2nd month of envelopes - adjusting amounts, what do you spend on ???
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  1. #1
    Registered User MrMom's Avatar
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    Default 2nd month of envelopes - adjusting amounts, what do you spend on ???

    Hey all,

    We are 2 months into our envelope system, and having created a budget we also have an accordion type thing that holds many other budgeted items (car insurance, clothing, medical, gas, water etc).

    The 2 core envelopes we are still working on adjustments of are

    GAS (car)
    and
    FOOD (groceries nothing else no eating out or hba)

    Gas (car) well we budgeted $300 per month and just ran out today (day 19 of 30) so we need to up that (just work commuting) so we are going to up that to $400 a month and pray gas stays under $4 a gallon.

    FOOD thats our grocery only money, we have a misc fund ($25) for things like detergent or shampoo etc, so this is just groceries, family of 4 (2 kids), we are budgeted for $300 and so far a bit ahead of that mark at day 19 having spent $170, so this envelope seems pretty close on target as we need to go again and get some basics in the next few days.

    Wondered what others pay in general on things like

    GAS (car) - budgeted for $400 a month
    FOOD - budgeted for $300 a month (family of 4)
    ELECTRIC - on the budget plan $195 a month
    GAS (house) - on the budget plan $150 a month

    are we way out of whack on these numbers?

    I kinda wanna go off the budget plan but the way the months go up and down i am afraid those numbers would really throw me off envelope wise, I am just tracking them so i don't get too far off the budget plan and end up owing $ at the year end.

    I do use coupons and shop sales, and on the car we are trying to sell a second car and looking into getting a replacement smaller car to get better mpg for more savings.


    Most other things are fixed allotments (car insurance, medical, haircuts, gifts, life insurance), so we just pull from those as needed.


    Bill

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    Registered User Lady_V's Avatar
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    [QUOTE=MrMom;1499533
    Wondered what others pay in general on things

    [/QUOTE]

    Since you asked, I may as well jump in here...

    Family of 3.5 (2 geezers, a tween and a cat ) 2 cars, in Massachusetts (since prices vary)

    These are ALL my categories... I will bold items in an envelope... and I have a LOT of them!

    OldMan's Health Insurance - $375/mo
    Comcast - $60/mo
    Verizon - $135/mo
    Ngrid - $45/mo
    HELOC - varies from $600-$1000/mo (our only debt)
    vacation - $700 (short-term, 7/11)

    gas - $160
    laundry - $20
    groceries (includes HBA and stockpile) $300
    school misc. - $10 (rolls over monthly until needed)

    my car ins. - $790/year
    his car ins. - $2500/year
    my car insp. - $29/year
    his car insp. - $29/year
    my excise tax - $25/year
    his excise tax - $100/year
    my reg - $50 (10/12)
    his reg - $50 (5/11)
    my lic - $75 (1/12)
    his lic - $75 (7/12)
    oil changes - $160/year

    school supplies - $50/year
    school clothes - $500/year (she's no longer in kids clothes and growing faster than I can blink)
    misc. clothing items - $100/year (winter items mostly)

  3. #3
    Super Moderator Spirit Deer's Avatar
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    We don't use a budget and never have, and that's why. Something is always going to crop up. Our approach is to minimize unnecessary spending on a daily basis. It's worked great for us for 36 years now.

    Not every plan is going to work for everyone. If you see something within your plan that does not work, then you have to decide if you can fix the plan by tweaking it, or if you need a different plan altogether. You're already doing that, so yea, you!

    If you're on a budget plan for gas and electric, look back on your old bills and see how close you're coming to your actual cost, averaged over the past few years. If you heat with gas, how much you need can vary due to fluctuations in weather each winter, ditto the electric bill with AC and/or heat, if you heat with any electricity. Whether or not you make a change if you tend to spend less than your budgeted amount may depend on the policy of the companies you'd owe money to if you come up short. Would have have to come up with a large lump sum, and would you be comfortable doing so? We would, because we use our money then instead of the gas company using it interest-free.

