budgeting after bankruptcy software and whatnot

[TomTea31]

I know this is a hot topic that has been discussed in the past. I wanted to bring a fresh post to the forefront. After all, budgeting tools/tricks change year after year.

I need to come up with something for budgeting . Currently I just write all my bills on a piece of paper and divide in half. Hubby gets half and I get half. That works but what we really need is a plan.

Looking through my bank statements it's clear I need to have a better system. I wasted a lot of money on small things. Running to am/pm for hot dogs or starbucks weekly even though I have both a kuerig and a tassimo to avoid starbucks.

So a few questions.

1. We currently have no savings. The move and chap 7 attorney took out entire tax check. I feel we need to start saving something but how much? what percentage should we take from our monthly income to put towards savings?
2. what software do you use for budgeting?

3. How do we figure out how much we can spend on things outside the actual monthly bills not including food?

[papie]

I think the first thing you need to do is write everything down that you spend, even if it's $1.00 on a cup of coffee. One of the biggest ways that people "lose" money every month is that they don't realize how much they spend on unnecessary items. Do this for one month.

If you google "budget spreadsheets" you'll get a lot of hits and links to excel spreadsheets. Personally, I hate having to log onto the computer and type stuff in, since that's basically what I do all day at work, I use a workbook that has folders divided into months and it has a place to write the bills, amounts, date paid, etc. You can find a lot of them on Amazon, try searching for "monthly bill organizer" or "household finance organizer."

After following your spending for one month you should be able to see what you can eliminate or reduce, what your monthly bills are, and plan an actual budget around that. Write your budget down on a piece of paper, giving yourself a little wiggle room for the little things that come up, and try to save whatever you have leftover. I've always heard that you should have 3-6 months of income saved. Your budget should include all of your monthly bills and must haves: rent, gas, groceries, etc.

[JessMN]

I use mint.com (free) and do almost everything without cash (meaning debit cards, online bill pay, etc) so it is all grabbed by mint, then I am able to categorize the transactions and see exactly where my money goes.

[spidge]

I just set up Mint a couple days ago and I think it exceptional. You can customize it as you become familiar. I especially like the mobile app from Mint (also free) so that we can see where we stand anytime, instantly. It drives me to use my card rather than cash so that I can easily and instantly categorize my expenses. It takes some time to set up, but it is well worth it.
Another option is to Google a spread sheet or even try Microsoft office online where there are user created spreed sheets that are free. My first few were from Microsoft users and were helpful. Try looking up financial budget planner so that you can forecast your entire year.

[mountanddo]

I just use an Excel spreadsheet and set up everything I need to budget for. Simple, but effective if you know basic Excel.

[TheBajan]

My husband and I created a spreadsheet based on the zero balanced budgeting system. I use it along with Quicken to keep track of things. Quicken is top-notch for keeping track of your money but the budgeting side of the software absolutely stinks. The spreadsheet we use is a perfect compliment to that. For budgeting purposes the spreadsheet is all we need. I just like using Quicken b/c I'm OCD about knowing where my money and assets are. Quicken is also excellent for running reports to see if you are overspending in any given area. It's kinda like the spreadsheet tells me what I should be doing with my money and Quicken tells me if that's what I'm actually doing with my money. If it's not, I know I need to make adjustments to either my spending plan or to my spending habits.

The spreadsheet includes every income and expense that we have including areas for misc, periodic, and the unexpected. It's also divided by paycheck. When we receive income, we go down the list of anticipated expenses and transfer money from the income side over to the expense that needs it. If we receive more income than we expected, the remainder gets put into our emergency fund. If we have a major unexpected expense (like the car accident my teenage son had a week ago) we pay for it out of the emergency fund. At the end of every month I prepare the budget for next month. It's formatted to do my addition for me (I'm awful at math). I would be happy to send a copy to anyone if you pm me for it. Or, if we are able I will attach it to this forum.

Cheers!

[Pandora]

I'm old school.... paper and pen Just did our budget for the rest of the year actually.

Have tried using software and/or online sites and while many benefit from them, to me its too much work to have to type everything in the way they desire it.

