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Budget Changes

April 4th, 2016 at 04:59 am

52 Week Challenge Opening Balance: $3,148.28
Plus:
- Snowflake- Safeway Everyday Reward $10
- Mortgage principal repayment $8
52 Week Challenge Closing Balance: $3,166.28

To start with the additions to the challenge: when paying for something at Safeway they gave me my $10 reward off the groceries purchase price, so I transferred that to the EF today. I also saw the $8 bank fee got charged to the mortgage which put it back over $122k, so I paid the $8 back.

****

We've operated our budget on a monthly basis for the last 11 years since working at my job but after doing a completely joint budget as of 1 April, I'm already realising that perhaps we need to do things differently. (Not perhaps but we *must* do things differently).

I think it's a combination that we can see more income than we usually see and this month has already started to be expensive and looks like it will get out of control in a big way.

B gets paid on the 30th and received just under $3k for 2 weeks work (next month working a full month will be just under $4.5k as the tax is a bit higher). As he closed the business he advised me that his friend who has work for him occasionally (and he would work for the friend occasionally- instead of paying each other they would simply trade their time) is owed 5 days work and because the business is no longer open, they can't trade time anymore and he needs to pay him. 5 x $350 per day... We paid him one day and now owe him four. We'll pay another 1 or 2 days from his next pay, his friend is fine with this.

We now have to pay the car lease from our personal funds, which is $926 per month because even though it is no longer used for the business. It is high because the car was bought brand new. It's a good car and we're going to keep it. The lease expires in August and has a balloon of $15000 due. We are going to get a personal loan to refinance; looking quickly the best rate I can see is 11.83%, so that on a 3yr loan of $17000 maximum is $573 per month. Will be a much better result and as the car won't be driven as much we'll keep it a long time.

So first we had these two expenses, plus my UK trip savings, plus it's my birthday this month so we had to repay the $330 bike plus we had to get B glasses which were $400 and new work boots worth $126 and for a month we didn't have very much income left to live off.

I spent time juggling things around and just thought B gets paid on the 30th, I get paid on the 15th, why are we bothering with a monthly budget? It will be so much easier to manage on a fortnightly basis, especially as the bill repayments are now spread out evenly throughout the month.

So first in my budgeting app I deleted the amount of any transactions after the 15th, but wrote the amounts in the detail line, so after the 15th I will put them in.

I then analysed the percentages of the various categories to try and work out what is a reasonable spend and adjusted accordingly. I had to juggle some things around, some things will need to have part of the cost repaid from his next pay at the start of next month. Eg the glasses and the work boots. I made sure that our EF savings and my balance transfer repayments continue at the same amount.

So now after much juggling we're sitting at $504 for this week to live off (which was better than $983 for two people for 26 days). Live off means food, fuel,we have to go out for a birthday lunch and other miscellaneous exps like alcohol.

I'm really hoping this new method will work. Many years ago we got paid fortnightly and it all worked out ok, it just takes getting used to.

7 Responses to “Budget Changes”

  1. scottish girl Says:

    Good luck with your new method. It'll probably take a couple of months to get used to it.

  2. creditcardfree Says:

    I'm sure that will work just fine!

  3. VS_ozgirl Says:

    Thanks guys, hope it won't take long to get used to Smile

  4. FrugalTexan75 Says:

    Do you have to go with a personal loan for the car? That seems like a pretty high interest rate.

  5. VS_ozgirl Says:

    Thanks for your input FT, it made me look a bit more! We can get cheaper loans with credit unions instead of the big 4 banks (in Australia we have four main banks which pretty much have a monopoly over the banking industry). We've seen 8.5% where you can make extra repayments with no penalty for early payout (important to B). We've got a couple of months to decide (and B probably needs to receive a few more paycheques!)

  6. FrugalTexan75 Says:

    8.5% sounds better for sure! Maybe by the time you need it, there'll be even better deals to be had. Smile

  7. VS_ozgirl Says:

    Thanks, hope so!

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