About Me

October 3, 2016

Living on a Budget.

I grew up in a house where every penny was precious and purchases were talked about and saved for. Goals were set and in the end, my parents went from teenage parents to business owners and retired early. My dh grew up in a house where every penny was spent and there were no goals or budgets. And unfortunately, incomes were not high. Here we are, are these years later, living on a frugal budget so we can meet our goals. This has taken lots of work and much compromise. He didn't even have a bank account when we met because he didn't need one. No bills to pay, just a paycheque to cash every 2 weeks. And that money would go in to his pocket, without any accountability. I scrounged and saved every penny and it's been quite the process to learn to spend without worry. I feel we're finally in a good place of being able to live comfortably, as long as we can still put money in to our savings accounts each week. Our current economy is in a recession and although we both have great jobs that haven't yet been affected by this, we are conscious of the idea that in any moment, it could change. We go to work each day with gratitude that so far, so good. Our province has been through many recessions and then many rebounds and it sounds like the upswing is starting to pick up. Hopefully, this will be another one of those blips. 

So, how do we live frugally? Part of our process is having a savings goal for the year and achieving that by putting money in to our various accounts each week. We have our Emergency Account (in the event we have something major creep up, like job issues or a big repair bill), our Travel Account (we travel frugally too but like to put money here so we don't have to be worried when we're away), our Celebration Account for gifts and treats and finally, our Retirement Account, which we both have the same amount in separate TFSA accounts so the interest earned is not taxed. We also have RRSP's but I don't count those in our savings column. 

After we put funds in to our savings, then we look at what our hard costs are (items we can't change like our mortgage payment or insurance) and our variable costs (like groceries, which vary week to week). We also have to have some funds in our budget for those items that pop up that we weren't prepared for, like contributing $10 to our grandson's reading week event. Love that we can say yes to things that pop up (within reason) without having to worry that if we did say yes, we'd have to not pay for something else. We do make many decisions though about what to spend our funds on and often talk ourselves out of a purchase if it doesn't feel right. Rarely do we have regrets with this process. Works for us and I personally love to save for something rather than just buy everything and anything I find in my travels. Even when we go to the Antique Mall or the charity shop, we decide ahead of time what we can spend, if we find anything we'd like to buy. 

We have different times we get paid and I love when our pay runs opposite weeks. So much easier for managing our budget on a weekly format. I am paid twice per month but dh is paid every other Friday. Many months, it works out to be opposite weeks but other times, both pays will come in the same week. Not a big issue ~ just requires a bit more juggling. 

Today, I just pulled up our main account to see what we'll be doing for this week and immediately thought to myself "how the heck did we spend almost $300 in 3 short days?" But then broke it down and it made sense. Here's the expense numbers for the first 3 days of October:

  • $134.68 to our Mastercard. We never, ever carry a balance and to date, have never paid interest. We pay almost daily by taking the amount we may have put on the card that day straight to the card or by "evening" out our account balance each night ~ yes, that is my OCD kiking in ....
  • $50.00 to our Home Depot Card. Again, we never, ever carry a balance and have never paid interest. However, we will at times use our card to take advantage of a "no interest, do not pay for 18 months" offer.  Many will say "do NOT go there" but for us, this is a great way to buy something we want or need for our house that doesn't have to come out of our regular budget and we can pay off, without fees, without interest, comfortably. Right now, we're paying $50 a week for the vinyl Arbor Gate and wing fences that are just being put together now to create our "Secret Garden" in our front yard. If we paid what the plan called for, we'd be paying just a few dollars a month for 18 months but we prefer to up it to an amount we're comfortable with. This will be paid off by Christmas. Next year, I'd like to put up a cedar Gazebo in the back garden and we'll likely do this no interest plan to keep our savings intact. 
  • $40.63 spent at the grocery store. I'll be expensing this for the event we had yesterday. 
  • $25.20 spent at Tim Horton's. I'll be expensing these treats for my volunteers at the event.
  • $7.79 spent at the grocery store. Dh bought his lunch today.
  • $6.62 spent at Tim Horton's. Dh treated us to hot chocolate and muffins on Saturday. It was raining and so cold and we so appreciated this yummy treat.
  • $2.78 spent at the grocery store. Bread we forgot in our grocery order on Friday.
Our grand total for expenses for the last 3 days is $267.70. However, $65.83 will be expenses and come back to our account within the next week. So technically, our spend is $201.87. Take away the amounts we transferred to Mastercard and to Home Depot, then our true expenses were just $17.19. Not as bad as the immediate $300 I had in my head. Later tonight, I'll calculate how much will go in to our savings accounts this week. More as we go. 

Do you live on a set budget?
Is life a frugal experience?


A Brit in Tennessee said...

I started my first career as a bank clerk, and bookkeeper, so I was well familiar with budgets.
Fortunately my husband and myself saved over the years, and didn't live frugally, it's now paying off, with a mortgage free home, and monthly expenses on the credit card, always paid in full. We are able to help our grandchildren through college, and contribute to new vehicles for them. That being said, I still have the same kitchen appliances we installed when we built the house thirty years and counting :)
Well done on your budget planning !

A Brit in Tennessee said...

I obviously meant we DID live frugally :(

~Carla~ said...

After the last few days we've had with 3 sick kids and a sick husband, numerous cab rides, meds, OTC meds, extra juices, soups, Popsicles, etc... my # for the first few days is not going to bepretty and part of that was cash, so I can't even count that. Horrible way to start the month but i'm going to try not to stress and just get back on the right foot! Usually yes, we live on a stick budget, but sometimes life happens and gets in the way! *sigh*

Penny said...

In the 24 + years my husband and I have been married, we have mostly been on a very tight budget, ranging from tight, to extremely tight! We manage, and make the most of the times when money is a little more plentiful, and it means that any treats, outings, tickets etc are very much appreciated and enjoyed X

Chy said...

Thanks Jo. I miss being mortgage free but know we'll be there again soon. It's worth the bit of a payment each month to have this beautiful landscape and a really fun house to decorate. X Chy

Chy said...

Thanks for the clarification Jo!

Chy said...

I so agree Penny. We were single income with a bit from my ventures on the side but every penny was counted and cherished. And I'm sure that's made us so much more appreciative of what we can now do. Thank you for sharing. It's nice to know that we were not the only ones raising kids on pennies and somehow, it all worked and no on did without! X Chy

Chy said...

Carla, sometimes the budget has to go out the door when things creep up. Thankfully you have your slush fund for just those day. It will get back up there! X Chy