So far this year we had been really good spending wise. We'd hardly use credit cards at all except just a month ago to fix my commuter car. We only owe $1300 left. I'll make $800 payment in January which will give me $500 to pay the rest in Feb 08. Although, my wife and I both make good money, we don't seems to able to save more than than we like. Our goal for next year is to really build our emergency fund at least 6 months or $30K. With our existing expenses and the tendency to pay everything cash crimp our ability to really save. You could say we're a spender more ways than one. We don't spend on lavish things or have bad habits, don't gamble, smoke, or buy big item tickets. We do spends however on many family functions; birthday for our kids, presents for relatives, friends, and coworkers. My wife parents travel once a year to visit us and stays. Their roundtrip costs about $2000 a pop. We did upgrade our carpets to flooring last year which cost about $5000.00 but paid that off in 4 months.
So our plan is to save for next year. Based on our expenses we could save about $700 per month which will be towards our emergency funds and and additional $300 per month towards our planned vacation next summer, birthday, and xmas presents. That's about $12K we could potentially saved in additional to our retirement contributions (403, 457, ROTH, and Pension).
This won't be easy but I also figured that I need to cut down on things i spend daily; starbucks, lunches, and dining out. This month alone, i spend $25.00 a day, which is $100 bucks a week. I'd figured i could save $300 a month alone through drastic measure.
I like to get some feedback from people and hear your story....
So far so good but we could do things much better
December 25th, 2007 at 12:32 am
December 25th, 2007 at 01:14 am 1198545296
Merry Christmas!
December 25th, 2007 at 03:23 am 1198553025
Good luck!
December 25th, 2007 at 03:35 am 1198553700
Scfr: I figured the drastic change would hurt, but I'll probably make my own coffee first before i work out door each morning, maybe toss a sandwich or bagels to eliminate the crave. It's almost silly that it's hard NOT to stop to Star bucks before i go to my office. It's addicting, or sort impulse reaction habit. It's find odd.
December 25th, 2007 at 03:45 am 1198554328
December 25th, 2007 at 04:14 am 1198556095
It sounds like you are pretty good about not having debt, which is step 1, but you are spending exactly or very close to what you make, and the reason that you spend that is that you have large seasonal expenses. I think you can go quite far with cheapening your routine - substituting homemade coffee w/ Starbucks, etc.
But you really want to check out cheapening the large expenses. If your family events come every year at about the same time/ same reasons, perhaps you can work on cheapening those - cheapening the plane ticket, frequent flyer miles, finding better deals on the birthday gifts, teaching your children the value of a gift match (if they have yen for high end electronics and gaming), budgetting and planning for the 2008 home improvement project.
December 25th, 2007 at 04:57 am 1198558654
I agree with scfr, cut your spending a little at a time, that has definately helped me. The $20 challenge is a great idea, before you know it you are coming up with different ways to add to it
Good luck
December 25th, 2007 at 06:36 am 1198564568
You all have a Merry Christmas!
December 25th, 2007 at 03:11 pm 1198595504
December 25th, 2007 at 04:33 pm 1198600437
December 26th, 2007 at 03:16 pm 1198682213
December 27th, 2007 at 12:12 am 1198714378
So instead of spending on average $25.00 X 21 days (average working days) per month = $525.00 (Surprise to realized this much I spend on coffee and lunches). I'll give myself a budget limit of $10.00 a day X 21 days = $210.00. This could roughly saved me $300.00 a month. There are some days, I'll have ZERO expenses, cuz i'll be bringing in my lunch or out sick or something. At the end of the month, whatever is left, it will go towards the emergency fund goal. So potentially, I could really save much more.
Now the problem with this, I use my debit card like water. I'd never been good in tracking what I spend daily. But with this, it will force me track spending. So I created a spreadsheet at work so I know exactly how to spend daily. So to maintain the spirit of the challenge consistently, beginning each month, I’ll withdraw $500.00 cash and put aside. Each morning before I leave for work, I'll access this envelope and pay myself $10.00 a day. Why not take the whole $25.00 cuz I don't trust myself. I tend to spend it all for silly things (like snack bars or gum whatever). So by just taking out $10.00 a day, I began to save already. But also, it will prevent me from using my Debit card a lot. I know, there will be days that I'll need more than $10.00 in my pocket. So to rectify this, on days I’ll be bringing in lunch (at least once a week), or the days off or holidays etc.. I'll still pay myself $10.00 a day limit. At the end of the month, whatever is remaining $$ in my wallet, it goes towards the emergency fund. I'm actually excited to visit my bank and deposit cash I saved. I don't remember ever doing this since high school or college. I have direct deposit and use bill payment a lot. If this works, I'll convince my wife to do the same.
I started practicing it today since I am back to work for 3 days this week. I figured a "test trial" is warranted before I fully implement the program starting January. Because many of you encourage me to brew coffee, I made instant coffee on the go. But it works. I didn't have the urge to stop by to Starbucks for a coffee break or one of their breakfast sandwich. Saved myself $7.00. I was so excited and for lunch, I only spend $9.14, which is below my $10.00 a day limit. I was like "WOW!" I got to try this again tomorrow and Friday. I'm really excited....can you just feelin it...
I know its going to be a battle, but I know it will work. I need to stick to this plan and continue urging myself how important this is. Although, I’m not a blogger at all (this is my first time), I’ll keep you all informed as much as I can with my progress. I’m glad I found this website that gave me a motivation to set goals for next year. I know I'm not a lone on this endeavor, many of you are in similar situation. I'll keep you guys updated. Good luck to all of you. I look forward in reading all your stories.
With that---on behalf of my family, may you all have a safe post Merry Christmas, Feliz Natividad, and a very HAPPY NEW YEAR!