budgets

Why should you budget?

Basically you either figure out how to live within your means -  you spend less than you earn - or you go into debt.


That's it.


It doesn't matter how much money you make - if you spend more than you make you are at a deficit - borrowing money. I live in San Fransisco and I know folks who make alarming amounts of money and spend more each month than they make. And yet when I made $30,000 a year - an extremely low amount here in SF, mind you - I was able to save toward my retirement, save into my savings account, and pay off my student loans. So even though I knew people making 4 times more than I made - and even more - I was actually in a better financial position than they were due to my frugal ways. That's right - I was in a better financial position than people making three or four  times what I made.

So how do you do it?

Some people are really good at living within their means.  They may not have savings goals but they may have an aversion to debt - my husband was like this when I met him.  And this is great if this is  you too! He had a big savings and no debt - a perfect place to be. If you are this way you may still want to draft a budget and get some savings goals down on paper - to buy a house, retire, pay for your kids college, etc. Just to get you excited about saving. Another sort of 'lives within their own means' person grew up poor - like me - so they developed really cheap hobbies and they think eating beans for dinner multiple times a week is totally normal. Again - this is great! Unlike my husband I tend to spend to the limit of my income, but not over, unless I have some actual savings goals. A budget really helps me see my goals and how I can get there simply by the choices I make about how to spend my money.

If you are living within your means - but only just - you are at risk. If anything happened- to you, your car, your house, your job - you wouldn't have a cushion to fall back on. You would need to borrow money. You need to have a savings in case of emergency at the very least, and to save for big items like vacations, a home, a car, etc.The general rule of thumb is to have 3 - 6 months living expenses in your savings account, in case of one of these emergencies.

So lets create our budget and start saving today!


Creating a Budget

So you are ready to budget - that's great! Yay! Let's think of something we want ot save for. Emergencies. A home. A vacation. Something because a goal helps.

First up, it does help if you have some idea about what you spend your money on right now, so try to keep track for a month. Computer savvy & do most of your spending on a debit or credit card? Hook your bank accounts and credit cards up to Mint and you can see what you spent your money on last month. Otherwise download from your bank. And add in all the ATM withdraws under miscellaneous.

Shocked?! If you are like a lot of people you just discovered you spent a car payment on coffee shop coffee last month and a mortgage payment on your debt. Never fear - knowing whats going on money wise is half the battle. If you see some spending you are not happy with, change it. I know it seems hard, but it is doable. Bring your own coffee. Get a small regular coffee instead of a big fancy coffee drink. Bring your lunch. Buy groceries and start to cook at home. Small changes add up to big bucks! But I digress!

What do you need to create a budget? A spreadsheet is great, excel or google docs are wonderful. But honestly, a piece of paper works just fine.

So, starting:

List everything you spend money on in one column
List the amount, monthly, in another column

 
Here is a good list to start with:

• Rent or Mortgage
• Renters or Homeowners Insurance
• Debt: Car payment
• Car insurance
• Electricity and Gas
• Garbage
• Water
• Groceries
• Restaurants
• Debt: Credit Cards
• Debt: Student Loans 
• Gifts
• Entertainment (movies, bands, books, Amazon Prime, Netflix, etc)
• Coffee Shops 
• Miscellaneous

Total it up.

How much is it? More that you make? Less? Are you including everything?


( Expert budget maker? Add in a monthly amount for annualized costs like car registration,or other annual membership costs like AAA. )


Now, the budgeting part is figuring out how much you want to spend on each thing and then reducing your spending to get there. This is where handy tricks come into play!

Lets say you want to radically reduce spending - so go from $400 a month on lunches out at work to $0. You need to break the habit - spending, and get a new habit: making and bringing lunch.That's hard. But you can do.

First: plan ahead and buy lunch stuff. Keep it simple:

Lunch menu: PB&J, fruit, water

• Bread
• Bananas or other fruit
• Peanut Butter
• Jelly

   
Next make lunch the night before.
Bring it to work.
Repeat for the week.

Now, how to not go to lunch with your friends? How to actually DO IT? That's hard but not impossible.   