    Car gas is a wild card. No one knows what's going to happen there. We do estimate fuel costs when we plan vacations, to avoid any excess angst and sticker shock when we go. We tend to estimate in .50/gallon increments ranging from $3 to $5/gallon. That way we're covered, and if we have money left over, that's a good thing. We never have trouble figuring out where to spend it! Maybe you can adjust your budget in a similar way by watching to see if the gas prices are trending up or down. But the reality is if you have to drive a certain amount of miles per week for work and that can't be changed, you're going to have to pay the price, so maybe you're better off to just plan for the worst and hope for the best.

    I don't know if you've run the numbers on the car you're trying to sell vs. what you think you'd like to buy. I know the popular wisdom is to buy something more fuel efficient when gas prices go up, however IMO that doesn't always make the most financial sense. We own two gas-hogs. One is a daily driver, one is our tow vehicle when we travel and rarely leaves the yard without the trailer behind it. Both are in excellent condition and are paid for. The van has very low miles, the truck has below average miles for its model year. Both should live a very long time yet. We've talked about trading one of them and getting something smaller, but for us, it would take years and years to recoup the cost of a new car vs. paying for the gas for the ones we have. Since we like both our vehicles, they're mechanically sound, and they serve our needs well, it does not make sense at this point to trade. Your situation is different of course, but I'm just mentioning it as food for thought. What's the cost going to be to trade, and can you really make that back at the pump?

    As for food, do you own a freezer? If not, you may want to invest in one because you can then take better advantage of sales, particularly for meats but also things like close-outs on crackers and cereal or exceptional sales on staples like flour and butter and even milk and juice. A freezer also is very handy for making meals ahead, which can save money by taking advantage of loss leaders and avoiding fast food because then supper's always in the freezers on busy days.

    I think it's VERY GOOD to track your spending and see where the money goes. Then you can more easily see any hot spots that need attention. It seems to me you're on track. It feels good to be in control, doesn't it?

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    Registered User MaryCarney's Avatar
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    I think your grocery budget is pretty reasonable, and I agree with staying on the utility budget. As a long-time frugalista (we voluntarily lived for almost eight years at or below the poverty level without incurring debt and with four kids)- it would be helpful if you posted the rest of the budget (or is it somewhere else in the forums?) That would give us a better picture of things overall and enable us to make specific suggestions.

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    Moderator mauimagic's Avatar
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    Sounds as if you have a good grasp on reality - great suggestions above!! It does depend on where you live for sure - Our gas is heading towards $5/gal - we minimize our driving as much as possible. Food is anotherr area where we get hit hard. Garden going in next week - shall save when and where we can.

    Looking forward to reading about your experiences!!

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    Registered User Menifeemom's Avatar
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    It feels like every time I get our budget done something changes to mess it all up again. We try to redo it as quickly as we can to make it work better, but overall right now with gas/food prices going up we are mainly just trying to spend as little as possible in all categories to make sure we somehow make it with money left over.

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    Registered User MrMom's Avatar
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    Totally understand that, we made a few goofs and are still adjusting ours about once a week as we go into our 2nd month, heck probably will still be adjusting it at 6 months too, but at least by then we will have more of a "TRUE" budget right?

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    Registered User Franki's Avatar
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    Hi Mr. Mom. Your numbers are similar to ours.

    We spend

    GAS (vehicles) - $350 - $400 a month (budget $400)
    FOOD - $400 a month for a family of four (this includes miscellaneous)
    ELECTRICITY (House) - We budget 220 a month...but it ranges from $175-$250

    Our house is only set up for electric heating and appliances.

    Your numbers seem pretty reasonable to me.

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    It feels like every time I get our budget done something changes to mess it all up again. We try to redo it as quickly as we can to make it work better, but overall right now with gas/food prices going up we are mainly just trying to spend as little as possible in all categories to make sure we somehow make it with money left over.
    I aim to over-fund each envelope and try to have extra at the end of the month.
    This provides a little cushion for things that crop up.

