Your Money Or Your Life: June Update

After reading the fantastic book, Your Money or Your Life, I decided we should start tracking all our spending. We started doing that this past month, and now have a full month of data to break down and analyze.

I did all my tracking on Google Docs, recording the date, what was purchased, the main category and sub-category, and then the total of the bill, and any break-down amounts if the bill contained things in different categories or sub-categories.

Last night I finally dealt with all the data, and it was an eye-opening experience. Until you try to parse your data, you won’t see how you actually should be recording your raw data.

I started by making a duplicate sheet of my spending sheet, so I could play with it without losing any of my data. Then I stripped off the date column and the description column. I was left with the category and sub-category, sub-category amounts and total amounts. I then sorted by category so that I could then do the breakdowns.

What I figured out pretty quickly was that I had a few things I had neglected to enter a category for, so I had to go back and enter a category so those items didn’t get lost.

I also figured out that where I had put the total of the bill and then the breakdowns, things were getting screwed up. So I left in the break-downs (must make sure from now on that all breakdowns account for the whole bill!) and took off the bill totals, since they had not been categorized anyway.

The other tweaking I did was to figure out some better categorization. This happened quite naturally after seeing the kind of spending, and simply standardizing some things.

Once I had my categories, I sorted A-Z by the category names, and then totalled up for each category. In my breakdown sheet I now have category in column A, sub-category in column B, category name (again-for the purpose of the chart) in column C, and in column D, the totals for each category. I got those by doing a SUM equation to add up all the spending for each category.

For anything I wanted to do more of a breakdown for, I put the sub-category totals in column F, with their titles in column E.

Finally, I made a pie chart for kicks to see where our money is going. Very instructive!

What I learned

I learned that our grocery budget for this month was pretty good, and that we’ve really brought my husband’s lunch spending down significantly. It will be interesting to see how we do next month. Our household expenses were sortof high, as we had to buy a car seat this month.

But in general, we are not big spenders. There was not a lot for entertainment, or clothing.

So the goal for next month will be to challenge our food spending, though this might be hard as we are going to be doing some traveling.

I highly recommend doing this kind of tracking. It is highly instructive to see where your money is going. The next step will be figuring out my husband’s “real wage”, and then assessing the spending in each category to see if it’s all been worth it.

We also have to get our wall chart set up. Both of these things are quite exciting, and although we aren’t doing this today, at least we have the raw data to be able to do it later. I’m going to continue with this, and I’ll make some sample data to show you how I did it. I’ll let you know when I have the sample up!

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Work Lunches: a new strategy

Some times you have to spend money to save money. It’s a hard, cruel fact. One that I’ve ignored for far too long. Today I broke the bank with pyrex, but it should save us a bunch of money in the long run!

Now that we’re doing Your Money or Your Life step 2 (part 2)–which involves tracking every cent that comes into and goes out of our lives–I’ve realized just how much money is being spent on food outside the home. Lots! One area where we have fallen down is in organizing my partner’s lunches at work. When he doesn’t bring something from home, his lunches out can easily cost around $10 per day. And that doesn’t count the $5 afternoon Starbucks run. Fifteen bucks a day adds up quick, and my partner is the first to admit that the food is crappy and not worth it.

Now that the baby is eight and a half months, things are beginning to stabilize a bit in our household, and we can start building some systems again, start re-organizing. So we had a chat about the lunches, and came up with a strategy for reducing his food costs at work.

Basically, the plan is to have five lunches ready and waiting in the fridge or freezer at the beginning of each week so that there will always be something to grab each day and he won’t end up needing to buy lunches any more. The specific strategy points are as follows:

1. Try to do better with leftovers. I always “intend” to make sure there are leftovers to take, but too often I forget to actually allow for them in my cooking. Leftovers will be priority #1.

