This & That
Posted by Gail | Filed under Budgets, This & That
I have a Happy New Year present for you. Y’all have been at me to make the budget worksheet a download so you can keep it on your computer. Some people have been creative and done up their own budget at home. One very determined woman created her own version of my budget for download. Hmmm. I guess you really want it, eh? Okay, then. You win. Now when you go to the worksheet, there’s a download button. Click that before you start making your budget if you think you’ll want to keep it.
I’ve been getting a lot of questions – at least 50 a week – from people who haven’t bothered to read the instructions that go with the budget. Really, people! Taking a shortcut just ends up taking longer.
People sometimes want to debate with me whether an expense category should be fixed or variable. I get long letters from people telling me why a budget category is in the wrong place. I don’t care. If you want to make the expense a “variable” expense, feel free. When I created the budget worksheet, these are the choices I made. But you should feel free to make your own.
People also want to debate the validity of something being in the LIFE category, as if LIFE isn’t a valid category. I get letters from people all the time objecting to the fact that “childcare” is a LIFE expense. They find that childcare drives their LIFE category out of the acceptable percentage so they want to put it somewhere else.
Do you want to put your childcare expenses under Housing? Transportation? Savings? Debt Repayment? Those are the other options. The percentages I give are guidelines. If you’re spending nothing on debt repayment – yeah! – that means you have another 15% to stick in any of the other four categories. But if you’re over the top in one category, it means you’ll have to cut back on the others. So what if LIFE is 50% of your spending. As long as your budget balances, you’re saving at least 10%, you’ve got no debt, and you’re happy, you’re fine.
The other huge misconception seems to be around the debt repayment category. Yes, the guideline is 15% of your income. But what that means is if you are spending more than 15% of your income paying off your consumer debt you have far too much debt. IT DOES NOT MEAN you should only put 15% of your income to debt repayment. You need to put as much of your income into debt repayment as necessary to get all your consumer debt paid off in three years or less. And if that means your debt category is up to 25%, 30% even 40% of your income, so be it. Then you have to cut back elsewhere or make more money to have enough for the other categories. If you’ve dug yourself a deep hole, it’s time to grow up, suck it up, and pay it off!
Savings is another area people have questions. Yes, your company pension plan counts toward savings. If you want the savings number reflected on the budget, add the money going to your company pension in to your income, and then take it out again on the savings line. Or just know that you’re setting aside 8% for savings (or whatever it is) and make up the difference on the savings line.
The 10% rule applies to long-term savings. Emergency savings is separate. So is saving for your kids’ education. And if you’re saving for a vacation, a downpayment on a home, a new car, those need their own lines on your budget and do NOT belong in the “savings” category because they are, in fact, “planned spending.” Ditto that money you’re automatically deducting from your paycheque for savings bonds, when you plan to use those bonds to buy Christmas presents. That’s your Christmas fund, and it may need it’s own line on your budget. But it’s NOT savings.
“Savings” is the money you NEVER spend unless you are destitute or have so much money it doesn’t matter anymore.
If you’re accumulating money for any purpose, it’s “planned spending.” And the best way to keep your “planned spending” organized is to have a line on your budget and a savings account set up for each category. That means you may have to customize the budget to your specific needs, which was why I never bothered to make the budget a download to begin with. I thought y’all would fill it in, print it, and then make your own version. I sorry I never allowed for the spreadsheet-challenged amongst us, of which there appear to be plenty. But now that you have the budget worksheet to work with, you can still make changes to make it work for you.
January 9, 2009 at 8:30 am
Wow…you have great timing (or I do!) I had printed out the budget worksheet and have been building my budget this week, with plans on doing an Excel spreadsheet for my use. Now I’ll be able to use yours and modify it instead! Greatly appreciated! I had read ALL the instructions prior to working with the budget worksheet, and had found them very helpful. However, being a volunteer in my kid’s Advisory Council, I know how terrible people are at reading information – it is really frustrating!!! Thanks for making it easier for all of us!
January 9, 2009 at 9:14 am
I just tried finding the download link on the Budget Worksheet and found a small problem. I use Firefox as my browser – and with it, I couldn’t see the download link. I tried with Internet Explorer, and found the two links (one for instructions, and the other for the download). Thought I should mention this for those who may also run into this problem. I did download it, and can’t wait to “play” with it! Thanks again.
