Financial Balance

Major Spending Insight

2009-01-23T13:06:00.003-05:00

Latest expenses from the past few days (Sunday 1/18 to Thur 1/23), including my husband's:

$11--Hub's lunch
$36--Hub's haircut
$27--My biz mtg
$130--groceries
$33--gas
$30.78--fleece and socks
$65--wine (incl. for the 'Inaugural Ball' we attended)

Reminder! I'm tracking our daily expenses, not our basic bills. I mean, I'm tracking those too, but they're more or less the same every month (some variation for heat, electricity). The expenses I'm interested in are the extras: the "where does all the money go?" money.

What's interesting is that I thought we were money leakers, falling prey to a cease stream of little purchases. That used to be our pattern, when we lived in NYC.

Now I'm realizing that the money is more like to go in chunks--as for the biz trip. We're chunkers, not dribblers. I have to think of cuter terms.

I would say this exercise has also made me a lot more cautious about spending. Mindful. I have walked away from several purchases--including a package I decided not to mail, because I was going to see the person soon anyway.

Spending spending spending

2009-01-16T17:39:00.003-05:00

Gag. Here are the raw numbers of the last few days. I don't even feel like commenting on my own excesses. Except that I warned myself. I knew this was going to be a slightly over-the-top trip, because a) of the celebratory dinner and b) the unusual amount of time in NYC (which sucks money out of your wallet before you wake up in the morning).

WED

$10—lunch for two
$297—celebratory dinner
$35--office space (daily rental charge)

THURSDAY

$7—lunch
$35--pants
$15--taxi
$9.25--train
$2.50--magazine
.75--tissues

FRI

$14—lunch
$9.25--train
$6—snack
$35--office

TOTAL PERSONAL: $345.25

TOTAL BUSINESS: $130.50

Three days of spending ahead

2009-01-14T09:04:00.002-05:00

Headed out for a biz trip today. I'm dividing the upcoming spending into two categories: expected expenses and possible spending threats. Awareness is key!

EXPECTED:

Need to pay for meals, including taking friends out to dinner to celebrate their engagement.
Travel expenses (trains, gas, subway fare)
Clothing--I need a couple of things for my work wardrobe (black pants, winter shoes), if I can find what I need at a good price.

POSSIBLE THREATS

Being in NYC means shopping opportunities galore. I was talking to Greg Daugherty recently, a Consumer Reports money analyst, and he was saying the best way to save: Stay out of stores!

The Oops! Factor

2009-01-13T12:03:00.004-05:00

OK, this is the upside of spending tracking--once you get into a rhythm, it's pretty dull, which can be a nice change from the stress of watching the greenbacks fly. but there's a downside. Here's where you run the danger of losing track of little things.

My husband spend $30 at the hardware store the other day, on top of the $14 at the grocery store. But because DH (a.k.a. dear husband) does most of the shopping--and ALL the bill-paying-- I have to rope him in.

I haven't spent a dime in the last few days (it was so cooooold last weekend we didn't go out). But we got an oil delivery and some wine in the last week--not sure what those things cost, and I have to track them down, in addition to any other bills that he might have paid (or gas for the car).

Last: Another biz trip coming up this week. A friend's book party. Another friend's engagement--and I'm taking them out to dinner! These are the unexpected expenses that one often wants to disregard ("How often does that happen?"), but ya gotta.

Why? Because every month there's something. That's why I have a special branch of my ING Direct savings account labeled "necessities", i.e. those out-of-the-blue expenses. I put $50 a week into that account, and then empty it periodically--when we needed a new snow tire, or have to take a newly engaged friend to dinner.

Weekend spending warning

2009-01-10T13:51:00.002-05:00

Weekends can lead people to go a little crazy, because you're running errands and meeting up with friends or taking the kids out. To make this monthlong exercise a little more fun, I'm going to make a point of keeping a separate tally of just our weekend spending. Household bills aside, I bet we do 70% of our spending on Saturdays and Sundays. Let's see how it turns out.

