Category Archives: budget

Life without a credit card

In the distant past, I wrote a post about shopping online without a credit card. At the time, I recommended Vanilla Visa gift cards; these cards come in denominations of $25, $50, and $100, and can be purchased in many places, such as CVS Pharmacy.

I have come to decide that these cards are NOT the way to go. A big disadvantage of the Visa gift card variety is that they are only good for the face value, and cannot be reloaded. Add to that a steep initial purchase price, and the cost-effectiveness of using the card goes way down. The environmental impact of all those disposable plastic cards is also a concern.

Since then, I have been using– and highly recommend– the Wal-Mart Money Card. Say what you will about Wal-Mart (and I’ll probably agree with every criticism you might have), but the Money Card has changed my financial life.

The Wal-Mart Money Card has many advantages over the “single use” cards:

  • A debit card that can be used anywhere Visa is accepted
  • Card is printed with your name
  • Reloadable
  • Direct deposit for paychecks and income tax refunds
  • Convenient bill-payment service
  • Low fees

Using the Wal-Mart Money Card for direct deposit and bill-paying has made budgeting so much easier… and no more weekly trips to the bank to cash paychecks! Most important, I am only spending what I actually have– no credit card debt or hassles.

Do yourself a favor and check out the Wal-Mart Money Card. You may very well decide it is the right choice for you.

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Filed under budget, budgeting, cash basis, credit, credit cards, frugal, money, money management

If time is money, then I’m less frugal than I thought!

Looking at my schedule for the coming semester, I suddenly came to a harsh realization:

I’ll really need to manage my time very carefully if I’m going to make it to graduation!

Yes, I’ll be graduating in December with my Associate’s degree in Liberal Studies. After that, I’m transferring to the university for my Bachelor’s in Media Writing.

The next few months will be a crucial time for me… and time itself will be crucial!

I’ll be taking six classes, working in the library part-time, caretaking at home, writing several blogs, working on other writing projects, reading close to four hundred different blogs, hopefully having something resembling a personal life…

After spending the past few days keeping track of how I actually spend my time…  I realized I waste a lot of time! Now, I’m all about living a life with broad margins (as Henry David Thoreau once wrote), but I’ve been seriously out of control! There’s really no excuse for playing twenty-seven consecutive games of Snood. That will not work when I’ve got six classes’ worth of papers and projects to do!

What I really need is to budget my time as frugally as I do my money!

Just as in learning to control your money-spending, it will take great self-discipline to rein in my rampant time-spending. I need to re-frame time as being just as valuable as money– Time is something that should be managed carefully to maximize its usefulness. Obviously, the analogy only goes so far– you can always make more money, but you’ve only got twenty-four hours in the day, and that’s it. Still, a subtle change in perception can make a huge difference.

Anyway, I’ve been working on an Excel spreadsheet, similar to my financial budget, to portion out my hours as if they were dollars. I’ll post a screenshot when it’s done.

I know I can stick to a money budget…. but can I stick to a time budget?

Stay tuned for updates….

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Filed under budget, cheap fun, frugal, money management

Budget vs. Lifestyle

Let’s talk a little about budgets and income.

Your budget (and you do have one, right?) consists of:

  • Income
  • Expenses
  • Savings

In a zero-based budget, no income goes unaccounted for.

[ Income – (Expenses + Savings) = 0 ]

Let’s say you’re cruising along with your nice zero-based budget, and suddenly your income goes up? Let’s say you get a raise or promotion at work, or maybe you take a part-time job to make a few extra bucks. Could this actually be a potential problem?

But that’s a good thing! Well, sure it is, and congratulations! For smart people, things won’t change too much. The extra money will mean extra savings, a bigger emergency fund, a thicker cushion against the slings and arrows of life.

For others, however, that extra cash will represent a potential lifestyle upgrade. It’ll go directly into the expenses (new car, nicer home, more stuff, etc) portion of the budget, and the savings will stagnate. The frugal instincts may weaken, and soon it will feel as if the raise never even happened.

