A new year, a new budget

Last week–before 2011 began–Margie and I sat down and penciled out our 2011 budget (well…Excel’d it). We did the same exercise at the end of 2009 for 2010. And while we didn’t stick to our budget as well as we would have liked, we were/are glad to start the year on the same page–financially speaking.

Margie and I don’t like to budget. We’d prefer to live like we did pre-kids and pre-furloughs, but that simply isn’t an option. We have a mortgage and we want to be able to pay for our kids’ college educations. A budget is a necessity.

We discussed travel plans, paying for preschool (Adelaide will start in the fall), home repairs and improvements, and retirement savings, among other things. Very few of our budget categories have changed. We did, however, add a category for a babysitter, allowing me to have some time to myself one morning a week (oh. so. important!).

What has changed, is our commitment to tracking our spending. Over the last couple of months, we’ve been tracking our spending a couple of times a week rather than a couple of times a month. We didn’t save nearly as much as we would have liked to last year and this is primarily due to not checking-in often enough. With the new year, comes a new commitment to accurately–and frequently–track our spending.

So…yes…two nights a week, you will find me (or Margie) curled up on the couch, computer on lap and receipts in hand.

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3 thoughts on “A new year, a new budget

  1. We did this many years ago using Quicken. For me it felt a necessity, for similar reasons as you state (sans kids). We came up with categories and tracked every expense over $1. The first time we did it for about 6 months, then looked for patterns, areas of excess or unanticipated needs, etc. A big surprise the first time around was how much we spend on coffee (daily morning walks to Espresso Metro). We noted areas where we thought we could do better, and paid attention to these areas. We would then repeat the effort for 2-3 months every year or two; sometimes adding or deleting categories. We did this just to check in and refocus attention and awareness to key areas. We used this exercise as a way of being cognizant of what we did, more than to actually control or limit our spending.

    It was a valuable tool and process, and the lessons learned stay with us. And… the daily walks to Espresso Metro continue. No budgetary cutbacks there.

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