Today my husband had to pick up milk, etc. at the store--and our sink is leaking so he had to buy a spud wrench, whatever that is, and some plumber's putty. He said he kept the receipts, but the only total he remembered was the groceries: $14-something. I thought that was funny: I guess we're so accustomed to tracking our grocery spending, we always file away that number.

Why do I keep spending?

2009-01-09T11:30:00.003-05:00

It's amazing when you think how much money living requires. Just these constant dribbles here and there.

This week I had to take a short business trip; luckily a friend was driving in the same direction so I only had to buy a one-way train ticket. Because I'm tracking my spending IN PUBLIC, it has made me even more self-conscious about spending. I talked myself out of several purchases on this trip and my total for 1/7-1/8 was $80.24.

Interesting what you can talk yourself out of. My glaring weakness is food--about $50 of the above was for meals and snacks during the trip. I was about to buy a $7.00 sandwich, reconsidered when I considered the shame of blogging such an expense and made do with a slice of pizza instead.

Then again, I was set to spend no more than $20 on dinner, but I ended up eating with the friend who was kindly putting me up at their house: $40. They picked the restaurant. But I agreed, right? How much control do we have? A lot, when you think about it. The trick is exercising one's right to be frugal.

Still, I was about to pay $35 to use the rent-a-desk place where I sometimes work on these trips--and wisely decided that paying $3 for coffee and a bagel and working in a cafe was just fine, thanks. See, I'm not all bad.

Insight #198

2009-01-07T17:11:00.002-05:00

I've done this exercise before, you know, being a money writer and all. But I've never done it in public, nor have I chronicled my thoughts during the process.

It's different. The one thing that struck me the other day, after tallying up the $217--or was it $271?--anyway, one of the most valuable aspects of spending tracking is getting a whole new perspective on your way of life. We don't spend in isolation, right? We live a sort of life that includes or is based on a certain pattern of money usage.

For example, we have one view of our financial selves and behavior that we carry around in our minds with all the other self-definitions: I'm smart, I'm a pretty good mom most of the time, I don't spend that much on myself anymore, we're pretty good savers now, I should probably floss more often, etc.

But the person you believe you are could turn out to be quite different from your Real Financial Self. I found myself saying, "I don't really go out to lunch"...but in fact--I WENT OUT TO LUNCH. you know what i mean? People who genuinely don't go out to lunch would have said to their friend, "I'll meet you for a coffee." But I said, Sure! Because life is dull and it's January--but then I spent $19 (because we got dessert too) AND i bought my husband a hat and my son a shirt. On sale, but still.

See, that's the other thing: Once you start spending, it's harder to stop. It's called the "shopping momentum effect," if you can believe it, and actual academics at Yale (yes, Yale) have studied it. Let's all go to Yale. I could do a killer research paper on the Makeup Acquisition Complex.

Insight #197

2009-01-06T07:27:00.003-05:00

See, this is why I secretly love tracking what I spend. It's annoying, yes, but that's not really due to the tedium--but rather being constantly exposed to one's financial self. Painful but oh so informative.

Money is tight. Work is uneasy. The economy is ailing--we haven't even begun to see some of the fallout. If 2008 was the Great Unraveling, 2009 is going to be the Great Reckoning.

For my family, the absolute top priority right now is building up the saving account we have for emergencies. How are we going to substantially increase what we save? By tracking what we spend and noticing all those spending blind spots and reining them in.

Right now, in addition to retirement, we save about $400 a month--$200 for unexpected expenses (like car and house repairs) and $200 for emergencies (like an accident or job loss). It's not nearly enough, when you consider all the hidden expenses of life. Just recently some serious cracks appeared in the exterior of our stone chimney; some rocks fell into the gutter and the garden. Chimney guy says it could cost about $2,500 to fix!

I'm convinced that we overspend on groceries and all sorts of little things--this month is when I'm going to hunt down all those excesses and kill 'em! Like some financial version of Warcraft (do I have the right game?).

So as you monitor where your money goes this month, stay in touch with your own greater goal. How are you going to use this information? What do you want to accomplish? This shouldn't be an exercise in self-torture, but plotting ways to make your life better.

