Monthly Spending Expenses

I wanted to follow our Monthly Budget with a breakdown of our monthly cash expenses.

Listed in our Monthly Budget is our living expenses (*), we pull cash out every week and keep it in an envelope size accordion file. Each main category listed here is one envelope that holds that weeks cash for that expense. We then pay cash for ALL of our day to day things. The only time we don't use cash is when we pay bills, which we either pay online or by check.

This is a great tool to keeping us on track with our money makeover because it makes us more aware of exactly how much we spend on items throughout the month. We also do not carry our debit cards/checks/credit cards because it becomes all to easy to just use your card when your purchase runs over the cash you have on hand or you want to “splurge” on a larger item.

Below is an idea of how we budget our living expenses each week. (Keep in mind that we make changes as needed depending on the events of the month but we try to keep it as close to this as possible.)

Monthly Spending Expense Breakdown:

Grocery:	$100.00
Produce	-$10.00
Dairy	-$10.00
Meat/Poultry	-$15.00
7 Dinners	-$35.00
7 Lunches	-$10.00
7 Breakfasts	-$5.00
Toiletries	-$10.00
Snacks	-$5.00
END TOTAL	$0.00
(Roll remaining…)
Restaurants:	$20.00
(Roll remaining…)
Gas:	$20.00
(Roll remaining…)
Medicines:	$10.00
(Roll remaining…)
Clothing:	$10.00
Kids Clothing	-$5.00
Adult Clothing	-$5.00
(Roll remaining…)
Laundry:	$10.00
Dryer Quarters	-$10.00
(Never have any left.)
Baby Care:	$10.00
Diapers/Wipes	-$10.00
(Roll remaining…)
Cosmetics/Ect.:	$10.00
Hair Care	-$5.00
Personal Items	-$5.00
END TOTAL	$0.00
(Roll remaining...)
Jason's Work Food/Drink:	$12.50
(He gets reimbursed when he purchases food & drinks at work but we budget it in at the beginning of the month.)
Entertainment:	$10.00
Netflix	-$10.00
(Netflix is a once a month fee. On the other weeks we keep it simple or roll the money to the following week so we can use a bigger amount for entertainment.)

We have a couple expenses (**Oil & Repairs & **Dr. Visits)  in our Monthly Budget that we do not pull cash out for but rather we put it straight into savings, this way we have it ready for when one of these needs arise.

Full Monthly Budget

I was recently asked to give a breakdown of our budget. Like I mentioned in a previous post, Jason and I sit down together to hand write our budget every month. We allocate our money to each category. It is a freeing feeling to “tell” our money where it is going to go each month, rather than it "telling" us.

We use the worksheets copied from the back of Dave Ramsey's book, "The Total Money Makeover". Below I have made a chart that is based around the worksheets from the book. I began by listing our pay periods, then our income, followed by all of our outgoing bills, debts and living expenses. You will notice that each column's balance is zero...that is part of telling our money where it will go/belongs. (Side note: I’ve compiled our debts into two small categories rather than listing them all separately.)

Pay Period:	1st	10th	15th	20th
Income:	$2,736.31	$875.00	$2,736.31	$1,122.94
Housing:
Rent	$1,300.00
Mortgage	$342.25	$875.00
Utilities:
Utility			$160.00
Cell Phone			$200.00
Internet/Cable			$100.00
Food:
*Grocery	$200.00		$200.00
*Restaurant	$40.00		$40.00
Transportation:
*Gas	$40.00		$40.00
**Oil & Repairs	$20.00		$20.00
Car Insurance	$113.16
Clothing/Laundry:
*Kids/Adults	$10.00		$10.00
*Laundry	$20.00		$20.00
Medical:
*Medicines	$10.00		$10.00
**Dr. Visits	$10.00		$10.00
Personal:
*Baby Items	$20.00		$20.00
*Cosmetics/Ect	$20.00		$20.00
*Jason Work F/D	$25.00		$25.00
Recreation:
*Entertainment	$20.00		$20.00
Debt:
Credit Cards & Loans	$545.90		$1,029.44	$175.00
Car Payment & Medical Bills			$811.87	$947.94
Final Balance:	$0.00	$0.00	$0.00	$0.00

*I’ll follow this post with a breakdown of our monthly cash expenses.

