Tag Archives: wantlist

MOOLAH MONDAYS: Workin’ the System Part II

December 4, 2014Budgeting & Moneybudget, cash, checking account, credit card, discretionary income, money management, overdraft, overdrawn, paycheck, receipts, spending, want list, wantlistKurt Kirton

budget, money management
Using this system, at the end of every month, or after your last paycheck for the month, do what I call “Paying Yourself.”

1. Total up your paychecks in the “Pay” section of your Tracking Budget. This is how much you have to work with for the next month.
2. Anything you paid for with cash – Handle this by referencing your ATM receipts and subtracting your ATM cash withdrawals from the Tracking Budget and on your checkbook register. (I recommend writing how much cash is intended for what on ATM receipts).
3. Sort your mountain of receipts into groups by the sections of your Budget (eg. Gas, Food, Me; and ATM separately), sum and subtract the totals of what you spent in each category from your Tracking Budget. See #3 below about credit card purchases.
4. Anything you paid for with your credit card – Subtract it from the respective section (for example, subtract the total of all your grocery receipts from Food), and add each total up to the “Credit Card” section. Then, I get a master total of all my credit card receipt piles and add that total up to the “Credit Card” section. When the cc bill arrives, I pay it out of the “Credit Card” section.
5. Get a new total for each section on your Tracking Budget. This way, you can see where you might have gone over/have a negative balance in that section. An example cause of this would be the shortfall from that leather jacket you bought, or that from spending more money on gas than you thought you would last month.
6. Now that you’ve dealt with everything you spent, reference your Planning Budget, and allot the amounts there by writing them into the respective sections of your Tracking Budget adding money to each. (Make sure to subtract all of the Pay section from itself. For example, $1800 – $1800=0 since you are distributing the full amount into sections of your budget.)
7. Ideally, you will have made more than the total of your regular expenses. Before you have a party about your discretionary (leftover) income, use the leftover cash to absolve any of the negatives we talked about in #5.
8. Anything you’ve got left after your negatives are taken care of is your final discretionary income. You can save that, spend it, or some combination thereof. Fun, fun, fun! Log how you’re using this money into your Tracking Budget. Time for totals…
9. Total 1 – You’ll get this from balancing your checkbook.
10. Total 2 – Get a full total by adding up the sections of your Tracking Budget.
11. Total 3 – Your Checking Account Statement total
12. Write total 1 and 2 on your checking account statement so you can see 1) Checkbook Register total and 2) Tracking Budget total vs. 3) Checking Account Statement total. Honestly, my 3 totals rarely equal, but as long as my Tracking Budget total is equal to or greater than my Checking Account Statement total, I’m happy since I spend based on my Tracking Budget.
13. If the total from your Tracking Budget is more than your checking statement shows, be careful as you spend for the forthcoming month. For some reason your budget shows more than your bank says you have. You may have subtracted something from one section and not added back to another. (For example, I’m guilty of subtracting something from say my Vacation Fund and forgetting to add it up into the Credit Card section of my budget.) Try to get these 2 totals to always equal since you’ll ideally want to spend based on your Tracking Budget not your current checkbook register total or online account balance.

WRAP UP – After “paying yourself,” put your pile of processed receipts in a different drawer, box, bag, etc., and at the end of that tax year along with your tax return paperwork, box them up, label, and store them. I like to group my ATM receipts together with any old checkbook registers and bank statements.

HOW OFTEN? – If you’re disciplined with your money, you can pay yourself and process receipts at the end of each month–this is by far the easiest way to do it. If not, you’ll need to do receipt subtractions more often to avoid overspending. For example, if you subtract what you’re spending on yourself in the “Me/Spending” section every week, you’ll easily see when you’re running out of pocket money for that month and can adjust. (Slow down spending on the fun stuff!)

FRESH BUDGET SHEET – When your Tracking Budget starts to get full, get a current total for each section, and start a fresh one, putting the date in the top corner. File the old one in with your processed receipts.

I know this process sounds very involved and may seem confusing, so check out this nifty to see the monthly “Paying Yourself” process in action!

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MOOLAH MONDAYS: Workin’ the System Part I

November 20, 2014Budgeting & Moneybills, budget, budgeting, checkbook, debt reduction, discipline, discretionary income, earning, expenditures, expenses, finances, money, paycheck, receipts, saving, spending, stress reduction, system, tracking, want list, wantlistKurt Kirton

budget, system, spending — Photo by Annafur

Ok. So after the last post you know why it’s nirvana to live 1 month ahead and why you should create 2 Budgets, a Wantlist, and a list of Regular Yearly Expenses. Well, “What now?” you may say.