We see this a lot with recent college graduates in their first real jobs. They’ve been living like poor students for the past four years, and become intoxicated by their first decent paychecks. And so they jump right into a spendy lifestyle they really have no business having…. at least not until the student loans are paid.

Now, what about the folks lurching through life without a budget or any sort of spending controls? That extra money will fix everything, right? Not necessarily. Habits don’t change that easily. If your spending is out of control at $20,000 a year, it will probably be that much more out of control at $30,000.

The smart person will maintain the budget, increase the savings, and keep moving along according to their goals… you do have specific goals, right?

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Economics 101– Part 1. Scarcity and You

Economics?! Gross! Who wants to read about something so dry and dull as economics?

Keep reading, friend. You might learn something relevant to your life.

Part 1. Scarcity and You.

Let’s say you have twenty dollars in your pocket.

Let’s say that twenty dollars is all you have until next payday.

Now, what will you do with your twenty dollars?

  • Do you go to the movies with your friends?
  • Do you go out to lunch with your co-workers?
  • Do you buy your favorite band’s new CD?
  • Do you pick up a few groceries?
  • Do you put a few gallons in your gas tank?
  • Do you buy a new paperback book to read at the beach?

One thing for sure– you can’t very well do all these things with with your twenty dollars. In an ideal frugal world, you will stay home, eat peanut butter sandwiches, listen to the radio, and read a book from the library, but that’s just me.

Still, there are so many possible choices vying for your twenty dollars. Your choices are endless… yet your money is finite. That twenty dollars is all you’ve got.

This is the basic dilemma of economics– scarcity. The idea of scarcity is that people have unlimited wants and needs… yet the available resources to satisfy them are limited.

Economics is concerned with scarcity and the choices we need to make: if I choose to spend all my money on a movie, popcorn and a drink, I can’t very well gas up my car, as well. However, if I go to a cheap matinee and forgo the snacks, I have money left over to put at least some gas in my tank.

When you live within your means, you become very conscious of the choices you make.

Each time you make a choice, any number of alternate choices are given up. This is called opportunity cost. A dollar spent on one thing is a dollar you can’t spend on something else.  If you go thirty dollars over your entertainment budget, you have thirty dollars less to spend on, say, groceries.

Time is even more scarce than money. If you choose to spend the evening watching TV instead of studying for an exam, that time is gone forever. If you choose to limit your child to only one after-school activity per season, he/she might be missing out on all the other activities, but the decrease in stress may be worth it.

The concept of scarcity seems so obvious, but a lot of people just don’t get it. There’s a lot of denial surrounding scarcity. This is a major reason why credit card debt is such a huge problem– too many people view their available credit as an ATM whenever the “wants” outnumber the available dollars.

Scarcity is very real. You can’t have it all. Unless, of course, you’re Bill Gates or Warren Buffet.

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Rough times: just what we needed?

In one of my past careers years ago, I worked for a small company which also employed a delightful retired gentleman. He worked as a courier, making deliveries and pick-ups between our two stores and various local vendors and customers. In his working life, he had been a barber, and even well into his eighties his hands were rock-steady; out of love and friendship, he treated my bosses to free haircuts.

John had been around for most of the 20th century–  born during World War I, came of age during the Great Depression, and served in World War II. I always respected his wisdom, as crude as it might sometimes be.

Like many people who lived through the Great Depression, John had a very conservative attitude towards finances. He always deplored wastefulness, valued self-reliance, and saved every penny he could. John saw his beloved nation slipping out of control with greed and consumerism. He often told me that America badly needed a serious wake-up call:

“Sweetheart, what this country needs is another Great Depression. It’ll teach people how to live right.”

While I certainly hope things don’t ever get that bad again, I have to acknowledge the truth in his commentary. Many people do change their habits when times get tough. In the past few months, as our economy has gone into a recession, the lifestyle climate has definitely changed. Frugality, thrift, and self-sufficiency are definitely becoming hot topics these days.

I have to wonder, though: will a shift towards frugality last, or will it just be a temporary response to the economy? Will the scars need to cut as deeply into our consciousness as a full-blown Depression in order to create lasting change? Do we even want that?

