Am I the only one without a "budget"?

[dvcgirl]

If that opinion applies to dvcgirl, then it applies to her Uncle.

It's his money...he earned it and can spend it however he wants, regardless if others think it's reckless.

Sure he can, and he does. Trust me. Well, maybe reckless isn't the right word. There's just no thought put into their spending....they just spend. They're always in "life's too short mode".

He's a great guy, and I love my Aunt (my Mom's sister) dearly. But I see problems coming....have for years.

He had bypass surgery just a couple of years ago. And so, while he's pretty healthy now, I can't see him working well into his 60s. He plans to retire, but then do "something else". He's an Amtrak employee, so he gets 60% of his current salary. No social security. My Aunt has no pension....no savings. The annuity I mentioned early ends in a few years....that's another 30K gone. My Aunt was diagnosed last year with rheumatoid arthritis....so she won't be working much longer either. They are going to experience a huge drop in lifestyle.

But this is happening to many, many Americans....and it's only going to get worse as the Baby Boomers retire. We haven't seen anything yet.

So now they're earning 140K, no savings....but thankfully, they'll have my uncle's pension and eventually SS. But I don't think either will make it til 65 for SS or medicare.

And since this is a second marriage for both, they've got adult children...from age 19 to 30....6 altogether, and 4 out of the 6 are always looking for money.

That's where I suspect a lot of their money goes....and why at age 50-something he has to put an iPad on credit.

They talk all of the time about wanting to travel...get back to Cancun or whatever, but it's just talk. Unless it goes on a CC, it's not happening. And that's *now*.....how likely are they do see the world (which they talk about all of the time).....they won't. Unless someone else takes them along.

And who knows, we may take them along one of these trips. We enjoy their company. They've already been to my sister's house on Bald Head Island twice and loved it.

They certainly won't eat alpo....they have a pension. And my sisters and I will make sure that they'll enjoy some nice trips. My Aunt is closer in age to us than she is to our own mother. They talk about going to Europe as if they're going to the moon, but if they want to go....we'll make sure they get there.

What we are trying to do in that branch of the family tree is to change things. My cousin, her son is engaged to be married next year. In addition to a nice engagement gift, DH and I gave them our favorite personal finance book....but also invited them over for a few "financial planning" dinners....to talk about how to set financial goals and handle money. Help them to get of that "if we can afford the payment, we can afford the item" mentality that they've both grown up around.

We left it up to them to accept the invite or decline. They're both excited to learn...and so we're hoping we can do some good

 

[dvcgirl]

So what exactly is the point of learning DVCgal's income and budget?
I really want to know?

She is an atypical American

No Mortgage
**********No KIDS********
Huge income


I could have a triple investment portfolio if we hadn't done 12 years of private school & 4 years college x3

So others can post that they make 40K, 50K, 80K and it's fine? But when you post that you earn 300K....then it's of no use to anyone?

Then why is it that I get private messages asking for saving and investing advice whenever I do post? Why? Because, when DH and I earned 100K, we wanted to know how you get to make 300K...and so we observed and studied those people....and read, and asked questions. Now that we make 300K...I'd like to know how to get to the next level, and so I read and ask questions of people who earn much more than we do.

And your comment...."I could triple my investment portfolio if we hadn't done 12 years of private school and 4 years of college....."......hey, that was your decision to have children. You can't be angry at those of us who decided not to have children.

The only reason I posted was to point out that the word "budget" isn't a dirty word....it's simply a plan for telling your money where to go based on a set of financial goals. And regardless of ones income.....we all need a budget.

 

[dvcgirl]

So what exactly is the point of learning DVCgal's income and budget?
I really want to know?

She is an atypical American

No Mortgage
**********No KIDS********
Huge income


I could have a triple investment portfolio if we hadn't done 12 years of private school & 4 years college x3

Oh, and by the way. Thanks for calling me an "atypical American". That's about the nicest thing that anyone has called me in a long time.

 

[silmarg]

So the bankruptcies had nothing at all to do with CEO's getting millions and millions in bonus's and huge benefit packages year after year? And tons of mis managing funds? Why is it always the struggling worker that gets the blame?

I am not blaming the workers. Afterall, they negotiated hard and got management to agree to a contract that they had no way of honoring if consumers taste in cars changed dramatically (and they have changed in a very big way over the past 40 years).

My point was not to blame to workers, it was to simply state the the retiree obligation was too great of a burden for those corporations to survive. And we are just beginning to see this take hold in the public sector (Wisconsin's plight of the last few months being the most notable).


I have to agree with Disneylicious... being a landlord is not an easy task... and in NYC it can take 9 months (of no rent) and $3000+ in legal fees to evict.

 

[LovableGluttons]

OK, I'll bite.

