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Wednesday, January 7, 2015

Spending Confessional

Three weeks ago, Greg and I started an expense journal. I wanted to use a notebook and jot down our expenses, but Mr. Excel Spreadsheet wanted to see a running total and created a spreadsheet instead.

I'm glad he did. It made a huge difference. Had we just kept a running list, we wouldn't know our totals (and details) until we tallied it up. This way, I know exactly how much we spend, down to the category. Knowing the problem is half the solution.

To be fair, Christmas was probably the worst time to start a journal. The holidays are not reflective of a normal spending week, but putting it down in black and white put everything in perspective.

The first week was a wash. We had continued eating out like we normally did (which was always excessive). We also shopped for gifts and the fancy foods we'd planned for our feasts. 

By the second week, I was putting stuff back on the shelves and rethinking priorities. Knowing it was going on the spreadsheet kept me from buying anything superfluous.

Eating out was kept to places where we had coupons or gift cards. Now into our fourth week, we don't even think of eating out unless we know we're going to be out all day. As a matter of fact, our spending has dwindled to a fraction of what I originally allotted. How's that for putting us back on track?

We've been cooking at home a lot. I even spent two days making freezer meals that I could take out for those days when I'm just too pooped to do anything but turn on the oven.

Greg's been experimenting with bread making and I've been making soups. Here's a photo of my French onion soup. It's incredibly satisfying, especially with a hunk of bread and Swiss cheese floating in the bowl.

It was humiliating to learn how weak we were with our spending. Neither of us minded when we had regular paychecks, but now that we're on a strict stipend, every little expenditure comes under scrutiny.

My personal Waterloo comes when I go grocery shopping. I only shop for fresh foods and bread, but I haven't had the strength to walk out without first purveying whatever's on sale. It hasn't blown my allotted budget yet, but it came close.

Ironically, our biggest setback didn't come by our efforts, but by our health insurance. They raised the premiums by almost two-thirds, which goes to prove that even the best laid plans can be thwarted by outside forces. 

In the end, the spreadsheet has been a godsend. It forced us to reevaluate our needs and rein in our vices. It's easy to see how people can get into trouble. We weren't even trying to play fast and loose, yet it was easy to spend when the increments were small. 

And that was my biggest discovery. If it had been a big purchase, we both would've screeched to a halt, but as I look at the spreadsheet, most of the numbers are tiny, which is why we never noticed them before. It all adds up.

If you use Excel, I can send you a copy of our spreadsheet formulas if you'd like to try tracking your spending too. Even if you do it for a week, I guarantee you'll never look at your spending the same way again.

There'll be a future post on how we trimmed our spending, but I'll cover that later.


In other news: Stacy McKitrick has a new book coming out and I designed the cover.

If you've never visited Stacy before, check out her blog and books.

Have you ever tried tracking your expenses? Was Christmas expensive for you this year? Where do you think the majority of your money goes every month? 

Ours used to be gasoline, but that's been slashed in half since Greg came to live with me again. Dining out was definitely our 500-pound gorilla in the room.


Mike Keyton said...

I don't have a spreadsheet - just X amount of money split over a month for food and drink. Everything else is via Direct Debit. Being inherently mean I usually have a small surplus. But without a doubt when both of us retire, there are savings to be made. The biggest one will be TV/Phone/Internet. It's much cheaper over here to bundle them all with one supplier eg Sky or BT. Half the price. At present we can afford to split them Sky for TV and BT for internet - because each are different. Sky offers better TV. And, basically BT are better at internet. The difference is small and a choice will have to be made. Gosh, I'm boring my self :) Sorry, Maria. Is there an Excel program for prolix idiots!

Stacy McKitrick said...

Thank you so much for such a wonderful cover! I never would have come up with something like that (my brain isn't that kind of creative).

I suppose when my husband finally retires, we might have to rethink our spending, but since we're still able to save, I'm thinking right now we'll do okay. Still... we do eat out too often. Even though we use coupons or reward points, it's not exactly beneficial to our waistlines! :)

Raelyn said...

