Budgeting ?

123bedebtfree · September 2016

I need you guys expertise! I do our "projected budget" for the full year and a finalized budget on monthly basis. However, my problem is being consistent! I find myself always changing the budget and looking for bills to cut or decrease? I just want to be consistent! i use pen and paper (old school) and i look at the budget everyday! Here is our budget, and it changed only 3 times this year -

would you guys share your budget, how often do you budget and are you consistent?

joint income- 4000.00 monthly after all deductions
mortgage- 1075.00 ( insurance and taxes included in escrow)
Electricity- 200.00
water- 45.00
netflix- 11.99
dish network- 30 (basic)
Hulu- 7.99
car insurance- 110.65
life insurance- 75.08
internet- 55
car payment- 205.69
cell bill- 123.00 (3 lines)
hoa- 95.00 (year)
gas- 200
grocerys- 400
toiletries- 50.00
savings- 500
vacation- 500
left over- stays in checking
e fund balance- 2500.00

julieanne912 · September 2016

I budget for each paycheck, although I have a set bi-weekly budget that covers all the expenses.

For example with utilities, I budget $300/month during non-summer months, and $350 during the summer because we use more water and have a higher electricity bill. But in the non-summer months, the utilities rarely come in at $300, so then I adjust the budget based on the actual bills, and then take the left over and put it somewhere else depending on what I need that month... either more for spending money, or more to savings, etc.

ETA: My income also varies every month based on my office's production so it's hard to come up with an annual budget other than a baseline one of what HAS to get paid. I base that budget on my 40 hour a week salary that doesn't include the bonuses. Then once I know what my bonus will be, I adjust.

hoffse · September 2016

Your budget looks pretty good to me. Utilities look low to me, unless you are on a budget billing system?

Also, you don't have any designated categories for spending - clothes, home improvement, yard maintenance, eating out, etc. If you are "missing" money at the end of the month, it's likely going to these things, and you aren't picking it up since it's not on your budget. Here is my budget:

Mortgage + escrow: $1868
Student loans + debt snowball: $3,220
Savings + investments: $1500
Car insurance: $110
Disability insurance: $190
Utilities (all): $500 - varies through the year, never more than $500 total
Cell phones: $120 - employer reimburses $100
AT&T: $90
Hulu/Netflix: $18
Gym: $20
Health: $100
ROTHs: $915
Annual payments sinking fund: $600
Clothes sinking fund: $300
Gifts sinking fund: $100
Costco/Target/Publix: $600
Costco gas: $125
"Save or Spend:" $500

Note on the clothes: our budget is high for most people, but H and I are both attorneys and expected to dress a certain way. Also, we really like clothes and accessories and tend to gravitate toward more expensive things.

The "save or spend" category captures things like dry cleaning, eating out, small home improvement, travel that we can cash-flow, etc. We normally don't spend all of it, but it's there as a cushion for flexibility. We modified our budget a lot until we finally landed on the "spend or save" category as a catch-all. Now we really don't modify our budget more than once a year.

I will admit that there are a number of things we could reduce in our budget, but we finally landed on the numbers above because they work for us. We don't feel deprived, but we also can't spend to our hearts' content either. There is plenty of room to trim if we ever have a financial emergency.

short+sassy · September 2016

Some items you might be missing are health insurance premium and/or out-of-pocket for medical. Entertainment, clothing, etc.

Some people on this board are super good, to the penny, budgeters. I personally don't have the patience for that. My budget includes my fixed costs, $400 for groceries/toiletries, and $400 for general randoms. That last category is a "catch all" for entertainment, eating out, clothes, etc. As such, I never adjust my budget, unless something changes...like my income or one of my fixed costs. I also round stuff up and down to the nearest $5 or $10. Here is my budget:

Income -- $3750 (monthly after deductions, includes $580ish taken out for out-of pocket medical and med. insurance) I also typically earn another $100-$200/month mystery shopping, but it is too random for me to include in my budget so it just becomes extra slush.

Mortgage -- $790 (all insurances/taxes included in escrow)

Electricity -- $150 (an average, I also have my $35/month for solar panels included in this category)

Internet/Cable -- $130

Cell Phones (two plans) -- $80

Car Insurance (one car)-- $185 (monthly amount, but paid every 6 months). I have a great driving record, car insurance is just insanely high where I live. Includes comprehensive.

Gas -- $60

Groceries -- $400

Catch-all -- $400

Sub-total: About $1550 left over. That all goes toward my HELOC balance.

Rental income: True cash flow (not including income tax) around $2,000 month. That includes setting 18% aside for repairs and vacancies. But both the property tax and that 18% set aside are put against my HELOC balance. So about another $3,000/month against my HELOC.

