- I actually stuck with it! Every few days, for the last year, I've gone over my statements and transferred everything into my meticulous budget spreadsheet. Now it's habit.
- I got in the habit of saving. Except for a few months where I was too cash-strapped, I've been putting away $100 or $200 each month toward going to Italy. After that trip I plan to continue saving. Saving makes me feel all warm and fuzzy inside.
- Contrary to my fears, now that I can look at the whole year in review, most of my budget slip-ups weren't from profligate eating out expenses or other small expenses - it was because every few months I made a pretty major purchase - a computer, a TV, birthday/Christmas gifts, a mattress (I couldn't avoid that last one, but still). Luckily resisting big-ticket impulse spending is fairly easy. I'm now entrenched in a stubborn "I'm poor" attitude.
- I'm getting a lot better at cooking and making use of what's in my kitchen. My diet has definitely improved.
- Try as I might, this year I just kept getting poorer. After the summer I quit my tutoring job, because it's very hard to be a full-time student with two part-time jobs. Then financial aid kept decreasing in conjunction with tuition going up 14%, culminating with this quarter where suddenly I had to start paying out of pocket for books and $100 of tuition. Yikes. I'm trying to get out of here with as few loans as possible, but I definitely need to plan for this next year. The situation will likely get worse.
- I suck at not eating out. Lunch isn't the offender - I'm very good at either bringing it or going hungry. It's going out to dinner with friends. The answer obviously isn't to become a recluse, so the most likely way to deal with this cost is to trim spending elsewhere. I already order the cheapest things on menus and don't get drinks.
- In general, I need to think long and hard about whether I need something or just want it before I buy. This has been getting easier in the last couple months: I rarely go to places where I have the opportunity to buy things. Mostly I just go to the grocery store. When I did my Christmas shopping yesterday I almost felt empowered; passing chic clothes, handbags, and all sorts of baubles, I thought, "I don't need you! I already have everything I need to make me happy!"
The most obvious goal is: don't spend more than you make in one month. For several months in 2009 I bankrupted myself by using September's first paycheck to pay off the rest of August's expenses. Naively I thought I could get by on one paycheck for September, and when I couldn't, the cycle continued.
Not anymore. I want to start 2010 with a clean slate, which means spending this month living on one paycheck - for real. Luckily, I'll be going home at the end of the week, so I won't have to worry about food/gas/electricity and all of the uncertain expenses of living on your own. Unfortunately, this month is also December. Because my family is awesome and supports me so much, they deserve Christmas presents. But in order to start off 2010 clean, I gave myself a budget of $50 for all of my Christmas shopping this year. Here's how it worked out:
- Every few months I get a free $25 amazon gift card as a perk for using their credit card. I saved the latest one and used it to buy presents for my dad, stepmom and boyfriend. Score!
- My mom, stepdad and sister came to a grand total of $54, but to help offset this I sold some old textbooks today and got $36 back! Yes!
- Everyone else will be getting yummy and lovingly-wrapped baked goods.
Besides this Christmas spending, I've tried to absolutely reduce all non-necessary spending to zero this month. The one slip-up came when I took on an extra shift at work in the middle of the day - I hadn't brought anything in for dinner because I thought I would be home, so I bought something because I was starving. But, I'm on track to start the new year in the green.
One thing that this month has taught me so far is that it's really not all that hard to not spend. There's enough food in my kitchen to last a couple weeks. After about a week I wouldn't be eating fresh vegetables or fruit anymore, but my nutrition wouldn't take a very big hit. It just takes meal planning creativity and getting myself up off the couch. Last night I made homemade tomato soup and grilled cheese, which definitely hit the spot on a cold and dreary Seattle night.
So besides actually living within my means, here are some other financial goals for next year:
For about a year I've been saving up to go to Italy with my parents this summer. Once that trip is over, I want to keep saving monthly:
- Build a $500 emergency fund. Within five months at the latest (putting away $100/month) I want to have $500 in the bank to be used in case of emergencies: unexpected car costs, health costs, and other unforeseen and unplanned emergencies.
- Keep a $200 fund for recurring expenses. Keep $200 set aside at all times for recurring expenses throughout the year: textbooks, out-of-pocket tuition expenses, and gifts. This way these expenses won't take me by surprise and bankrupt me ($200 is a lot when you make just under $8,000 a year!).
- Don't make a large purchase until all of it has been saved. This one is probably a no-brainer, but unfortunately I need to make it a rule. Last year I was saving $3- or $400 for a TV and caved to purchase a great deal when I was still $100 short. While it's been a great TV, ultimately I don't need a TV and I'm a little ashamed that not waiting until I had all the money ready meant that I had to do some scrambling to cover that $100 I didn't wait for.
My usual method for saving for fun things (like the TV, or things like a weekend trip to Victoria) is to take 10% off each paycheck and put it in savings. This is a small enough number that I can manage its loss, but it still adds up relatively quickly. The amount of time it takes to save for something also has the added benefit of helping me realize if I really want it or not. Of course, sometimes I just sabotage all my well-thought-out plans. But I'm determined to learn from my mistakes.