And...We're Off!

2009-01-06T06:42:00.002-05:00

OK, here it is, Tuesday AM and I haven't posted my spending yet for the weekend. Have I mentioned that tracking what you spend is THE Most Loathed and Dreaded Task on Earth? This is why. We are all chickens. I am a chicken. And I want to be perfect.

My plan for this entire month was to post how little I spent each day. Hah! Of course, that's when fate sends you to restaurants three times in two days, and a wee sale at the adorable kiddie clothing store in town, when you almost never (ever) eat out! Or shop! (Yes, you are watching a personal finance writer try to pass the buck to Fate. Pathetic.)

On Saturday, in a final round of holiday obligations, we spent:

$32.08 on brunch with my dad*
$19.02 on gas
$65.00 on a holiday dinner party at a new local hotspot (You know, I live in the Catskills. If someone invites you ANYWHERE, you say yes.)
$54.65 on groceries

*Please note strategic mention of parental unit, to alleviate spending guilt.

Then, yesterday, in a fit of Monday/post-holiday/deep winter blahs, I went out to lunch with a friend (and hit the kiddie store):

$19.00--lunch
$27.98--hat for DH and shirt for DS

It's only January 6, people--six days into 2009, 299 left to go--and we have wantonly frittered, lunched and brunched away a total of $217.73.

Ready, Set...

2009-01-02T17:15:00.003-05:00

Step one: Why bother tracking what you spend if it's the Most Dreaded Task on Earth?

Here's my answer: Because I CAN'T BELIEVE HOW MUCH WE SPEND (we being my husband and I), and I want to cut the fat so we can save more. You may have your own reasons: Maybe you're saving toward a goal, you want to get out of debt, or maybe you just want a greater sense of financial control.

The best way to get that peace of mind is to make sure you know where your money is going and why.

NOTE: The point is not to feel guilty or ashamed! No, no, no. The point is that once you notice--Omigosh, I always get $30 cash back at the grocery and god knows where it goes--or Holy pork fried rice, Batman, who knew we got takeout for the kids 5 times a week!--you can start making more conscious choices.

Maybe takeout is smart because it saves on time and sanity. Maybe not. But until you notice your personal money quirks, it's impossible to make changes.

Step two: There are various ways to track what you spend. I encourage you to employ whatever method suits you, be it an Excel spreadsheet, an envelope in which to keep all your receipts, a notebook, your iphone--or simply posting your daily expenses here the Financial Balance blog with me.

If you hate the tedium of any sort of record-keeping--and you're comfortable with online banking--try using Mint.com, a free budgeting website that downloads your bank transactions securely.

(If you don't want to share your actual spending, you can still post your experiences this month--and I hope you will!)

Normally, I'm a pen and paper kind of gal. I've had the most success keeping an envelope in my purse where I can stow receipts; if a purchase doesn't generate a receipt, I jot it down on the envelope itself. Luckily, now I have this handy blog, so I will post my daily totals here.

I plan to track everything, including bills, groceries, gas, miscellaneous--and share my own insights as the month progresses.

Today's total: $7.75

Welcome to Financial Balance!

2008-12-19T16:27:00.002-05:00

Finally, it's 2009. Phew! Wipe the dust of 2008 off your feet here, and let's step into a whole new year.

Starting on January 1, I'll be tracking my expenses--yes, my actual personal and household spending (which includes one husband, a two-year-old, two cats and moi)--in order to get a better grip on where all our money goes.

Where does it go? There are so many ways to ask that question: Where does it GO??? Where DOES it go? WHERE does it all go, for pete's sake?

The only way to find out for sure, and learn all kinds of fun things about yourself and your money that you didn't anticipate, is to monitor what you spend for a week or two or four.

Little-known fact: Tracking spending remains The Most Loathed Task On Earth!!!! Thus making it even cooler that we're doing it together. Right? Stick with me and I'll help you clean out the garage this spring. (That would be Most Loathed Task #2.)