Noor77's personal budgeting thread

Re: Re:budgeting for saving and life goals

Hi again Clubman. I know I definitely do not make €35k a year - I wish!!! The €2,300 a month is made up of my salary and an additional 330 a month I get from letting a room in my apartment. I think I'm on about €28k, if even

Re: Re:budgeting for saving and life goals

Hi again Clubman. I know I definitely do not make €35k a year - I wish!!! The €2,300 a month is made up of my salary and an additional 330 a month I get from letting a room in my apartment. I think I'm on about €28k, if even

It doesn't really matter - €2,300 net per month, whatever way you get it (e.g. main income plus tax free rent a room scheme income in this case ), is the equivalent of c. €35K a year gross for an individual with the basic tax credits on class A PRSI. Your tax free mortgage subsidy from your parents brings you up to the equivalent of c. €38K - quite a bit above the average industrial wage of c. €28K and well above the minimum wage of c. €15K (figures off the top of my head so may not be exact).

Re: Re:budgeting for saving and life goals

Really, I don't think it's that amount. Not being funny.

How do you budget Clubman? Have you got your discretionary spend well under control? Am I some strange human anomaly in a world of perfect budgeters?

I give to charity every month too, not to any specific ones but I make sure I contribute.

Re: Re:budgeting for saving and life goals

Really, I don't think it's that amount. Not being funny.

Really, I think it is. Enter €35K into [broken link removed] and you get €2,300 net per month. If €2,300 per month is your net income then you are on the equivalent of €35K gross for a single PAYE worker, with the basic/standard tax credits and on class A PRSI. In fact, if you add in your €120 per month (€1,440 p.a.) pension contribution then it brings you up to c. €36.5K. No offence but it's not unusual for people who can't understand how they manage to spend most/all of their disposable income to not even have a clear awareness of their total income in the first place. This is why budgeting has been mentioned several times previously.

How do you budget Clubman? Have you got your discretionary spend well under control? Am I some strange human anomaly in a world of perfect budgeters?

I don't really do budgets. Don't be mislead by the advice that I spout - I am certainly no paragon of excellence in this respect by any means. I do know how much the household income and outgoings are at a high level (e.g. on an annual rather than monthly/weekly basis). I did clear the mortgage well in advance a few years ago which made quite a bit of additional disposable income available which I redirected into my SSIA, and am otherwise debt free too. I think that I live quite comfortably and not that lavishly (e.g. no car, not overly house proud, only buy new clothes sporadically, interested in technology but generally a late adopter of new gadgets etc.), definitely spend much less than I earn on bills and discretionary stuff and have accumulated quite a bit of savings over the years. Some of this happened more by accident than design but I guess that I am probably quite prudent (inherited from my upbringing I suppose!) when it comes down to it. I could probably make the money work "better/harder" by budgeting and more regular/thorough/comprehensive reviewing of the finances but sometimes I find it a bit of a drag. However I do try to do a basic review of the finances (pension, savings/investments) at least once a year.

Re: Re:budgeting for saving and life goals

"definitely spend much less than I earn on bills and discretionary stuff and have accumulated quite a bit of savings over the years"

would you not consider investing some of these savings in property clubman?

re: myself - I feel you are leading up towards telling me I am as bad as that cavan woman who was on show me the money : ))

Re: Re:budgeting for saving and life goals

would you not consider investing some of these savings in property clubman?

No - the PPR means that there's probably c. €400K in equity already wrapped up in property so I would not be inclined to concentrate significantly more in that asset class (and geographic region if we assume local property only) due to the potential risks involved and would be more inclined to diversify across other asset classes and risk/reward profiles. In the past I was playing it safe with stuff like Savings Bons/Certs (when the rates on offer were significantly higher mind you, but then again so too was inflation) but as these matured I tended to shift them into low charging unit linked equity funds and the like. Given a few grand I'd be more likely to put it in an equity/stock market based investment rather than consider property. In any case I'm not inclined to get into the property management buiness.

I feel you are leading up towards telling me I am as bad as that cavan woman who was on show me the money

I don't watch it so I don't get the reference but don't take my comments/observations as criticisms directed at you personally. I'm just trying to clarify the fundamental issues and provide some useful tips even I might sound a bit brutal at times!

Re: Re:budgeting for saving and life goals

One quote from a self-made millionaire type (heard him on Oprah) struck me as very useful and might give you pause next time you're about to blow your budget: the key to creating wealth is not what you earn, it's what you don't spend.

