Tag Archives: budgeting

5 ways budgeting and weight management are alike

This post was originally published on September 22, 2008.

One of my first posts was about how I lost weight using basic budgeting skills. Now that I’m working to get healthier, I wanted to revisit the topic. Only this time I’m talking about why constant monitoring and reassessment are crucial to staying physically and financially fit.

Here are some tips I’ve found helpful when managing my weight and my budget:

1. Be realistic.

Sometimes it’s necessary to go on a strict budget to pay down massive debt. You may have to cut all discretionary spending for a little while to overcome a major financial hurdle. However, if you try to maintain that level of restriction for too long, it’s harder to stay on track and meet your own high expectations.

Your best bet is to find a comfortable balance between necessary bills, discretionary spending, and saving. Maintaining a reasonable budget requires constant monitoring, but it shouldn’t be incredibly difficult or make you feel deprived.

2. Frequently monitor your progress to catch yourself before you veer too far off track.

Once you find a comfortable budget, it’s crucial that you measure your progress regularly. Without careful planning and monitoring, you could easily throw your entire monthly budget off track with one weekend of bad decisions. Imagine how bad it could get if you just stopped monitoring your spending for months at a time.

Just as you check your budget frequently to make sure you’re not overspending, you must weigh yourself regularly. A slight increase in weight could alert you to a problem in your diet and activity before you veer off track to an unmanageable degree.

3. The longer you avoid the problem, the harder it is to resolve.

It’s much easier to pay off your credit card balance every month than it is to pay down several thousand dollars of debt that’s accrued over months or years. It’s also a lot harder to lose weight when the pounds have packed on over time. Overcoming a 1-pound weight gain usually just involves watching what you eat closely for a few days. It’s a lot harder to get back on track if you wait until you’re 40 pounds overweight.

4. Constantly adjust according to your changing needs.

When it comes to budgeting, everybody knows that you can’t continue spending the same after a major pay cut. When your income decreases, your spending must decrease, too. Likewise, when you welcome a new baby, your discretionary spending is probably going to take a hit to accommodate for diapers and formula.

You must find the same balance between activity and calorie intake for weight management. I first started struggling to maintain my weight after my job changed two years ago. In retail, I was on my feet 8 hours a day running around the store, moving heavy objects, and constantly moving. I didn’t watch my diet as closely as I should have, but the constant activity made it easy to keep extra weight off. Now that I’m sitting at a desk all day instead of moving, I need to seek out more activity outside of my job and become mindful of what I eat to avoid weight gain.

5. Sticking to it and making the right choices are the hardest parts.

Everyone knows that the easiest way to stay ahead of the game financially is to spend less than you make. We also know that the best way to maintain a healthy weight is to burn more calories than you consume. It all sounds so easy when you break it down into those simple equations, doesn’t it? The truth it, it’s not that easy.

The part that’s left out of that equation is the constant struggle every day to make the right choices and stick to your commitment. After all, if it was as easy as it sounds, nobody would struggle with their weight or their finances.

The best thing that weight control and budget management have in common? They’re both totally worth the struggle.

Photo by nataliejohnson

What are you frugal weaknesses?

ipodTo most people, the holiday season is synonymous with family, spirituality, and tradition. Unfortunately, it also means we’re surrounded by marketing messages and inundated with consumerism.

No matter how firm you are in your frugality, this is one time of year when you’re likely to fall off the wagon. Whether it’s shopping for family or for yourself, holiday advertising combined with great deals can make it difficult to resist the urge to spend.

The easiest way to avoid it — or at least minimize the damage — is to be aware of your own weaknesses. It’s different for everyone. Whether you’re addicted to high-end shoes, high fashion, or just expensive gifts for friends and family, self awareness can help you avoid situations where you’re likely to give in.

Here are my top frugal weaknesses:


Computers, televisions, gadgets, camera gear … I love all of it. So when I see a great deal, it can be very difficult for me to resist.

How to avoid the temptation: I don’t browse electronics stores or websites unless I need to make a very specific purchase that I’ve planned in advance. And on the day after Thanksgiving, I won’t be anywhere near an electronics store.

Gourmet Food

I’ve written before about my husband’s expensive taste in food, and I would be lying if I didn’t admit that I like pricey, specialty foods myself.

How to avoid the temptation: We make a specific grocery list every week, purchase only the essentials, and avoid browsing as much as possible.


Once upon a time, my husband and I spent our weekends browsing at Barnes and Noble and rarely left without bringing home something new for the bookshelf.

How to avoid temptation: Browse the library or a friend’s bookshelf instead of the bookstore.


Every year I’m tempted to spend way more than I can afford on the people I love.