Baby Step 2: The Debt Snowball

Moving into the new year brings a new baby step for us! We've put our $1000 into savings...it took longer than we had anticipated but we are ready to move forward now!

For those of you that haven't read Dave Ramsey's books (which I highly recommend!), this second step is all about paying off debt. You write down all of your debt, excluding your house, in order...smallest balance should be your number one priority. You don’t worry about interest rates unless two debts have similar payoffs. (If that’s the case, then list the higher interest rate debt first.)

"The point of the debt snowball is simply this: You need some quick wins in order to stay pumped up about getting out of debt! Paying off debt is not always about math. It’s about motivation. Personal finance is 20% head knowledge and 80% behavior. When you start knocking off the easier debts, you will see results and you will stay motivated to dump your debt." Dave Ramsey

We've listed our debt in order from smallest to largest. Here is how it breaks down...

1-Reliance Urgent Care: $151.34
2-Sam's Club Credit Card: $309.44
3-Mercy Medical: $1,052.90
4-My Parents: $3225.00
5-American General: $4518.46
6-Wells Fargo Credit: $5000.00
7-Chrysler Financial: $26,371.32

(This does not include our house. We do hope to sell our house but if not we'll have a step for paying it off later on down our Total Money Makeover road.)

Now starting this month we will be putting as much as we can towards paying off the smallest debt, while paying the minimum on all of our other debt. Jason and I have already made our budget for the month which includes paying off our first two debts! Yep you read right...we will be writing a check to Reliance and Sam's Club Credit for the full balance we owe!! Then we get to close our Sam's Club Credit account and put that debt behind us!!

In February we get to roll the minimum payments we were paying on those first two debts to the third debt, my parents, along with the payment we've been paying them monthly. That should triple the payment we have been paying, which puts us paying the third debt off completely in April!!

See the snow ball effect working here?!? I do!! **Note the squeal here!** I've been waiting for this step and now that it is here I can already see the difference it is going to make in our lives!

I will give updates as we pay off debt during this second Baby Step.

Update for the New Year!!

It has been several months since I have written an update for our Total Money Makeover Challenge, sorry! Life has been busy since Ryan started school and I have been working to get a MOMS Club chapter started in Midland. With today being the first day of 2011, I figured there was no better time to fill you in on the last few months...

...We have been sticking to our monthly budget and we pay cash for everything but our bills!! We sit down on the first of every month, write it all out, allocate our money to each category, and then put our plan into action. Now of course we've had a few unexpected things come up that we hadn't budgeted for...we've had a few doctor visits, extra things needed for Ryan at school, etc. However after tweaking our budget a little we've been able to make it all work without putting ourselves into more debt. (Which I must say isn't easy when you know how easily you could just get a loan or borrow money.)

...We've put $1000 into savings which means we have officially completed Baby Step One! (See my earlier post for more info on how we got this started.)

...We are now working on Baby Step Two! (I'll have a post about this next!)

So we are still on track with our Total Money Makeover!! Actually Jason and I ran some numbers yesterday and realized we could be debt free (except for our house in Farmington but we hope to sell it this spring) by January 2013!!

Now some may think that date seems really far off, for us that means we have two years to pay off all of the debt we've accumulated in 7 1/2 years. We realized that if we meet our goal of Jan. 2013, at that time we will have been in debt for 10 years!! That is 10 years too long!!

Seeing this goal date to being debt free has made us really "gazelle intense" about saving every dollar we can to put towards being debt free! Our goal is to meet that January 2013 debt free date but we are really challenging ourselves to push that date up as much as we can!! This has given me some personal challenges...I am going to start selling our left over yard sale items on craigslist/local baby sale/as well as holding another yard sale AND pushing myself to save more on groceries using coupons w/sales.

Now it's time to put our plan and goal into action!

Follow Up: Our Yard Sale!

Well after a rocky start our yard sale ended up being a success. We had forgotten to get change on Friday and we had to drive to several stores before we could get change for the yard sale. When we finally arrived to start setting up we only had a half hour before we had advertised our sale would start. Needless to say people started showing up while were still setting up but they were patient with us and stuck around until we go it all out.

