ex to just shove it up his ^*#. He moved 1000 miles away and apparently it's my responsibility to pay everything since I make more money than he does. The child support doesn't even cover her day care expense.

Any and all help is GREATLY appreciated!!

Thank you.

[Reggie]

Also, I'm thinking I should maybe get a part time job for awhile to build up my savings account. I will need a sitter and I can't do anything related to web design, coding, computer engineering of any sort because I have a contract with my employer. So, that leaves me with weekend work like bartending, serving etc. I bartended in college and it's some quick cash around here.

[disneysteve]

Welcome to the site. There are lots of people here who will be happy to help you work this out and come up with a plan that makes sense.

My first question is, should I pay off my loans (cars) or save money? Which is more important?

We can't really answer this without more info. If you can post your income, expenses, and debts, as well as your current savings, that would allow us to answer your questions.

Another question, should I make a monthly budget and just pro-rate non-monthly expenses?

Yes, that's a good way to do it. Have an account where you set aside the money to pay the non-monthly stuff so that you're all ready when those bills do come.

What should I do with the money that isn't in the budget like excess?

There shouldn't be any money not in your budget. The budget isn't just for spending. It's also for savings. So if, for example, you're putting $100/month into your emergency fund, that should be listed as such on your budget.

[Jerry91]

It is always better to pay off your debts prior to anything else. However, as you do not have any kind of budget, it will be better if you could formulate a budget. You will be able to allocate money for your debts and other expenses and will also be able to save excess money. This will help you create an emergency fund. A proper budgeting will help you save more money by cutting down unnecessary expenses. You will be financially secured if you have a bigger emergency fund.

[Reggie]

Okay, here's my budget. I have a 7 year old and a 19 year old in college. I just turned 39.

My total savings is only $8800 after the divorce. I know I need to build this back up. I did keep all of my retirement.

car loan - 284 (I pay $550)Bal $4000 rate 0%. I would like to pay this off before new loan starts or ASAP
2nd car loan - 448 (this is new. My first pmt is oct and I plan to pay $550)
Cable - 160
Electric - 125
Natural Gas - 50
Water, trash - 50
Day Care - 400
Gyms - 45
School Lunch - 40 (she packs a lot)
Food - 250
Clothing, hair cuts - 100
Entertainment (incl dining out) - 100
Household - 50
Cell Phones - 260 (I pay for my parents phones, my daughter in college and mine)
College - 440 (i'm paying some cash and using her 529 and saving for the 7 yr old)
Insurance - 300 (home, cars, health, life)
Prop. Taxes - 300
Savings - 3000 (this is what I would have left after all of those expenses)

Should I take some savings and one check from September and pay off my small car loan?

[disneysteve]

It is always better to pay off your debts prior to anything else.

I disagree. If you have no emergency fund, I think it is more important to start one. If your debt is at a very low interest rate, I think other things can make more sense to focus on. It really depends on the situation.

[disneysteve]

Okay, here's my budget. I have a 7 year old and a 19 year old in college. I just turned 39.

My total savings is only $8800 after the divorce. I know I need to build this back up. I did keep all of my retirement.

car loan
2nd car loan
Why do you have 2 car loans? Is one car your daughter's? If so, why isn't she paying for it?
Cable - 160 This is insane. Cut down to basic cable. Does this also include internet?
Electric - 125
Natural Gas - 50
Water, trash - 50
Day Care - 400 Why is a 7 year old in day care? Is that just an after school program?
Gyms - 45
School Lunch - 40 (she packs a lot)
Food - 250
Clothing, hair cuts - 100
Entertainment (incl dining out) - 100
Household - 50
Cell Phones - 260 (I pay for my parents phones, my daughter in college and mine)Why are you paying for your parents? Even so, this is really high. We have 5 phones on our family plan, 3 are iPhones with data, and our bill is about $200.
College - 440 (i'm paying some cash and using her 529 and saving for the 7 yr old)
Insurance - 300 (home, cars, health, life)
Prop. Taxes - 300
Savings - 3000 (this is what I would have left after all of those expenses)

Should I take some savings and one check from September and pay off my small car loan?

I put some replies above in red. You didn't list your income. Are you funding a retirement account?

