Friday, September 7, 2012

Budgeting and setting goals

Inspired by my cousin, who runs a household of 5.5 kids in Southern California, I thought it might be a good idea to start paying more attention to our budget.  Okay, to have a budget at all.  And then we bought a new car.  It couldn't have been timed better.

I'm linking up with Frugal Friday!!

Last month we wrote down all our spending and kept a running list on the fridge.  We also included a (much shorter) column for incoming money.  This list didn't include bills or paychecks.

Yesterday, I did some math and here's what I learned.

We tried to keep our spending (other than bills) to $800 for the month.  We went over that by just a little, which I was actually pretty impressed by since we weren't really paying that much attention or trying to save money too much.  (Plus if we hadn't bought a new car that costs $60 to fill the gas tank, we probably could have stayed within that $800 limit.)  But most of that spending, 78%, to be exact, went to groceries.  This included spending at Target, because mostly I buy things we need at Target... like diapers, dish soap, or baby food.

1. We spend a LOT of money on groceries.  I could probably cut that down a little just by paying closer attention to things.  I'm not ready to jump on the coupon train yet (I don't have the time or the energy between taking care of Sadie and being pregnant), but I can buy more generic brands.  We are also going to try to be better about making a menu and using stuff that's already in our cupboards.  We kind of fell off the wagon when I got pregnant, and I truly believe making a menu helps keep your grocery bill down.  I don't want to spend more than $550 on groceries this month.

So, then I went through our bills and wrote all those down and added them up.  We had a lot of random bills this month that aren't recurring, but I kind of think we're gonna have a few of those every month.  Buying a car didn't help with that.  Plus we paid for Yuri to get neutered this month.

2. Our electricity bill is TOO HIGH.  A few months ago I signed up for this plan where electrcity is more expensive between 3:00-6:00, so that other times of the day it is cheaper.  So, I've been really trying to turn the AC off during that time and "powering down" everywhere else.  We don't start dinner until 6:00, and last month we saved $40-something and this month it was over $50.  The problem is that we don't have a programmable thermostat, so I have to remember to turn it down at 3:00 and I don't always.  So, this month, I'm going to set an alarm on my phone to remember to turn off the AC at 3:00, and all other times of the day, I'm going to set the AC to 80 degrees, instead of 78 degrees where it's been always.  The goal is to get that electricity bill under $200 this month...which will be our last hot month since in October things start cooling down.

We had to finance a bit of the van, luckily though, not as much as we put down.  And we got a REALLY great interest rate, considering our credit.  Our car payment is $300-something a month, but we really want to pay it off in a year, so our goal is to pay $1000 on it each month instead, which is basically what we were trying to save each month in order to buy a new car...remember how that came upon us sooner than we expected?

3. We should still be able to put $1000 in savings every month even after paying $1000 on the van.  If we can get that van paid off in a year, we can then start shopping for another new car for Brian.  Basically, my paychecks are going to van-payments, then what's left over + Brian's travel/mileage reimbursement will go to savings.  I can't keep my closet/room/house/kitchen organized, but I have a good handle on my bank account!

4. As you know from last week, I got out the cloth diapers and muddled through them all to find which ones are still usable.  I'm hoping that by using those the majority of the time on Sadie I can shrink the diaper bill.  So, I'm making a goal to not buy any diapers this month.

5. This isn't really a goal for this month, but for October, and maybe not even until November... but we have been buying our Bountiful Basket each week, which is a good deal on produce as long as you don't get 2 heads of cauliflower, 18 chiles, and half a dozen onions every week (who can use those up so fast?!).  Buying through the food co-op saves us money, but in October, the food rescue starts back up and we can get twice as much produce as Bountiful Baskets for about the same price.  We now have a freezer and a Food Saver, so we're going to start preserving, saving, and using what's in the freezer (even if it's all cauliflower and onions).

We feel very blessed that we both have jobs that support us well, we have no mortgage, and we were able to put a LOT of money down on our new van.  Being able to manage money is something that definitely takes practice, but it's a good habit to be in to pay attention to your spending so that you can always be saving.  I would encourage anybody reading this to start writing things down, and look at your spending habits, set some realistic goals, and start saving!! 

Good luck everybody!

1 comment:

  1. I wish we had Bountiful Baskets here!!! And I totally failed in the gardening dept. this year, that helps so much with lowering the produce bill. I'm excited that you are doing it, now I don't feel like such a loser having failed this week. :)