Buy what you need. Don’t go too crazy buying leisure stuff (clothes, eating out, drinks–whatever is “fun” to you.)
Keep any item receipts, ATM receipts, or paycheck stubs in a drawer or on a spike until you process them.
Have a section on your Tracking Budget called “Credit Card.” When you process credit card purchases using the aforementioned receipts, subtract the amounts from the respective section of your budget and add them to the “Credit Card” section. This way, you’ll have the cash to pay that credit card bill off when it arrives. Then, each time you pay your credit card bill, simply subtract the amount you paid (ideally the full amount!) from the “Credit Card” section.
In the “Pay” section of your Tracking Budget, log your paychecks (if you’re depositing that money into your checking account.) In the Pay” section, you’ll also log any other income you receive throughout the month and deposit. Of course, write anything you deposit in your checking account into your checkbook register as well.
Use your checkbook register and your Tracking Budget to log what you pay for out of your bank account—be it by check or debit card. For example, paying your electric bill or buying things at a flea market.

Next time, I’ll go over what to do at the end of each month to process your receipts and prepare the money you earned in one month for use the next month. There will also be a video tutorial so you can see me using this system and get a real-world visual.

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MOOLAH MONDAYS: 5 Tools You Can Easily Create to Improve Your Money Management

October 23, 2014Budgeting & Moneybills, budget, debt reduction, discipline, discretionary income, earning, expenditures, expenses, finances, money, overspending, paycheck, receipts, saving, spending, stress reduction, tracking, vacation, want list, wantlistKurt Kirton

budget, money, finances, vacation, spending, saving, earning, paycheck, discipline, tracking, stress reduction, debt reduction, overspending, discretionary income, expenses, bills, receipts, wantlist, want list, expenditures — Photo by eric731

They say sex and money are the top two things couples fight over. So let’s talk about money. Managing your money well can do several things for you:

Reduce stress
Pay off debt
Avoid new debt
Help you save for things you want like a vacation, new car, a child’s college fund, or Christmas gifts

Several months ago my post about 7 things you need to do right after a layoff touched on budgeting. Budgeting is so important whether you are in transition or not—and can be fun! In this new series, Moolah Mondays, I’m going to share the system I came up with and have used for years to successfully budget and manage my finances.

First, make a Planning Budget (click the link to download a template in MS Word). This will show your regular expenses/recurring bills. The fun part is you’ll end up knowing how much discretionary income (leftover money you can use for things you want) you have when you’re done. The Budget is based on your total net (after taxes, withholdings, benefits, etc.) income from all sources each month—Just use a best guess estimate if you are on commission or have income that varies. This will be a simple table and look something like this:

Second, make a paper Tracking Budget. This is like a Checkbook Register but better! Here, you’ll enter what you’ve made (have to spend) and spent (subtracting what you bought) We’ll go into more detail on this tool later in this series, but here’s a sample in use.

Rent: $500 -$500 (Nov.)
Tithe: $200
Utilities: $200 -$100 (cell) -$60 (internet) -$15 (water)
Food: $150 – $75 (Nov 1)
Gas: $100 -$35 (Oct 1) -$35 (Oct 8)
Car Insurance: $200 + $200 + $200
Homeowers Insurance: $100 + $100 + $100
Me (spending): $300 -$20(ATM) -$25 (dogfood) -$35 (watch) -$5 (lunch)
Car Payment: $300
Retirement: $400 + $300 + $400
Vacation: $100 +$200 +$150
Credit Card: +$100 + $60 + $35 + $35 + $25 + $35

Next, let’s do a fun one…keep a Wantlist. Here you can plan to make dreams a reality. I like to keep mine in Google Drive as a Google Document. Your Wantlist could look something like this:

$1500 – Trip to 20th Class Reunion
$500 – 50” flat panel TV
$800 – Cindy’s prom dress
$200 – My birthday party

Last, keep a list of Yearly Expenses; sample below. I recommend a Google Document for these too. With this, you can keep an eye on things that you regularly expect (or might forget!) during the year for which you’ll need money. You can use things like your discretionary income, tax return, work bonuses, airbnb.com earnings, or 5^th week paychecks to cover or get ready in advance for these expenditures.

Jan – Property tax
Feb – Vacation (final bit of funds)
Mar – Cindy’s birthday gift
Apr – Mothers Day gift
May – Fathers Day gift
Jun – Wash/Wax/Detail the car
Jul – Car alignment
Aug – (nothing/TBA)
Sep – Car emissions inspection and license plate
Oct – Christmas gifts
Nov – Parent’s anniversary gift
Dec – Termite treatment

Now that you’re armed with the right tools, next we will talk more about how to use them.

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