Spaghetti lunches, ready for the freezer

2. Make big-batch home-made “frozen” lunches. This is where the pyrex comes in. I finally broke down and bought five glass freezer containers suitable for a decent portion of food for my partner’s lunch. My idea is to do just like the frozen dinners do and have a bed of noodles or rice dumped over with a good helping of sauce. Only this version will be home made, and it will be super duper cheap!

So, today I did a big batch of spaghetti. We ate a good helping for dinner, and then I made more noodles and packed up five yummy portions for frozen lunches. Easy peasy lemon squeezy. I’m planning to make big meaty saucy stewy meals every Sunday from now on to stock up the frozen lunches for the week. These home-made frozen dinners will be priority #2.

3. Buy enough frozen meals to last a week. My partner doesn’t mind the President’s Choice frozen Indian dishes, so I will try to make sure there are at least five in our freezer at the start of the week. That way, if we fall down on #1 and #2, at least he has those.

4. Make cookies. What can I say? My man likes my cookies. I figure for the cost of maybe two cookies at Starbucks, I could make a full batch of cookies at home. If I make them, he’ll eat them. And we all save money.

So there you have it: the new plan. It involves a lot of Sunday cooking and shopping, but I think we’re ready for it. There is a lot to be said for getting ready for the week on the weekend, instead of playing catch-up the rest of the days.

I also wanted to add that today I shopped at the Isabella Loblaws and found some great sales. First off, the PC frozen meals were on sale for $3 each, so I bought enough for two weeks. There were also all these bread products, reduced to 50% off. Due date: June 15! I don’t know who is getting fired over this, but I got a loaf of bread, a bag of english  muffins, and two bags of bagels, each for between $1 and $1.50.

So we are really really really well stocked at the moment. It feels good. But MAN my freezer is full!

Year in review and a new project

Your Money or Your Life

I missed my “blog-a-versary”, but I thought I’d chat a bit about what I’ve seen happen over this past year. Lots of changes, especially with the birth of my little guy, but we’ve also made some progress financially.

For one, we made a decision to pay off our line of credit from our daughter’s education fund. When we looked at our bank summary and saw that we were actually “in the black” by a few thousand dollars, it suddenly seemed foolish to be paying interest on the line of credit portion of that tally. We’ve been able to continue, and even increase, our deposits in the RESP, which now includes our boy as a recipient as well.

We have also become more aware of the cost of traveling, and have reduced our pleasure traveling significantly. This has also been due to having two little ones making traveling harder, but also because we noticed that our “little” trips to Toronto or Montreal would leave us reeling financially. We would check our balance a few days later and end up shaking our heads and asking “How did that happen??”

We still travel to Sudbury to visit our family a fair bit, but we are lucky that we almost always get those travel expenses covered. Our families like to see us I guess 🙂

I’ve been trying very hard to keep our food expenses down, and it’s getting easier now that the little guy is a bit older. Now that his naps are more regular, and I can leave him to roam around the living room a bit longer, and everything is just a bit less intense, I’ve had more of the requisite time to cook and plan meals. Actually I’ve noticed that the planning is almost everything in terms of staying on top of meal frugality.

There are other things–I’ve reduced my spending in many other random ways, and so has my husband, we’ve made some loose financial goals and have started moving towards them, and I’ve been using my freezer to stock up when things are on sale. All good changes.

So it only makes sense to bring things to a new level with the coming year. I recently got Your Money or Your Life out from the library. It is a nine-step plan to achieve Financial Independence, defined as having enough money to live on from a source other than paid employment.

Wow! Who doesn’t want that! Right now that seems a bit impossible, but even without fully achieving that goal, I do feel confident that we can reduce our spending, and refine our financial goals. Our next big ones would be paying off my partner’s 2 remaining student loans, and saving up a down payment for a house.

I’m giving the book a primary read-through, but we’re going to start tracking all of our spending right away. The beginning of the month seems like a good time to do it. I will give updates along the way, and who knows–maybe some day I’ll be writing “frugal + rural” posts from my organic farm in Northern Ontario, having achieved Financial Intelligence, Financial Integrity and ultimately, Financial Independence!