Monday, April 21, 2008

Dolla Dolla Bills Y'all

Justin and I have recently decided to tighten up our financial situation. We used our tax refund to pay off our car and are really not super anxious to get back into debt again. I know, crazy talk right? We've attempted budgets before, but never stuck to them. I realized it was because we would make up these impossibly tight budgets that I would never follow just because 1) I didn't see a reason to and 2) they were just to hard to stay within. I am not a coupon clipper or bargain hunter, I like to just go to the store and buy what I want and pay for it without haggling. So sue me. So this time around we tried a different approach, a "padded" budget. For every item in our budget, we put more than we really needed. We figured that having a larger budget will give us more incentive to save, so that rather than squeezing every penny out of a tight budget, we're using less than our allotted amount each month. So that way, we not only have our savings that we get from having a budget, but we have leftovers in our budget as well, that can be added to our savings.

Here's how it's going to go down. We have three accounts, each serving a different purpose. The Cash Account: This account will be for cash only. When we put a cheque in the bank, we'll take out enough cash to last us through the next two weeks, and put in a file folder that has been sectioned off for this purpose. The cash goes into the folder, and can be used as needed as long as under these conditions: Cash can only be used for the right purpose ie: food money is for food, not clothes. Boo. And once it's gone, it's gone. No taking more out. The Bills Account. This account is only used for bills that need to have a cheque written for them ie: gas, electric, mortgage, whatever. No using this account for fun, even though I would very much like to. The credit card for this account is very shiny and gold and attractive. The Savings Account. Self Explanatory.

What brought this all on? Well, it was an exceptionally frivolous March, where we (meaning I) spent alot of money and had no idea where it went. After going through our accounts and alot of highlighting, we (meaning Justin) figured out that we (meaning I, again) had spend an exorbitant amount of money on things like clothing, crappy food and boredom.

If anyone has seen that show on TLC called I Can Make You Thin, I borrowed a principle from the cool English dude who hosts it. He says that people are fat due to unconscious eating. Instead of knowing what they put in their bodies, they eat without even realizing it, therefore eating more than they need to. I think the same could be said for unconscious spending. I spend money without even realizing it, and therefore spend alot of money on things that I don't even remember spending money on. While we traditionally view the term "budget" as something restricting, I think you can actually spend MORE on a budget, while saving more, because you're aware of where that money is physically going.

I guess I needed to write it out so I'll more incentive to stick to it. I want to increase our savings but not change our lifestyle, and this seems to be the best way to do it. So basically, I want to have my cake and eat it too, is that SO much to ask?


Alisa said...

Good Luck! Don't you love how the husbands blame it on us? it's not always our fault. :) We are budgeting the same way. Once it's gone it's gone. It's worked out pretty well.

designed by