If nothing else works, try the brown envelope method of saving. Get a pile of envelopes. On each one write the items you require money for e.g. clothes, esb, gas, phone, going out, presents, charity, travel, food, holidays, magazines etc. etc. etc. Now, next week you have allowed yourself €100. Take that money out of the bank, get it in tens or fives if possible. Now, divide the money up according to the way you want to spend it, place that amount in each chosen envelope and put the whole lot into an old box/biscuit tin. Some weeks, you may put nothing in your "clothes" envelope (can't remember what you said you spend on clothes, was it €100 per month? That's a HUGE amount to me to spend on clothes. I'd certainly find a better use for €1,200 every year but if they're your luxury item of choice so be it), but other times you might put €10 every week in to that envelope, then the next time you want to buy something you've got the cash there already.

This method helped me in the past when I was trying to really get down to basics and try to plan to have money for bigger expenses like birthdays, holidays, winter coat and so on. If you've divided your money like this then run out of money for say, a night out, and you have to physically go and take money out of another envelope, maybe your holiday fund, it really hits home that you've only a finite amount of money and it is your choice what to spend it on.

It probably goes without saying that you wouldn't want to do this for long enough that it meant you might have large amounts of cash lying around.

I've tried many different ways of budgeting in the past and unfortunately used the plastic method to live on for a while and so have ended up with a very big loan to try and pay for my previous overspending. And none of that overspending was on very expensive holidays or designer clothes, just too often choosing the slightly more expensive way of doing something instead of thinking first if I had enough money to do so.

One other thing I did for a while, at the beginning when I had the feeling I should have more money but it seemed to just be slipping through my hands all the time is this. Determine how much I was going to allow myself for one week. Divide that amount by 7. As an easy example lets say €70/7=10. So, that's €10 per day. In the morning put €10 in your purse and no more. Leave all cards at home. And you can't spend any more than that on that day. At the end of the day take any money left over out of your purse, even if it's only 5 cent, and put it in a money box somewhere (got myself a really cute little piggy bank for this, cost about ten pounds at the time and this was exactly the kind of thing that led to me being broke all the time, an old Dolmio jar would have done just as well!). Next day start out with €10 in your purse again. And so on and so on. When I did this I managed to save sixty pounds in the first month - as I was going away on a work weekend away at the end of the month this was brilliant for me - I still would have gone away but everything I spent would otherwise have been overdraft/creidt card paid for and I probably would have spent far more than 60. As it was I went away with a pocket full of sixty pounds worth of change (should have remembered to go to the bank and get notes for it) and didn't quite spend it all.

Re: Re:budgeting for saving and life goals

Thanks Janet - I think something simple like the brown envelope method is exactly what I should be doing and I'm going to start from today. Do you still use it?

How did you manage to run up such debts without spending on "luxury" items? Any people I know with "plastic" debts usually have them because they have a problem with buying expensive clothes. One friend in particular regularly spends an entire weeks salary on pairs of shoes

Re: Eur100 Test

Okay, so the plan is Eur100 to last me from today until next Thursday, budgeted as follows:

Transport: €20
Food: €40
Socialising: €30
Papers, Magazines (and Vitamins!): €10

I'll let you all know how I get on

Re: Eur100 Test

Think of it this way - you don't see your money disappear every month and don't seem to have an extravagant lifestyle. So why is it surprising that I was able to spend money on a not very extravagant lifestyle? The only difference is that I got a credit card and fooled myself about how I was paying for it all.

For a long time I paid my overdraft and credit card off as soon as I got paid. But of course then that would leave me short for the next month and I'd need to use them again. And then one month I didn't quite clear them and left a hundred pounds or so to clear. And when that happens and you don't discipline yourself it builds up the interest and gets more and more difficult to clear. So I took out a loan to clear the card but didn't get rid of it. Spent nothing on it for months (it was just for emergencies after all) and then I had to move house and used the card to pay for hiring a van to move, buy a fridge and mattress for the unfurnished house I moved into (all the other furniture was donated by friends and family or bought in the Vincent de Paul place, I didn't buy a bed until a few years later) because I just couldn't afford it pay for it otherwise. Housemate gave me half of the money for the van but that was cash in my purse and just sort of disappeared. That kind of thing happened a good bit once I started taking the card out again, with me using my card to pay for cinema tickets and so on and friends giving me the cash - it never made it to the bank.

