accounts and envelopes and wallets OH MY

I love pay day. It's my chance to move the cash around into each lil spot I put it. Perhaps in a subconscious way it makes me feel wealthy for a moment.

I have four accounts at two banks. There is a primary chequing and savings at one bank and another chequing and savings and bank 2. Bank 1 is the main account. That's where the money comes in, the bills get paid, groceries are bought etc. There is precious little in the savings at that account. I pay for gas on CC to get the airmiles so I temporarily 'store' the gas portion of my budget there so it is intact when it comes to pay the CC. I do this with a couple other categories as well.

The second bank accounts I started about three years ago. I was having great trouble saving and when big bills would come in for the boys school fees, their sports fees, music fees etc, that money was never there and I'd go in the hole. I started this chequing account and made it a point to deposit a set amount into this accout the day after payday, each month. Then the money is there and kept quite separate from the others. The savings account at Bank 2 I just opened. I needed an account I don't regularily access so I could begin this much needed Emergency Savings Fund. My initial goal for that fund is $1000. I currently have $400 in it thanks to a bit of frugality last month. I don't anticipate things growing too quickly here as I am focusing on debt repayment.

All of these accounts are in my name only. I appreciate knowing that there won't be any surprises when I go to pay for something and find myself short of funds, as I was before when we shared an account. He has no objection to these accounts. We have had separate ones since Day 1.

I have a fifth account which is joint, but really his. I have access to it, I can go to the bank and deposit or withdraw, I can write cheques on it, but not a debit card. Since I don't contribute to it, I never use it.

Sometimes I wonder if my many accounts helps or hinders. I sure appreciate the 'hockey account' as I call it, though the boys are in more than that LOL

I have also taken out my own 'allowance' and have 4 weeks of envelopes ready to go for that.

It' s complicated but it seems to work for the most part.

Finally Pay Day

I can't believe a month has gone by already since I started with this 'beginning budget' and my plan to get my spending under control and get myself on the right track to get out of debt.

As the bills for the month start to come in I can see where the money went and how well I did.

This next month will be a big expense as my son and I have a trip to a city with food and hotel costs coming in close to $1500. My MC will take a hit but my goal is to have the balance of that paid off by end of October. The downfall of starting budget in July is that there isn't money set aside for this big of an expense this soon. The positive to starting in July is that I have a year to get ready for a similar expense for next summer and I can start to save.

My salary is actually over 10 months. I don't get paid for the summer 'off'. We have a lovely option with our workplace though that allows us to take smaller cheques in the main 10 months so that we can have a 'regular' cheque over July and August. I'd never be able to set aside the money to do so otherwise and then the bills would not get paid. I am so thankful for that 12 month option. The bonus of the July and Aug cheques is that the regular year long deductions are not taken off so these cheques are actually higher by about $500ish. This money I will put towards some of the city costs. That will definitely help.

I will get a pay raise for September but until the pay stub comes, it mostly is guesswork on how much my net pay will go up.

I always have a ton of enthusiasmfor budgetting on pay day as there is money and I can see the light. By the third week into the month with the main bills all paid off, there is little to do but try not to spend. Once a month paydays feels like forever til the next one.

coincidence

Right after I published the blog about Gas I went to CNN to see the primary article on gas prices :-)

It is rather scary to think that there are stations which charge different prices based on whether you pay in cash or credit card. This is news to me. We don't have such things in my lil prairie province. They may well in the larger centers in Canada. I don't know.

Now that my CC is paid off, I use it to pay for gas, pay it off in full at the end of the month, and collect air miles for the purchases. If this type of tiered system came here, I'd have to think about which is more beneficial....the miles or the money saved.

Seems like the more technology there is, the more complicated our choices become. Ironic

I also investigated the map which shows gas prices across the US. The highest was in the $4 range so I guess our prices up here of over $5 a US gallon are higher. That answers my question below then.

I've got gas :-)

My summer "let's drive to...." has been drastically cut this season. Before I head out anywhere I am constantly thinking of how much this will cost. In many ways I envy my children's friends who are a part of the 'we're driving to x lake' or 'we're heading out to the coast'. I feel bad for my kids because they don't get holidays like that but we can't even afford the gas to GET to such places, let alone stay there for a week or two. It really just doesn't seem fair sometimes.

