Money Talks

Basically this is a continuation of Wednesday's post. I said I would reveal to you some tips and tell you more about my budget tracking system. Also, somewhere embedded in this post is my credit card number.

I was browsing through last January's post, and it seems like I had the same frame of mind a year ago. I talked about how the envelope money system would never work for me, because I don't want to keep track of receipts and I can't be bothered to write anything down when I'm at the store.

So I'm gonna start by telling you about the trends I noticed after running my year-end-report. As a teacher, I'm basically a pro at data analysis. I've more or less gone bug eyed staring at reports and test results printed in size ten font.

This is what I noticed:

The eating out category shows the patterns of my social life. For example, in October I only spent $9.95, because I was too busy putting in extra hours at work and was immediately going to bed when I got home. In May either I was too lazy to go grocery shopping, or I had a lot of ventures out with friends, because I overspent by 50%. Oops.

I noticed that my gas heating bill peaked in January, but then slowly declined until it got to its lowest point in October. It started to rise again once November hit.

The cost of garbage service increased by seventy cents.

There were only two months where I spent $0 on clothes: April and October.

From January 2010 to December 2010, my bank account profited 79%. I think this is fairly awesome. Nearly doubling my money in one year seems kind of a feat. I doubt it will happen in 2011. Unless of course, I strike it rich and discover I am actually living on top of an oil well.

Now let's chat about some finance tips.

1) I'm going to start out very harsh. If you can't pay off the entire balance of your credit card at the end of every month, you should get the scissors out right now and cut it up. I'm all about using a credit card (they're safer for on-line purchases and some get good bonus point rewards), but it's incredibly important to pay the thing off. Maybe this is bad, but I don't actually know the interest rate on my credit card. It doesn't ever matter to me, because I've never paid a dime of interest on it in my life. The short of it is, don't spend money you don't actually have. This is called debt.

2) Pack your lunch everyday. And vending machines totally are a rip off, so keep a drawer full of snacks at work. I do. My staples are Goldfish crackers and small amounts of chocolate, like Hershey kisses or mini sized candy bars.

3) Pay all your bills on time. If you're really bad about doing things on time, sign up for automatic payments. If you are constantly late paying various bills, there's this thing called a credit score and it gets affected. Plus, who wants to pay interest or late fees? Not me.

4) Buy-one-get-one-half-off still means you are paying 150%. Sure, if it's something I actually need or will use (toilet paper, toothpaste, shampoo), I will buy it. But if I buy a shirt for fifteen bucks, I am not going to get another one for $7.50 unless I really really love it and need it. Marketers are always trying to get you to spend more money than you actually would on things. They claim that you are saving, but you are not saving if you spent more than you set out to spend. Don't cave in. Think, "Do I really need two?"

5) Don't pay to waste something. Case in point: I used to buy a bag of spinach every week or two but I usually let half of it go bad. It was only $1.78 or whatever, but I was being wasteful. I'm a little embarrassed to admit this, but I have not packed salad for lunch since the beginning of November. Instead I have a lot of frozen vegetables that I cook instead, because they won't go bad.

I think the biggest thing that helps me is that I check my on-line banking account like every three days and I write down what I spent my money on. When you are aware of your spending, it helps keeps things in check. For me, guilt acts as a good deterrent to irresponsible spending.

Happy $pending and $aving this year.