Category Archives: Budget

10 Financial Commandments for Your 20s, Part 2

This is part 2 of a series inspired by Give Me Back My Five Bucks, based on a Kiplinger article of the 10 commandments for finances in your 20s… I’m grading myself on each one of the commandments. Read Part 1 here.

6. Establish credit. In order to qualify for the best interest rates on a credit card, auto loan or mortgage, you need to start building a solid credit history. In fact, a good history can also save you a bundle on your auto insurance or help you land an apartment or a job (see Why Your Credit Score Matters). Building a good credit history in your twenties will ensure it’s ready when you need to use it. If you didn’t have a credit card in college, one way of getting credit now is to apply for a secured card: You make a deposit — usually $300 to $500 — in a savings account as collateral, and you can get the money back after one year of using the card responsibly. You can also start building a credit history through www.prbc.com, an alternative credit bureau that gathers data on regular payments for rent, cable and other recurring expenses. (See Rent Your Way to Good Credit to learn more.)

Score C. I’ve never made a big purchase on a credit card and paid it off slowly, so my credit score is not as great as it could be. That said, I’m totally opposed to how you need to carry a balance in order to build credit. I do have a credit card (ok I have a lot of credit cards) but I don’t have a lot of recurring expenses. Continue reading

10 Financial Commandments for Your 20s: Part 1

The other day, I was reading Give Me Back My Five Bucks, one of my favorite personal finance blogs on the web, and came across a series on 10 Financial Commandments for Your 20s, based off a Kiplinger article written a few years back. As Krystal, author of GMBMYB, detailed how she’s doing with the commandments in a two-part series, I thought I’d do the same. If you’re in your 20s, you should too!

1. Plan ahead. To get where you want to go in life, you need goals and a plan to reach them. Having neither is like driving a car without a steering wheel — with your eyes closed.  Start by asking yourself what you want in your future. Think about the short term (five years or less), medium term (five to ten years) and long term (20-plus years). Now you’re driving with your eyes open. Then take hold of the steering wheel to reach your goals.

Score: C. My idea of planning ahead is trying to not spend all of my income for the month. Some months I succeed, some months I don’t. My planning is less itemized as it is general, ie “hit $150k in networth this year.” That isn’t a bad goal for someone who is 27, but when I look at the big-picture purchases/expenses (house, new car, retirement, etc) nothing seems possible without some big exit at my current company. While I have faith my company is going to be huge and feel very fortunate for the opportunity to be a part of it, nothing is certain, and I’m doing terrible at having a real plan for my 30s and beyond.

2. Live within your means. Can’t afford something? Don’t buy it. Sounds simple, but too many people have a heck of a time following this one and get in over their heads in debt. Borrow sparingly, and only for those things that have lasting value, such as a home or an education. Continue reading

Q3 Spending Breakdown: $13,620.56

From July to September, my spending was a little ridiculous. It all started with the DUI, which cost me $3,000 in legal fees even before the big fine that will hit in Q4. The other large expense of the quarter was my Canon 5D plus a flash for it. Photography is an expensive hobby. I did manage to also spend $1082 on clothes and other shopping… how did that happen? Yikes. (see the graph below.)


Unfortunately the legal fees and DUI fees will continue to take a toll on Q4. I have $750 more left in the legal fees, and expect a $2,000 fine. The good news is that I have a chance to obtain $10,000 total in bonuses for this year, which should help me up my networth, and instead will go towards my stupidity. My income this year including bonuses will be a minimum of $95k.  That helps. I’m really trying hard to prove myself at work so I can move up the career (and salary ladder) but it’s pretty clear that I’m still learning as I go, and things take me longer than they should. I can only hope I can prove myself going forward.

 

 

 

September Budget

After an expensive August, I’m hoping to keep September expenses at a minium. That will be tough with all the traveling, though some of the traveling is for work.

September Budget

Auto & Transport — $1350 ($750 lawyer fee, $450 Traffic Ticket, $150 Registration, Gas)
Rent — $632
Shopping — $700 (possibly new DSLR)
Entertainment — $200 (broadway show tickets?)
Food & Dining — $200
Gifts — $150 (2 wedding gifts)
Health — $150 (a few doctor’s appointments)
Bills — $100
Personal Care — $100
Travel — $100
Fees — $60
———————————————
Total: $3643

Potential Savings: $617? 

August Spending Wrap

August was a high spending month, thanks in large part to the first installment of fees relating to my DUI . I think I still managed to end the month with $200 extra in the bank, so that’s not too bad considering I had to pay $1500 of my $3000 in lawyer fees then.