January 9, 2009 at 9:49 am
Thanks again Gail – I love these posts when you tell us to smarten up! When did we start needing to be spoon fed all the answers?
That is my other advice – it doesn’t hurt to ask! “No” doesn’t cost you anything.
As for ways to make money at “home” – it might be hard on your pride but use word of mouth to get it out there that you are looking for work. My spouse has founds lots of ways – not all of them are steady but the little bits add up. We have a friend that manages a pizza take out place and asked hubby to deliver pizza. It is just a casual position when the other driver is busy but it adds up – paid for 2 frugal vacations this past summer. Hubby blows snow for neighbours in the winter. I would do it for free but he is more “frugal” than I am so he happily takes their money. He cuts grass in the summer, housesits, does odd jobs, sorts scap metal (not as profitable as it was a few years ago), has yard sales, never turns down overtime at work, barters his job skills and muscle with others. He is even better than I am at finding ways to do what he wants and get what he wants cheaply! Being a “nice” guy pays off. When people are getting rid of stuff they think of him – sometimes it is a sewing machine (which his spouse has been wanting) or a nearly new snowblower cheap! or treats at Christmas time. It literally “pays” to know your neighbours!
Gail – I am sure you are using the planners to encourage new success stories but I think you should include all of the stories in the draw- even those of us who were good students and submitted our stories without incentives
January 9, 2009 at 9:51 am
thank you for the downloadable budget. i look forward to using it! & thank you for addressing the child care in the life category. in my head, i thought there was more too it then it just being a category and a recommendation. we pay less in housing then your recommended percentage so it all evens out.
i wrote an entry for the ’success story’ last week. this is good motivation to remind me to actually send it to you!
January 9, 2009 at 10:09 am
& i ‘work’ from home. i crochet and do crafts and then sell them informally to friends and family. i keep meaning to set up an etsy shop/website, but haven’t gotten around to it yet.
i think a good way to get exercise and make a little extra cash is to deliver flyers/newspapers. we have neighbourhood newspapers that get delivered every week. you can bring the kids along, and the dog, and get some exercise!
January 9, 2009 at 10:18 am
WOW…I tried to make my own and it would never balance out the way using your did..lol…I am spreadsheet stunned I think…You have no idea how much you are helping our finances with all your stern blogs and awesome, awesome, awesome…advice!! Lots of love to you from Eastern Canada
January 9, 2009 at 10:24 am
Gail, I think it is great that you have a downloadable version. After I took your online version and made a downloadable version at the end of December, one of the things I encountered was that some people do not have Microsoft Office. You may want to tuck away that there is a site called OpenOffice.org which apparently has very similar software to MS Office, including a spreadsheet.
This is the beginning of week two on the jars. Hubby was quite surprised at how well we did. I did find myself itching to spend money out of habit, but I was very good. In 1 month, our jars will prevent us from $1200 of frivolous spending and see us starting with $500 a month in savings, for the first time. We’ll do this until the end of April, when our Visa is paid off with the $1200 a month, then move into our planned spending phase. So exciting.
Thank you a million times for your great approach to financial consciousness and living. Yay!!
January 9, 2009 at 10:32 am
My husband and I have been using the budget worksheet since August and WE LOVE IT!! We ended up creating our budget in Gail’s online worksheet, then transfered it to our own personalize Excel spreadsheet. Each week, we sit down and look over our budget, modify it where possible and work on paying our bills/debt together. We also are in the process of working our way down from 3 (yes, THREE!) chequing accounts to one to save money on bank fees and to be more of a solid team. Another thing we added to our budget worksheet was our debt repayment goal. That way, when we’re feeling weak and wanting to spend money, we see our goal and remind ourselves that if we want to be debt-free in two years, we have to stop spending our money on “ca-ca” (as Gail would say!). Along with out debt goal, we also keep a running list or to do list of things we want to achieve – most will come in time, but it serves as another good reminder that we will always need a plan and goals to strive for.
Gail, thank you so much for sharing your wealth of knowledge with the world. Mu husband and I seriously do not know what we would be doing without your guidance! Whenever we have a question, we always say, “Gail would know!” and we log onto your blog and read away. In fact, just last night we wanted more information about tax free savings accounts – we logged on and sure enough we were able to see the light!
Thank you, thank you, thank you!
January 9, 2009 at 10:34 am
This line stuck with me:
“Savings” is the money you NEVER spend unless you are destitute or have so much money it doesn’t matter anymore.