I've tried a few different ways to track spending. I'm usually pretty consistent for a week before I fall off the wagon. My challenge is That Man who wouldn't know a budget if it bit him in the arse, which it has. I'd love to see your spreadsheet.

Christmas was over done this year. Sigh. Even though it was planned over expenditures, we went over. Of course we have the wee beasties, one of whom is still very much a believer of Santa.

Food is definitely where the majority of our weekly funds. On a monthly basis, setting aside funds to cover the A/C over the summer. I'm sure there are little things like my :cough: book habit :cough: that would surprise me when I crunch numbers.

Your soup looks delicious and now I have a craving for French Onion :) I even have a vegetarian version, yay.

Angela Brown said...

I did a sort of expense journal keeping up with my receipts the last few months. Because of recent changes in my life, Chipmunk and I are getting down to the bare necessit, only building lists for groceries and reducing eating out to a couple of times a month. And I am working on lunches being leftovers instead of grabbing fast food.

Diane Carlisle said...

January 1st I started my budget worksheet (again). I had stopped using it last year, but I think with the new year, it's easy to start off fresh. I can already see a problem with my spending. LOL

Please send me a copy. Yours might be a better baseline than what I created. Mine is very basic.

diane-carlisle at comcast dot net

Thanks for sharing, Maria!!

Sarah Ahiers said...

Great cover, Maria! As usual!

I tracked my expenses before we bought my house (back in 2008, i think?)
And like you, i was mostly surprised by how the little things added up so quickly, and it was mostly eating out, too, even though we do a good job of cooking most our meals.

Clearly, the solution is, is we need more money ;)

Susan Gourley/Kelley said...

Those health insurance premiums are hurting a lot of us. It's really tough on young people just starting out and people on fixed incomes.
We seldom eat out, mostly because it's too easy to overeat when someone else is cooking.

Maria Zannini said...

Mike: I wish I had more choices for internet. Living in the boonies, my options are pretty limited.

I am glad I talked Greg into giving up cable/satellite for tv. Instead we rely on Netflix and Amazon. It's substantially cheaper.

Talking about money is boring...unless someone ends the conversation by giving you some. :)

Maria Zannini said...

Stacy: I'm glad you liked the cover. I think it turned out pretty nice. Sexy without being overt.

Re: eating out
We've always been bad about that. Hopefully these new habits we're developing will curb our over indulgence.

Kevin Graves said...

Would love the spreadsheet.
I am saving for a cause....and have discovered Aldi. Is there one near you? Just for staples and stuff, it is great. You must take your own bags. Surprisingly, my niece Robin shops at Dollar Tree for canned goods and things. I buy big quantities of meat like chicken at Costco, put them in baggies and pour a different marinade in each and freeze them. I can defrost in the mickey-wave and they are ready to cook and very tasty.

Maria Zannini said...

Raelyn: Greg's going to make up a blank one to send out. I'll email them tonight or tomorrow.

It's really EASY to fill out. The only trick is to remember to put in your numbers. I usually stash all my receipts in a pocket and then fill out the spreadsheet that night.

Kevin Graves said...

Maria, I also watch only Netflix and Amazon, but I watch Acorn TV online which is mostly old british mysteries such as Periot, Midsumer Murder Mysteries, Inspector Lewis, etc. I don't have an antenna for local tv, but am getting the add on for the back of my tv at Radio shack.
$18. If you have a Smart TV, you can watch a surprising number of shows on You Tube.

Maria Zannini said...

Angela: Eating lunch out was probably my biggest expense when I was working. I subsidized it by brown bagging more and not buying soft drinks from a machine.

If you want to try the expense spreadsheet, let me know and I'll send it to you. It's a pretty efficient little journal.

Maria Zannini said...

Diane: Will do, Diane. I should have a blank copy available tonight.

Maria Zannini said...

Re: Clearly, the solution is, is we need more money ;)

ROTFL! I nearly swallowed my tongue. :D

Maria Zannini said...

Sarah: And thank you for the cover compliment!

Maria Zannini said...

