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Happy to Spend
Sep. 5th, 2011 07:44 pmThe goal
So I decided to try really doing steps 3 and 4 in Your Money or Your Life. Step 3 is keeping track of every penny that goes out of your pocket. Step 4 is asking yourself at the end of the month, for each category of expenditures, whether you received fulfillment and satisfaction in proportion to the amount spent, whether the expenditures in each category were in alignment with my values and purpose, and how much this expenditure might change if I were financially independent (no longer needed to work for money).
The plan
I've done step 3 before--I track my spending again whenever I find myself wondering where my money is going. Step 4, not exactly, I just basically try to pay attention to when I have a regret (such as buying stuff I end up not liking and such as not paying to go to the top of the Arch d'Triomphe).
This time, I categorized my spending a little differently than usual because of the whole values-and-purpose thing. I decided to work from my knowledge that in order to be happy, I need to be taking care of the physical, intellectual, creative, social, and spiritual (and career). So I split my purchases into those categories.
I stuck food, housing, health care, and exercise stuff into the physical category and the other things were weird. I put movies in the intellectual category and anything I wouldn't normally spend money on but I was going with other people I put into the social category. Charitable contributions went into the spiritual category.
I usually split my food purchases into grocery store spending and restaurant spending, but this time I decided to further split my food purchases into these categories: protein, dairy, grains, produce, and empty calories.
I decided to go a little wacko and include all my earnings (base pay, longevity pay, premium sharing, and the part R pays me for rent) and then include insurance and both halves of the rent instead of just acting like health insurance is free and like I pay half the rent. I did subtract my social security and income taxes from my income rather than calling them expenditures, though.
There are categories where I budget a certain amount each month but I generally don't spend that amount. For example, so long as I have a lifestyle where I own a car, I budget a certain amount for car upkeep (gas, maintenance, repairs, insurance, taxes) and a certain amount toward savings for my next car. So, how do I account for that? I decided to subtract any amount that goes into savings for these things and ignore any expenditures that come back out of those savings.
The findings
1. It was surprisingly easy for me to pick a single category for each of my grocery store food purchases. I really had no problem, even with things like frozen fried fish (protein, even though it's breaded), graham crackers (empty calories, even though there is some fiber) and ice cream (empty calories even though it's dairy).
2. In that same category, I spent the most (over 1/3 each) on protein and dairy (almost a perfect tie) and very little in the other three categories.
3. I found a $1000 difference between the amount I earned and the amount I spent. Wha?
Okay, I am not the sort of person who accidentally spends $1000 and forgets about it. Then I remembered that R had paid me ahead of time for his part of the rent, etc. and so I had moved that into savings ahead of time, too. But I had entered only the earnings into my chart, not the savings. That still leaves $500 unaccounted for.
I'm going to try again this month and see what happens. And this time I'm not going to wait until the end of the month to enter all my receipts.
4. I have not actually used many of my purchases yet, so it's hard to be completely sure how satisfied I am with them. That's okay; I often buy things before I need them.
5. Overall, I am very satisfied with all the spending I did, do not regret a single purchase (except I am a little sad that my new pants attract lint), and in general am very happy to be as rich as I am. Dang, I was supposed to be finding something I don't care about so I can save more money. One thing about sticking movies and dance lessons into the social category--they don't seem so extravagant anymore.
6. Obviously I spent most of my money (that did not go into retirement savings) in the physical category. That doesn't mean this category is the most important to me (I don't think)--it just means this category is more expensive. I don't think it makes sense to say that since I care about the intellectual part of my life more that I need to spend more money in that category. (Maybe I need to spend more time in that category than the physical.)
Your turn
Have you ever played around with budgeting?
**
In other news, I tried a new Mexican restaurant in my area, Nueva Vallarta. Love the chips, but the enchiladas are not magical. La Palapa is still my favorite Tex Mex. However, I'm going to try the queso at N.V. next time I'm in the mood for some of that. With awesome chips, they have half the equation satisfied already.
