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Nicole

Monthly Budget August
Budgeting, Money

Monthly Budget: August 2015

The year keeps going! It won’t stop! It’s time for another budget update.

Looking Back: July Monthly Budget

We aren’t that far into August and I already feel like I’ve forgotten what happened in July!  I did better in July than I did in June from a spending perspective, but I still ended the month with a negative net income. August is my month to get back on track, as I will be going on vacation for a week and a half in September.

The July Budget Good

  • Work Lunch: I was a dollar over my work lunch budget ($40 for the month), so I’m pretty happy with how well I’ve been estimating and spending in that category.
  • Home Supplies: Similar to my work lunch budget, I went over only by a couple of dollars. I think $20 per month has been a good estimate/reflection of my spending habits in this category. Now if only all categories could be estimated so well!

The July Budget Bad

  • Restaurants: My restaurant spending was a bit out of control in July. I spent $400 when I budgeted for $200! This is probably due to a couple of factors: 4th of July festivities and a couple of evenings out after work. I’m going to try to be more mindful this month, in preparation for my trip in September.
  • Everything Else: The one-off expenses added up in July. I signed up for a half marathon in September and have not yet received the 50% reimbursement from my work’s health subsidy. I also paid some deposits for my upcoming trip. Finally, I had a number of hair/makeup expenses as I was running low on shampoo and some makeup items.

July’s Net Income

Since I’m pretty vague about what my actual income is (on purpose), I decided to add another piece of information to give you a sense for how my spending mapped to my income for the month: net income. You can usually tell how well or poor a month went by how much you spent vs. how much you brought in. In July, my net income was -$625. This means that I spent more than I earned last month. This was a great improvement over June, but I’d still like to see it in the green for the next couple of months. Two items to note: The money that one of my friends owes me for her share of our trip and the reimbursement for my fitness subsidy aren’t accounted for in this number.

My August Monthly Budget

Now that I know how July went, I know how I can improve this month.

Rent: $1075 (my portion of rent – not split exactly 50/50 but almost 50/50)

Utilities & Non-Discretionary

  • Gas (my portion): $25
  • Electric (my portion): $50 – Bumping this up by $10 due to it being summer.
  • Internet (my portion): $28
  • Cell Phone (my portion): $56
  • Employer-Sponsored Health Insurance: $108

Car & Transport

From now on, I’m removing fuel from my budget. Since Richard is now driving to work as opposed to working from home, he is driving more than me. Since our shared fuel costs are typically low, we decided he will cover all fuel.

  • Car Insurance (rolls over monthly): $66 (plus $198 from rollover)
  • Metro: $80 (taken directly out of my paycheck and applied to my Metro card)

Food

  • Groceries (my portion): $350 – Moving this back to $350. Seeing if I can get it closer to $300 though.
  • Restaurants (my portion): $200
  • Work Lunch: $40

Debt

Each month, I pay a total of $775 to minimum loan payments. Not that I’m counting or anything, but this expense is second only to rent in my monthly budget.

  • Student Loans Minimum: $565
  • Car Loan: $215

Shopping & Miscellaneous

Pets, clothes and home supplies all come up at infrequent intervals, so I set aside an amount each month to contribute and if I don’t spend it, it rolls over to the next month. Everything else is everything that doesn’t fit into a neat budget. I’ve increased my everything else budget to account for some one-off expenses.

  • Pets (my portion – rolls over monthly): $60 (rollover set to $0) – I’m setting the rollover to $0, because keeping track of the vet expenses from April & May wasn’t really helping me keep track of my current spending.
  • Clothes (rolls over monthly): $200 (rollover reset to $0) – Bumping this up again due to the fact that I keep going over and I was beginning to realize that $100 doesn’t get you very far when you need to account for shoes AND clothes.
  • Home Supplies (my portion – rolls over monthly): $20 (plus $2 rollover from last month)
  • Everything else: $400

Total Expenses: $3,538 (minus savings and extra student loans)

And don’t forget…

Savings & Extra Student Loan Payments: I generally contribute 25% of take home pay. All of the money that goes to savings and extra student loans is split up in a 30:70 ratio with 30% going to savings and 70% going to student loans. Some of my savings is short-term – I save for the irregular one-off expenses that I know will come up throughout the year. I put the majority of my savings into my long-term emergency fund though.

