It has been a few to many days since my last post. I have been spending several evenings working out a better budget because my previous one had some flaws in it. Listening to readers I think I have come up with a better one (fixed vs. variable). This fixed budget assumes I will get at least 2 paychecks a month. These two paychecks should be able to cover all of my expenses. Anything else is a bonus which would go to savings for investing, vacation or to cover unexpected expenses like I incurred this month.
For each month there are certain things that are fixed so those remain. One of the fixed items that sprang into life this month are braces for my son. He is getting older and the longer you wait the harder it is for the orthodontist to move bone. It was a hefty $1,000 down payment and then $145 for the next two years. That is what I owe after insurance. So for July you will see the down payment and then going forward it is a fixed expense. When I have enough money saved up in my Health Savings Account (HSA) I may request a reimbursement. For now it is coming out of my pocket.
Saving is still set at an amount that will cover my car insurance, water and sewer bills each quarter. There is a little baked into this as well for other expenses that reoccur yearly like school fees for my kids.
Where Did It Go?After I added all of my fixed expenses (the needs) there was not much left for guilt free spending money or investing going forward. I will do my best to squeeze what I can from the miscellaneous category (toilet paper, toothpaste, etc.) as that is about the only area I can reduce. Utilities are pretty consistent and we only run our air conditioning on the hottest of days. I would be fine getting rid of TV (but not internet) as I don't watch much. However my family has blocked me on this one. The best I could do this year was renegotiate my package to a lower rate. I got HBO free for a year, a land-line phone and the price went down $15/month. I must admit I am watching more TV than I used to because of HBO.
Food was $56 over budget. I was expecting this to be at least a hundred lower as we ate out for a week during vacation and that was all placed under GFSM category. The price of food is just getting ridiculous. No wonder those with less have a hard time just surviving. My gas budget was under as I did not place the vacation gas under needs. Utilities was under as well because there was no water or sewer bill this month. I wonder if I should not count those 2 under utilities as they are just quarterly and I pay those from my savings. That may paint a better picture. What do you think? Needs gets the big red X mostly because of the down payment on my son's braces. I had not foreseen this so had not saved for it. I was just expecting insurance to pay and then a monthly payment. The remaining categories I classify as needs were close to the budget so nothing worth mentioning there.
Guilt Free Spending Money
Had to give it a big red one as well. Under my new budget I basically have nothing left over to play with. I have hinted at this to the family but haven't shown them the numbers yet. Luckily I had saved for vacation so this category is covered. I also wonder if I should include things like vacation that I planned for and saved. I am not really spending money I earned this month for things like that. What do you think?
So what if there is something leftover? Anything that is will go to investing. I still have my paycheck being split so $200 went into my cash account. This may be stopped since I can't even afford that anymore. This means I may have to look into alternatives that offer no fees for investing. Investing something is better than nothing right?
With $2,893 dollars coming out of savings to pay bills I get the red X award for the month. Granted this was before my new budget but wanted to use it on July to test it out.
Am I OK with this new budget?
I sure am. This is probably the first time in my life I have a budget that means something. I have always had problems in Quicken with their budgeting tool so never really had one. Even my previous budget had to many flaws in it to be useable.
No longer will I spend more than I make each month. As always things change and so will this budget. But for now I have a plan and that puts my mind at ease. Is the family happy with the fact that we won't be able to eat out anymore or go places (that aren't free?) They are but hopefully they will understand and apply this learning. I cannot, I cannot, I cannot go back into credit card debt. Hopefully the family will understand that and as a result be happy knowing they have what they need without owing anyone.