So I decided to try really doing steps 3 and 4 in Your Money or Your Life. Step 3 is keeping track of every penny that goes out of your pocket. Step 4 is asking yourself at the end of the month, for each category of expenditures, whether you received fulfillment and satisfaction in proportion to the amount spent, whether the expenditures in each category were in alignment with my values and purpose, and how much this expenditure might change if I were financially independent (no longer needed to work for money).
The plan
I've done step 3 before--I track my spending again whenever I find myself wondering where my money is going. Step 4, not exactly, I just basically try to pay attention to when I have a regret (such as buying stuff I end up not liking and such as not paying to go to the top of the Arch d'Triomphe).
This time, I categorized my spending a little differently than usual because of the whole values-and-purpose thing. I decided to work from my knowledge that in order to be happy, I need to be taking care of the physical, intellectual, creative, social, and spiritual (and career). So I split my purchases into those categories.
I stuck food, housing, health care, and exercise stuff into the physical category and the other things were weird. I put movies in the intellectual category and anything I wouldn't normally spend money on but I was going with other people I put into the social category. Charitable contributions went into the spiritual category.
I usually split my food purchases into grocery store spending and restaurant spending, but this time I decided to further split my food purchases into these categories: protein, dairy, grains, produce, and empty calories.
I decided to go a little wacko and include all my earnings (base pay, longevity pay, premium sharing, and the part R pays me for rent) and then include insurance and both halves of the rent instead of just acting like health insurance is free and like I pay half the rent. I did subtract my social security and income taxes from my income rather than calling them expenditures, though.
There are categories where I budget a certain amount each month but I generally don't spend that amount. For example, so long as I have a lifestyle where I own a car, I budget a certain amount for car upkeep (gas, maintenance, repairs, insurance, taxes) and a certain amount toward savings for my next car. So, how do I account for that? I decided to subtract any amount that goes into savings for these things and ignore any expenditures that come back out of those savings.
The findings
1. It was surprisingly easy for me to pick a single category for each of my grocery store food purchases. I really had no problem, even with things like frozen fried fish (protein, even though it's breaded), graham crackers (empty calories, even though there is some fiber) and ice cream (empty calories even though it's dairy).
2. In that same category, I spent the most (over 1/3 each) on protein and dairy (almost a perfect tie) and very little in the other three categories.
3. I found a $1000 difference between the amount I earned and the amount I spent. Wha?
Okay, I am not the sort of person who accidentally spends $1000 and forgets about it. Then I remembered that R had paid me ahead of time for his part of the rent, etc. and so I had moved that into savings ahead of time, too. But I had entered only the earnings into my chart, not the savings. That still leaves $500 unaccounted for.
I'm going to try again this month and see what happens. And this time I'm not going to wait until the end of the month to enter all my receipts.
4. I have not actually used many of my purchases yet, so it's hard to be completely sure how satisfied I am with them. That's okay; I often buy things before I need them.
5. Overall, I am very satisfied with all the spending I did, do not regret a single purchase (except I am a little sad that my new pants attract lint), and in general am very happy to be as rich as I am. Dang, I was supposed to be finding something I don't care about so I can save more money. One thing about sticking movies and dance lessons into the social category--they don't seem so extravagant anymore.
6. Obviously I spent most of my money (that did not go into retirement savings) in the physical category. That doesn't mean this category is the most important to me (I don't think)--it just means this category is more expensive. I don't think it makes sense to say that since I care about the intellectual part of my life more that I need to spend more money in that category. (Maybe I need to spend more time in that category than the physical.)
Your turn
Have you ever played around with budgeting?
**
In other news, I tried a new Mexican restaurant in my area, Nueva Vallarta. Love the chips, but the enchiladas are not magical. La Palapa is still my favorite Tex Mex. However, I'm going to try the queso at N.V. next time I'm in the mood for some of that. With awesome chips, they have half the equation satisfied already.