I don’t know much about the Dave Ramsey concept as a whole, but, aside from sinking funds, another concept I hear being tossed around are about cash envelopes.
Now, last month in June… really late May, I ended up forking over most of my One Month Ahead fund that I had spent all of this year trying to save up. Prior to this, I was budgeting with a full month’s worth of bill and budgeting money (which was the dream!). But now that I’ve gone ahead and purchased a car, I’ve set myself back some and while it does kind of get me down a bit, I’m still glad that I was able to purchase a car without having to get a loan for it! So that’s good! ?
In my video, I also explain to you how FRUSTRATED it made me to know that my eating out habits were really getting out of control. I evaluated my budget from the past few months and found that I wasted so much money that could’ve been saved on eating out ALONE. It looked a little something like this:
• February: $155.68
• March: $184.82
• April: $110.58 (this one I estimated wrong in my video at $177 which was a wonderful surprise! ?)
• May: $208.59
• June: $202.07
Now, in May I gave myself the benefit of the doubt for going over my eating out budget because May was when I was going through such turmoil with my bank after being a victim of fraudulent activity which left my bank account wiped clean and overdrawn. I discovered how much of an emotional eater I am so I forgave myself for that.
But JUNE? There was NO reason to have hit the 200s again and that is really bothering me. Look at everything I spent on eating out just from the past 5 months. Had I been disciplined enough to focus on eating in more than forking over my funds to less-than-luxurious fast food joints, do you know all of that tallied up to $861.74!?!??!!!!!
When I realized that, it just…oooh! I was ONE hot potato with myself… Over $800 that could’ve been saved in my online savings account collecting high interest or something… Ugghhh! That really peeves me because I just know I can be more disciplined with my budget and my eating out, so why am I not doing that?
JUST SAY NO!
(to Fast Food…)
So… with that being said, I’m switching it up in the strongest possible way. I’m not even going to try and be lenient with myself when it comes to my eating out budget. April was the only month I ever came close to my usual monthly budget of $100; but every other month? Such obvious fails. ?
If you’ve watched either this cash envelope video or my July budget then you know that I really want to get serious about saving up for a down payment on a house in the future. That’s just a big goal of mine right now, not only just to get in my own house. But to get in my own house using the best possible route. Obviously, the best route is to just buy a house upfront with cold hard CASH!
And while I know that’s possible… that’s not the only dream I’m hanging onto. I want to better my credit score and be able to put down the heftiest down payment I can manage so that my monthly mortgage can be the lowest I can get it. If I can, I would rather opt for a conventional loan so I’m not tied to HAVING to pay monthly insurance every month, though I’m not sure if that’s such a bad thing… but I’m very much a beginner in home buying research, so I’ll be continuously looking into this.
MY 2-WEEK BUDGET
All in all, I say that to say, this month’s budget is going to seem REAL tight and skinny. But just to put it into perspective for you all, I am single and live on my own, and I realize even THIS budget might be small for other singles, but I’m still working through everything and this is just where I’m starting for now.
So, I do my cash envelopes every other week on my paydays, and I always budget for the two weeks coming up. So, for these next two weeks, this is what I have planned:
• Gas: $ 70
• Toll: $30
• Grocery: $40
• Eating Out: $20
• Personal: $10
A whopping $170 in total to get me through the next two weeks… and we shall see how that goes. I have already written out my budget to the penny (what most would call the “every dollar budget”) because I wanted to go ahead and transfer what I was able to save to my online savings account. I didn’t want to give myself any excuse whatsoever to use any of those funds for a sneaky luxury of eating out. I am really going to crack down on this in July.
And I will report back to you all in my July Part 2 video (and post) to let you know how I am doing. Until then, you all have a wonderful day! ?