How to avoid temptation: We already set a budget for how much we can afford to spend on holiday gifts, and we’re making a list now of the best gifts for everyone on our list within our budget. By planning ahead, we reduce the chance of panicking at the last minute and spending more money than we have to.

What are your frugal weaknesses, and how do you avoid them?

Photo by mallol

Should you keep a cushion in your checking account?

nickels and dimesA little over a year ago, we moved most of our money into our savings account. We didn’t want to keep very much money in our checking aside from what we need to cover our monthly expenses.

I decided to leave a $1,000 cushion in our checking account. The idea was that $1,000 would serve as the zero mark. It would just sit in the account, unspent, serving as a cushion so we’d never overdraw our account in the event of a miscalculation.

Fast forward 14 months. Each month we went just a little over budget. $50 one month, $25 the next month, $100 the month after that. The motivation to stay completely on target wasn’t as strong because there was extra money there. Now, our $1,000 cushion is gone. Even though we have a pretty health savings account, it feels a lot like living paycheck to paycheck.

I’ve considered putting a little money aside each month in the budget to rebuild our cushion, but here’s the thing: I don’t know if I want a cushion.

Even though I don’t like the feeling of an empty checking account at the end of the month, we’re less tempted to overspend a little here and a little there when we’re cutting it so close. But it still feels like living on the edge. One error and we could be hit with overdraft fees (our bank hasn’t yet allowed opt-in and opt-out for overdrafts like Chase and Bank of America).

I feel like we’re stuck between two crappy choices: the risk of overspending vs. the risk of overdrafting.

I’ve decided to open a new savings account with my bank (our main savings is with ING) and put $100 or $200 in it to reduce the risk of steep charges in the even of a miscalculation. It’s unlikely since I watch our spending so closely, but I don’t like worrying about it.

The thing is, our dwindling cushion wasn’t due to error. It was due to poor judgment. As long as we had “extra” money in our account, we were more likely to make poor choices. As I said last week, we don’t make big purchases, but we nickel and dime accounts to death.

How do you handle this dilemma? Do you keep a cushion in your checking account, or do you move all of your extra money to savings to protect it?

Photo by heypaul

Why I’m happier on a tighter budget

Yesterday I confessed that we kind of blew our budget this month.

After a summer living on cash, we went a overboard once we started using our debit cards again. It wasn’t that we went completely nuts and totally disregarded our budget. It was much sneakier than that. It was a few things here and there at the grocery store, because we can afford it now, right? It was stopping on the way home from work to pick up a few things because why not?

For us, it’s never something huge that blows our budget. We’re too careful about big purchases for that to happen. Big purchases are always planned out, saved for. What blows our budget are the fifty or so purchases throughout the month. $1 here, 50 cents there. Then suddenly we’re a week from the end of the month and we’re already out of money.

Living on a cash budget, that didn’t happen. Each and every purchase was given the same consideration as a major purchase. Even if it wasn’t, we were protected from spending next week’s budget today because we didn’t have the money on hand. All we had was what we were allowed to spend for the week.

As I’ve said before, my favorite part about living on cash was that there was no Monday budget dread. I didn’t look at the budget on Monday morning and kick myself for overspending on the weekend. We withdrew what we wanted to spend, and that was what we spent. It was so much less stressful for me to have those decisions made ahead of time instead of keeping track of everything in my head. I could just enjoy the weekend without adding things up in my head, because I knew that we were spending the right amount.

My point is, we have decided to live on a cash budget going forward. With so much to save, we can’t afford to let a hundred little purchases eat away at our savings. We’re getting serious for the next 15 months so we can have it all: Europe, a stress-free move, a healthy emergency fund, and our own home sooner rather than later.

And instead of feeling restricted by our tighter budget, I feel free from the stress and worry of trying to keep track of all of our purchases in my head. Life is too short to spend it worrying about every little purchase.

The beauty of a monthly budget

budgetingWhen our no spend summer ended in August, I told myself we weren’t going to go overboard. I told myself we were going to keep our budget just as tight. I was wrong.

Just as I feared, we went a little overboard for the past month. So overboard that it’s only the 23rd and we’ve already spent all of our food budget. Oops.

But you know what I love about a monthly budget? I love that we only have to scrimp for the next 7 days, and then it’s a whole new month. I love having a clean slate at the beginning of every month. Last month’s mistakes don’t matter, because all that matters now is this month’s budget. I can start all over again.

Here’s how I get back on track:

Don’t wait until next month.

As soon as you realize you’re overspending, stop. We stopped a little too late this month, but we’re doing what we can now to control the damage and start fresh next month.

Make some changes to this month’s budget.

If you’ve overspent in one category, see if you can cut discretionary spending in another category to make up for it. I’m cutting down on entertainment and household expenses spending for the next week to make up for a little bit of our overspending in food.

Forgive yourself and move on.