I don't have a car payment. I typically keep a $1,000 e-fund. However, I also keep at least $20K available on my HELOC for what other PPs call a "sinking fund"/larger emergencies/savings for large purchases.

I realize it sounds a little weird to use a loan product as a savings account but, it is a liquid account. So I don't want to put money in a savings account, when I could use the same money to pay down that line, but still have the funds available if I need them. Certainly the interest I save is much more than the interest I would earn!

brij2006 · September 2016

The others have given good tips on what you may have forgotten.
But I've found that we have to do a new budget every month. No 2 months are the same for us. Our set expenses are the same, but all of the other categories fluctuate. Groceries increases around the holidays or if we have family in from out of town, clothing increases in a season change as we need things, gas/electricity fluctuates based on season, etc. So we do a new budget every month so we can plan for upcoming expenses.
Know that it will take a few months to get the swing of things. It took us a good 4-6 months to get the kinks worked out and realize how much we truly did spend or needed in each category.
We also budget every single dollar and as we purchase things we put them into whichever category they fall. Once the money is gone, it's gone. We stop spending.

LillibetteV · September 2016

I love budgeting - my husband does not. Some parts of our spending we're still hashing out (for example I want set budgets for our own play money so we can save more but he thinks having an allowance is dumb) but really neither of us would spend us into the poor house - I'm just really focused on cutting down clutter in our house so I naturally want to buy less and spend less while he loves to shop. The current compromise is that there is a non-negotiable amount that goes into savings every week and is not touched. And occasionally I flip my lid when I see he spent $400 on board games in one shopping spree (which is more about the clutter in the house than it is about the money, although I have better places I can think to spend that money such as saving up for a new kitchen!) but as long as it's from the cash flow he doesn't see an issue with it. Sigh...marriage...

I have a rough budget of our "must spends" that I check in on a few times a year so that if one of us were to lose our jobs I can make sure we have enough in savings to cover us for several months. If that were to happen he agrees that all additional spending would stop (I'll probably steal his wallet just to be safe - he's a stress shopper). All of this is monthly and based on our net pay - health insurance, short/long term disability, aflac, retirement, and my T pass are all taken from our checks first.

Mortgage (PITI, plus extra principle) - $1975
cable/internet/streaming services - $153
cell phones - $125 (full cost not including my work reimbursement which we put straight to savings)
utilities - $400 (a high month of gas, electric, and water)
groceries/household - $650 (it's high but includes a wine subscription and all of the pet food too)
gas for car - $110
0% credit card payments - $200
minimum mandatory savings - $2400

That leaves us with about $3300 a month that gets used for home repairs, car repairs, charity, extra savings, vacations, clothes, gifts, haircuts, restaurants, vet bills, annual car insurance (we pay it once a year in January from cash flow), husband's game board addiction, co-pays for infertility treatment, and whatever else may pop up. It's far from a perfect system but so far it's working for us while I get my husband more on board with the saver mentality. He's SUPER frugal and always finds great deals, but I am trying to get through to him that finding $100 game for $30 doesn't save $70 - it's still spending $30 lol.

als1982 · September 2016

How often are you updating the spent columns (using receipts or your account statements) to make sure you're staying within the amounts allocated for each category?

AprilZ81 · September 2016

We use a budget app called GoodBudget (available for phones and desktops) that syncs between our phones. So if DH spends money and puts it in the app the next time I open it up I see what he spent. This is a virtual envelope system (similar to Dave Ramsey's plan except we don't have actual envelopes of real cash) and it helps us track where our money is going and where we may be over spending or over budgeting.

I've been on a strict budget since 2012 when I bought a car and wanted to make sure I wasn't spending too much to where I wouldn't have enough money to cover my bills. I'm now pretty good at knowing what we spend and we only adjust our budget if we have a change in expenses or income.

We just paid of our HELOC and got a "new" used car and DH finally adjusted his tax withholdings which means we had an extra $500 a month to find a home for. We just sat down last night and re-worked our budget and we probably won't do it again until March or so when raises and bonuses are announced.

We budget monthly with a lot of sinking funds and assign each dollar to a category. Overages roll over to the next month and if it gets too big we will transfer the extra to a specific savings goal or an agreed upon splurge.

Net Take Home (after taxes, benefits and 401k): $7467

Gas for cars: $100
Groceries/Cleaning Supplies/Toiletries: $520
My Misc Spending/Fun Money: $170
DH Misc Spending/Fun Money: $170
Entertainment: $350 (this is for joint entertainment, if one of us goes out with friends or goes out to lunch then that comes out of our fun money)
Church Giving: $550
Mortgage/Utilities/Cell: $2457 (now that we've been in our house for a few years when I do our budget I take the 12 month average of each utility and budget that amount for the month, some months we have extra and some we are a little over but it does balance out without huge fluctuations in monthly spending)
Car Payment: $325 (paying $75 extra a month)
Random Sinking Fund: $100 (Costco, lawn care, mulch, flowers, etc.)
Clothes: $100
Home Improvement/Decor: $175
Car Insurance/Repair: $135 (save monthly, pay annually)
General Savings: $800
Christmas/Gifts: $250
Vacation Fund: $350
ROTH: $915

Our emergency fund is in a mutual fund and some non-retirement stocks but we try to cash flow everything that we can.

