Friday, May 10, 2013

Financial Friday - Refining the Budget

 Financial Friday

Fridays are dedicated to Financial Matters. At the beginning of the year I decided to take the money horse by the reigns buckling down to pay off debt and save for retirement. Every Friday I share a part of what I learned and implemented, whether the outcome was positive or negative, and what I’ve learned.

Refining the Budget

After a couple of months using the money envelopes and doing zero based budgeting, I did have to change my plan. And I do have to admit, sometimes the months just don’t go fast enough because I want to see results. So I have to say to everyone working to change their financial position, this requires a lot of patience.

So some refining areas I have made are to my cash envelopes. I have decided to make “bank envelopes” for items such as gifts, school expenses, car maintenance, etc. I keep track of these on a spreadsheet alloting so much per paycheck. These envelopes are not going to be used each week or even each month and so I thought they were better placed in the bank.

I also decided to move my oil changes and home repairs to the bank envelopes. I was also thinking that I will have limits on the amount of money contributed to these envelopes. For example, home repairs may not happen each month and at times we will need larger sums than the $25 each month. I will play it by ear, but figure that once it reaches $300 or $500 for home repairs and car maintenance respectively, I can move that extra money to debt or other savings. I figure if a home repair is larger than $300, we should be saving for such a repair and over $500 for car maintenance maybe we should look at a new car?? Not sure if this will work, but I figure at least my money will be working for me in reducing debt since I am still in that stage.

How are you attacking and changing your budgets?

1 comment :

  1. Great idea, I am trying to stick to a budget before we move in our new house next April. It is very hard.

    Zero based budgeting is an amazing routine to get in but scary, challenging and sometimes you take away to much.

    Emergency fund is the best choice for me.