Use a calculator
Published on August 31, 2008 By Ziggystyles In Life Journals

Yeah, before we have people pointing out the obvious...Im not one to be giving money advice or even budgeting advice.  But advice when you think about it, is a tool.  Most often, advice is a tool that is gained from previous situations.  I like to say that I fail, but I succeed at finding out what doesnt work.  Advice given is something that others found to be helpful and offered as a tool so that others may be helped.  And stuff.


Anywho...Calculators.  Sounds easy...actually sounds dumb.  A calculator should be used in creating a budget, obvioulsy...but it should be used in many ways. 

My first budget was a spreadsheet on excel.  I dont even know why I called it a budget as all it did was show where our bills and debts where.  I had information on: the debts name, how much we owe, any interest, any daily interest, last update, what i paid, minimum payment due...etc.  I had it set up also to create a pie chart so I could see how our money was being spent.  Not a bad start, but in the end, all I was doing was basically recording information on our debt, not making a plan to get out of it. 

The second budget I created...I dont even think I referred to it as a budget but I wrote down our bills as we got them in the mail...then paid them off as we had money, cross it off from the list...etc.   

however, over the past few months, I've found the best solution to be Planning where to spend the money...giving each dollar a job, and making sure that each one is used for either bills, basic stuff, but mostly on getting out of debt, although it can be used for other things after one is out of debt. 

What I do is I print a free calendar from Printfree.com and write down our paydays and what we will get paid.  I get paid every Friday and Marcie, on the 15th and 30th.  So With that in mind....I start crunching numbers with the calculator.  What I do is write down what we got paid.  Meaning if I got paid $1,000...Id write that in the date box.  With that, I know that I have 1000 to spend.  I go and write down our pay amounts for each of our pay days.  From there, I start spreading the bills out.  There are some bills like rent, mortgage, lot rent, credit card agreements, insurance, automatic payments...etc, where I know the exact date the payment is going to process; and I jot them down on our pay day. Second, I go and write down our weekly items such as 100 for groceries, 30 for fuel for one of the cars, partial bike payment...etc. 

Then I start getting more detailed as I write down the rest of the bills such as utilities, phone bills, cable...etc.  I fill them in throughout the month when I have money left over.  I also do it so that Im not late with the bills, outside of our mortgage. 

When Im finished with the week, I add up what we will spend moneywise that week...and then if there is anything left over, I can start planning on how to use it.  For example...lets use the 1k figure.  If I got paid 1 grand on Fridays, and then after all the number crunching for the month was over...I had 850 in bills and money spent that week...Id have 150 left over.  I basically wait until the next friday and any leftover money, I use to pay down a debt even more.

The calculator is just a tool to use to see how you are doing as the week progresses.  You can compare the money in the bank to the bills you are paying that week.  You can see if you will have extra, if you are going to be tight...or if you messed up and are going to overdraft.  This last week, I ran the numbers and felt we had some extra spending money so I sent off a check to pay down our furniture.  The same thing happened the week before last and I sent off 300 bucks.  All together, we have paid down that particular bill 400 bucks just in the past three weeks alone, just by giving each dollar a job.

As each bill is paid, i cross it off so I know what is still waiting to process.  For the ease of budgeting and such, I pay most of our bills online via bill pay or the companies websites. 

I just ran the numbers this morning and if everything plays out how i think it will, we will have one extra dollar in the bank, lol.  However, I know that is also a false showing as well because of the fact that I budged 40 bucks for dinner and a movie which is most likely overshooting it since we are going to matinees so we will have extra for that.  Plus, we dont spend 100 bucks a week on groceries, so there will be leftover from that as well.  And on top of that, we transfer 75 bucks a month over to our money market account automatically so I can transfer that back with no penalties.

In the end, by using the calculator and crunching numbers, and giving each dollar a job or bill to pay...we have paid off 7 debts in the past few months and payed down 1/3 of our furniture in 3 weeks. 