    When the 1st of the month comes up again, I just add enough to that envelope to meet the Goal Amount (again, tending to aim high enough to over-fund a bit)

    Also, when I first started, whenever I had something Unexpected, I either made a New Envelope for it, or I upped the amount dedicated to That Envelope.

    Over time, it works out really well.

    If I ever get too much money in one envelope, I can either skip a month or snowball some.

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    Registered User MaryCarney's Avatar
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    Actually, you should make a NEW budget every month, based on what's happening that month. Mind you, stuff like a mortgage payment and insurance premiums don't change from month to month, but throw in stuff like - in our instance- baseball ign up fees, and you can really get discouraged.
    The trick is to adjust often, based on reality. There's a word for this in Dave Ramsey-land, I just can't think of it right now.....

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    Registered User 227melissa's Avatar
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    wow 400 a month on gas !!!!!!! we only spend 80 a month 2 cars, 2 jobs. 400 a month hurts me to read it.

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    We started the modified envelope system on 6/1, since we like to keep a papertrail on all bills.

    We envelope for Gas and Groceries. .

    GAS: $120 for DH, works M-F commutes daily 30min total.
    $120 for me, work when I need to, taxi kids,run errands.
    1-16th of June only used a tank of gas. Whooohooo (65/fillup)

    Groceries: $300 (so far, so good. We have meal planned and we have been eating healthy too)

    Next month we will do an envelope for blow money. A minimal amount, just so we don't feel so deprived. It has been 17 days on this plan and i feel like I'm missing out on stuff. hahah

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    Registered User MrMom's Avatar
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    Quote Originally Posted by MaryCarney View Post
    Actually, you should make a NEW budget every month, based on what's happening that month. Mind you, stuff like a mortgage payment and insurance premiums don't change from month to month, but throw in stuff like - in our instance- baseball ign up fees, and you can really get discouraged.
    The trick is to adjust often, based on reality. There's a word for this in Dave Ramsey-land, I just can't think of it right now.....
    I love what my wife did, she made up an excel form for both our debit snowball and our monthly budget, both are very basic but at the bottom are all our months of the year, she carries over the previous month into the next months tab and we sit down every other week or so and adjust as needed.

    Having those previous months to "tab/view" back to is very inspiring to go back 2-3-4 months and see the numbers going down and the budget getting simpler each time we knock out a line of credit etc.

    Whenever I feel a bit discouraged at still having debt I tab thru the last few months and it just gets me fired up to keep on track...

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    Registered User Natalia's Avatar
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    it sounds like you are doing the mistake i always used to make, that is, writing a budget before tracking your expenses. when you track your expenses first, then you can plug accurate, predictable, liveable numbers into your Spending Plan. when you start with the spending plan and just grab numbers from thin air, they are impossible to stick to. after many attempts i finally got something workable.
    i agree with Mary too, to adjust and personalize your Spending Plan monthly. for example, with March Break next month, i plan to add more than usual to Entertainment and probably Restaurant envies.
    here are some of my numbers
    gas $180 (1.25/litre here)
    restaurant $100
    groceries $600
    hubby blow $140
    my blow $140
    entertainment $40
    gifts/Christmas $100
    clothing $70
    vacay $90
    car repair/ maintenance $20 (hubby is a tech)

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    Quote Originally Posted by 227melissa View Post
    wow 400 a month on gas !!!!!!! we only spend 80 a month 2 cars, 2 jobs. 400 a month hurts me to read it.
    Wow!!! There is no way we could make it on 80 a week.... much less $80 a month!!! We spend at least $400 month on gas, and some months (when dh doesn't have anyone to carpool with) it can be much higher. Consider yourself blessed! Way to go!

    Lisa

    PS: LOVE your avatar! ROLL TIDE ROLL!!!!!!!!!

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