$1723 — Auto & Transport ($1500 lawyer fees + gas)
$632 — Rent
$417 — Travel (flight to personal finance bloggers conference + friend’s wedding)
$357 — Health & Fitness (a few doctor’s appointments and new running shoes)
$225 — Food
$187 — Gifts (1/2 flight for my boyfriend to wedding)
$179 — Bills
$163 — Shopping
$93 — Personal Care (haircut)
$78 — Entertainment
$53 — Fees
$20 — Cash
———————————
Total: $4111
Income: $4630

Savings: $251 (eek, but at least not in the red.) 

 

 

April Budget Update

April was a pretty good month in the budget department. Despite a few last-minute splurges (what can I say, Spanx are expensive!) I managed to put about $2977 into savings / investments over the month.

What is really helping is the extra income that I’ll see this year due to some sales I made early in 2011. While I don’t get bonuses, commissions are a nice cushion for when I accidentally overspend in a month.

$694: Shopping (breakdown below)
$632: Rent
$336: Food
$185: Personal Care
$151: Bills
$75: Health & Fitness
$12: Fees

Ok… so besides gas costing more than I’d like (auto & transport) my big spending this month was “Shopping.” What exactly did that include. Well, the spanx, and …

Bloomingdales — $372.49
BCBG Dress on Sale $70 (from $200)
Spanx & Undies: ~$150
Eyeshadow, bracelet, earrings: $151

Website Stuff — $130
Domains & Hosting

Personal Finance Blogger Conference — $90
Early bird discount, though I haven’t bought flight or hotel yet!

Those were my larger purchases under “shopping” in April. The Bloomingdales splurge occurred at a conference when I had a cocktail party to go to and nothing to wear. Other than that, I was good! I just hate when I spend $400 on (not even) one outfit — esp when the dress itself is a good price on sale.

Mid April Budget Check-In: Goal to save $3,000 this month

To keep tabs on my monthly budget, I promised to check in at least twice a month. So here’s where I’m at so far this month….

My goal is to save $3,000 this month after expenses.

INCOME: $2700

Rent: $630 / $630
Personal Care: $145 / $150
Food & Dining: $310 / $350
Auto & Transport: $155 / $200
Shopping: $107 / $150
Bills: $0 / $150
Entertainment: $0 / $150
Health & Fitness: $75 / $100
Gifts: $0 / $100
Travel: $0 / $50
Fees: $12 / $20
Education: $0
———————-

$1478 / $2053 spent

March Spending Wrap: Food & Lasers

Despite thinking I had succeed at a frugal March, it turns out I spent ~$6300 over the course of the month. This means April is going to be fiscally conservative, and I need to stick to a carefully planned budget (to be defined in my next post.)

In the meantime, here is a breakdown of what cost me so much this month…

Personal Care $4,348.10 (laser hair removal)
Food & Dining $646.10 (eeks!)
Home $632.50 (rent)
Shopping $292.16
Bills & Utilities $280.12
Health & Fitness $192.43
Auto & Transport $164.89
Uncategorized $50.00
Fees & Charges $14.25
Entertainment $9.81
TOTAL $6630.36

April is going to be a month of discipline. At least this month the majority of my spending was on the one-time fee for unlimited laser hair removal ($4300.) But the amount I spent on dining was ridiculous. And it’s not like I went out often or had extravagant dining experiences.

This is how my restaurant spending ($440) broke down…

Mar 29 Neiman Marcus Restaurants –$56.18 high tea with friends
Mar 29 Tokyo Go Go Restaurants –$84.74 shared sushi with aunt, cousin. water.
Mar 29 Little Chihuahua Restaurants –$12.50 breakfast with friend
Mar 28 Benissimo Italian Pizz Restaurants –$47.73 dinner with aunt, entree, shared bottle of wine
Mar 25 Max Restaurants –$24.64 dinner for bf, appetizer for me, water
Mar 22 Bangkok Bay Restaurants –$49.76 thai dinner for boyfriend and I
Mar 11 BJ’s Restaurant Restaurants –$64.58 bf’s birthday dinner & his drinks. I didn’t eat.
Mar 7 Cha-am Thai Restaurant Restaurants –$36.06 dinner in city with friend
Mar 1 Morocco Restaurant Restaurant Restaurants –$70.63 nice date dinner with boyfriend

At least my rent cost is still low compared to my income, so I can get away with months like this. Sure, I spent more than I made, but I make it up on other months (as long as you keep me away from the mall!!!) I’m worried about moving, and spending more money on rent this summer. Ok, time to figure out my April budget… coming up next…