I've been doing some sinking funds for a few years now, mostly for Christmas/Gift Giving and I'm a huge fan. It makes it nice to have a pre-determined amount available when Christmas comes around or if DH needs a new pair of running shoes. We also have a large savings account for other things that come up that we want to do or if we have medical bills that need to be paid.

julieanne912 · September 2016

als1982 said:

How often are you updating the spent columns (using receipts or your account statements) to make sure you're staying within the amounts allocated for each category?

I update mine a few times a week, I keep a google doc with my budget, with the line items totaled at the bottom. That total should match what's in my checking account at any given time. I don't necessarily "itemize" each item individually, but I'll go in and add up what I've spent in each category, then subtract it from that line item in my budget. Then, I match up what's in my bank account vs what the budget says I should have left to make sure they match up. If for some reason they don't, I then adjust the line items up or down.

ETA; now that I'm utilitizing a credit card to pay for groceries and gas, when I subtract those amount from the groceries or gas line item, I move it to another line item labeled "CC" so the money is still there in my checking account to pay the credit card.

cbee817 · September 2016

We just use an excel spreadsheet- one handles daily transactions and the other breaks out the year by month to see show how much goes in/how much goes out throughout the year. I've been using this method since 2008 and it has worked out well.

Our monthly budget looks like this for a family of 4:

Mortgage (15 year at 4% includes taxes & insurance) = $1,358
Electric/Gas/Water/2 Cell phones = $316 (average)
Day care for DD#2= $913 (average)
For 2017, it'll be $1,083/month (average)
2 car payments = $1,075 (48 months 0.9% and 1.49%)
Girls' 529 plans = $350
Groceries = $650 (average)
Car insurance = $110
Life Insurance = $42
Target = $175
Cable/Internet = $102
Netflix = $10
DD#2's dance class at day care = $28
HVAC and plumbing plans = $21
Home improvements/clothes/shoes/toiletries/copays/gifts/donations/courses/memberships/ food out/gas/misc = $2,255--> this is high because we gutted our upstairs bathroom this summer
Bernina sewing machine = $224 (will be paid off in December)
Savings = $1,000 (Roth IRA is pulled from this account 2x a year.. we'll be changing that to a monthly withdrawal soon)

We always have a balance in our checking account - usually try to keep a $250 cushion in there in case. We have a large savings account with about 6 months of expenses.
We also have a vacation account that is funded with tax returns, DH gets a health insurance waiver from his school, and I usually get a small bonus each year. We're just starting to travel with the girls so that has had a few years to grow while they were babies.
We contribute 12% to 401k (with 1.5% match), 10% to 403b (with 0% match), and we both have pensions. DH's pension is solid because he's part of a union/state retirement. He'll receive 60% of the average of his last 3 years with the school district. Mine continues to get smaller- I'm waiting for a buy out.
The plan is once the sewing machine is paid off, that amount will go to the mortgage. Then once day care is done (only 9 more payments!) we'll move that to the mortgage as well. The cars' interest rates are so low that we'll just pay them off on time (July 2019 and May 2020). The goal is to have the mortgage paid off by August 2021 when I turn 40 (eek!)

KAdams767 · September 2016

I use a combination of Mint and Excel. I like Mint because I am too lazy/busy to manually record or keep track of transactions, so I like using a program that imports them for me. I keep our regular budget and savings goals in Excel spreadsheets though, it's easy for me to keep track of that way.

I keep a budget, but honestly except for savings goals, we are not particularly strict or diligent about keeping to it. When we were younger and just getting on our feet, we were, but I feel like we have things in a good groove now and as long as we are hitting our savings goals and increasing net worth, I've stopped worrying as much about line-item budgeting.

We each contribute the maximum to a 401(k) and fully fund one IRA annually (only one for tax reasons, unfortunately), and then contribute $1,000/month to a taxable investment account. Above and beyond that, we try to save an additional minimum $1,000/month to regular savings and then do lump-sum deposits to the investment account semi-annually following receipt of bonuses and depending on how much we have in regular savings earning next to nothing. After these things are covered each month, we are comfortable spending on things here and there and cash flowing most other expenses.

