Tag Archives: budgeting

Budget

Getting my Finances in Order – End of Year Edition

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I understand why the rich have personal CFAs to help them manage their finances. Trying to do this properly and have a 24/7 full-time job is a bit chaotic… I can’t imagine making sense of this with kids to boot. For now I have a few free hours each week to make sure I’m keeping on budget, investing the right amount towards my retirement, and paying off bills so I don’t generate any nasty late fees or dings to my credit.

At the moment, the big question is when to pay for what. I’d like to hire a CFA to help me understand this, but think that any savings I see via the CFAs advice would be washed out and then some via the CFAs fee. If someone is super rich then whatever a CFA charges will not be more than their savings gained via the outside expertise, but when we’re taking tens or hundreds of dollars it’s unclear to me if there’s value in bringing in outside help. I really want to make myself an expert so I can make the best choices, but that, again, is not possible with a full-time job.

Right now the biggest question is December spending. I typically play my cards to save up a chunk of cash at the end of each calendar year so I can splurge, so to speak, on my 401k in the first months of the next year. I never have faith I can keep my job for the entirety of the year (the reality of startup life) nor do I have faith my next position will have access to a 401k. There are also various reasons why investing earlier in the year is better vs later, though a lot depends on the stock market performance (i.e. if stock market is sucking at end of previous year then odds are it will start to go up at some point so investing early is important, vs if stocks are performing well like they are now and a downward run seems more likely, so dollar cost averaging over the course of the year is the better way to go.) (*this is my theory and not validated in any shape or form.)

The other open question is how much to put towards my Roth IRA this year. I’m going to be on the line where my contributions are reduced, but I’m really not clear by how much because I’ve held so many different jobs this year – not to mention have dividends and stock sales coming from multiple accounts – and I haven’t done a good job in keeping track of my total earnings. This is where I’m confused as to whether I should just max out my Roth IRA and then deal with recharacterizing before Oct 15, 2015 (and likely have to hire a CFA for this) or just stay well under the limit and accept I’ll probably miss out on some future tax savings (though at my income level who knows if Roth IRAs really hold any value anyway.)

I’m also questioning what to do with my $600 doctor’s bill because I’m waiting for my COBRA to kick in (I sent in paperwork but apparently did it wrong so had to re-send it in.) The actual COBRA costs $800 for the two months so now I’m wondering if I should just pay the bill and have a lapse in coverage – need to do more research into how bad that actually is. I have insurance now through work, but I would be facing the lapse if I don’t legally backdate the COBRA with that $800 payment, which is only $200 or so more than what I owe anyway…

Meanwhile I owe my boyfriend a good $12,000 because he’s been paying my chunk of the rent over the last year. I only don’t feel bad about that because he has most of his money sitting in a checking account (talk about risk adverse) and I’m investing this loan and will pay him back slowly. Given how much it will cost us to buy a house every dollar matters and having thousands of dollars sitting in a bank. At least last year I convinced him to start a Roth IRA.

You know, these are all first world problems but they’re problems nonetheless. I’m going to create a new post to go live tomorrow on how I’m going to manage this mess of my December 2014 finances.

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Dear Mint… How I love thee, let me count the ways…

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After finding out about personal finance sites like Mint, Geezeo and Wesebe in their early days, I’ve been enamored with the concept of using technology to make personal finance easier to grok. While Geezeo and Wesabe (and Cake and Covestor, etc) had some decent features, Mint ultimately took the cake… with the frosting.

Even though I was a little worried when they were bought by Intuit, I’m still a fan. I can’t say I contribute to their wealth as I’m pretty smart about my credit cards and cds, so they never have any good deals to offer me. (Mint, take note of BillShrink.com, which is offering a cool find cheapo gas near you feature… which is actually useful for me. Though I’m not sure how they’d make money off of that feature, other than hoping you get a CD or Credit Card through them on an educated whim.)

Anyway, what has me all buzzing about Mint today? Their planning tools that they rolled out a few months ago. They weren’t that useful to me online only, but now that I have my shiny new iPhone having the Mint app makes my financial life a thousand times easier and better.