Retirement Contributions: I contribute 6% to my employer-sponsored 401(k) each pay period.

Notes About My Monthly Budget

“My Portion”: You’ll notice that there are a few “my portion” indicators next to my monthly budget line items. This means that it’s an expense that Richard and I split. For 99% of the things we split, we split right down the middle.

Rolls Over Monthly: This year, I’ve been trying to become more purposeful in how I budget and allocate my money. In some categories, my expenses are sporadic. Two examples of this are pets and clothing. We are proud parents to two senior pets – as a result, we’ve decided to set aside some money every month to cover those inevitable vet costs. For clothing, I prefer to do big shopping trips a few times a year rather than shopping in smaller spurts more frequently. By rolling over my budget each month, I make sure I’m accounting for the inevitable expense.

August Challenges

I’m hoping that August will be the calm before the storm that is my Wild West trip in September. That in and of itself will be a challenge.

  • Travel/Trip Prep: We should not have any additional accommodation expenses prior to leaving, but I have purchased a couple of items that I will need when we are on our trip (e.g. backpack, rain jacket).
  • Food: I need to get a handle on food spending (still).

How did you do sticking to your budget in July? What are you budgeting for in August?

 

August 7, 2015 by
Deconstructing the Grocery Budget
Budgeting, Food, Money

Deconstructing the Grocery Budget

If you’ve paid any attention at all to my monthly budget updates, you’ll know that I plan to spend $350 per month on food costs for me only. Since Richard and I split food costs, this means we are budgeting for $700 in food for both of us per month. Clearly, this isn’t a small sum of money. Lately, I’ve been thinking that there is likely a way for us to work to decrease spending in this category. I’ve also been thinking that the number that I’ve put together is pretty arbitrary.

Grocery Desires

Before I get to the numbers, I wanted to articulate what is important to us when we go to the grocery store. I often see people online claiming they spend like $400 for a family of four per month on groceries. As someone who spends wayyy more than that for a household of 2, that seems pretty extreme. It also makes me question: What are you buying? What kind of food are you even making?

The quality of what we are eating is pretty important to both of us, so if $200 is getting us a lot of processed items per month, I’d rather continue paying the $700. So, what is important to us?

  • Minimally processed foods
  • High protein, low carb diet
  • Minimal added sugars
  • No artificial sweeteners (ever!)
  • High quality coffee
  • Quick and easy recipes that can be cooked in double batches
  • Some organic items, but not really a necessity

It actually seems like a pretty simple list, but I know it’s harder to translate these wants into a lower grocery budget.

Staples

Each week, we purchase a number of staples that aren’t necessarily incorporated into specific recipes. A typical week (and costs) for our staples includes:

  • 3 half gallons of almond milk – $8.97
  • 3 packages of dry Roasted Edamame seeds – $5.37
  • Wheat fajitas – $2.79
  • Peanut butter – $5 (every few weeks)
  • 1 to 2 packages of crunchy snacks (e.g. roasted chickpeas, lentil chips) – up to $10
  • 8 oz of coffee – about $10 per week

So, each week, we are spending about $40 on staples. Assuming 4 weeks are in a month, we spend $160 on staples. We already get the store brand for almond milk and don’t always get crunchy snacks. The one area I know we can cut back on is coffee. The only problem is that we really enjoy good coffee and haven’t quite found a good place to get whole beans at a reasonable price. The one good thing we have to look forward to is the fact that Richard recently started a new job and isn’t drinking as much coffee at home, which will help reduce our coffee drinking.

