I was checking my bank account and budget recently and realized how far I’ve come.
I used to be terrible about managing my money. When my pay would go into my bank account, I would just start spending. Some spending would go to “needs” and other spending (too much) went to “wants” and paying bills would happen haphazardly at best. By the end of the month – rent time – I would struggle to pay the rent and, often other bills went unpaid. I borrowed more money than I would like to admit which, of course, would leave me short for necessities when I had to pay it back. It was a vicious cycle…….
Don’t even get me started on credit cards! I’d get one with the best of intentions, “only for emergencies”, but before I knew it I’d have it racked up. It seems everything was an “emergency”. This is why I no longer have a credit card. I’m honest enough with myself now to admit that I just can’t have one without amassing debt. It’s been almost ten years now without one.
All that was left was to get my cash flow under control; a monumental task, believe me……
Over the last five years or so, I have been finding ways to cut my monthly costs and streamline my life. The first measure that I took was to get rid of my landline. I mean, really, I barely talk on the phone enough to justify one phone and here I was paying for a landline AND a cel phone. Ridiculous! So I dumped the landline and further streamlined things by moving my internet from the phone company to my cable company and got my cel phone through them too. This means that I get an electricity bill and a cable company bill each month and that’s it; the end of multiple bills coming at me each month. Of course, this move meant that my kids got cel phones earlier than they otherwise would have since I can’t have them at home when I’m not there without a phone but, in the long run, I believe that I am saving. The other added benefit is that they have given their numbers to their friends so that, when they are at their dad’s place, their friends can reach them and I don’t get their calls. Bonus!
A few years ago, my car’s brakes died. There were a number of other things wrong too that I had been putting off fixing because of a lack of funds so it was time to make a decision. The repairs it needed would cost me more than the twelve year old car was worth. I work downtown and take the bus/metro to work so the car was sitting in the driveway five days a week and hardly even moved some weekends too so was it worth going into debt to fix? My kids were a bit older and so it’s not like I was hauling a couple of toddlers around. In the end, I decided it wasn’t worth it. I am no longer paying for both a bus pass AND gas, registration, insurance, repairs, etc. and it’s amazing how much that opens up the budget. I now spend eight dollars a week on a taxi to bring home my groceries (less than my car insurance alone!) and allow myself the occasional taxi splurge when carrying a big load or coming home late at night. What a difference it makes!
The last thing that I did was create an Excel worksheet with a budget. I listed all of my regular monthly bills along with my expected deposits and what was left is divided by four weeks (or five if it’s a five paycheque month) and that is what I have each week for groceries and incidentals. Given that exact figure, I can regulate my spending accordingly and know exactly where I’m at; no more spending willy-nilly just because there is money in the bank. It’s a shockingly easy concept that I somehow didn’t clue into until I hit my forties. I may be a slow learner but I do eventually get it.
Today I am completely debt-free and my bills are paid on time. I’m not rich and, depending on the month, the budget can sometimes be tight but my kids are fed, have a roof over their heads and have enough cool stuff to keep them entertained. Who could ask for more?
Good for you! Maintaining a personal budget has always been tricky for me. Luckily, the majority of my bills are auto-debit and I never miss those, but I need to regulate my "extras" spending better. Yes, I'm on top of my bills, but I would like to be a better saver. I've been pretty good lately (specifically because I'm saving for my wedding), but I would really like to have the discipline to save without a specific end-goal in mind other than just saving.ReplyDelete
Now there is my next challenge! Unfortunately, I am truly a horrible saver. I'm considering sitting down with someone at my bank to discuss options. I need to have it taken out of my hands (literally!!) and put somewhere that I can't take it out of easily.Delete
It truly is a challenge, isn't it? That's a good idea to get some outside third-party help. I may have to look into it.Delete
One of the things I like is using ING Direct savings accounts (it's now called Capital One 360). you can link this savings account to your regular bank account and transfer money back and forth between the accounts. But it usually takes a few days before the transaction occurs-- it's almost like it's a pain to take money out of the ING/Capital One 360 account, so maybe you won't want to do it.. But it's good to know it's there if you need it.
An ING account is definitely an option. The fact that it does take a couple of days to get to the money would be a good deterrent from spending it easily but wouldn't make my money totally inaccessible. I think that investigating savings options is going to be my project in the New Year. God knows there will be no savings between now and Christmas!Delete
Way to go, Kat. Becoming debt free is a HUGE accomplishment and one you should be very proud of. I feel extremely fortunate to be debt free, with the exception of one very small home equity loan. I once heard someone say that we will never see a true economic recovery until we can raise a generation that knows how to live within their means. It looks like you're doing exactly that with your children.ReplyDelete
Thanks Shana! I completely agree with you. I am always totally honest with my kids when it comes to money. I believe that they should know that we aren't their personal bank machines, we work hard for what we have and that paying the bills sometimes means that we can't have everything we want.Delete