Ok, we finally did it. I've been somewhat avoiding this part of my 2008 Resolutions, but last night I put our budget down on paper. EVERY DOLLAR has a home... well, we have an extra $0.26 that isn't allocated, so we'll just call that our "fun money". Hahaha! Here's what is working for us and how we're cutting back.
GROCERY SHOPPING
Since the start of the year, I've been "working the drugstores" (CVS and Walgreens). Now that I have a pretty good handle on their systems, have some of their store dollars accumulated (currently $15 ECBs at CVS and a little over $40 at Walgreens), and a nice stash of coupons, food, and medicine, it's time buckle down on the spending. During this "learning time" I allowed myself to spend what I had normally been spending, but I was bringing in MORE... lots more.
I'll just tell you right now, when I was shopping solely at our Wal/mart, I was easily spending $175 a week... sometimes more like $225... and even occasionally a bill of $300 (when there were gifts to buy or something like that)... yes, in a week. I thought that with two in diapers, one eating baby food, and needing to buy soy products (which are much more expensive) that I was doing as well as I could. I used coupons and (most of the time) shopped just from my list. Like I said, I THOUGHT I was doing well.
At the beginning of the year, I restructured my shopping plan. I still only shop once a week, but I hit up to six stores that day for the best sales (rarely is Wal/mart one of them). For each store I have my list prepared and coupons that I'm going to use attached to the respective sales paper. I do not bring my kids with me since this is such a go-go-go day for me. My MIL arrives after Will is at preschool and she watches the other two boys while I'm gone. I leave around 10:30AM and at 1:30PM I pick Will up from school and I am usually done shopping by then.
Is three hours of shopping worth the extra bit of headache? Yes, because it's not much of a headache to me. I get three hours by myself to begin with. ;) I spend some of my non-shopping time cutting coupons and figuring the best deals... it's almost a creative outlet for me... a hobby if you will. Sometimes I feel crazy bringing my big coupon binder (looks a lot like this) into the store, but I am saving so much money by being prepared. How much money you ask? Well, I'm down to about $125 a week and occasionally under $100 (still with 2 in diapers, soy products, baby food, and now formula, too). I know that's not close to some of the frugal bloggers' budgets of $40 or so, but I'm saving up to $200 more a week than before! Wow. It's amazing what a little (okay, a lot of) preparation can do!
Witt will be off formula next month and it is my hope that Nathan will be fully potty trained by the end of the summer. Those two events will bring about a huge reduction in costs right there! So, my hope is that by August of this year I'll be down to about $75 - $80 for our weekly shopping. This is definitely a gradual process!
PHONE BILL
We still have some "bugs" to work out on the phone bill. In the past year, we were upgraded three times on our DSL. They'd call and say that "for just $5 more", we could upgrade our speed... so I did. Then one day I got online and realized that we had the highest speed possible - for major gamers and such. I don't even play Solitaire on my computer; we don't need that speed. So, I downgraded online and while I was at the website took a peek at our long distance. We had unlimited long distance, but we rarely call anyone long distance and if we do, I use my cell phone. So, I downgraded us to a "no monthly charge", but the highest per minute charge - as long as we don't use it we're saving money.
In doing those changes online, they assumed I needed a few features. Don't you just love how charges just "show up" on the bill? They gave me a static IP address ($14.95) which basically is for gamers that need to keep their IP address the same. They also included a wireless fee and a fee for computer protection (firewall or spam reduction or something). We have our own protection, don't need theirs. Then, under our long distance they included a $1 occasional oversees calling fee. I NEVER call overseas. Oh, and there is the fee for the protection of the phone line - if something goes wrong, they'll come out and fix it free of charge. Jeff can fix just about anything; we don't need that either.
My goal is to rectify all of that today. These changes can't be made online, so I'll have to call - something I really don't like to do.
I'm also considering just getting rid of our home line and switching to my cell as our main phone. I don't talk on the phone much anyway. My calls to my mom and Jeff are free because we're with the same company. I'm just curious what the charge will be to only have one service instead of bundling. Do any of you do this? I'd like to know how this works for you.
Be sure to check the charges on your phone bill... you never know what "extras" you might be paying for!
CREDIT CARDS
Jeff and I have always used credit cards and every single month we have always paid them off - no fail. We're taking a big step in a different direction and switching to an envelope system. With only $0.26 leeway money in our budget, we have to keep better track of everything. I'll miss the extra features on the credit cards (cash back is currently $130 on Discover, college money is over $800 on Upromise, etc), but now we've got a better plan than the credit card features: we've budgeted $50 per kid (for now) to be put in some sort of savings for college... MUCH MORE that those features could ever offer.