Playing with my conversion chart, 1 US Gallon is 3.79 L. Currently our gas price here is $1.33 a L, which is down from $1.39 of about 10 days ago. That works out to $5.04/gallon. I'm not sure how that competes with any US readers out there and the price of their gas.

We live in a small twin community of a town and a small city. Total population of them both is about 25 000. Before school let out, I filled up my tank and did a loop..... from home over to drop the boys off at school, to my work, then picking them up and home again. That round trip cost $3, which isn't that bad, but often during the course of our day, we're doing similar trips over and back 2 or 3 times a day which means 14-21 of those a week. That comes to between $42 and $63 a week. That's warm weather driving. In the winter when the van needs to be warmed up in the AM and again after school before going somewhere, those costs are almost double.

I know there are people out there commuting to work and have a much higher gas bill than I.

I have budgeted $280 per month for gas. (I've actually been doing a gas budget for about a year). Anything not spent during these warmer months goes into a separate category saved aside for longer road trips or winter months. It's worked rather well except when you have several longer road trips recently which have eaten up the 'extra'.

It's made me think a lot about how much I drive, how much my car idles (say in Drive Thru), how to combine and preplan errands to cut down on the number of trips I make. That part has been a good thing. Paying the extra money per litre sure hasn't.

Tinkering

I can see already that when Sept 25 paycheck comes, I will have to have some tinkering in place for the budget. July and August's downtime will give me the chance to develop positive habits of record keeping of expenses and paperwork. It's giving me a good idea of how much I spend in each category. I have to accept that there will be a CC debt for end July/early Aug that will not get paid in full, so the Sept budget will reflect getting rid of that debt and then snowballing the rest.

I need to add a few things in.

I have not made a budget line for emergency savings.

I have not made a budget line for Christmas gifts.

I have not made a budget line for getting my hair permed/coloured.

I have not made a budget line for infrequent expenses like CAA, Costco, package policy on my van etc.

I have decided to reduce my weekly allowance and create a budget line for my perms/colouring. Since I don't use this line each month, I will have to tuck away what isn't spent and save it for when I do go.

Our contract shows an increase of 2% I believe for salary increase so offhand I'm not even sure what that means in dollars for my September cheque. My plan is to take whatever that raise is, and attach it to the debt to get rid of it faster.

We shall see what else changes. It shall be interesting.

summer budget and unprepared for expenses.

Starting a budget may be ideal for time to get things set up, but it isn't necessarily the best when one considers expenses. Summer is an odd time with us. I'm off so routine is broken...the boys are in a variety of activities, which cost to attend and are aways from home, so there is the extra cost of driving there and back. With our camping and our trip to the south of the province for my elder's training camp, expenses are high and abnormal.

The best I can do with the information is document and analyze, tinkering with a few points until the fall begins and my regular salary is back as is our routine.

Starting in the summer means that I don't have the cash already set aside for the activities so there will be a hit on my formerly zero balance MasterCard. That will have to be taken care of as quick as possible in the fall.

The end of Aug will bring school fees x 2, sports fees, band fees and back to school supplies and clothes (they are growing like weeds). It's more than a bit intimidating about the costs to come.

Til Debt Do Us Part

I have discovered a wonderful show on Slice TV called "Til Debt Do Us Part". It's a quick 30 minute show where a personal finance professional, comes in to the aid of families in trouble. She comes in for a month, visits once each week and goes through their finances and spending.

Each week there is a challenge the couple must do to work together and dig their way out of financial difficulty as well as become a more communicative couple.

She takes away their debit and credit cards, and divides their flexible expenses into jars of cash, labelled with the amout per jar and category. They have a log to write down each expense.

At the end of four weeks, if they have completed all the tasks she gives them, she will give them $5000 to use towards their debt.

It has been very informative to see what situations other couples get into and how they work to get out of it.

I love that she doesn't come in and do it all for them, but rather teaches them skills to better themselves financially.

What I would like to see is follow ups of the couples after six months or after a year to see where they went in their debt repayment.

I see things in these couples that I recognize in myself. It's a good awareness.