Budget looks like this:

Mortgage and taxes/insurance: $1,400
Natural gas: $150
Electric: $80
Water: $40
Garbage/sewer: $15
Car insurance: $90
Student Loan: $195
Internet: $45
TV: $45
Gas (cars): $75-$100
Groceries: $400
Dog: $100
Investment account: $1,000
IRA: $458
Entertainment: $300

bmo88 · September 2016

We are very loose budgeters. As in, we save first, make sure our bills are paid, invest additional every other month and then "monitor" the spending of extra funds, but not super strict about it.

Here is our basic budget:

Take home after health insurance, PERA (state version of SSI) and taxes: $10,500

Mortgage (including taxes, insurance and $50 additional): $1,715
HOA (includes trash, internet & recreation fees): $118
Utilities: $140-180

Cable: $90
Cell Phones: $85

Groceries: $250-$300
Eating Out: $100-$150
Entertainment: $100

Dog Food: $50
Vet Bills (averaged over year): $25

Fuel for both cars: $80-$100
Car payments for both cars: $725
Car Insurance for both cars: $97

Roth IRA for both of us: $916
401k for me: $1,000
Emergency Savings: $750
HSA: $208

als1982 · September 2016

We budget by the paycheck (instead of by the month) using Excel with each of our checks having a distinctive purpose:

1. My first paycheck of the month pays for utility bills, recurring donations, insurance and to fund our mad money accounts, plus half of the month's food, entertainment and car gas.

2. My second check goes to the mortgage and the rest of the month's food, entertainment and car gas.

3. H's check (he only gets paid once a month - boo), goes to savings/debt payoff and any vacation spending.

Every week we look at the budget and calculate how much we've spent in each category and how much remains. We do it over coffee on Saturday and it's time we enjoy.

If there is money left over at the end of a budget cycle, it's currently getting moved to pay down the mortgage (our current debt payoff goal).

ETA: Our budget is a living document and is constantly being revised, just like life. We move things around, accommodate fluctuating gas prices, etc. and make updates regularly to reflect our changing goals.

123bedebtfree · September 2016

You all are so helpful! I am going to add a line item for eating out and clothing into our budget!

labro · September 2016

We use YNAB (You Need a Budget) which is similar to an envelope system. We track our purchases through an app on our phone and I go in to the budget at the end of the month to update it and make sure all of our purchases are cleared and synched with reality (sometimes we forget to track here and there). Then I update our budget for the next month based on anywhere we overspent.

Net Take Home after fully funded 401ks, health insurance, taxes, etc: $7985

Budget:
Mortgage (PITI plus additional principal) - $1058.69
Phone - $152.24 but will eventually drop to $90
Internet - $80
Electricity - $80
Water - $25 (we have a septic)
Natural Gas - $85
Car Insurance - $210 (we have three cars, all comprehensive so it's a little high)

Groceries - $500
Fuel - $125
Eating out - $120
Medical - $30
Clothing - $75
Household Goods - $40
Personal Spending Money - $200 ($100 for each of us)
Dog - $150
Entertainment - $200

Sinking Funds

Car Repairs - $150
Home Maintenance - $200
Birthdays - $40
Christmas - $40
Other Gifts - $15

Roth IRA - $459
Car Replacement - $300
Vacation - $500
Savings - $2400

brij2006 · September 2016

Here's an example of our budget. It changes every month based on what is going on and what we need to plan for.

Church Tithe: $630
Gifts: $50
Brij Roth IRA: $458.33

Water & Sewer: $79
Gas/Electricity: $175
Cell Phones (2 iPhones): $165.62
Netflix: $9.99
Internet: $59.60

Auto Gas: $500 (H commutes 55 miles each direction, I commute 35 miles each) This category sucks!
Car Maintenance: $100
Car License: $50 (sinking fund)

Groceries, toiletries, household items: $600
Eating Out: $100
Beef: $50 (sinking fund for 1/4 of a cow once a year)

Subscriptions: $55.93 (Weight Watchers, Scribed, and iCloud storage)
House Updates: $50
Clothing: $100
Childcare: $500
Entertainment: $100
Baby Items: $20
Miscellaneous: $50
Haircuts: $30 (once every 3 months)
House Cleaning: $80

Life Insurance: $57 (sinking fund, paid annually)
Auto, home, farm land, and umbrella insurance: $375 (sinking fund, paid annually)
Property Taxes: $150 (Sinking fund)

Brij House decorating fund: $100
H Car crap fund: $100
^ Yes, this category literally says this in our budget.

BeachBaby516 · October 2016

I'm new to this budgeting thing. We are trying to get out of debt. I see everyones budget but my question is where do you put the money for all your categories? Do you have multiple checking accounts to directly transfer the money after you get paid? Or do you just keep this money in cash envelopes?
Thank you all for you help!

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