Just tracking my expenses and income per category, and having access to that at all times, is giving me so much more control over my financial life. And it feels good. Minty good.

While this month my expenses have been (scary) more than I’d like, starting in 2010 I’m going to use Mint to carefully BUDGET (like really budget) and account for every little thing I spend. It’s so easy to do that because Mint knows. Every once in a while I have to adjust a category or categorize a check, but that’s easier than inputing everything by hand. I am so excited to embark on a year of incredible savings and budgeting thanks to my Mint iPhone app and Mint.com (and yes, even (M)intuit.

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2009 Budget Plan

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As I wrote in my last post, my 2008 savings plan was a success. But in 2009, a lot of variables are a changin’, and I can’t save 50% of my income for taxes anymore. Being a full-time employee means regular tax withdrawals from my paycheck. No more saving for taxes in a nice 3% interest ING account. So what does that mean for my spending and saving in 2009?

First of all, I recognize that at 25, my medium-term goals (buying a house, grad school, having kids) are suddenly becoming more-or-less short term goals. I won’t go into how much that’s freaking me out at the moment, and instead will concentrate on how I can best save for them while my fixed monthly out-of-pocket expenses are low.

Even though I use Mint to track my spending, I find it most useful to have a Google Doc spreadsheet set up for my monthly budget.

First, I make a row of “Budget Headers” — which includes everything from “income” to “travel.” For now, I’m not too picky on my breakdown. I have a few columns left for income – my base paycheck, some small additional freelance income I earn monthly, and other revenue streams that may pop up throughout the year. Then, using my strategy from last year, I deduct 50% of my income from spending power.

The next columns are set up for fixed expenses: Rent, Bills, Insurance, Gas, Food, Gym, etc. After I got all those in, I made a column for remaining liquid cash called “LEFTOVER.” My LEFTOVER money in 2009, assuming I can take in $2650 after taxes, is $1178.

$1178 seems like a lot, but it’s not extravagant.

After the “LEFTOVER” column I added a “REMAINDER” column, which basically tracks the difference between my extra spending/saving and the LEFTOVER amount. The goal would be to get this as close to 0 each both as possible, without going under.

On the right side of the REMAINDER column I made columns for all of my un-fixed expenses: clothing, travel, Roth, downpayment account (currently at $0), gift, entertainment.

I’m sure I’m forgetting something but I’ll add it once my January totals come in.

The cool thing about this spreadsheet setup is that I can adjust it for income. My favorite thing about 2009 is that I have a few easy income streams for a couple of extra bucks a month if I can get myself out of bed early. My main job is going to really take up most, if not all of my time to “work,” but if I really want the extra cash I can write a blog post once a day for $25, up to $500 a month. Last month, I earned $250 doing that… which was a good thing since my other generally stable freelance income stream of $400 a month payed out only $100.

At the end of each month, I’ll post my budget chart here.

Investing

March 1-20 Spending ($3176.93)

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March Spending Breakdown Check In (March 1 – 20)

Fixed Costs = $1422.28
————–
$71.33 — Cable Bill
$129 — Health Insurance
$87.33 — Car Insurance
$57.62 — Phone Bill
$1050 — Rent
$27 — Gym Bill
————–

Gas Totals = $121.30

—————

Color Code

$1543.58 — Fixed Costs & Gas
$387.98 — To Be Reimbursed
$371.16 — Food / Drug Store
$0 — Clothing / Beauty
$105.54 — Furniture / Household
$512 — Investment
$256.78 — Other

———

$2277.06 Spending
$512 Investment
$387.87 To Be Reimbursed
———-
$3176.93 Total March 1-20

————————-
breakdown by type:

Cable / Internet Bill:
$71.33

Health Insurance:
$129

Sharebuilder Investment:
$500

Car Insurance:
$87.33

Play TBR – Tables:
$50

Cash Withdrawl
$50

Cell Phone Bill
$57.62

Gym Bill
$27.00

Rent
$1050

Sharebuilder Fees
$12

Sheet Music for Play (TBR)
$6.39

Drug store
$3.79

Dinner for Two
$28.03

Target – bookshelf and ottoman
$105.54

Quik Stop
$5.07

Drug Store
$13.62

Antiques for Play (TBR)
$15.16

Quik Stop
$7.40

Groceries
$6.04

JoAnn Fabrics (TBR)
$43.22

Home Depot (TBR)
$45.24

Burger King (TBR)
$15.34

Gas
$63.48

Dinner
$11.69

Book
$11.85

Groceries
$14.97

Dinner for Two
$42.40

ITunes – sound for play (TBR?)
$29.88

Taco Bell (food)
$3.38

Bagels for two
$7.10

Drug Store
$63.25

iTunes (TBR?)
$9.99

Ace Hardware ($30 TBR)
$52.34

Target
$32.46

Joann Fabric (TBR)
$20.25

Gift for Boyfriend’s Birthday
$150

Home Depot (TBR)
$89.76

Ace Hardware (TBR)
$62.75

Groceries
$6.99

Gas
$57.82

Groceries
$169.90

Food

March Groceries — $169.90, now on my new Chase Freedom card

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My Chase Freedom and American Express Blue Cash cards both arrived in the mail today. While I’m terrified of credit cards, I’ve decided it’s about time to really start building my credit score. I have a bunch of open credit cards and according to a recent credit check I’m in the 730 range, but I still want to up that credit score so one day when I want to buy a house (or condo) I can get a good mortgage rate.

Anyway, I finally gave in and got these two credit cards. I don’t know if they’ll help or hurt my credit score, but I’m going to start spending on them each month and paying off my balances at the end of the month. I’ll only buy what I can afford. Period.

So I went food shopping today. At the “cheaper” (aka non-organic, non fancy) supermarket in town. Safeway. I spent $169.99. I supposedly saved $41.34 on buying things one sale w/ my “club card.” I did spend extra time picking out things on sale.

I went a little overboard on buying spices this month, but I don’t really have any spices and if I’m going to start cooking more, I need some more spices. I tried to buy ones that were on sale! Thank goodness for credit cards.

Without further ado, here’s what I got for that $169.99

$1.39 – Jumbo Taco Shells
$1.11 – Canned Corn
$3.89 – Cooking Spray (non brand Pam)
$3.69 – Paprika (spice)
$3.29 – Bread Cracker Stuff
$3.27 – Spice Island Mustard (spice)
$3.75 – Thyme (spice)
$3.99 – spinach tortellini
$3.99 – three cheese tortellini
$3.73 – garlic powder (spice)
$2.71 – basil (spice)
$3.00 – butternut squash soup
$5.00 – 4 Tuna Salad Lunch
$.99 – plastic spoons
$1.66 – steamed vegetables (frozen)
$5.29 – kashi lime shrimp frozen dinner
$4.99 – liquid egg whites
$2.50 – shredded cheddar cheese
$2.69 – fat free milk
$4.49 – cottage cheese
$2.49 – lowfat yogurt
$5.49 – frozen strawberries
$4.50 – frozen blueberries
$3.49 – frozen quesadillas
$3.00 – frozen veggie bites
$9.00 – three boxes of morningstar frozen meatless buffalo wings
$1.39 – banquet fish stick meal
$6.76 – four cheese and beans burritos (frozen)
$5.00 – two cheese quesadillas (frozen)
$3.99 – a fitness magazine. To inspire me to workout.
$3.39 – bread
$4.00 – frozen fried fish
$2.50 – frozen fish
$2.50 – frozen fish
$5.99 – stuffed salmon frozen
$6.23 – Rockfish Fillet (not frozen)
$3.45 – five kiwis
$2.45 – three sweet potatoes
$2.00 – raisin boxes
$2.00 – two bags of baby carrots
$2.99 – bag of four avocados
$2.99 – veggie turkey slices
$7.98 – two boxes of veggie buffalo wings (non frozen)
$3.00 – blueberries (non frozen)
$3.99 – vegetable mix
$3.50 – cheese whole wheat tortellini

