I believe I inherited my mother's lack of money sense. She was irresponsible with money, always just getting by. Unfortunately, I'm in the same boat. I always seem to be "just $10 short" this month or "accidentally" late on a bill. I have tried creating a budget - writing expenses on paper each month, etc. - but failed.

Have you created a budget/idea/trick that worked for you? How do you keep your finances in order?

-- Anonymous, May 02, 2000

Answers

Some time ago Heather and I agreed on a plan. I drew up a chart with room to note month, year, main income - - (two) - -and total of both. some things change yearly so the spaces are left blank. Length of the sheet is divided into columns. First column is checked if the check has cleared the credit union. Second column is the Item (who owed) Third column is the budgeted amount (the normal per month) Fourth column is the actual amount sent in. Fifth column is the +/- column shows how the actual compares to what was projected. (phone bill can really vary, for instance) the last column is check # or debit card and date, room for pertinent comments. I make it on a legal size sheet and have at least one years supply copied. So, after totaling up the knowns, we can see what is available and what should be put aside for emergencies and what is available for birthdays and all and what fun money is left.

By being extremely hard nosed about it I have convinced Heather that we won't Rob Peter To Pay Paul.

Usually the sheet is long enough to add the non budgeted stuff we are going to do and the amounts - - then counting it as budgeted, not to be changed.

Below that is even room enough to make notes on out of the ordinary necessary expenditures coming up in the future.

It is perfect in my eyes, and sometimes gets rolled up and shoved into my peepers. But if followed does make life simpler.

Heather's income does the groceries and some left over for needed things.

Out of my income we each get an allowance and money is put aside for eating out and amusements.

If followed, it works. We do have a bit in a savings accout to take care of unexpected car repair and the things that creep in the night.

Hopes this helps

-- Anonymous, May 02, 2000

I never had much of a budget problem, although last year was kind of hard, but that had nothing to do with me. My boss had made a grave administrative error and the government made me pay for it. Man, did they ever! Everything I earned went straight to the taxman, aside from what I had to spend on luxuries like rent, food and clothing. In the course of 11 months, I had to cough up the equivalent of $3000. It wasn't easy on a paycheck like mine, but it's all behind me now.

-- Anonymous, May 03, 2000

I learnt to budget through bitter experience - I got sick of earning a fairly good salary but always being broke at the end of the month.

I try and pay everything off as soon as the money hits my account each month - mortgage and all the bills, all by direct debit. We used to also direct debit money straight into the savings account, which meant we could blow the remainder with a clear conscience, but lately that hasn't been happening, so we need to get good again.

The best tip budget-wise it to not have credit cards. If you must have one (and they are pretty handy) have an American Express, so you have to pay the whole amount every month, instead of earning a fortune in interest.

-- Anonymous, May 03, 2000

I keep track of my expenses in an Excel spreadsheet. Everything goes in. I also religiously balance my checkbook. If I'm trying to save money, I leave my credit cards at home when I'm out. If I use my ATM card to pay for something (I use it when I do grocery shopping, for example), I record the amount in my checkbook *immediately* upon arriving home. Well, ok, I put the frozen stuff away first.

Because of this, I always know how much is in my bank account. I keep track of bills on my spreadsheet, so I don't forget about paying them. I have a "bills to be paid" basket on my desk where the envelopes go upon receipt.

Bottom line - you have to get anal about keeping track of your money. Once you've got yourself set up, you can relax a little, but be aware (and you probably already are) that things can get out of control quickly.

Good luck!

-- Anonymous, May 03, 2000

I still haven't figured out the whole day-to-day budgeting thing, though I've so far avoided debt by simply not spending money I haven't got. The VISA is for cash flow only - I'm really strict with myself about that. But I'm hopeless at knowing how much I spend on variable expenses like food and movies and clothes and so on.

I've tried writing everything down but I don't seem to be able to remember to do it every day, so my records become meaningless pretty quickly.

What I am good at is saving money. I don't try to put away what I haven't spent at the end of each pay period (there wouldn't be anything left) - I "spend" my savings first. Like a tax. When I got my last raise I arranged for the bank to take that amount off my pay cheque, so every two weeks I'm squirreling away a little money. Every so often I decide what to do with it - buy a new computer, go see my sister in Edmonton, contribute to my RRSP (that's Canadian for 401K).

My bank has a minimum you're supposed to contribute when you do automatic deductions, but I asked them and they waived it for me. I'm putting the money into a money market fund (T-bills in this case) so I make a little interest, around 4 percent. Every couple of months I use it for a long weekend trip someplace or to go towards my permanent savings in my RRSP.

I guess what I'm saying is that you don't have to be at all organized on a day-to-day level to have it together for long-term stuff. Just recognize your own weaknesses and work around them instead of fighting to change yourself.

Joanne
Parietal Pericardium

-- Anonymous, May 03, 2000

For me, budget is pretty simple because I tend to get paid on the split salary -- an actual paycheck, and cash tips. The cash is my entertainment money -- movies, eating out, bowling, whatever. The (larger) paycheck is for the bills and savings. I have an automatic contribution to my IRA from my savings account (so I never bounce a check because I forgot about the withdrawal). I never have to remember to make the contribution, and I don't miss the money, because it's being "spent" on the future.

That's what finally works for me. And I carry no credit card debt beyond 60 days (and that's only when it's really lean).

-- Anonymous, May 03, 2000

I was forced to learn after my husband and I moved to Ohio, I didn't work for 4 months and we continued to spend money here and there without really paying attention. When we realized we had to use our credit cards to buy groceries, that did it. Luckily I got a job the same month and we avoided any real disaster, besides ALOT of credit card debt.