[Reggie]

I just bought a new car. In hindsight, not the best decision, but I did it. The interest is 0% on the new car for 36 months. I did put down $20k on the new car. My daughter's car is paid for. My income is about $6800 a month after 401k contribution of $1450 per month. In my budget, I just threw the difference in the savings category. My 401k account is at $280K. I can't reduce my contribution because my taxes will skyrocket.

I can't drop my parents from their cell phones. They need them and I need the peace of mind to be able to reach them. I also need high speed, reliable internet cell phone for work. Verizon is the only service that works in our office, we are in the basement.

Day care is before and after school care. I can't cut this expense.

Cable - I can cut this. We have netflix and don't really watch television anyway. I just need to pay for internet, basically.

I can also work part time on the weekends but will need day care.

[disneysteve]

I just bought a new car.

I'm confused. You listed 2 car loans. Why do you need 2 cars?

I can't drop my parents from their cell phones. They need them and I need the peace of mind to be able to reach them. I also need high speed, reliable internet cell phone for work.

Is there some reason why your parents can't pay their own cell phone bills? Also, as I said, even with 4 phones, your bill is awfully high. If your parents' phones are just for emergency contact purposes, they don't need a bunch of extra features - just basic service.

[riverwed070707]

I just bought a new car. In hindsight, not the best decision, but I did it. The interest is 0% on the new car for 36 months. I did put down $20k on the new car. My daughter's car is paid for. My income is about $6800 a month after 401k contribution of $1450 per month. In my budget, I just threw the difference in the savings category. My 401k account is at $280K. I can't reduce my contribution because my taxes will skyrocket.

I can't drop my parents from their cell phones. They need them and I need the peace of mind to be able to reach them. I also need high speed, reliable internet cell phone for work. Verizon is the only service that works in our office, we are in the basement.

Day care is before and after school care. I can't cut this expense.

Cable - I can cut this. We have netflix and don't really watch television anyway. I just need to pay for internet, basically.

I can also work part time on the weekends but will need day care.

Guess I'm confused about why you need a part time job when you have $3k to throw in savings every month. What are your goals? Besides the cars, do you have debt that isn't listed here? What are you doing with the almost paid off car? Can you sell it and put that towards the new loan? Also, I'm sure you considered this, but why would you buy a new (presumably expensive since you put down $20k) car if it meant having to take on a second job to pay for it? Certainly you must have higher priorities than driving a fancy car? Finances aside, I think taking on a PT job on top of working FT is about the worst thing you could do for kids already going through some drastic divorce-related changes.

[Reggie]

I bought a 2-seater sports car. I know, I know.

I will look into the cell phone plan today. Maybe I can shave off some money on those. My parents cannot afford cell phones.

[feh]

I just bought a new car. In hindsight, not the best decision, but I did it. The interest is 0% on the new car for 36 months. I did put down $20k on the new car. My daughter's car is paid for.

The vehicle situation is still not clear - your daughter has her own car, and you have 2 cars? Is that correct?

[Reggie]

Guess I'm confused about why you need a part time job when you have $3k to throw in savings every month. What are your goals? Besides the cars, do you have debt that isn't listed here? What are you doing with the almost paid off car? Can you sell it and put that towards the new loan? Also, I'm sure you considered this, but why would you buy a new (presumably expensive since you put down $20k) car if it meant having to take on a second job to pay for it? Certainly you must have higher priorities than driving a fancy car? Finances aside, I think taking on a PT job on top of working FT is about the worst thing you could do for kids already going through some drastic divorce-related changes.

I don't have any other debt. I had a great deal of savings before the divorce and the purchase of the car. I purchased the car on a whim and probably to just do something for myself during the divorce. Not the best decision, I realize that. The old car is worth $16k but my daughter has to ride in the backseat in a booster seat, so I can't really sell it. I know. It was a mistake and I just need to work on paying it off.

My goal is to build up an emergency fund and feel a lot more secure.

[Reggie]

The vehicle situation is still not clear - your daughter has her own car, and you have 2 cars? Is that correct?

yes. That is the situation.

[feh]

yes. That is the situation.

Sell one of them. It's a completely unnecessary expense.