STYLETHREAD -- LET'S TALK SHOP!

Well my first thought would be to calculate the expenses that can't be changed.  I would do this in excel.  At the top put your monthly income and then have separate rows with the bill and then the total.  Groceries and entertainment can change month to month and are somewhat based on what you can afford.  Once you have how much is left over after your bills you can determine about what you can spend on these items.  Hope that helps some! 

PS- make sure one line is savings!

Thanks for the advice.  The savings part is really the hard part!

I wrote out all of my bills, but what I'm really trying to figure out is am I being indulgent if I allot let's say $200/month for entertainment?  Or am I being frugal, because most people spend more than that on entertainment?

I'm reading this book, The Millionaire Next Door, and the author has interviewed many millionaires, and he lists common qualities, such as they all have budgets, many of the wives are frugal with money, even though they can afford to buy from any store, many shop at JcPennys.  I'm definitely not a millionaire.  I'm just trying to live at or preferable below my means.  So I'm trying to fiqure out specific dollar amounts for my expenses that are reasonable. For example, even though I really can afford to buy all of the groceries I want, what would be a reasonable amount for a family of four to spend?

pinky wrote:

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Thanks for the advice.  The savings part is really the hard part!

I wrote out all of my bills, but what I'm really trying to figure out is am I being indulgent if I allot let's say $200/month for entertainment?  Or am I being frugal, because most people spend more than that on entertainment?

I'm reading this book, The Millionaire Next Door, and the author has interviewed many millionaires, and he lists common qualities, such as they all have budgets, many of the wives are frugal with money, even though they can afford to buy from any store, many shop at JcPennys.  I'm definitely not a millionaire.  I'm just trying to live at or preferable below my means.  So I'm trying to fiqure out specific dollar amounts for my expenses that are reasonable. For example, even though I really can afford to buy all of the groceries I want, what would be a reasonable amount for a family of four to spend?

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Ha!  My hubby is reading The Millionaire Next Door right now too . 

How much you spend on food depends on how much you cook, what you cook, and how much you eat out.  Buying food at the grocery store is waaaay cheaper than eating out obviously, so we try to limit our restaurant nights to once a week (there are only 2 of us btw).  I'm a cook-from-scratch kind of girl so we meal plan and buy all our ingredients each week, along with staples, snack stuff, etc and spend anywhere from $75 - $110 each week on food.  So with that we buy all the fruits and veggies that look good, our meal ingredients, occasionally alcohol, but stay away from almost all processed foods which tend to be more expensive for what you get.  Most of our meals use alot of the same key ingredients too, so we don't end up wasting things.  So I think a $400/month grocery store bill for a family of four is decent, but not over the top .

My family is the same age and I don't know how I would possibly be able to budget groceries under $200 a month.  On the average, I spend over $100 a week on groceries, which of course includes non-foods like detergent, diapers, etc.

I recommend Quicken for categorizing.  It doesn't help me save, but it does help me recognize where my money is really going.  My husband and I are pretty good, but like a lot of people, what gets us is the temptation to dine out.

I'm a single 23 year old in nyc- so my breakdown is going to be different by a lot.  but thought i'd post it regardless in case it helped someone out.  I have: a credit card (i refuse to use debit cards- too hard to keep track of and the net 30 aspect of credit is amazing as long as you can manage it), a checking account, a couple of investment/retirement accts (which i won't really go into), a main ING savings account, and several nicknamed ING accts- all with direct deposit.  After bills I HAVE to pay (rent, utilities, etc)- i have about $1250.  Here is my breakdown:

ING acct "TRAVELING"- this gets $200 a month- very important to me.  Any time i make a vacation purchase (plane tix, etc)- i put it on my cc and immediately transfer the money to my checking from this account.  Any time I have to make a withdrawal while traveling- i'll transfer the money to checking as well- including all ATM related fees.  By the time I can go on my next big vacation (maybe April of next year?? I'm thinking south america or Europe)- i'll have about $1400 saved up- which will def. buy me plane tix and fun cheap living.  I also use this acct. to fund small road-trips and whatnot.

ING acct - "Sean's Savings"- $25 a month- this is set aside for my 13 year old brother- i want to give him the money when he's 21.  I'm teaching him to save his own money as well- but I want to help him out when he gets older.  I'll increase this each time I get a raise (i don't make that much money right now, but also don't have too many bills yet)- i'd like to have at least $5000 set aside for him, if not much more.

ING acct- "Health"- right now - its $100 a month- i have no health insurance- eek.  I'm hoping to get a cheap plan w/a high deductable for accidents (knock on wood) and use the remainder when i need to go to dentist, for contacts, etc.  keep in mind i'm young and pretty healthy- ideally i want real health insurance in a couple of years.

I'm also thinking of setting aside a nicknamed acct. for charity- i'd like to donate to some wildlife conservation charities, planned parenthood, etc.

Food- this isn't an acct.- but i let myself go grocery shopping twice a month- $60 each time- on my credit card ($120 a month). 

CASH (food, entertainment, coffee, liquor, etc)- I keep 4 envelopes at all times- that each have $60 in it ($240 a month)- that I open on each Friday.  I only let myself spend that amt. each week.  On a week I didn't go grocery shopping- I know i may have to spend more money on food that week or on buying fresh produce.  I also use it for the bars, etc, so i don't run up high tabs on my cc.  Some weeks I can live extremely cheaply (for example-the week i go grocery shopping, and i also don't go out that weekend)- i may spend only $5 that week.  So it transfers to the next week- if i have $115 that friday instead of $60- i might go out to a nice place to eat- or buy myself some flowers.  I always want to have a little left over- i never want to dip into next week- plus its fun keeping it a challenge to not blow money every time i feel like it.

So after all that- i have $565 left over.  There are always incidentals that I charge- haircuts, etc.- but I try to put at least $500 a month in savings.   I have expensive taste- but right now, i'm trying to sell on ebay to balance out what I buy that is new ( i need to get on this)- and i'm really editing what i buy these days.  I bought a great vintage bag on the street in williamsburg for $5 and spent $5 on a cool chain that i found a trim store- and it is great for going out and no one else will have it. 

So that is how i spend my money- i don't make a ton- but I keep costs down and if i get a raise (really hope i will at the year point!) i'll put excess in savings.  Its such a misconception that nyc has to be expensive- i feel the quality of living here is so high considering you can do SO much for free- when i lived in the suburbs- i felt like my life was one of consumption- Going to the movies, Going to meet a friend for dinner, Going to Target, Going to the Mall- anything to get myself out of the house.  I live in Brooklyn and have the highest quality of living that I've ever had- I have friends at bars that hook me up w/free drinks, we grill on our balcony and watch the sun set over manhattan, we have byob parties on our roof, we walk around the streets and people watch, go to block parties, visit my friends at their stores during the weekends, clean, go running across the bridge...  I don't mean to diss the suburbs (born and raised!) but I don't think you have to spend a lot of money to have a high quality of life.  Having savings gives me peace of mind, lets me enjoy nice clothes by designers that inspire me, and lets me see the world.