Now we use Microsoft Money, I love this program. It keeps track of when bills are due, and you can categorize all the money you spend and keep track of how much you spend on different things (gas, groceries, gardening, books, whatever) really easily. It also makes balancing the checkbook a million times easier.

I do the bill paying and keeping track of accounts. I did this on the condition that my husband Brandon would give me EVERY receipt he got, for the ATM or for purchases. He agreed, of course, because he hates dealing with bills, balancing checkbooks and all that stuff. We just pile all our receipts in one place and every couple of days I put them in the program.

We also don't use our credit cards at all, except for job expenses that we'll be reimbursed for within a month. Whenever we make purchases we use a debit card that pulls money directly from our checking account. It's great for my husband who hates writing checks and used to spend tons of cash without remembering where it went.

Oh yeah, I also have most of our bills on direct withdrawal from our account, so for the mortgage and utilities, I don't have to worry about sending the check in time.

-- Anonymous, May 03, 2000

I still haven't figured out the whole budget thing, but I would really like to have one. I've got to figure out how to not have a "good" pay and a "bad" pay. The good one is where I get my money (direct deposit rocks), and all I have to do is pay bills and buy groceries. The "bad" pay is rent and bus pass. Once that is done, and a few more groceries are bought, or whatever, I'm broke. I got paid on friday, and I have maybe $50 left. My goal with my next cheque is to put away half of my rent. Then, when the end of the month comes, I will already have half my rent, and I won't have such a lean pay.

I would love to be able to afford to get new glasses, a computer (this one's at work), my driver's license, and a new couch. I'm tired of the futon. Right now, I'm trying to buy pots and pans. My last set crapped out on me (the non-stick coating is coming un-stuck-- in big black flakes). I went to IKEA and picked one up to test it, and I really like it, so I have to find the cash to get the other pieces I need. That means I have to hold off on getting new clothes, which I very much need. Eventually, I won't have to be such a tightwad, but I really want a disposable income. I think I should have pushed for more money when I took this job.

I think I'm doing OK, though. It's my first apartment on my own, which is great, and I've never been late with the rent, had a utility shut off or gone without food. Loonies for laundry can be a problem, but that's about it. I'm not living below the poverty line. I don't have to ask my parents for help. But sometimes I'm scared.

-- Anonymous, May 03, 2000

I learned by making a total mess of my finances, what worked and didn't work.

Now I:

1) Avoid at all costs, using my credit cards, unless absolutely necessary

2) Balance my checkbook regularly

3) Pay cash as much as possible and assign a weekly "allowance" for spending money

4) Discuss all major purchases with the SO, so that we weigh the relative merits of having XYZ over going out to eat more often

-- Anonymous, May 03, 2000

Heather, If you're in debt, get out of debt. Go to http://members.aol.com/r5809245637/032200.html where I wrote out our plan to get out of debt. Once you're out of debt stay out of debt. I also tell how to do that in the next entry. The key is making a budget and 'sticking' to it. Also, like many of the others have said above. Balance your checkbook daily! That way you will always know what you have in the bank. Quicken is a great program for this. Hope this helps and feel free to email me if you have specific questions. We have nice things, but we saved for them.

-- Anonymous, May 04, 2000

If you have debt problems, I can't recommend the following book highly enough:

THE CHEAPSKATE MONTHLY MONEY MAKEOVER by Mary Hunt. (Available at Amazon.)

It's a very inexpensive paperback. While it goes heavy on extreme examples of people in massive debt who got out of it (which can be pretty inspirational, since it's unlikely that your probs are as bad as theirs) -- the basic system of how to get rid of your debt and budget your money so you no longer need credit is so darned simple and effective, it's hard to believe.

Check it out.

-- Anonymous, May 04, 2000

When I was a grad student, I bought an Apple Newton (anybody want a used Newton?), which came with Pocket Quicken. For a whole year, I didn't try to set a budget, but I did try to track every cent that passed through my wallet. I had tried doing this before with pencil and paper, but in all my previous attempts, I had been lazy and gave up after a few months. By sticking to it for a whole year, I could see how much I spent on extraordinary expenses. When I got married, we used those records, and my wife's records and estimates of how much she tended to spend, to set a baseline budget.

Check out a book called The Seven Laws of Money -- I forget the author's name, but he's a banker with a hippie streak. It has good philosophical / psychological / spiritual tips about how to deal with money.

-- Anonymous, May 04, 2000

I'm not in debt (unless you count my parents, but they're in no rush). I never took out student loans or anything, and I don't have a credit rating yet. I would like to get a credit card, but it would be for emergencies. I know every one says that, but I mean it. Or I would use it for a large purchase that I know I could pay off, like a couch. I bought a bed in January, and I did it by putting it on my boyfriend's card and paying him $100 every pay until it was done. I wouldn't do what my friend Martin did, which was get a line of credit as well as a card. The guy's $8000 in debt since he took out the line of credit in September.

I don't use cheques for anything except rent. All my bills are paid over the phone, and if I could pay my rent like that, I would. Telephone banking is great, because it's all done right away, and I know exactly what's left in my account. I try to keep an eye on what's in there. I just need to know how to manage the money that's there now, so I don't end up broke before next pay (like I am now). Interac is evil, but it helps me from overspending: I never carry money. Ever. If I carry it, it gets spent. It annoys the hell out of my friends, but it works. If I'm going out and I don't know if they have debit, I take out money, but that's rare these days.

I think Ikea will be the death of me, though. I have never gone in there and just bought what I went in for. I have to go back next pay for the pots.

Isn't it ironic how most books about money management are so expensive?

-- Anonymous, May 04, 2000