Exactly! My partner and i seem to disagree with this one. I want to lock the money away and label it as untouchable. But he seems to see the savings (and money earmarked for future spending) as flexible and usable for other purposes, so I can’t shake the fear that the money won’t really stay as savings…
January 9, 2009 at 10:35 am
Dinah, your crafts are great – you should totally get set up on Etsy. I bet you could double your income!
January 9, 2009 at 11:14 am
Love that smart talk in the morning, Gail; and I love my DayPlanner!!
January 9, 2009 at 12:06 pm
“The 10% rule applies to long-term savings. Emergency savings is separate.”
Ok, so why are they both highlighted in purple?
Shouldn’t emergency savings be under ‘Life’?
January 9, 2009 at 12:21 pm
I am a pampered chef consultant. Basically I get to go into peoples homes and cook for them, show them how much fun we can have and how great the products are. I love the product and really love to get out and socialize. You can also just do catalog orders, but its more fun and make more doing cooking shows.
If your interested let me know contact me through my website. http://www.pamperedchef.biz/angelawade
Id be happy to give you any info I can and even mail you some if you like.
January 9, 2009 at 12:22 pm
I don’t pay attention to Gail’s recommended percentages except for housing (no more than 35%) and retirement savings (at least 10%). Those two expenses are far and away the most important to me. If I spent more than 35% on housing, I’d need a bigger emergency fund to cover housing expenses in case I lost my job. If I spent less than 10% on retirement, I’d have to retire later. I don’t want to do either of those things, so I keep to the rules.
But as for the rest, it doesn’t really matter to me if I classify education savings as “savings” or “life” or whatever. I know what I’m putting into it every month, and my budget balances. I care about what works, not irrelevant details of what goes in which bucket.
I agree with you, Gail, that people get hung up on minor issues without using common sense. I’ve suddenly become the person to ask about money matters amongst my friends and relatives. Every time I refer someone to your site, I get some silly question about whether the sky will fall if they have 26% devoted to life instead of 25% or 20% for debt repayment instead of 15%. Sigh. But at least they’re TRYING to get their crap together (finally).
January 9, 2009 at 1:52 pm
I am happy to be able to work from home as a private music teacher. I teach piano, voice, and harp while my hubby watches the 2 young kiddies. My work is satisfying, creative, and I am well paid for what I do. I love that clients come to me and the I can set my own hours.
So if you have a skill and a passion, it’s great to have folks willing to learn from you and get inspired to reach their own goals. Being at home to do it is a great perk!
Love you Gail and thanks to all the other comments with honest and insightful sharing.
Vanessa in Halifax
January 9, 2009 at 3:52 pm
thanks so much for the downloadable format, i have a excel budget that i use that works for us, but i like to have yours to be able to see our %’s, something i’m not too good with on my own sheets!!
January 9, 2009 at 6:44 pm
a big thank you from the “spreadsheet challenged!”
January 9, 2009 at 8:58 pm
Gail… THANK YOU for making the planner downloadable !
January 9, 2009 at 11:10 pm
Gail, Gail, Gail – I think that sometimes you want us to just work hard! My husband worked long and hard to create an exact duplicate of your budget sheet (I’m talking down to the colour coding!) and now here it is downloadable – you make me laugh. He did an awesome job and here we are 6 weeks later with cash in the accounts and money left in the jars week to week – even starting out in overdraw.
Thank you, thank you, thank you.
January 10, 2009 at 12:13 am
Me and a lot of my friends work at home and/or work and some just earn EXTRA money from home (for planned fun expenses).
I am a Graphic Designer and Freelance Photographer… unfortunately it took 2 years of schooling and 6 years of working for others in an office to gather the experience and loyal clientele to go out on my own, but it is very rewarding work and childcare isn’t necessary.
I also put out the word that I can read schematics and follow instructions, so I lucked out being a fill-in contractor putting together manuals for mechanical systems, it’s really part time and very different!
My husband fixes dirt bikes, atvs, hydraulics and cars after work and weekends sometimes, he saves the money from that to buy parts and run our dirtbikes.
I have a friend that sells from a catalogue in her spare time.
I also have a friend that set up a hairdressing salon in a spare room in her home, and does house calls for shut-ins. She’s great!
