Happy Friday, everyone! I’m here today to dish on all things budgeting! Yep, that’s right. Today we’re talking money. Specifically — how you save it. And then spend it.
I think sometimes people get nervous when the conversation goes toward talking about money. Why? Because our society is one the says “Hey! It’s none of your business!” And to a point – I get it. But when it comes to how we allocate money, save for big trips and plan out my funds for monthly expenses, I think it’s fair to share that information, especially if I think it can help someone else. Ya feel me?
So let’s get right to it!
First things first – it’s important to note that the majority of what I make goes into savings and we try to live off solely Dane’s salary. There are obvious loopholes to this (like when I want to surprise him or buy him a gift of sorts), but for the most part, we try to make sure that the majority of what I make goes into our savings account.
Now, my favorite topic — the holidays. I always found myself getting worried around the holidays — how am I supposed to use my regular paycheck for all my expenses PLUS gifts?! Do I dive into savings? Take out a loan? What the hell do I do?! When I met Dane, he and I developed a really handy way of dealing with this – every week, we put money aside for holiday spending in the number amount of the week. So, in January on Week 1, we each put aside $1.00. On Week 2, we each put aside $2.00. You see where this is going. By the end of Week 45 (the beginning of November, when I typically start Christmas shopping), you will have accrued $1,035.00!
Okay so my next favorite thing is vacation. Who doesn’t love a good vacation, am I right? We save for vacations on a monthly basis, by taking 10% of our monthly pay (5% of each paycheck) and depositing it straight into our vacation fund. This happens automatically, so we never even see the money, which helps in not wanting to spend it on stupid shit we probably don’t need from Target. We take one big international trip per year and we never feel guilty, because we save for it in a special bank account all year long.
Now, let’s talk about the not-so-fun things like rent (or mortgages), groceries and utility bills. These are never fun expenses, because it’s just the cost of living. It’s nothing exciting! We account for this with a RUG fund — Rent, Utilities, Groceries. We’re really clever, I know. 40% of each of our paychecks goes into this fund each month. Whatever we don’t use at the end of the month goes directly into savings. Some months it’s nothing, but every little bit helps.
So, if you’re keeping track by now we’ve allocated 50% of our pay to something. But where does the other 50% go?
30% automatically goes into savings. We never even see it and it’s better that way! And the remaining 20% goes to “fun money”. We use it for date night, meals out, a round of drinks at our favorite bar, a new pair of sneakers — whatever. But! The caveat of all of this, is that when the fun money is gone — it’s gone! No more! It’s VERY easy & tempting to dive your hand a little bit into the savings pot, because you really want to try out a new restaurant or upgrade your wardrobe. Believe me, sometimes the sales at Nordstrom just call my name…but don’t do it! You can resist, I promise 😉
Now that we’ve gotten all of MY budgeting out of the way.. I want to hear about yours! I can’t wait to see your favorite tips and tricks 🙂