Beating yourself up doesn’t change the fact that you overspent. It just makes you feel bad. Everyone makes mistakes. When you make a spending mistake, the important thing is to stop the bleeding, control the damage, and ride it out until next month when you can have a fresh start.

That’s what I love about monthly budgeting: you’re never more than a month away from a clean slate!

Photo by spiderpop

Necessity is the mother of frugality

money jarTony will finish graduate school in May 2010, but after that he’ll have a semester of student teaching before he’s certified to teach. Right now he receives a stipend for teaching undergraduate classes, which he won’t receive while student teaching. Unfortunately, this means we’ll have to live on my income alone for about 7 months. The student teaching program is full time, and we’re hoping he’ll be able to work nights and weekends, but I don’t want to count on that considering the trouble he’s had searching for part time jobs in the past.

We’re also preparing ourselves for after the move. I’ve done a little research, and in the area where we’re moving, it looks like we can expect Tony to start somewhere between $32,000 and $35,000 as a high school teacher (according to what I read, he’ll be paid slightly more than a normal first year teacher because of his master’s degree and experience). Of course, this number is just an estimate. If you have any information about what starting teachers in the Indianapolis metro area make, by all means please pass it along!

I will continue to generate freelance income, but I won’t be working full time since we’re planning to start a family shortly after Tony finds a teaching job. Freelancing is feast or famine, so we don’t want to factor my income into our normal budget. That means we need to start planning now for a reduced income with a baby.

On top of all this, our savings goal has increased since we’d like to buy a house sooner rather than later.

To help us reach these goals, we’ve decided to reduce our monthly spending by about 5% and increase our total monthly savings amount by 25%. Put simply, that means we’re cutting about $150 from our monthly spending and adding it to our monthly savings.

I spent some time pouring over the budget. I determined that if we continue living on a cash budget, cut our weekly spending by $25 a week and make some minor adjustments in other areas, this is totally doable. If we hadn’t spent the summer on such a tight budget, I never would have thought this was possible. I thought we were saving as much as we possibly could, but after a summer of tight expenses, instead of feeling like we need more, I only see where we can cut.

In real terms, this means we’re cutting our grocery budget from $50-$60 a week to $40-$50. Our “shopping” budget, which covers household expenses like cleaning products and other miscellaneous items, is being cut from $20 per week to $15.

As we move into fall, we’ll increase our additional savings by another $50 when our electric bill drops from $100+ during the summer to $40-$60 a month during the cool winter months.

Over the next 8 months, this will increase our total savings by about $1500. More importantly, it will better prepare us for next summer and fall when we lose 1/3 of our total income. It will also make it easier for us to transition into a single income home in spring 2011 when I’m no longer working full time.

My point is this: if you’re looking ahead to a lower income, now is the time to make cuts. It’s always easier to transition slowly than it is to jump into the cold water. Don’t wait until you lose your income. Learn to live on less now so you can bank the extra money for the future.

Photo by jayd

Lessons learned from our no spend summer

cashIs it really September 1st? It seems like just yesterday when I started no spend summer, but it’s been three months.

Tony received his first paycheck of the school year at the end of last week, which means our experiment is over. But I have to be honest, it feels like it ended at the end of July. Between the Paul McCartney concert, our vacation, our huge camera purchase last week, and some necessary car maintenance, August has been anything but a no spend month.

Despite the fact that our budget fell apart this month, we still accomplished what we set out to accomplish: we made it through the summer living on 2/3rd our regular income without spending any of our savings.

Here are the things we learned from living on a cash budget for (at least) two months:

We developed better grocery shopping skills.

Shopping with cash forced me to learn better budgeting habits for groceries. We were menu planning and list making, but too often before this summer, our total at the cash register was a surprise. We were shooting in the dark when we tried to stay within a budget each week. Now I estimate the totals of each item on our list based on previous purchases, and then I update those amounts as I put things into the cart. This allows me to keep track of how much money we’re spending and make changes at the grocery store if we’re over budget. This skill is essential to staying within grocery budget, and if this was the only thing I learned this summer, it would be worth it.

Cash budgeting is actually easy and freeing.

I used to have a negative attitude toward cash budgeting. Because I tracked my spending electronically, cash in hand was money that had already been deducted from my budget, so I was more likely to blow it. But I found cash budgeting to be incredibly freeing this summer. I no longer dreaded looking at my bank account on Monday morning, seeing how much we’d spent over the weekend, and adjusting my budget for the rest of the month. With cash, I knew exactly what I’d spent, and I knew that it was within budget. Tracking where that money went was simple with Mint, and knowing that we’d stayed within budget removed spending stress.

We became more creative and resourceful.

