Wine & Popcorn Get the Ax

With the new year I wasn’t sure exactly what a new small raise (woot woot!) and tax withholding would mean for my take-home pay and, subsequently, my budget.  So yesterday I took a long, hard look at my pay stub.  If you haven’t done this, DO IT NOW.  It’s amazing the kind of stuff you miss if you never look.  Like in 2011, when I managed to miss the fact that I didn’t withhold ANY money from the government, and in April owed the IRS a fat check.  Repeat after me: Ignorance ≠ bliss.

Anyway, turns out my taxes have increased pretty substantially, at least in terms of $$, if not percent.  SO back to the budget drawing board I went. 

I know it sounds obvious, but one of the biggest improvements to my budget this year is that I start by budgeting my annual salary, rather than my monthly pay.  It all gets to monthly in step two, but first I start with what I make for the year.  Real novel, I know.

While in theory either should work, I've found that when I start from the total and work backwards, it changes my thinking.  ALL the money I spend HAS to add up to that fixed annual sum – there is no wiggle room.  In contrast, when I budgeted by the month, if a large, one-off expense came up – like the few thousand dollars it took me to move from New York to Houston – I would treat that expense like it didn’t belong in the budget.  After all, those large items don’t come up every month, so it didn’t make sense to allocate a portion of my monthly budget to these types of expenses.  At least, that was the faulty logic that allowed me to mentally relinquish responsibility from dealing with them.  Stupid.

So anyway, back to this budgeting thing.  With my new determination to make my $$ add up, I took a really hard look at what I could cut from my spending to account for those taxes.  And while I’m a little sad about it – clothing, fitness and manis/pedis were downsized even more than they already were – I am committed to teaching myself this very real life lesson.

And in that spirit, I’m proud to say that I have dabbled in my first little bit of foregoing.  As my “food,” “entertainment” and “grooming” spending is coming close to meeting its monthly max (yep, on January 16th -- what a newbie I am at this!), here are some things I have done a little not doing!

1. Said no to seeing Zero Dark Thirty tomorrow night.  Would have gone to a theater where you can get an overpriced glass of wine, and I’m sure I would have had two.  Saved $33!
2. Said no to lunch with a friend.  She is all about budgeting, too, so we’re going to figure out something free to do next week instead.  Saved $15!
3. When I ran out of chap-stick, I didn't buy more.  I realize this one sounds a little extreme, but at the beginning of the month I picked up all this dry cleaning and tailoring and a pair of shined shoes and that totally maxed out my “grooming” budget.  (Michael argues these items should have been in “clothing,” but it’s my mind and my budget.)  Now, this one I’ve thought about cheating a lot – so easy to slip a chap-stick in with my groceries and allocate to food! – but I really want to test myself, and anyway, it’s probably not good to be so addicted to chap-stick as it is.  Saved $3 and will maybe kick a habit! 

Total saved = $51.  Not bad!