Budgeting: Do As I Say, Not As I Do.

I talk about budgeting a lot.  Every personal finance blogger does.  Budgets come in various forms, but at the end of the day, the important parts are that you know where your money is going and that you’re not spending more money than you should be spending in any one particular area.

Guess what I’ve been doing?  Ignoring both of those elements.

Falling Off Track

I realized this past week that I hadn’t even looked at my budget program since the beginning of the month.  Now, I knew that I would be doing some maneuvering with my money.  The funds for the closet rehab were coming out of a savings account that isn’t part of my day-to-day budget.  I decided that I would pull the funds for the cost of the closet as well as the paint and the other supplies needed once the closet was finished (baskets and bins, all bought on sale).

Somehow, this meant that I felt like I had free reign on spending.  I just stopped paying attention.

Now, I wasn’t going crazy.  But I also wasn’t checking my budget when I decided to make a purchase.

In cleaning out my closet, I realized that my wardrobe was seriously lacking in a number of areas.  When I got rid of the clothes I don’t wear, I realized that my work wardrobe was looking pretty sparse and the things I wear regularly were looking a little worn.  Appearance is important in business, and I knew it was time to make some purchases.  So I did.  All items on sale that look good on me and fit into my wardrobe, but I hadn’t planned for these expenses.  My budget was tight this month due to some bike repairs that I opted to have done last month, and there really wasn’t room for all of these clothing purchases.

Of course, I could argue that they were on sale, and I needed them, so it was fine to blow the budget.

Going Back to Budgeting

At the end of the day, I’m not sure that the point is that I blew the budget.  The point is that I didn’t even think about it.  I don’t believe in hard and fast budgeting.  Money can always be moved around to make a budget work.  But it should be done consciously.

I need to get back to a place where I’m reviewing my budget weekly.  I need to think about what I can spend before I actually do spend.  Some things, like gas for my car, are non-negotiable.   But when it comes to clothing or grabbing lunch with coworkers, I need to at least acknowledge that there is a budget for these things and perhaps I should check where I’m at with those numbers.

I’m starting now, and am determined that August will be a better, stronger budgeting month.

Megan Smith

Megan is a 40-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:

In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance.  It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information.  It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck.  While that was working for me, clearly I needed a better plan.

While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.

Except that’s not what an emergency fund is for.

So I did a lot of research, read a lot of blogs, and decided that I needed a plan.  I needed to budget.  I needed to know what I was spending my money on.  I needed to prepare for the future.

I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way.  I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.