Going to a restaurant I wouldn't just buy the cheapest thing on the menu, I'd eat whatever I felt like, probably have starters and desserts too (after all, it's a night out, I work hard, why shouldn't I treat myself) and then afterwards if it was cold or rainy, instead of waiting for the bus/nitelink just hop in a taxi (sure it's not that far really, it's worth it to get home earlier). I'd sometimes buy breakfast and lunch in work and then get takeaway for dinner - but every days for weeks before I got around to sorting out some time to cook. But I'd always convince myself I wasn't going to do that again next week, buy loads of food at the weekend and then end up throwing half of it out weeks later having spent a fortune in the meantime on paying for lunch in work/takeaways etc. Just lots and lots of silly things like that. Don't ask me how I ended up like that - when I lived in Germany (and got paid half of what I do now) I had no credit available to me and managed on a cash basis for everything - I knew the prices of everything in all the different supermarkets and never went to just one for my shopping. But somehow it just seemed to difficult to do here.

It's hard to explain but these small kinds of things to build up - and eventually the stress might get to me and I'd take my card and go shopping and buy one or two small things to treat myself - but one or two small things (new clothes, cd, books) still mount up to say seventy or eighty pounds and even though you think it's not much, when you don't have anything to spend (in fact, have negative amounts!) then it's a huge amount. Or I'd decide since Ryanair were having a sale I could go on holidays - always to visit family or friends because then there's no cost right? But when you're there you want to buy a present to say thanks/invite them out to dinner etc. etc.

About a year ago, I was in a job I hated and although I had finally started to really sort out my finances and stick to a budget properly (never lasted more than a month or two before) I could feel that I was starting to feel the same way I had before, just sick of always having to be watching my money. But this time instead of blowing money I didn't have on crap I didn't need, I decided to bite the bullet and start going for counselling (there were some emotional issues involved, leftovers from bereavment as a kid and so on, plus I have a similar problem with eating food as I do with spending money and really wanted to continue to lose weight). It's not cheap but I reckon it has saved me hundreds in the long-run as well as helping me get a new job which I love.

Hmmm, this has been another mammoth post. Thanks to anyone who actually made it to the end, apologies to any I may have bored and well done for not falling asleep!

Re: Eur100 Test

Where has your night course gone ( 40pw )?

If you enjoy it I really cant believe you need to give it up.

Re: Eur100 Test

Janet, fair play to you for the posting such an honest account of your experiences. I'd say that the incidences of emotional issues impacting on financial issues would be quite common to be honest. I usually try to concentrate on the hard financial aspects of queries so perhaps come across a bit direct or unfeeling at times (sorry Noor77! ).

Re: Eur100 Test

Janet, I'm sure you haven't bored any of us. Least of all me. You are very admirable in that you have reached a stage where you can be totally honest with yourself and take responsibility for any past mistakes you may have made. Not many people have the ability to be so candid with themselves. And, I totally understand the whole small things equalling a big debt scenario. A couple of years ago I got in to that whole buying takeaways scenario - and it's a very difficult one to get out of. It's easy to reason with yourself by saying "I have worked hard today, now I'm tired and don't want to cook so I'm going to have a takeaway". Now I only ever order a takeaway about once a month (if even), as a consequence I enjoy it much more.

Finances are affected by emotions, money sometimes seems to offer "quick hits" ...but this is really an illusion. It's like my friend who regularly spends €400 on a pair of shoes that she maybe wears about 4 times a year. She can't afford them really (not in "positive" cash terms anyway), but buying them gives her a temporary rush.

And Elderdog! Don't worry - I paid for my night course up front at the start, so I am still attending and getting great enjoyment out of it.

Re: Eur100 Test

You definitely didn't bore me either Janet; thanks for posting it struck lots of bells with me too.

One "behaviour pattern" (apologies for the psychobabble) that I think I suffer with is a need for a routine. When I have a routine up and running; everything works great but it has to be properly thought out to cover pretty much everything. I work my spending out to the nth degree now; I ignore my bank balance and have made my budget spreadsheet my bible and just reconcile it to the bank a/c once a week or fortnight. It took a while to set up but once it was up and running, it's the same thing every month. I usually have ti set up for a few months in advance, so that I can't be codding myself with "ah shure won't I pay for that no bother next month".

The food shopping I do once a week covers everything; all necessities (including toileteries) and yummies - it's sad but I have a shopping list on floppy with everything I like/buy and tick off what I need and just print it and off I go. (The shame of admitting to being so anal!!) So I eat good stuff, keep an eye on my weight and on my budget. If it goes off the rails even for one week, then I start to slip out again and start popping to the shops for a shampoo and come home with 40 euros worth of stuff.