Digital Finance, PF Tools & Tips

Attempting to learn how to Budget with Beehive

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Thanks to an anonymous poster for reminding me how I really need to start budgeting. After my little shopping trip to the local mall the other day, I realized just how little control I have over my spending. One of my biggest problems (and I know I’m fortunate to even have this problem) is that I have $20k+ in savings, so often I feel like even though I shouldn’t be spending that money (I should be SAVING it for grad school or a house) – but it just feels like those bigger ticket items are so unreachable that I might as well just spend my money now. And I get such a rush buying clothes. Especially ones that I feel good about buying… when I feel like I’ve bought items that I’ll wear again and again. It makes the endorphins kick in. Shopping is my drug. But it’s an expensive habit. And I need to quit it.

In any case, I’ve decided to try to make a budget and to… hopefully… stick to it. There’s no reason I can’t get through a month on a monthly salary of about $3000. It’s pathetic that I’m still losing money. Ok, so I haven’t actually gotten through my first “full” month of work, so last month was just a mess financially anyway, with my time off between jobs and everything. In any case, I looked online to find some budgeting tools, and of course, I found a zillion. I picked one out at random…

Beehive basically helps you make your budget. I’m going through right now and filling in all of my income and expense information. This should help me see exactly how much money I have to use to budget per month.

I’m trying to estimate low for non-fixed income, since I’d rather end up with more money at the end of the year than less. When they asked how much I make per year in investments, I put down $200. I think my CDs probably take in about $300 per year, but the way my other investments… Roth IRA and Mutual Fund are doing, I’ll be lucky if I break even this year.

Meanwhile, I’m estimating high on most expenses. I’m really confused on how to budget, but I guess ultimately if I put in $100 a month for clothing I NEED to stick to that.

Here’s what I’m budgeting for non-fixed expenses…

(per month)

Clothing: $100 (um, can I really just spend $100 a month on clothing?) $200: I don’t have to spend all $200, but I’d rather save some money for clothing each month and then go on a massive shopping spree, as opposed to only having $100 to spend.
Gasoline: $250 (it’s been that high in the past few months because of all of my commuting for various reasons. In september, my gas costs should come down quite drastically, but it can’t hurt to estimate high, right?
Entertainment: $200. Should include alcohol costs. Because that’s what adds up.
Beauty: $100. I figure between eyebrow/face waxing, and my occasional hair cut, beauty costs average out to about a hundred a month. Maybe I should estimate higher. Hmm.
Alcohol: $50. Here, I’ll through in an extra $50 for those rare months when I actually have a social life.
Travel: $100. That’d get me to Hawaii in a year.

Anyway…

Now I’m entering in “Assets”

I’m confused as to how I should record my assets for my investments. Should I note how much I put into the funds, or how much currently exists in the funds? It doesn’t look like there is a spot to track the funds, or to note how much its average earnings (or losses) are per year. Hmm.

I guess I’ll put in what they’re currently worth. It will make me less sad to start off with a smaller amount in my budget anyway. And I can kind of (try to) forget that thus far my investments have lost $400.

…

15 minutes later.

…

Ok, so I’ve decided “Beehive” sucks as a budget tool. I really wish there were an easy way to make a budget and track my finances.

One thing I don’t like about Beehive is that when you’re inputing your expenses for the month, it lumps all your “personal expenses” together. That includes everything from clothing to gasoline. What I really need is a breakdown of my “personal expenses” spending. I guess it’s not a terrible idea to start thinking of it as a lump sum, because then I might be motivated to spend less on eating out in order to support my shopping addiction. But, still, I think it’s important for me to break down my spending via category, and see where the money goes each month.

Meanwhile, I find it’s really difficult to keep track of expenses that I am supposed to get reimbursed for at work. I feel like they should be counted separately, but I need to make sure to note that any future income that’s actually reimbursement needs to cancel out.

Does anyone out there know of a good way to make (and keep) a budget? Help!