I want to start by thanking everyone for the kind and supportive words from my last post "It's Ok to Fail." I know it was more of a slip than a failure, but the title wouldn't have as much impact with "It's OK to Slip" :) Seriously, thanks for the encouragement. Saving money means a lot to me, along with financial security which go hand in hand.
I am back on the horse, I took Dimples' advice and I am trying the budget thing out. I normally don't like budgets, I try to just be as frugal as possible. I feel that budgets tend to be too restrictive and you start to feel controlled by the budget after a while and you end up throwing it out the window like a child fighting against his parents. But I'll give it a try to see if we can supercharge this horse and get him running down the track a little faster.
Anyone have any opinions on budgets? Good or Bad? Do you use them?
I tried to break down all the categories after necessities (Rent, Car Insurance, ConEd, etc), these are bills you HAVE to pay each month, without question. I included the emergency account as a bill (ING Direct automatic withdrawal) to give it more importance. But then I have like 5 different other categories for my money to go to. Between the saving account for the baby, the 401 K, the IRA, the vacation savings, blah blah blah Am I micro-managing this too much?
Is it better to use general categories like just "Savings", but the I don't really get the detailed picture of whats going where....
See this is why I didn't even want to start :) Just kiddin
Thanks for reading
Love you baby
Labels: Personal Finance
first, if you don't like budgets, call it a "plan" instead. it sounds less restrictive. i have a "plan" (which i usually call my budget.) every paycheck, savings/debt repayment are automatic, then i pay bills, and then i realistically anticipate my expenses based on what i will need/want until the next time i make a plan.
the more realistic i am, the less i deviate from the plan. my plan has categories for different expenses like transportation and food, and the amounts are based on my past spending and whether or not i realistically think i'll differ from it. it helps me keep perspective throughout the month, which helps me overall with pacing, not overspending, and with having enough money throughout the month.
maybe you are micro-managing a little. if you made your deposits to the various accounts automatically, you wouldn't have to think about the savings, it would just happen.
i hope your planning works out!
I do not have a budget. I could not put one together if my life depended on it. This is how my system works.
Every paycheck: Direct deposit into ING savings account, automatic deduction for retirement and healh savings account. The balance goes into my checking account. This amount is then used to pay rent, car payment, student loans, credit cards and living expenses such as gas, groceries etc. Basically, I pay myself first, once the money hits the checking account am free to use it to keep myself afloat till next paycheck. This is key, to not having to dip into the emergency fund unless you have a real emergency.
Another thing I also have started doing is to set up the minimum for each bill into online bill pay. I make sure the dates coincide with pay days. This way no bill gets paid late. The balance of the money is used to make additional payments on each debt.
The key to any system is to pay yourself first. ING has the direct deposit form pre-printed. I did automatic savings through ING for a year, but found direct deposit to be more convenient.
My system is a work in progress.
I hate budgets, I pay myself first and tithe. Then I pay bills and then I do whatever with the rest.
Get a set amount taken out of your check and transfer the $ to a savings acct.
Write down all your bills, highest to lowest. If you can pay above the minimum.
If your bills are higher than your paycheck, start cutting expenses!
Remeber this process does not happen overnight!
Rad - you alright out there? The last time you were this quiet, when you came back you had fallen off a horse. Be easy, man.
Where you at buddy??
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