• Trick one: Have no other options. Leave your money and ATM/credit cards at home. Once you get used to the new habit you can start bringing your cash or ATM / credit cards again.

• Trick two: Remember your goal: print out a picture of what you are saving for: a house, a bicycle. a vacation. Put the picture where you can see if at your desk.

• Trick three: Enlist a buddy. Get a buddy at work to also bring lunch or have a savings contest with a friend. 

• Trick four: Replace the habit. Learn to make super gourmet lunches from scratch. Or use the lunch time to take an awesome walk and call a friend. Go knit somewhere. The key is to replace the spending habit with a new habit that you like. 

• Trick five: Spending or Savings Made Visible: keep real paper money - the amount you have decided you can spend on something - in an envelope. Only use that money for that expense. So put your grocery money in an envelope and use it to buy groceries. No ATM/credit cards allowed. Seeing the actual money as you spend it is a great motivator! Conversely see your savings by putting your average lunch costs (15$) into a jar each day you don't spend it.

What tricks do you all have for saving? For budgeting? I am always looking for new tricks!!

-daslael

community supported agriculture

Our Community Supported Agriculture (CSA), Eatwell Farm, is pretty fantastic.

What is a CSA? You join a local farm and pay a membership fee and in return you get the bounty of the farm and you participate in the community of that farm. . From Eatwell we get a box of super fresh produce every week along with 2 dozen eggs. Some people get a box every other week, and you select how many eggs you want. How much food is it? A lot. It's two grocery bags full or organic produce each week. We do a great job of eating our box – or put something up for winter, like the wonderful basil – every week as well as easily eat our 2 dozen eggs. Getting farm fresh produce means our food is super fresh, and stuff keeps longer, so sometime we save the garlic, onions and acorn squash for a few weeks. It also really forces you to up your veggie eating, as in yikes - the box is here, lets get cooking and eating! We also try new veggies we wouldn't have normally have tried - my husband now makes a mean kale chip - and pretty much anyone who tries them ends up eating handfuls.Prior I would guess that hand;t been a vegetable he considered purchasing and eating.

The veggies and eggs are fantastic, a good deal, money wise, for organic produce and free range, bug and tomato eating, chicken eggs. Two bags of organic produce will run you 60 - 100 dollars at Whole foods or the local farmers market, and it's just 27$ a box. The eggs are a super food and a amazingly healthy source of yummy protein for our egg loving child. We pay $108 every four weeks (27$ a box) and eggs are 8$ a dozen. But by going with a CSA we eat super fresh, local, organic produce and are saving at least $160 a month, if not more, on groceries.

Apart from the giant box of super fresh organic produce being a super deal,  every year Nigel (our farmer) has multiple events at the farm where you can visit, tour the farm, camp over and can - free for members!  There are two strawberry days, two tomato days, a pumpkin day, a garlic braiding day, and a chili cook-off, to name a few. At these events you can really can a ton for winter – we have yet to be super organized about this, leaving with a dozen of so jars of organic tomato sauce, but some farm members manage to can 90 (!) jars of tomatoes for winter. The strawberries are all you can eat and then 1$ a pound - I have made some amazing jam and fruit roll ups from the Strawberry Days. And these are shockingly low prices for organics - you can spend $7 a jar for organic tomato sauce, and how much are organic strawberries a pound? So look around for a local to you CSA and check them out! And hey, if you sign up at Eatwell tell them daslael sent you - I get a jar of Nigel's homemade tomato sauce if you join!

One event that was fun last year was the chili cook-off! We met lots of other farm members, some from our town with a little girl just a bit older than our bean! Little bean bounced in tents with other kids, held baby chicks that will grow up to lay our eggs, swam in the pond with little fishes and a little snake, and slept like a rock. We stayed up late, ate chili, drank home brew, toasted marshmallows around the campfire,  and had an awesome time.

My husband’s chili – a Chicken Curry Chili – was a giant hit! And we did manage to can a few cans of tomatoes for winter too.



A great weekend was had by all, and a great deal as these are free!

What are some of your secrets for low cost high quality organic food?

- daslael