One of my New Year's resolutions was to follow a budget this year. We make about average salaries, have no debt (not even a mortgage) except for some furniture on which we have a no-interest loan, and have three kids. The oldest lives with us and pays $500/month for rent, food and whatever else we give him. The middle child in in college and after her scholarships are applied, her tuition, room and board comes to about $5,600/year. The youngest is in Catholic school and between tuition, after school care and summer camp, she costs us about $6500 per year. We drive old cars but my husband and I carry a lot of liability insurance. Compared to what I've seen other places, I think our property taxes are low (about $550/year on a house that is worth about $180,000) compared to what a lot of folks pay, but our homeowner's and flood insurance is high ($4,300 for homeowners; $700 for flood). Still, I think we should be able to save more money than we are--I think there is a lot slipping through our fingers (and into our mouths is my guess).
This month I made a rough budget, spending all our take-home pay and we agreed to track our spending. I put lines in the budget for the once or twice a year bills and while I may one day open another checking account and transfer the unspent money from each budget over there, to set it aside for those big bills, for now, I'm just leaving it where it is.
Under house expenses, we budgeted for our utility bills, maintenance and "supplies", which is where I put the furniture payment. This month I way under-budgeted for phone bills--I put the house phone/cable bill there but forgot about my college girl's $35/month cell phone bill and I didn't allot anything toward the $100/year each that my husband and I pay for our phones. We came in $63 under budget for electricity and $14 over for gas, which is about right since it is winter. That will reverse in the summer. I budgeted toward the water bill, which, due to taxes we expect to increase this year. However, we are billed every other month so we'll have to wait until next month to see how that goes. I budgeted $100 toward maintenance and repairs, but didn't spend anything in January; however I have a plumber coming February 1. All total, we spent $259 less than budgeted, but I'm not ready to cut this category yet.
The transportation category includes our car insurance, gas, maintenance, and $300 savings toward our next vehicle. We have enough money in the bank for that vehicle; therefore the plan is to invest that $300 with Lending Club or Prosper, and, when we do buy a car, to stop reinvesting the money paid on those notes and transfer it to the bank. I marked the contribution toward yearly fees as "spent" on the budget, even though the money is in my account. The budget called for $150 in maintenance but my husband's brakes cost $516. I budgeted $200 for gas but between not driving much, the low cost of gas and fuel perks, we only spent $80. Still, we were $246 over budget for cars.
We do not include health insurance in our budget since it comes out of our checks before we see them. We do have our homeowners, flood, car and life insurance here. None was due this month but I charged the budget for them, so this category broke even.
This category includes both groceries (meaning everything we buy at the grocery store or all food we buy) and restaurants. We budgeted $1,200 for groceries and $250 for restaurants. This will be a high-expense month as my college girl has been home (and eating). We overspent this category (which was generously budgeted compared to a lot of websites I've seen) by $150. If we need to cut, this is an easy target.
Tuition and daycare are the big expenses here, and there is a $100 "other" because we all know kids cost you money were you least expect it. Our Christmas savings are in this category as the kids are our major Christmas expense. The $1000 for tuition was marked as spent even though no check was due this month. I budget $125 for childcare but only paid $33. That too was expected--summer camp is the big expense there, so I marked all $125 as spent. This month the kids cost $300 less than budgeted.
I couldn't remember if I adjusted my withholding after the big tax bill I got last year or not, and looking at my W-4, it looked right. I budgeted money and marked it spent.
Our big charity is our church; the Catholic school and it's projects are next. This month we are over, and this is one area where I think the budget definitely needs to be adjusted upward.
I have lines in here for medical, haircuts, clothing etc. We did not spend any of it.
We budgeted $300/month and this month we only spent $50.
The big leak in our spending is where I figured it was--in what goes in our mouths. I'll follow this budget for a few more months--it really is more a reflection of reality than a plan going forward, and then decide to what extent we are going to try to limit spending in some areas, and in which areas I budgeted too much.
*Part of Financially Savvy Saturdays on brokeGIRLrich, Disease Called Debt and The Yachtless*