I’d like to say that we learned to live on MUCH less than normal, but I can’t. We cut our budget pretty close, and most weeks we spent all of our cash by Monday. In the past, we relied too much on the ability to run to the grocery store and pick up a few things in the middle of the week. But with cash budgeting, if we were out of cash and we realized on Thursday that we’d forgotten to add a crucial part of a recipe to the grocery list, we couldn’t just run out and pick it up. It forced us to make do, and we learned to look at our pantry differently.

While this is the official end of no spend summer, we’ve decided to continue cash budgeting. I have actually enjoyed the structure, and I’m hoping cash budgeting will allow us to save more each month so we can reach our goals for Europe, moving, and buying a house much faster.

If you’ve never tried cash budgeting, take it from someone who used to hate the idea, and give it a shot! You might find that you like it. :)

Photo by nicmcphee

Tracking spending on a cash budget

budgetingOne of the top complaints I hear about cash budgeting is that it’s harder to track spending with cash. When you’re swiping a debit card, it’s easy for to track spending electronically. When you’re spending cash, there’s a little more work involved.

I use Mint.com to set and track my budget. The idea of changing my system completely, or using the envelope method was exhausting. So I came up with a system for tracking my cash purchases electronically.

I still use Mint.com to track my spending. Mint allows you to split transactions. Before we were cash budgeting, we used the split transaction feature to categorize spending. If we bought dog food at Target along with other household purchases, we’d split the transaction so that the price of dog food was categorized with “Pet Expenses” while the rest of the purchase went under “Household Expenses.” Simple.

That feature makes it just as easy to split cash transactions. On Saturday, we withdraw our weekly cash allowance. We do our grocery shopping, pick up household purchases, and run errands for the week. I save all the receipts for purchases made with that cash.

Mint categorizes our ATM withdrawal as a single transaction. The following Saturday before grocery shopping, I split the ATM transaction based on the receipts I’ve saved.

To do this, just highlight the ATM transaction, click on “Edit Details,” and then “Split.” Enter the store and spending category. That amount will be categorized correctly in your budget. Cash we don’t spend remains categorized as “ATM Transaction.” If we spend it later, I go back to the original ATM transaction and categorize it correctly.

It reminds me a lot of something I watched my mother do every weekend when I was a kid: balancing a checkbook.

Electonic banking and money management software have made checkbook balancing obsolete. It’s possible to track purchases up-to-the-minute online, so most people are happy to be done with the hassle of checkbook balancing. But tracking spending manually makes me more accountable. It a little extra work, but it’s made me a lot more knowledgeable about where my money goes.

This system takes all the guesswork and stress out of budgeting for me. Instead of mentally adding things up in my head and checking my bank balance, I forget about budgeting until Saturday morning. I only take out the cash I can afford to spend, so there’s no danger of overspending. At the end of the week, I organize that week’s spending and start over again.

Have you ever lived on a cash budget? How do you stay organized and track spending?

Photo credit: spiderpop

A change in perspective

Our no spend summer has resulted in the lowest balance on our checking account in, well, as long as I can remember. I was paid Friday, and after paying our bills and buying our groceries, our checking account balance is now $250.

I know there were times when I was in college, and even after I graduated, when my balance dipped well below $50. There were times when I overdrew my account. I remember these times vividly. But this is the first time since we started living frugally that I’ve seen a bank balance this low.

Don’t worry about us. We have more money in savings than we’ve ever had in one lump sum in our lives. We’re doing fine. Keeping our checking account balance low is a defense mechanism. It protects us from ourselves, and prevents us from spending more money than we want to spend.

But looking at that balance stresses. me. out. Especially since we’re heading on vacation this weekend.

I have access to our savings through my ING checking account just in case we need money immediately. Our low balance doesn’t pose us any threat since every penny is accounted for these days.

I still just don’t like seeing our balance that low. It makes me feel out of control, just like I did a little over two years ago when every penny wasn’t accounted for. When I still had bills to pay and food to buy with that $250 balance, and I was trying to make a dollar out of 99 cents.

I’m tempted to move some money around just to make myself feel better. I don’t like looking at that balance. But then the sadist in me wants to keep going, to see how far we can go this summer without dipping into our savings. After all, that was the point of the challenge. If I move $100 into our checking account just to make myself feel better, that’s technically cheating. So I’ll probably keep going, and it may even dip lower before the summer is over and Tony starts getting paid to teach again.

But it’s made me think about those days 2 years ago when low balances were a fact of life. Back when my bank balance rarely went above $500, and there was no separate account where I kept my savings because I didn’t have any savings. Back when I spent every penny I earned almost immediately. I felt out of control, and I never knew where my money went.

It’s times like these when I’m proud of what we’ve accomplished in such a short time, and I remind myself that I don’t ever want to go back. It’s amazing what frugality has done for my perspective.