I love LIDL and ALDI but can't convert to their toileteries (shampoo, bath stuff, moisturisers) at all. I guess the branding has worked on me. So I have a system now where I buy 3 for 2 or whatever on items I like when they come up and I always have spare ones at home, so there's no excuse.

Books and CDs are another downfall. I gave up reading magazines and buy loads of books in Charity shops, so I always have heaps to read. The local Enable shop must have some pretty cool contributers because there are always decent books to my taste there (not just holiday paperbacks). I got to the library too but I always end up picking up books I never read. I study art history and philosophy quite a bit and the best way to get these (mostly academic) books on the cheap is at abebooks.com (from the states or UK) or amazon marketplace.

Rebecca

PS Took a study break this year and am really regretting it - if anyone knows of Arts/Humanities courses starting now, I would love to hear.

Re: Eur100 Test

Noor, I think you are doing very well for your age to have a property of your own in today's market. Don't be too hard on yourself. But do take the advise given by others to track your spending carefully and honestly for a while until you have a more complete picture of where your hard earned is going. I too especially like Janet's suggestion (well done Janet!) so see how that goes for you.
And as a last suggestion, I often refer friends who feel a little "poor" to a link I got from AAM a while back, which might just cheer you up. It's a "not to be taken too serious" Net Worth Calculator from AIB.
[broken link removed]

Re: Eur100 Test

Forgot to mention that yes I do use the brown envelopes for certain things like birthdays and so on. I use a spreadsheet for tracking what expenses I know are going to come up during the month (monthly expenses on one side and weekly on the other). Right down to having a separate line for my lotto spend (spend a minimum on this but it satisfies my gambling instinct and otherwise I might go mad on scratch cards every couple of months). Once I know what my regular expenses are going to amount to:

Rent
Loan
HSA
Car savings
Internet flat-rate
Concern donation
Gym
Phone
Bus/train
Weight watchers
Counselling
Petrol
Any one-off expenses I know I'll have that month

I substract that amount from the amount that was lodged into my account as salary. From the leftovers I try to take €20 euro per week for bills (money goes into the brown envelopes) and the rest is divided by four or five (depends on how many weeks there are that month) and that becomes my "food" money. But really it includes everything else such as toiletries, household stuff, going out, books, clothes. Generally I have about 50 or 60 euro per week, and on the weeks I'm really being careful I would never spend that much. And so anything left over at the end of the week makes its way into a brown envelope. One of these days I'll even have enough to buy that winter coat I've been promising myself for the last four years - must be mostly wool, must be long, probably will be red or black. Can't wait!

By the way Noor, you are doing extremely well to have property and should never underestimate what a wonderful feeling of security that can bring. I'm a couple of years older than you (I think you said you're 28/28?) and will not have finished paying off my loan for about another 2.5 years. By the time I would then be able to save enough for a decent deposit I'll be heading into my late thirties and you will be halfway through paying your mortgage. Although you never know, maybe I'll marry rich one day (probably about the same chance of that happening as of me winning the lotto but at least dreaming isn't an expensive hobby LOL.)

Re: Eur100 Test

For what it's worth there are a few budget spreadsheets linked from and [broken link removed] also have one (actually they may be the same ones in each case).

Re: Eur100 Test

Thanks again Janet, I really appreciate all the tips. You can never know too much : )) I turned 27 in December 04...sssshhhhh ) I still keep thinking I'm 26 (I wish!)

I have just tried that net worth thing that Sunnyday recommended. I obviously did it wrong though because it gave me a mad figure at the end!

Re: Eur100 Test

Hi MissRibena

Did you take a year of to do anything special??? Most courses won't be starting again until September. I am very interested in art history, architecture and form. I find very reasonably priced books that cater to these interests in the little bookshop at the Trinity end of Dame Street - across from central bank and beside the australian travel agency place. I think it's called Books Upstairs. Generally the prices there are very good.

re: cd's - you can buy them very cheaply in Tesco now. I saw the new U2 for €23 in Tower records but it is only €14.95 in Tesco. Not bad.

I took a year out of work also, to do a masters. It takes a lot to get used to not having money again : ))

Re: Eur100 Test

re: cd's - you can buy them very cheaply in Tesco now. I saw the new U2 for €23 in Tower records but it is only €14.95 in Tesco. Not bad.

€12.99 including delivery on [broken link removed] .