Spending Habits of the Weak

In my attempt to determine where my money disappears to, I’ve sought out the aid of online personal finance tracking sites. Those of you who have been following my blog know that I enjoyed the ease of getting my finance info up to the Geezeo site. I’ve actually had a bit of trouble with signing in to the site lately (I’m pretty sure I’m using the right password, but then even when I try to reset the password it doesn’t work.) In any case, given that I have little patience and quickly got fed up with typing in my June spending into Excel, I signed in to my Wesabe account and updated my info so I could track my spending…

Geez. I spent a lot last month. I knew I was spending more than I made, but it’s kind of painful to see how grossly I burst past my invisible budget. I spent $3559 in June. But I only made $2273 for the month. Actually, come to think of it that’s all inaccurate because I deposited my final paycheck (which I received June 30) sometime in July. So right now my July earnings are noted as $2466, but really that money was earned in June, and half of the money counted in my June income was really my May paycheck. Plus, some of that money was the $450 my friend paid me to live in my apartment for the month. Oy, my income is much harder to track than my expenses.

I do need to start keeping tabs on my income. While I’ll be making more money at my full-time gig (when I start in a week), what I really need to do is track the money I make working the small freelance gigs I pick up on the side. Whether that’s doing some copy writing for my uncle’s digital marketing company, or designing a basic website for a friend who offers to pay something for the work… I really need to figure out how much per month I’m making on outside projects. Why? Well, it’s difficult to figure out a budget when these extra projects become a consistent portion of one’s income. When I was making about $2000 a month after taxes this year, the extra $100 a month I made on copy writing for my uncle was really a huge bonus. But then one of the companies that I did work for (through him) decided they no longer wanted him to put together a monthly newsletter, so I was then out $50 a month. Considering how much I spend, that $50 isn’t worth that much, but it’s also worth a lot. That $50 covered one voice lesson and a cheese plate at Starbucks.

My general theory on spending (albeit an irresponsible one) was that if I spent slightly more than what I was making at $35k a year, when I received a raise or managed to land a job with a higher paycheck, I’d be able to live comfortably at a slightly higher salary. After all, I don’t overspend EVERY month. Just most months. But only by about $600 to $1000. I don’t think I’m the type who will start spending more just because I’m making more. Sure my rent went up $145 a month (ouch), and I might splurge on nice clothes and paying for a nice dinner with the bf more often, but overall I think my spending habits will remain constant.

One thing I’d like to spend money on… if I had more money… would be travel. I’d love to take a real adult vacation, like to Hawaii or someplace like that. Thus far my only travel during my full-time work years has been back home to New Jersey. And up until now, my parents have chipped in for my plane ticket back east. But that doesn’t really count as a vacation, despite the high cost of that ticket. Going home is something that I just have to do every once in a while, but it’s not a relaxing getaway.

Since my bf doesn’t work, I’d really love to be able to afford to take us both to Hawaii, or maybe Seattle, or even to some random small ocean-side town in Southern California. I’d love to be able to splurge on a massage every once in a while, or just while on vacation. A massage and a facial. And maybe one of those fancy foot scrubs. And then there’s the laser hair removal and teeth whitening that I want to be saving my pennies for.

So… there’s plenty of things I could spend any extra income on, surely. Would I actually spend it? I’m not so sure. I’m not a huge saver, but I’ve never been good about spending money on big purchase items that I actually really want. Like that laser hair removal. I have this syndrome called PCOS and one of the lovely symptoms of the disorder is having excess facial hair. I don’t have a full-grown beard or anything, but I do spend a ridiculous amount of time tweezing random hairs out of my chin line and sideburns. God, what’s I’d give to permanently get rid of those hairs! Would I give $1500, or whatever the cost is these days for permanent (and painful) hair removal? Possibly. I’m afraid if I did that and it worked, I’d be addicted. I’d have to get my legs and armpits done, and my belly and back. I’d give anything to be hair free in the places where hair oughtn’t be.

Anyway, what makes me sad about my spending habits is knowing that I can go and spend $700 on clothes and makeup in one month, but I’d never really consider spending that much money on laser hair removal at this point in my life. Even though obviously it’s one of those things that I really want. I think I need to go to spending school. I need to get my financial priorities straight. I’m not sure where laser hair removal would fall into these priorities (after all, the treatment would be a luxury for sure, but in a way it’s a medical expense because it’s not like I can live a normal life with a thousand hairs growing out of my chin). Too bad my health insurance doesn’t care about that.