I know an at-home massage therapist and a reflexologist, a specialized small magazine publisher, a novellist, data entry, a computer programmer, someone who does custom presentation programming for special occassions, computer repair, marketing consultant, web designers, seamstress, furniture/toy woodsmith, boat restoration, professional craft painter, scrapbooker for hire, and MANY other work at homes! Really your imagination (and local laws) are the only limits!
For extra cash (but not quite at home) I know flea market vendors, housepainters, landscapers, handymen, dogwalkers, paper route delivery drivers, even a young lady that offers her services weeding and mulching your flowerbeds on weekends. It seems there is no service too small, no block of time too insignificant to find a task that needs doing that someone will pay for!!!!!
phew…. I know there are people I am forgetting, but you get the idea. I think there are 3 requirements, you need to be willing to tellEVERYONE that you are available, and the drive to really sacrifice your time to do it and the willingness to do it really well so they tell their friends how wonderful you are!
January 10, 2009 at 8:08 am
Hi Gail I can’t find the budget on your web site. Im using a Mac with OSX and Firefox as my browser is this the reason ? If so could you email it to me?
Thanks so much Gail you rock !
J
January 10, 2009 at 9:23 am
John – I had problems with Firefox – use Explorer and you will see the links on the bottom of the Budget Worksheet.
January 10, 2009 at 12:48 pm
For those using Mac OS X, if you are having trouble getting the file…. i put a link so that you can download as well.
go to
http://idisk.mac.com/emiliano.introcaso-Public?view=web
and download it from there.
Emiliano
January 10, 2009 at 1:09 pm
This is great. Thanks so much Gail.
I finally have a weekend off from the part time jov and was planning to use it to sit down and do my 2009 budget since I jus started a new job so this is perfect timing.
Happy New Year!
January 10, 2009 at 4:30 pm
I also make extra money from home. I sell Epicure selections. I also work full time and my husband, because of the economy, has just lost his job just before Christmas and every penny counts. This is actually the first time we have ever had to budget. Epicure Selections allows me to earn as much extra money as I want. It’s all about how hard I want to work and how much I want it. I want it!!
If anyone would like more information about this great business opportunity please feel free to contact me.
ddobson1@cogeco.ca
January 10, 2009 at 11:53 pm
We finally put together a budget, we will see how it goes this week. I planned out our meals for the week and bought just what we need. I think the only thing we may need is milk before the week is up.
Im starting to really get excited about doing a budget. Its been a crazy week for us, from funeral to lost luggage to being hacked, im still dealing with the hacking problem, i changed passwords and opened a new email account that is linked to any important accounts. Monday we talk to computer people about getting it checked out.
Money that is not budgeted, but will be somehow.
January 11, 2009 at 10:56 am
Thank you for the downloadable spreadsheet Gail! I had actually made my own on excel based on your model ages ago – and I redo my budget every month (I work on contract to my earnings fluctuate) — but it will also be a good tool to use as well since mine doesn’t break down my expenditures into percentages. Thank you again for all of your tools. They have made a huge difference in my life. I recommend a budget and reviewing it monthly to everyone! It helps to give a true sense of where one is at!
As for home earnings — I used to make jewellery and sell it every so often at a stall. It is amazing how much women love their gems and the returns were good! Also – it is fun and creative. There are some excellent websites out there to get inspired and buying beads from a good seller online (international) is cost-effective.
I haven’t done this in ages though, and need to earn a bit more over the next months, so I’m looking into Etsy and calculating whether a small business is feasible costwise given my other commitments/budget (calculating: time/material costs/packaging/mailing etc). Any advice would be most welcome if any of you sell your own home-made products! I am also open to giving advice!
January 11, 2009 at 11:13 am
Just thought I’d chime in about ways to make money at home. I used to edit papers/theses/dissertations and tutored in grad school for extra money. If you paid attention to spelling and punctuation in grade school, you can do this too. Also, I know people who do medical transcription from home. It’s a bit of an investment for training and testing (you have to pass to get jobs) but I know people who do quite well at this.
January 11, 2009 at 11:30 am
Thanks psychsarah!
That’s a great idea — I’m a grad student and could certainly make some extra money doing this too!
January 11, 2009 at 8:40 pm
Dinah, I have to agree with Saverqueen – your work is lovely! I LOVE the slippers!
I have been selling Epicure Selections for the last year. I love the products and you can do well with it if you persue the business. For me, I found it difficult to fit it in as my husband works shift work and we have a 3 yr old. So now I’m looking at other options.
I paint and do photography as well. I’m looking at planning more & selling more of my painting.