how i budget

For some reason, lately I've been talking a lot to friends about budgeting and how I handle my money versus how they handle theirs. I find it fascinating to hear how other people divvy up their paychecks and how they prioritize versus what I do. I could talk about these things for hours. Probably because deeply at the root of my being is one simple fact:

I love money.

I love making it, I love spending it, and I love saving it.

I know that in order to have the life I dream of I need to be smart about my money. No one is going to hand me billions of dollars. No one is going to provide these things for me but myself. I've been making a conscious effort lately to really up my game as far as my financial planning goes. I am by NO MEANS an expert and it's been a lot of trial and error along the way to find what works for me (I've talked about this before). But I think I've finally found a plan that works for me and I figured I would share it in case it helps anyone else.

First off, I am obsessed with LearnVest.com. It's a financial website geared towards helping women be more financially savvy, but I think it is a great resource for anyone. I have an account set up there which links all my bank accounts and credit cards and gives me a nice (and pretty!) overview of my finances. It has made it ridiculously easy to keep an eye on where my money is going.

There are lots of other sites out there like this one - Mint.com is another popular one. I used to use Mint, but, simply put, I didn't like it. Use what works for you, be it another website, an app on your phone, a spreadsheet, or crayons and scrap paper. Whatever! As long as it keeps you organized and accountable you're golden.

The best tip I have for budgeting your money is one I got from LearnVest. They recommend the 50/20/30 rule: 50% of your take home pay should go to necessities - rent, utilities, transportation, food. 20% goes to debt repayment and savings/retirement. 30% is leftover for your lifestyle - eating out, shopping, etc. It make it really easy to see where you're spending too much or too little and adjust accordingly. For instance, it turned out I wasn't spending 50% of my pay on necessities, so I was able to bump up my savings and lifestyle sections.

The 50/20/30 rule is so much easier than tracking every cent that goes in or out of your wallet. It allows you to focus your spending and saving without having to be a stickler. And if you're already using a money management website or system it should be really easy for you to see where your money is going.

The next financial challenge I plan on tacking is investing. I'm not kidding when I say I want a plushy life, so anything I can do to up my net worth is something I want to look into. Investing is something I know NOTHING about so this should be an interesting adventure. I'm thinking about starting to set aside some money purely to invest and seeing how it goes.

Any of you financial experts? Have any tips on investing or budgeting? I want to hear them! No, seriously, tell me because I wasn't kidding when I said I am obsessed with money.

Which now that I think about it is super weird since I hate math. Huh.

*This post is in no way affiliated with LearnVest. I'm just seriously obsessed. So dorky.

photos via learnvest.com and mint.com

january purchases

It's the end of the month so I thought it would be a good time to round up my January purchases. I have a $200 a month budget to spend on clothes. Originally, my plan was to pick one or two stores and  only spend my budget there, but the shopaholic inside me really can't be contained. This month's purchases came from a few different places. Here they are:

Madewell Artisan Tee $14.62 (sale) - mine is an eggplant color no longer available online

Madewell Top $26.24 (sale) - no longer available online

Madewell Year-Round Tank $7.49 (sale) - mine is more of a neon yellow, no longer available online

J.Crew Shorts $42.50 - I bought these a size too small as an incentive. I know this is a no-no, but for    $42 I WILL fit into them.

BP Basics Cami from Nordstrom $12 - these are the best cami's. They don't have that irritating shelf bra. Needed it for the Madewell sweatshirt top since it is actually kind of sheer in the back.

H&M Oversized Chambray Shirt $24.50

H&M Blouse $24.50

H&M Jacket $7 (sale)

H&M Necklace $12.95

Target Fleece Lined Tights $10 - unable to find online and who wants to see a picture of plain black tights?