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Saving money through mindful shopping

How many times have you gotten to the grocery check-out and been completely blind-sided by the grand total?

“How on earth did I spend that much money?!”

Actually, it’s pretty easy to do, if you’re not shopping mindfully.

What does that mean?

Students of Eastern philosophy, such as Buddhism, will recognize the idea of mindfulness. To practice mindfulness– to be mindful– is variously defined as being present in the moment… as being aware of the present… as being attentive to the present moment. You are fully paying mind to the task at hand. Your mind is fully grounded, present in the moment.

All too often, we’re zipping through the grocery store, rushing on our way to or from somewhere else. We’re mindlessly tossing items into the shopping cart. Our minds are focused on everything but the task of purchasing food to nourish ourselves and our loved ones. We just want to get out of that store as fast as possible. Even worse, we skipped lunch today and hit the grocery store with an empty, growling tummy.

So much for our carefully-crafted grocery budget.

No wonder the grand total at the check-out is a big surprise! I only came in for three items, and now I have half a shopping cart-full! How did I do that?

I can write about that sort of crazed grocery run from experience. These days, though, my check-out experience has zero sticker-shock. When I get to the check-out, I always know– within a dollar or two– how much I will be spending.

How?

Simple. With each item that goes into my cart, I make a point of noticing the price on the shelf. I keep a running total in my head, rounding up or down to the nearest full dollar. That just makes it easy to keep track. In the future, I may start bringing a little pocket calculator with me.

It’s also good to have your budgeted amount in mind while doing this, so you know when you’re getting close to the edge. It’s not an exact science, but it works. When the cashier wants my money, I already know approximately how much it will be.

This technique may slow you down, but that’s just the idea. Come back down to earth and shop mindfully. The Retail Powers-that-Be are counting on you to move through their stores like mindless little consumer-zombies. Beat them at their game. Reap the reward of no check-out surprises… and your budget shall prevail!

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Filed under budget, frugal, groceries, money management, saving, shopping, Uncategorized

Menu planning: giving it a try

Lately, I’ve been reading a lot of blogs about frugality, budgeting, and various other topics in personal finance. I am determined to get my finances whipped into shape!

I’m seeing a lot of suggestions of menu planning as a great frugal tactic.

Menu planning is based on the idea that knowing ahead of time what you plan to eat during a particular time period (say, the coming week) will help you stay focused within your grocery budget.

Other important aspects of meal planning:

  1. Know what you’ve got on hand in your pantry, fridge, and freezer.
  2. Devise meals based on what you already have on hand.
  3. Know what else you need to make your upcoming meals.
  4. Make a shopping list and stick to it!

By the way, I found an interesting site about organization that offers printable planner forms. I confess I’m just OCD enough to have printed out the pantry inventory forms.

I’ve never really planned my meals too far into the future, which– when I think about it– has resulted in an awful lot of last-minute trips to the store to buy curry powder or eggs or bread or zucchini or some other crucial missing ingredient!

Before going to the grocery store today, I wrote out a loose menu plan for the next week, and based my shopping list on that menu. In the store, I did feel more focused with a solid plan. (Who, me? A planner? Huh.)

I can’t say for sure whether I’ll still be in the mood for a veggie burger on Tuesday night (I start school that day), in which case we’ll improvise. Otherwise, this could work.

I’ll let you know how it goes.

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Here are a few days’ sample menus…..

[Color code: Food Already On hand Leftovers Food Bought 8/29]

———— Thursday 8/30 ————

Breakfast: Last of the Corn bread and coffee

Lunch: Salad

Dinner: Spaghetti and salad (just enough left in the bag)

————Friday 8/31 ————

Breakfast: Raisin Bran and coffee

Lunch: Salad (new bag)

Dinner: Cheese quesadilla (two more tortillas left after this meal) with brown rice and black beans

————Saturday 9/1 ————

Breakfast: Breakfast burrito (scrambled egg and cheese in a tortilla) and coffee

Lunch: Salad

Dinner: Last of the Spaghetti and salad

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