Re: insurance
Oh, don't get me started on that sticky wicket. What a mess.

We were so pleased when we learned about our initial premiums. Who would've guessed they'd raise them so much in less than two months.

They go up much higher and I'll have to get a job with benefits.

Maria Zannini said...

Kevin: I'll send you a copy as soon as I get it from Greg.

Re: Aldi
We just got one! The selection is small but for fresh veggies, the prices can't be beat.

Re: youtube
Greg does this. He usually finds a lot of interesting videos that we can watch on the 'big' screen. As long as he does the searching, I'll be glad to watch. :)

Darke Conteur said...

It's amazing how quickly you can change your spending habits when you need to. Our Friday nights out started back when Husband got full time work and was bringing home a paycheque every week. We put money away for a house and then we'd go out and celebrate by having dinner at a restaurant, then visiting his Grandmother. She loved hearing about the places we'd go and what we ordered, so we just kept doing it. Things got tight right around the time she died, so we cut back on going into town. I still don't like eating at home on Friday nights. I'm just too used to going out.

Maria Zannini said...

Darke: Like diets, it's hard to give up the good stuff. :)

We don't feel deprived, but I do miss the days when I didn't care if we had a big ticket meal.

Rebekah Loper said...

Aldi is awesome.

I've started to get on top of our spending, too. We shouldn't be living from paycheck to paycheck at this age. And some of it is that we've decided to live a more frugal lifestyle, but we've got have an emergency fund at the least.

I would love a copy of that spreadsheet! :D

Maria Zannini said...

Rebekah: On it's way!

Sandra Almazan said...

Great cover!

Most of my spending probably involves my son.

Maria Zannini said...

Sandra: Thanks!

Re: spending
Kids are the main reasons there aren't more drunken millionaires. LOL.

B.E. Sanderson said...

Hubs keeps track of the overall budget and as long as I keep my expenditures at or below the projected amount, we're good. I don't really think about it, but I was poor for so long, I'm constantly looking for deals when I shop anyway. He did a year end thing recently and discovered we've been spending less than he thought we would. I did do a month in 2014 where I tracked everything we spent, and I was pleasantly surprised. We live pretty cheaply. Then again, we don't eat out, go out, or buy stuff we don't need. (Except sometimes unnecessary food items. Peanut M&M expenses can really add up if you aren't paying attention. LOL)

Maria Zannini said...

BE: When we first got married, we lived on rice and pasta. As our earning capacity increased, so did the quality of food, until now when we'd rather miss a meal than settle.

Still living lean for so many years has made me a hawk in finding the best deals. I have enough rib-eye steaks to last a year. Chicken, goat and rabbit we raise at home. Now if I could only convince Greg to let me start a fish pond. :)

I'd ask him for a small beef calf, but he thinks it's too big for us to process on our own.

If we're going to raise animals for food, we want to be responsible for their whole lives to insure they're treated well.

LD Masterson said...

Wow. Great cover!

Of all the money management tools we're used over the years, I think the most effective was the envelopes. When we were first married, we'd cash our two paychecks, put some into the bank and bring the rest home. Then it got divided up into the envelopes - rent, food, utilities, insurance, clothing, etc. Emptying an envelop too soon meant doing without or borrowing from another envelop...and doing without that one. It sure kept us aware of what we were spending.

Of course,that was before Excel.

Maria Zannini said...

Linda: The envelope method is the one we started with too. It was simple. But then that was when credit cards were a luxury and checks were only for big important bills.

Now even your phone can pay your bills.

I miss the old days.

Anonymous said...

Both of us have kept budgets for years... decades, in fact. When we got married 14 years ago, it was an easy thing to combine our expenses/salaries and come up with workable system. We still track every penny. Year after year, we come in below budget, sometimes thousands below. I guess the other word for that is skinflint. Sometimes we have to remind ourselves that it's okay to have fun. It's in the budget!

Maria Zannini said...

Marlene: We tend to do our tracking every 3-4 years just to see where prices have jumped. Also to see if that was our fault, or the result of an economic shift in the gross national product.