If you've been keeping track and I did all my math correctly, you'll see that I came in a tiny bit under budget - the total is $181.80! Not too shabby. I have to say, I felt much less stressed about money this month than I normally do. I got a little crazed for a while about every little thing I bought - should I add my new shampoo to my budget? Gas money? A pack of gum?! - but then I decided this was really about keeping my excessive clothes shopping in check. As long as I don't go above my $200 budget for clothes and accessories, I'm not going to beat myself up about other things I spend money on. I even managed to put extra money in my savings account this month!

Next month is going to be a little tricky. I have everything I want to buy all picked out - it's all from Urban Outfitters! Except I am doing the 30 for 30 and I am not allowed to shop. So I think I am going to have to squeeze in that purchase before I start. I really, really want everything I have waiting in my shopping cart, hehe.

i got the budget blues

I feel like I've probably addressed this before on this blog, but I am addressing it again - more so for myself than anyone else. So if you don't want to read about my monetary woes and the new budget I am strictly enforcing for myself, then you'd better just leave right now. Go on, scram.

Okay, all the budget haters gone? Good. Let's proceed.

I recently got a raise at work, which was really exciting because obviously this meant I'd have more money. Then I got to thinking about what I wanted to do with that money. I know that, more than anything else, I want to buy a house. I don't like renting - the idea of giving my money away and not owning anything in return bothers me. Especially when it comes to something as personal as your home. However, I am nowhere near being able to afford a house, and definitely not on my own. Boyfriend and I would be buying a house together, but even then we'd both have to save for quite some time in order to even afford a down payment on something decent. Sadly, we live in a part of the country where your money just doesn't go very far when it comes to buying a house. I know whatever we buy will have to be a fixer-upper, but even then we can barely afford a run down old shack! I know we'll find something perfect for us when the time comes to begin looking...but we'll never be able to start looking without some money in the bank first!

So I am imposing a  budget on myself. Obviously there's nothing I can do about bills that have to be paid, so after factoring those out of my income, this is the budget I am allowing myself [*Note! I live at home currently, so that is why I have so much money kicking around]:

Shopping: $200/month
(clothes, accessories, etc.)
Entertainment: $100/month
(movies, food, etc.)
Emergency Fund: $50/month
(as in, extra pocket money, this is not for medical emergencies or any kind of real crisis)

This may seem insanely generous. I know there are people out there way better than me when it comes to spending and saving, but I am just not very good. I am decent with saving money - as in, I have a savings account and I contribute to it as often as I can - but I also feel no remorse about dipping into it to buy a new pair of shoes or something. Also, the AmEx bill has got to go. To be honest, I probably spend a lot more than $200 a month on clothes and stuff. And I don't need clothes! I have plenty! I am going to embrace the art of the remix. I am also going to try to spend my clothing allowance on better quality things. I will not be blowing it all at Forever 21. I think I may even have a specific store or brand I will spend the $200 each month. Heck, some months I may decide not to buy anything at all!

I'm going to have a spreadsheet at home where I keep track of every penny I spent on anything that isn't a bill. As soon as I hit that $200 mark, I'm finished.

The $100 entertainment fund will be spent on going out to dinner, grabbing drinks, the movies...anything like that. That's plenty, I think. Because you know what's fun and free? Hanging out at home playing board games and watching movies with your best friend.

The $50 emergency fund is money that I will keep in cash, in an envelope, at my house. If an impromptu diner comes up and I've spent my entertainment fund - I'll have that to dip into. If there's an article of clothing THAT I WILL DIE WITHOUT - I'll dip into the envelope. I figure I won't need to do this every month, so the money in the envelope will eventually add up. Then I can use it on weekends away or something.

Fingers crossed, this will allow me to save a big hunk of cash every month! This all sounds so lovely and logical written out, doesn't it? now let's just see if I can manage to put my words into action...wish me luck!

Now it's your turn. Are you on a budget? How's it working out for you? Do you have a shopping addiction like me? How do you keep yourself from going all Becky Bloomwood every time you step into a store? Leave a comment or shoot me an email.