Being a woman is expensive

I was doing some shopping and as usual was aghast at how much the little things add up. I am a drug store junkie and could spend hours wandering through at all the different lotions and potions one finds there. Rarely do I go hog wild but it's hard not to.

I did a mental count of all the 'necessary' items a girl needs and was amazed at the cost.

Now granted my list of 'essential items' might be very different than other girl's list...perhaps longer, perhaps far shorter. I am not all that high maintenance but neither am I plain jane frugal, so the following is just a generalizing and estimation numbers.

So during a typical month on the list of my basic necessities is: bodywash/soap, shampoo, conditioner, razors, face wash, moisturizer, foundation, mascara, blush, eye shadow, lipstick, toothpaste, 'girlstuff', deoderant, contact lens solution and hair gel. Ok that is all I can think of at the moment.

Now the quantity of each item needed each month varies, obviously so for simplicity, let's say one of each. That brings us to 16 items. (Now I KNOW I have more than 16 in my vanity but let's just stay with that.)

Now money. Everyone buys different brands, quality etc. Some of these items could be $40 for a moisturizer and $50 for salon hair products, or $1.49 for deoderant at Walmart. Again, let's generalize and simplify and say that each item costs $4.

In a one month period, using the generalizations above, the personal grooming products would come to $64. Mine comes to more but then some last more than a month so let's stick with generalizations.

That's $64 a month to be clean and fresh, which would come to $768 for a year.

Insane isn't it?

I think many of us who haven't gone through and thought about things, wouldn't realize how quickly things add up.

While keeping track of every item and quantity and cost for all parts of my life would be far too many details to do and still function in life, it would be interesting to pick a random month and see what the real numbers show.

Budget blowers

Two of my biggest impulse buys and expenses are books and magazines. I LOVE reading. No if ands or buts about it. It has given me countless hours of pleasure for escapism, introspection or education.

What is frightening is the sheer volume of items I have bought. I don't even want to think about the number of books I've bought since I was 16. In the thousands for sure. Many of them well read over and over. I've gotten rid of some of them over the years, mostly at garage sales with a few of the better ones donated to the library. I rarely buy used. It is mostly new, mostly softcover except for that one year where I was in a book club and had a plethora of hard covers come.

I read fast. While I re read many of them multiple times, it simply isn't worth the cash I'm spending for the short period of time. In the middle of June I was preparing for a garage sale and I went through all my books to see which ones I could bear to part with. I estimate I had about 500 of them. I managed to get rid of about 150 of them and it was a good feeling.

I have put myself on a book ban for purchasing. There is a small library 4 blocks from me and another much larger one across the river where I can read as many of those bad boys as I want.......for FREE. I haven't bought a new book since early May and I'm so pleased with myself for that. I will have to think long and hard about a new book purchase and whether it is financially worth it to get one.

As for magazines...well those are my guilty pleasure as well. I have three subscriptions: WW, Rachael Ray and Fitness. I will often buy at the store Good Housekeeping and Quick and Simple and I used to be very bad at buying US and Star.

At the end of June after a hectic month where I had no time to read anything, I cleaned and counted up the number of magazines I had sitting there unread: 3 of the subscribed ones and about 12 of the store bought ones. That's about $60 worth of magazines.

I have decided that I will cut back to just the WW magazine when the subscription comes up for renewal. I have told myself I can buy 4 magazines at the store per month instead of 15ish. That will be $20 instead of $60. It's not ideal but it's a start.

It's $40 savings per month for magazines and at an average of 3 books a month ($12ish each paperback in Canada) that brings an estimated $76 per month I can allocate to a more worthwhile source, like paying down debt. Add that to the saving of the 2 subscriptions and that puts me at a savings of $967 ish per year!!

Amazing how things add up.

two things

Firstly, I guess this goes under 'unexpected expenses'. After seeing the DR yesterday I needed antibiotics for an infection. It came to $45, but with my health plan, I got them for $27.03. Yeah health plan.

