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Saturday, February 5, 2011

Realistic Budgets

By: Notes From The Frugal Trenches

Every now and then I think I can trim more off my budget and I try to convince myself that I don't really need to have as many items budgeted for in my monthly plan. Little conversations will run through my head, the more determined side convincing myself I don't really need to keep adding to my health fund because I so rarely get sick. That same voice would seem so sensible when it suggests I don't need a clothing jar because I don't need new clothes. And yet again the voice rears it's ugly head when it tells me mad money is just a frivolous spend. Only what the weaker voice didn't state loudly enough is that mad money is great fall back money, new clothes may be needed if your winter boots break in half and medication may need to be bought if you suffer from eczema.

Living the frugal life can be a worthy pursuit, but if you aren't careful it can make life more complicated instead of helping you simplify. Sometimes in my effort to have as simple a budget as possible I have actually made my life more difficult. Overspending because you haven't spent enough, pulling money from the wrong place, dipping into other funds and feeling overwhelmed are in direct contrast to the simplicity the frugal life can bring. And when you aren't realistic about your needs & aren't actively and practically planning for the worst - you can be in a situation which is a bit like cutting off your nose to spite your face.

I use a jar system to allocate my money and the truth is, whether I like it or not, whether I add in $1 or $50 a week I need to budget each week & month for all of my costs. Even if I wish I could eliminate more in every season of my life I need money jars which represent the truth. And right now my *truth* is I need jars for:

Grocery Shopping
Pet Costs

And while health and clothing usually don't entail monthly spends, knowing there's some money rattling around in a jar to help deal with inconveniences like itchy skin & boots which split in half {and are much needed items since we have yet another 2 months of snow storms ahead of us} helps me live a simple, green & frugal life!

How do you keep your budget organized and on track? How do you make cut backs that are realistic? What are your budget necessities?


sl.tudor said...

Hi we use the jar system too..its easier for me to keep track of what i have and more importantly exactly what i can spend...i don't need the health one as we get free health care and dental care..the nurse will give me a pre-scription for most things so that saves me a lot...i do have a clothing jar that get emptied on a regular basis..having small ones they all need something..i do my food budget as close to the knuckle as i can get..thankfully i have got 2 allotments so veg and fruit is not a problem..but meat and out of season fruits are getting very is flour and sugar..for me now at this moment my life is so simple..if i need it then i can get it but if i want it then i don't really need it...
All my bills are paid by DD and whats left over goes on food and is divided into my jars..i have extra ones for birthdays,easter,fireworks night and christmas..might only get to put a few pennies in each one but its better than nothing..and i can always borrow from them if an emergency crops up...
I have a budget book and keep track of how much i spend and also how i can trim it..such as hubby wants seeds for the allotment..was going to cost a few pounds but i found a website giving them away for that money went into the jars..i have tried to trim it down but found myself struggling to put food on the table and running out of i have so much to spend and then if anything else is needed i can go to the jar and it won't affect my banking system...its harder than most think trying to be simple..and frugal it takes work and above all patience.

David said...

The dicipline of budgeting has always seemed to avert my abilities to make it work. My recent attempt to have a no spend month has resulted in the microwave breaking, the clothes washer leaking water, and the car acting up. So by the end of February I'll be back to cooking on the electric stove, wearing very stinky clothes, and walking. It's a great life if I just don't weaken.

Have a great budget day.

Rosa said...

I wonder if it would help you to automate some of your savings buckets - figure out the health/repair/clothes and other short-term savings amounts and have them deducted into a savings account automatically, so you're only actually dealing with it when you need to take money out? Then you can either keep a record of what's in the imaginary sub-accounts (I can send you a sample Excel sheet for that if you like, I used to use one that way - or a check register works well too.) or go back retroactively every six months or so and see what you're actually spending that money on?

One of the benefits of automative short-term savings is it makes the money left in your jars every month a reward - it's someplace you came in under budget and you can do whatever you want with it.

Your budgeting tools should make you feel free and prepared, not anxious and always about to fail. said...


My problem was I was eliminating jars, now that I've got them up again it is really working! Thanks for the tips though :)

sl. I too like "seeing" what I have.

David I can well relate, I think I've told many a friend when the budget is off or you're sick or unemployed expect everything to go wrong!

Heather's Blog-o-rama said...

Using jars is very creative for allocating money in the budget. I've certainly never heard of that before...although I do have a jar that I throw spare change in. I"m saving for a trip to the East Coast of the United States one day :) :) :) Some of my friends put their money in different envelopes. I write out my budget every month...and literally give every dollar a that I know/have a written plan of exactly where everything will go towards, including a budget for fun activities :) :) Greetings from Oregon , Heather :)

TechChik said...

Between my husband an I, I'm the finance person. I like to keep track with spreadsheets because it creates a history of our spending as well as how much we have left for the current month.
My husaband is a visual person though, and has no patience for spreadsheets. So I made paper thermometers for the fridge for each "jar" and fridge magnets move up and down each thermometer to keep track of how much is spent / left.

Surviving and thriving on pennies said...

I have a system that works for me but might not work for all. My husband gets paid once a month and I have to make my money stretch!

Payday-go to the store and stock up on bulk noodles, rice, nuts, etc.

I set aside $50 for each week ($200 total) and that will be used for fresh organic milk and in season produce.

Any left over money I use to order from Azure Standard to get things we need. Peanut butter, honey, etc.

All clothing (except undies etc) are bought from Goodwill Outlet where they sell everything by the pound. All clothes are passed down from child to child. We accept anything free & pass along everything to others.

Every year I have a garden and the same rule apply. I try to store, freeze and dehydrate what I can. Any left overs are given to friends/neighbors. They too give us stuff.

My monthly budget is $600 for a family of 6. We live very comfortably and don't feel at all like were stretching money.

louisa @ TheReallyGoodLife said...

David - I tried to have a "no spend December" (well, I started a week in but no spend three weeks) and in that time, our boiler (heating, hot water) broke and our dog got sick. I think these things have a habit of happening just when you don't want them too...

givetome said...

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No matter what your financial condition or income, you can enjoy wealth and abundance, and real freedom of choice that a frugalliving can provide.
Best regards from