We had a steady stream of people coming through all day from 8am to noon. We ended up making $145.70! Which wasn't bad, especially being that we didn't spend much time planning it and getting things ready. We managed to sell half of the stuff we had taken and plan to hold another yard sale at the end of Sept. or first part of Oct. when the weather is cooler here.


Here are some pictures of our little helpers/salesmen! They did so much to help us and we rewarded them with donuts!! (The last picture I took just before we cleaned up, so we had double the stuff you see there.)

Baby Step 1: Save $1,000 Emergency Fund

With our budget in place we are ready to start our Baby Steps to get on our way to being debt free! We are almost half way through the month and our budget is serving us well. I already have much less stress because we are now telling our money where to go so I'm not worried about how we are going to pay our next bill.

We are now working hard on our 1st baby step. We need to do everything we can to get $1,000 fast for our starter emergency fund. We have used the last two days to go through our very full garage. I am happy to say that we have were able to go through the entire garage in a total of about 5hours!! And to make this even sweeter, at least 1/3 of the stuff in the garage has been set aside for our yard sale that we are holding tomorrow!

Not only are we hoping to help start our 1st baby step with the money made from the yard sale but we are clearing a huge spot in our garage so it will be easier to get to things, get what we need out, etc.

We aren't sure how much we'll make in our yard sale tomorrow but we are feeling optimistic. Send us some good, selling vibes!!

Envelope System

Jason and I sat down tonight to write out our budget for the entire month of August. This proved to be no easy task. Actually it took us a little over 2 hours, we are exhausted and ready for bed but there were no arguments and we both completely agreed on the budget!

Now with this being our first written budget in several years we understand that we will have to work with it over the next several months to get it perfect but we are pleased with how our first budget came out. We started with each pay check Jason receives this month, then we "spent every dollar on paper before the month has begun".

To help us save as much as possible and stretch every dollar as far as we can we've decided to use the "envelope system". We have an envelope sized accordion file (bought in the Target dollar isle for $1) with seven envelopes inside. Here are the categories we have: groceries, toiletries (this includes diapers), clothing, gas & oil, laundry, dining out, and entertainment. I will be going down to the bank in the morning to withdrawal the exact cash to put into each of these envelopes for this week. We'll do this with every pay check Jason receives from now on.

Now like I mentioned before I have been couponing for almost a year now. During that time I was able cut our grocery budget in half and eventually in half again! Since moving to Texas I've been slacking a bit so I've made it my personal goal to spend no more than $80 a week on groceries. (Last month I was able to spend $200 less than June on groceries!) Hopefully I can meet this goal and challenge myself more in the coming months.

While couponing I have came across many great coupon blogs with so many great ideas, tips, and information. My two favorites are www.myfrugaladventures.com and www.couponingtodisney.com. Last month I noticed a post on the Couponing to Disney blog that caught my eye. She was challenging everyone to go an entire month without eating out or cutting your dining out bill by 20%, 50%, or 70%. At first I was just going to do the challenge so I could enter us in the giveaway she was having but then I realized that this was exactly what we needed because we would held accountable for our dining out choices. We were able to cut our dining out by 52% last month. We plan to cut that in half again this month plus I am challenging myself to try cooking some new meals for my family and use everything I have on hand here at home before running out to the store.

SIDE NOTE: The biggest thing that has helped us cut our dining out expenses was making a list of 7 to 9 meals that we have all ingredients to make. Posting that list on the fridge on Saturday or Sunday to use for the week. Then throughout the week I can look at the list in the morning when I'm feeding the kids breakfast to decide what we'll have for dinner. If I need to pull meat out to thaw or put food in the crockpot for that nights meal, I can do so right then. Later after the kids naps I can prepare dinner and there is no debating on what we should have so we are less inclined to run to the local fast food place to pick up dinner. I also try to use every last bit of everything I make...for instance tonight I made chicken burritos. I will use the left over spicy chicken in the quesadillas I am make later this week that I'll serve with a crockpot of pinto beans. I also allocate one night towards the end of the week (normally Thursday or Saturday) to have left overs. The boys have big appetites these days so sometimes leftovers also include cold cereal or mac and cheese. ;-)

With our budget written and our envelope system in place we are ready to put away the debit cards, cut the credit cards, and get down to business!!