Second, as I checked my Mastercard status online this morning I see that I was charged $90 for the annual fee for my airmiles MC. I phoned to see if this was negotiable but it is not. I debated the plan I had. Gold status costs $90, and you get 150 bonus miles and 1 mile /$15 spent. Silver is 100 bonus miles plus 1 mile for each $20 spent. Bronze gets no bonus miles and you get 1 mile /$40 spent. After a long talk with myself I decided to lower my status from Gold to Silver. The money spent/mile isn't all that different and the bonus miles are just upon sign up I believe (hmmm I should check that out). I am trying to save miles for a one day trip so I decided to change my plan to Silver.

They credited my account back the $90 and charged only the $35. I felt better about that.

Thank goodness I read my statement.

Oh moneyo Oh moneyo wherefore art thou?

So I began going through the last two months of bank statements. That is all I have kept. bad me. It's been interesting to see it all on a grand scale. I can go through it and clearly see how many times I filled up on gas, went for groceries, hit Walmart etc.

I've never really been a bank statement reading kind of gal. I guess deep down I just didn't want to know.

I went through, dividing things into categories such as mortgage, loan, fuel, utilities, eating out, groceries, boys, personal etc. Doing a bit of math showed me what percentage of my net income went towards each component.

It was frightening to see how often we eat out...how often I go for groceries (just a few things here and just a few things there), how many purchases were made in a day etc.

I learned our food bill is easily 20% of my income. Utilities, phone, satellite are 11%. Mortgage and loans (vehicle and personal) is 30%. The boys' activities fees and roadtrips runs about 10% on average. Fuel for vehicles is 14%. Beyond that is insurance, household supplies and a myriad of other smaller things.

I learned that having two different accounts with him paying some of the bills and me paying the rest, makes it harder to keep track of things.

I learned that the ATM cash withdrawls make it harder to track where that money is going. I am keeping track starting June 25 but that is not something he is willing to do.

Having only one of us on board with the need to keep track of expenses and get down the debt makes me feel very isolated. Bringing it up is not possible as that is a huge trigger for disagreement in an already tenuous relationship.

I view this as a learning experience and perhaps through my own growth and change the other half will see the benefits.

But I am excited about empowering myself with basic financial knowledge. Already I see things I need to modify on the budget, which I accept is a work in progress. The budget is for my net income only, to start with.

Getting Started

We've only just got started.

We've only just begun.

Well, I'm left to complete all the things

that we need to getting started.

by No Doubt

I think the biggest fear for those new to getting in touch with their finances, is the whole process of getting started. It's very overwhelming, unsure of what one needs or where to begin. The Keep it Simple philosophy probably works best for the majority of newbies.

Here's what I chose to get myself started. Did I make the right choices? I guess we shall see.

• I bought a rubbermaid storage tub designed for finances and a set of file folders to match. It's a good place to hold my receipts, keep them organized and less frustrating to fight with than the accordian folders. Now the trick is, to use it, use it regularly, and make it a logical system that works for my needs.


• I set up a 'guestimate' budget document on my computer to allocate where the money MUST go and where it should go. Some of the areas were a bit vague such as groceries. I slotted other things in first such as the loan and utilities as those numbers are much more finite. After about three months, say the end of September, I want to be able to make these grey areas more precise.


• I set up a spreadsheet to enter in the final numbers each month for all the categories. I am sure this spreadsheet will be modified and adapted in the coming months as I make it work for me. Come January 2009, it should be where I need it to be.
• I bought a small notepad which I can carry with me and write down every expense, the date, and where I bought it. This will help more at the end of the pay month so I can see exactly where things are going. I am sure I am in for one heck of a surprise when I figure things out.


• I gathered together the few bank statements I have and organized them. Ok I am bad for this. I open them. Sometimes. I take out the cancelled cheques which I know I might need to keep for reference later and I shred the rest and bye bye it goes. I managed to find May 18th and June 19th. That's all I have. sad hey?


• I check my bank account online each day to make sure I keep up with the expense book and to be sure there are no surprises.

That's it to start with. Here goes nothing!!

Little Steps

I am not sure how many of you out there have a good recycling program which pays. Granted we should be recycling on our own for the good of the environment, but our province charges an enviro fee which, if you take the empties back to the depot, you get most of it back.