 


Comments
on Aug 31, 2008
"Some couples go over their budgets very carefully every month, other just go over them."
Sally Poplin

"Democrats were quick to point out that President Bush's budget creates a 1 trillion dollar deficit. The White House quickly responded with "Hey, look over there, it's Saddam Hussein."
Craig Kilborn
on Sep 01, 2008

My system is far simpler

Mine's even simpler -don't spend out more than you take in.

That's it!

 

But seriously one more thing: pay yourself first. I have five different savings accounts -one a long term thing, one a retirement account through work, one a deffered compensation plan through work, one a "rainy day-slash- what if" account. Always put a little back in case you need some new tires or something and put into these accounts before you do anything else as if you never got the money in the first place.

on Sep 01, 2008

Always put a little back in case you need some new tires or something and put into these accounts before you do anything else as if you never got the money in the first place.
  I have always found if you can have the money deducted from your pay before you get paid, you don't miss it.  I need to build up a safety fund but I'm very much paycheck to paycheck and survival mode now but I'm keeping myself on a cash only diet.  You can't spend more than you have if you're paying with cash. 

on Sep 01, 2008

little-whip

Now I fully expect you to launch into a long list of reasons why this simple system won't work for you, but it really IS that simple.

Well theres no fun in doing so if you are going to call me out on it.

My plan sounds more complicated than it really is.  I just write what we get paid, then on that same day, I use bill pay or online accounts to pay stuff off / down.  Case in point...we both just got paid on Friday, and when I woke up and found we both had our paychecks deposited...I:

*had auto transfer for a partial car payment

*paid 16 bucks for a medical thing via bill pay, paying it off

*planned to spend 175 for another medical thing, saving 20% if I pay early.

*paid a gas bill online via their website

*paid 100 towards a furniture bill.

*planned for our apartment rent, groceries, dinner and movie, bike repair, bike payment, gas...etc

When all is said and done, we shouldnt need to spend any money for the rest of the week. 

RoyLevosh


My system is far simpler
Mine's even simpler -don't spend out more than you take in.
That's it!
 
But seriously one more thing: pay yourself first. I have five different savings accounts -one a long term thing, one a retirement account through work, one a deffered compensation plan through work, one a "rainy day-slash- what if" account. Always put a little back in case you need some new tires or something and put into these accounts before you do anything else as if you never got the money in the first place.

I agree in the sense where one needs an emergency account / fund.  We dont have one set up at the moment as...we could...but Im focused heavily on getting some debts paid off first.  After I get a good chunk of this stuff out of the way, I can start investing a bit. 

 

on Sep 01, 2008

I dont think there is one perfect plan out there for budgeting...just finding what works and what doesnt work.  The way I do it, just planning on how to spend every dollar and penny we have is working really well so far for us. 

on Sep 02, 2008

Turns out I don't have a system.

I get paid between the 5th and 10th of the month and receive the occasional money for vacation days and bank holidays. (I never figure these into any calculations.)

Rent is paid weekly and the landlord collects it in cash from the flat mondays. I just put the money into the rent book at some point during the week before (mostly Sundays) and forget about it.

Both telephone bills are paid from my main account and are never very high (i.e. usually below 100 euros each). I have no idea when they are deducted.

DSL is paid by a credit card every few months. It's also a mindor expense and I just note that I shouldn't use that card so much during those months.

All credit cards are paid using a separate account. Around the 9th of every month I check how much I spent and transfer an amount larger than that to that second account. For example, if I spent 850 euros using those credit cards, I'll transfer 1000 euros.

The result is a slowly growing account that pays for credit cards.

Health insurance is also deducted from the first account, at some point during the month; I think it might be in the beginning. It's also a minor sum (around 100 euros, I think?).

The electricity board also deducts money from the first bank account.

As do I for food and Nintendo games (or whaver comes up). For any larger purchase I use a credit card. I think this works because using that second account I know how much I spend using the credit cards and have a buffer in case I screw up (I often do).

I was thinking about starting to save money at some point. I am 30 years old.