[ld2366eh]

I use Quicken too, but instead of using the budget tool, I have all of my monthly income and potential expense listed out in the register for the next five years. That way, I can see exactly where I am in any given future month. I use my debit card for everything, so instead of keeping an offline check register (other than to record checks written), it's built into Quicken. It's worked so well for me, that's how I figured out exactly how upside down I am with my income and debt now that we have a baby on the way and future expense that we didn't have before.

[GoingDown]

Looking through my bank statements it's clear I need to have a better system. I wasted a lot of money on small things. Running to am/pm for hot dogs or starbucks weekly even though I have both a kuerig and a tassimo to avoid starbucks.

Um, hello?

The solution seems simple to me: stop doing that!


As for budgeting, I use nothing but cash when I buy things locally, and I only put the amount of money I can afford to blow each day in my wallet and when it's gone, it's gone, and I am done spending for that day.

This works better than anything I have found.

[SMinGA2]

Figure out what works for you in terms of spending. Some people are bad with cash: they have no accountability so spend it when they have it. Others may tend to hoard cash, only spending it when they must. Then again, some people are bad using debit, as they treat it like an endless resource. And some are more cautious using debit, because it keeps a record of what they've spent and they don't want to see a long list of wasteful $ on their statement.

[GoingDown]

But if you don't have a debit card, nor a credit card in your wallet, and you only have a set amount of cash with you-- no more cash than you can afford to spend for that day (which you would decide ahead of time exactly how much "mad money" you have to spend each day)-- then when you reach into your wallet and the cash is gone, you are done spending for that day, and there is no way to spend more than you had budgeted to spend for that day.

I've had the cashiers at the grocery store put things back because the bill went over my available cash in my wallet. Suddenly, I find that I am buying the most important items, and everything unnecessary for that day goes back.

It has helped me save a lot of money that I would've otherwise spent on things I didn't really need.

[spidge]

But if you don't have a debit card, nor a credit card in your wallet, and you only have a set amount of cash with you-- no more cash than you can afford to spend for that day (which you would decide ahead of time exactly how much "mad money" you have to spend each day)-- then when you reach into your wallet and the cash is gone, you are done spending for that day, and there is no way to spend more than you had budgeted to spend for that day.

I've had the cashiers at the grocery store put things back because the bill went over my available cash in my wallet. Suddenly, I find that I am buying the most important items, and everything unnecessary for that day goes back.

It has helped me save a lot of money that I would've otherwise spent on things I didn't really need.

Up front this seems like a great plan, but think about it for a moment. So you spend until your wallet is empty? Yes, you will get used to it and think twice after cutting yourself short a few times, but you still don't have a good grasp of where your money is going. A tracking system can help pin point what habits are causing the money to flow through your fingers and into someones pocket who likes having money more than things and satisfying simple (understated, I know) urges.
Reality sucks sometimes, but your better off finding out before you get back into the same BK position or living payment poor again. Another nice feature is that when we go over in a given category we have to find where the extra money is going to come from and agree on what we will have to do without. It helps peal down the layers and find the driving habits that need to change.
If you do not have a card then an envelope system may be your answer. I think it's Dave Ramsey that does this.

[GoingDown]

But you missed an important part of what I was saying.

I only put a set amount of cash in my wallet to spend each day, based upon what I can afford to spend. That's where a simple piece of paper and a pencil come in handy. You just figure out how much you can afford to spend after all your essentials are paid-- rent, utilities, etc.

And then let's say you want to go grocery shopping, you figure out how much you can afford to spend on groceries and only take that amount with you. It is similar to Ramsey's envelop system in that regard.

As for tracking your spending, even when you pay cash they will give you a receipt. That's how you can track your spending.

And I can tell you from experience that it is much more painful to lay down cold hard cash to buy something than to get out a card and just swipe it and then not think about it until the bill comes weeks later. I find it makes me think long and hard about each purchase, and I often decide that I don't really need it and just walk away without buying it.

And unlike the credit card or the debit card, you cannot over-spend. You have the amount of cash in your wallet that you can afford to spend. Once it is gone, it's gone. The spending ends immediately.

Since I have gone to all cash, I pay my rent and utilities on time, every time, and I have been able to save money again. More than ever in the past. Life is so much simpler without credit cards.