My area is pretty good at being environmentally friendly and at using the depot. I noticed though when we had our guest from Quebec, that he, nor his classmates thought twice about throwing the empties into the trash. It makes me wonder whether if recyling is prevalent there, or if, their higher socio economic status, makes it 'not worth' the pittance for the money back.

It was busy there this morning at the depot but after a bit less than 30 min, I made it through the line. Net money - $20. Was it worth it? depends how you look at it. I will tuck that $20 away and put it towards a lump sum payment on my loan, which is a good thing.

I had no time rush so waiting wasn't a big deal. Would others wait? some yes, some no, to be honest.

It's only $20 but then again if I found $20 out of the blue, I would be happy....so I'll count it as a good thing.

Of course when one eats out later, it makes me realize the right hand doesn't always agree with what the left hand is doing. I will have to work on eating out and a grocery budget that will work after summer vacation is over and we're back to school.

My heart skips a beat

It was a very topsy turvy day and as I was going through everything I was laughing to myself wondering how this would affect my budget and blog.

What began as an oil change turned into a possible transmission failure which basically would have meant a new vehicle would be needed.

Long story short, it was only a $200 repair (and oilchange) needed and not a new transmission, but knowing I would be needing a new vehicle in the next year or two, I looked over a few and did some pricing.

It came down to almost $500 a month for 6 years. Insane hey??? Lordy that just seems like so much money for so long a period a time to get a year old minivan which would have the space and seating I need.

Given I already have a loan I am paying, there is no way to see myself paying that kind of cash for that long.

I went through so many emotions today...dread over cost to elation over a new vehicle to the crashing reality of not being able to afford it.

So for now I'll have to cross my fingers that this one doesn't fail and continue to work at paying down the loan as fast as I can.

Today was a good example of unplanned expenditures. How does one prepare for them??

Keep the change

Today I delved into the change jar to wrap a bit. I've always loved doing this, even as a child. When the loonie first came out in Canada, I kept each one I got as change in a big bottle and used that money to buy my wedding dress. That was one of the best long term savings I've ever done.

The change doesn't add up as fast as it used to. Not as much of it with the debit card usage going up, and using my change for coffee or such.

Nevertheless, I welcomed the familiar comfort feeling of rolling. There wasn't a ton of it. Around $50 to be precise. It's all tucked away in a drawer. I'll do another rolling in a few months, hoping to get around $100 total and then I can take that to the bank and put a lump sum payment.

It won't rock the world nor wipe out the debt, but it will be a good habit, a good feeling and a baby step in the right direction.

Redid Math....scary stuff.

I thought a lot about my post yesterday. Text wise it was tiny but information and repercussion wise, it was overwhelming. Firstly I had the final amount wrong wrong wrong. I had it only in the 60s but that was way off and even without the numbers before me as I drifted off to sleep, I knew it was wrong. Yup. Into the 80s.

That's a really scary number. Now granted about half of that is mortgage and that is a different kind of debt. The loans and credit cards are scary though. Very very scary.

We can make our payments and we still have 'living room' but oh how different things could be if we didn't have this debt.

Add to that I will need a new vehicle within the next two years (with mine being worth nearly nothing in resale), no retirement funds and no college funds for the boys....sigh.

I can't redo the past but I guess I can start now and work it better for me.

Where the debt stands

As of July 1st, 2008

Mortgage - $44 537.19
Consolidated Loan - $15 625.24
His VISA -$2780.41
His Truck Payment - $18 015.38
Bank of Mom - $1500.00

Total Debt $82 458.22

Debut

I've been reading debt blogs.....errr....'personal finance blogs' for a few months now. I've been TRYING to create a workable budget for years now but it's nothing I seem to be able to stick with.

Am I horridly in debt? not as bad as some of the blogs I've read, more in debt than others.......so yes the debt is there and needs to go away! I'm a high end of 30s mom of two, married and really wishing that I could make the money work smarter for me.

We are a separate account family which works but does not. This status won't change but perhaps how I can allocate the money can make things run smoother for us. Money is always an issue....quite unhealthy to be honest but that would be the focus of a whole different blog :-}

My goal with this blog is to perhaps create a venue for expression, reflection and change.

Time for organization, control and change (no pun intended) .