SAVINGSWe are going to set up a certain amount of money to be deducted monthly from our checking and go straight to a Money Market. This way it is kind of set up like a bill and we have "no choice" in it leaving the account. We have done this before and it worked very well; we just never took the time to set it up again with the new bank when we moved (almost two years ago). When you don't see it in the checking account, you don't spend it.
SUPPORT
We already had a copy of Dave Ramsey's Total Money Makeover, so I decided to read it (go figure) and so far he's got some really good ideas. It'll take some work, but I like it so far. Another book I recently acquired is the Tightwad Gazette. I've only just started it and it's an interesting read. Some of it is dated, but still worth looking at.
I also really enjoy Money Saving Mom. Lots of support on CVS and Walgreens, but also budgeting, coupons, freebies, and such. If you haven't stopped by her blog, you must go! Here are other frugal blogs I peruse from time to time, in case you are interested: Coins In The Couch, Centsible Shopper, Sense to Save, Stretching a Buck, Six In the Country, and Mom Advice.
Another great resource is Hot Coupon World. Massive amounts of support for CVS, Walgreens, and of course coupons (printables here - although I think you might have to join (free)
to see their printables database). Many times you can see what will be on sale in the next few weeks to help you better prepare. For example, I believe you can see the next 4 weeks of CVS sales papers there. There are also forums for grocery stores and other shopping.
WHY?
Why are we budgeting beyond the basics of saving? Our ultimate goal is to build a house out in the country. Jeff's dad owns some beautiful land and has said we can build on it. Without a budget, we haven't seen the big picture of how much we need to be saving. Come this October, our only debt will be the house, but with our current house payment, we can't save what we really want to be saving as quickly as we want to.
There is a good possibility that within the next year we will either buy a used double-wide trailer and put it on the land or find a cheap rental property close to it. Either way, Jeff (and friends) would be able to work on the house and save us a ton of money. I think I've told you that he's pretty handy. It's going to be a big sacrifice to give up this living space we are currently in and go to something smaller in order to save, but it will be good to downsize our stuff and humble ourselves a little bit by realizing we don't need so many of the things that we think we do. Plus, it will help us appreciate the built house so much more. Here's the closest online drawing of what we want, although we'll make a few modifications. Be sure to envision a wrap-around porch; I have to have one... I'll be in the country by golly! :)
So now I'd love to know, how much do you spend on groceries? Do you think I can still decrease my current grocery budget? (Any suggestions?) Also, I really want to hear about your phone bill - have you ever considered or gone to just cell phones?
And of course you can tell me how much you love our house plan. ;)
Thanks for making it through this really really really long post.
12 comments:
Look who's wearing the Yoda ears now! I admire your organization and long term planning. I really need to be more purposeful about finances, and you have some great ideas here.
I'm not a big fan of WalMart,(we affectionately refer to it as the armpit of Satan), but I do know that the one here will honor any coupons or sale papers from other stores. It's worth saving the runaround time for me on most weeks.
I LOVE your house plan.
As far as your other questions, I'm so not a budgeter so I can't help you there. But the house is so nice and I think a wrap around porch would be perfect!
Lulu ~ the armpit of Satan is a very good name for it. Thanks for the laugh!! :) My walmart does the same with sale papers, but the local Kroger marks down meat significantly when it's close to the expiration date. I can get it much cheaper there, but I don't know what's going to be on sale. (I cook or freeze it quickly)
Plus we have an Aldi's and their produce is MUCH cheaper and not always advertised. (If you have an Aldi's nearby, check it out!) Don't want you to think I felt the need to explain myself, I just thought you might like to check out your local Kroger or Aldi's. :)
Also, I must say, Jeff is the financial head around here. He has taught me so much about money and how to budget and how not to go into debt. He's a wealth of knowledge, that man.
Something that has really helped us, and I you may already do this, is automating as many payments as possible. Sometimes this even gets you a discount. I know our insurance company, newpaper subscription, and a couple of other things, all give us a few dollars off if we set up automatated payments. We only do it for things that stay the same each month, so we don't confuse ourselves. Those small amounts we shaved off this way added up gradually.
I think you are right on track with the envelope system. There is nothing like seeing good ol' green money to help you watch your spending. This is how we raised four kids on one modest income. And now they do it, too!
Hey!