Meals Needed

We strive to eat most of our meals at home and try to eat out only one night a week (although, depending on what is happening, it sometimes turns into two nights per week). Now that I’m thinking of trying to really tune our budget and make sure our budget is actually grounded in reality, I figured I would start by figuring out how many meals we need to make from our groceries per month.

Okay, so to break it down, this is the number of meals I need to account for each month:

  • Breakfast: 7 days x 2 people x 4 weeks = 56 meals
  • Lunch: 5 days x 2 people x 4 weeks = 40 meals
  • Dinner: 6 days x 2 people x 4 weeks = 48 meals

For lunches, I assumed that we need to account for 5 lunches per week to account for each of us having the option to buy lunch an average of once per week and having a weekend lunch out. If we eat all breakfasts at home and have dinner out once per week, we need a total of 144 meals per month.

Costs Per Meal

Now that we know how many meals we need and what our staple costs are, we can figure out what our cost per meal should be. Once I know what our per meal costs should be, I can start to figure out two things: a) what our budget should be and b) which recipes will help stay within budget.

Even Cost Per Meal

Our currently budget is $700 per month. Our staples cost around $150 per month. If we assume that the rest of the budget is going to meal costs and all of those meals will cost the same, we should aim to make recipes that cost less than $3.81 per serving.

To give an ideal of how the cost per serving might be affected by different budgets:

  • $700 – $160 = $540 or $3.75 per serving
  • $600 – $160 = $440 or $3.05 per serving
  • $500 – $160 = $340 or $2.36 per serving
  • $400 – $160 = $240 or $1.66 per serving

Right now, I’m a little skeptical of the $500 and $400 per month budgets. Trying to stay under $2.50 per serving seems a little unrealistic for all meals considering we do eat meat and value high quality ingredients. But hey, this is still in thought experiment and I might find myself surprised by the number of recipes that I find that meet our grocery needs/desires list.

Breakfasts Cost Less

Another approach we could take is assuming that breakfast costs will be less than lunch and dinner costs. This seems like a reasonable way to plan things, since our breakfasts tend to be hearty but lighter than our lunches and dinners. In general, breakfast ingredients also tend to cost less. Lunch and dinner will always have the same per serving cost, because we do not make special lunches. We simply bring leftovers from dinner for lunch the next day.

If we assume that average breakfast costs will not exceed $2.50 per serving on average, we can figure out what our costs can be for our other meals. If we have 56 breakfasts that cost us $2.49 each on average, that will cost a total of $140 per month. Let’s see how that affects the dinner and lunch per serving costs:

  • $700 = $160 staples +$140 breakfasts (56) + $400 (88 meals); $4.54 per lunch/dinner serving
  • $600 =$160 staples + $140 breakfasts (56) + $300 (88 meals); $3.40 per lunch/dinner serving
  • $500 =$160 staples + $140 breakfasts (56) + $200 (88 meals); $2.27 per lunch/dinner serving
  • $400 =$160 staples + $140 breakfasts (56) + $100 (88 meals); $1.13 per lunch/dinner serving

Comparing the two sets of estimates, if we get breakfast down to $2.50 on average, we are given a little more leeway for lunch and dinner when we spend either $700 or $600 total on groceries. However, if we are spending $500 or $400 on groceries, we would actually be spending less on lunches and dinners than we are on breakfasts per serving.

Redefining the Grocery Budget

Now that I have a better idea of what different budgets can get me, it’s time to go out and find some recipes that will help us actually get us there. The most opportunity that I currently see for reducing our grocery budget is in the lunch/dinner category and potentially the breakfast category. I think regardless of where we end up, figuring out the per serving costs of our recipes will be a good gut check for whether or not we should decide to make it and whether or not it aligns with our goal to try to reduce our grocery spending (or at least make it more predictable).

How much do you spend per month on groceries? What do you do to reign in spending?

July 21, 2015 by