I have several friends who only use cell phones, and it works out fine, I believe. Matt and I have talked about it several times, b/c we NEVER answer our house phone...but he needs the fax line for work, so we are still looking in to it. I would like to hear how it goes for you.
I am currently spending about $60 a week in groceries, with two in diapers. I don't have to buy formula though, and I know it is expensive. My only tip is to buy fewer pre-packaged items. I know cereal, crackers, cookies, individual yogurt cups, string cheese, etc. really makes the grocery bills add up quickly. We have also pretty much eliminated fruit juice (the boys are drinking lots more water now) and such. I noticed a big decrease in our spending when I started trying to shop for things that weren't in plastic containers. I have been trying to reduce my amount of trash, as well as recycling. It is really hard to buy junk food, or convenience items that aren't in plastic.
It sounds like you are doing great! It must be very satisfying to see such a drastic reduction in your bills! Yay for you!!
I must say, I don't see how women can be bored as housewives...there are always new ways to learn to do our jobs better, and more creatively. And like you said, not only are you saving money, but it is almost like a hobby! I am excited for you, as you learn more ways to be a good steward of your money, as you look to the future and to your dream home! :) Keep the tips coming, I enjoyed this post very much!
We cut off our land line completely in December. With our service (alltel) and all the unlimited calls we can potentially make, we don't ever go over our limit. If you decide to go to cell phones completely just be sure to check all your options for internet connection. I have to have a high speed connection for work so we are using cable now.
I am trying to reign in my grocery bill right now too. I used to shop for around $80/week and I had 2 in diapers, but no formula and no baby food (I made all of it), and mayo was less than $3/jar. I think the biggest difference now is that what I do buy and the meals I make don't go nearly as far because my girls are great eaters. My groceries in the recent past were easily $500/month. If I can get to less than $400/month I will be ecstatic.
I just found your blog through Joyce's blog and it's great! We have just one boy (age 3) and he's a delightful big handful!
We spend $300/month on groceries (not counting the diapers - sigh), which drives me crazy because I think I should be able to do it for less, but we eat as much organic as possible and it's more expensive. We call Wal-mart the "Evil Empire" and we even hum the tune as we drive past. Someday, our son will be old enough to watch Star Wars and wonder why they use the "Walmart theme!"
I LOVE your house plan!
We had cell phones only for several years and I loved it. The only reason we have a landline now is because I stay at home full time and talk on the phone too much...we kept going over on minutes on our cell plan and found an unlimited calling plan on our landline (through cable company).
I am currently spending about $100/wk on groceries, cleaning stuff and toiletries. But I only have 1 child and we don't have any special dietary needs.
Thanks for the link to my blog too. I'm glad I found you! :)
We dumped our landline about 18 months ago because the only people who called us besides our parents were telemarketers. We have a family wireless plan now and it is much cheaper.
I spend about 400 dollars per month on groceries for my family of 4. And I just posted about diapers and formula, because I met someone online who doesn't think potty training and weaning to milk is cheaper!
Love the house plan! LOVE it!
I am inspired by all of this saving!!!! Once life is somewhat settled adn I have time to coupon clip, I think I'll need to join in! (since we just bought the house and all that...)
Good fo ryou girl!
girl, this whole write up could have been written by me! starting drugstores in 2008, 2 in diapers, boys, potty trained by summer, weaned by summer, used to spend too much in walmart, given land to build on by in laws in the country. just today i said to DH, let's just park a trailor out there and get out of here! we hate our house and neighborhood. the country would be so much better for our son. we only have our cell phones (highly recommend that). i'll have to go back and read what else you said. but it's all me, even the milk allergy. we are twinkies!
Yeah for the envelopes!! :) My husband and I love Dave Ramsey (and have paid off $65K in debt to prove it!).
Groceries can be a hard area - we have 4 kids and 3 adults in the house and between groceries/toiletries/etc...our cash budget is under $400 a month right now. I stopped doing coupons because we don't have a lot of the great places and I don't buy a lot of name brands. I do shop primarily at Walmart and generally shop once a month for groceries (I like to sit down and plan the meals for the month). That way we tend to stick to the budget and not go out to eat, etc... because there is a plan in place.
Your house plan is very similar to one that we are planning on building soon. :) We just bought some land - ours is a "revamped" Donald Garder plan (Walnut Creek).
And I'm just blabbing on and on.
If you and your hubby haven't taken Dave Ramsey's Financial Peace class, you might want to think about it. We learned so much more than just reading the book (enough that we taught the class several times too).
Jolanthe
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