I have a budget, have had one since I was in high school. DH and I have our budget in an Excel file which we update twice a month. We each get paid twice a month in addition to DH's military retirement pay. I used to keep my budget in spiral bound notebooks, which I would save for 7 years each.

I did inherit $500 when my grandmother died in 2004.

I'm financially insecure and it rubbed off on DH. I work in health care and see families hiding money to get dear old Mom approved for Medicaid so the taxpayers can foot the nursing home bill.

My best friend in high school had a mother who did not work outside the home and qualified for food stamps on her military husband's income. My friend was mortified that part of her diet came from that.

I want to know how my money is working for me. It is important for me not to have to get financial assistance from anyone if I could do something along the way to prevent that. College was paid for by me, I saved for a house instead of having a mortgage, I pay cash for vehicles, and I have no credit card debt.

One of my dear friends is a financial planner. He used to try to get DH and I to invest in the stock market, but that carries a risk I am not open to taking.

Do I feel like I am missing out on life's enjoyment by watching my money? No.

I also choose carefully which charities I donate too. So I am helping out as well. Is it as much as many people would think appropriate? Probably not. That's okay with me because it is my money.

OP, if not having a budget works for your family, that's fine. If it isn't working, there are several folks here who could help you get started.

I do it because it is all I know.


I was the kid who saved her tooth fairy quarters, so I've been like this a long time.

 

[neatokimmo]

OP, I used to track everything in an excel sheet that would tell me how much I had spent and how much I could still spend in like 30 categories. When I was single and childless, it was loads of fun to track.

Now that I have DD and 2 jobs, I'm more "meh" about the whole thing. I take my income from my main job, max out my 401K (38%) then spend the rest over the year. I sell kid's fluff for my second job and it is super low paying (more crafty hobby than money maker) and add any sales to my spend column. I do have some padding in my checking because I have more bills that income the first 4-5 months of the year. Then it gets built back up in the summer and levels off at the end of the year.

 

[Ciao Mickey]

So what exactly is the point of learning DVCgal's income and budget?
I really want to know?

She is an atypical American

No Mortgage
**********No KIDS********
Huge income


I could have a triple investment portfolio if we hadn't done 12 years of private school & 4 years college x3

I believe she is just trying to point out that you need a financial plan or budget no matter how much you make if you want peace of mind.

I have to agree with your NO KIDS observation because kids can suck you dry.

I was a SAHM for over 25 years before I went back to work. Once I did the math and realized how much more money we would have had (my lost salary and all those stock options would have had added up to many more mil in the bank ) I think that I must have been out of my mind to stay home.

 

[Debbie]

The only reason I posted was to point out that the word "budget" isn't a dirty word....it's simply a plan for telling your money where to go based on a set of financial goals. And regardless of ones income.....we all need a budget.

Absolutely true. Unfortunately, many people (and there was a time when it was me) don't have financial goals except to get from paycheck to paycheck. As soon as there is any discretionary income ($5 counts!), you need to think about how it is going to be spent.

There was a time when I didn't have any discretionary income, or so I thought. I decided to put a small amount in a savings account (it was a Credit Union first, later an ING account) that was not easy to access. Those first 3 paychecks without that small amount of money were tricky and hard, but after the third or so, I had adjusted and the saving had begun.

OP, I used to track everything in an excel sheet that would tell me how much I had spent and how much I could still spend in like 30 categories. When I was single and childless, it was loads of fun to track.

I look at my tracking as a game, and I love to see where the money goes. I just went on a spending spree of school supplies, videos etc. that I don't normally do. I have the savings set aside, so it was fun. Had I done so on credit, it would have been stressful.

I believe she is just trying to point out that you need a financial plan or budget no matter how much you make if you want peace of mind.

I have to agree with your NO KIDS observation because kids can suck you dry.

No KIDDING! When you have 5, and you make music lessons the priority....wow! Our youngest is graduating high school in a month and the $300 a month that I have always saved for music lessons/trips etc for the five kids is waiting for me to decide where it is going. Likely to my Tax Free Savings Account (which I'm saving for the weddings once they start) or, barring that, into my Retirement fund.

I love learning from others. MY favourite book is David Bach's The Millionaire Next Door, where, simply put, (almost) everyone can change their habits, save (even if it is only $20 a pay), and that it adds up, when you don't touch it!

Everyone makes their own choices, and there is nothing wrong with that at all. Hopefully, your choice doesn't affect my savings. DARN, there's those KIDS again! (I feel very fortunate to be able to help my kids out as they start out-but only for emergencies-just loaned $200 to DD-i-L)

 

[nunzia]

If that opinion applies to dvcgirl, then it applies to her Uncle.

It's his money...he earned it and can spend it however he wants, regardless if others think it's reckless.

of course, but noooo..the point with the uncle was he had NO CASH and had to FINANCE a $500 item even though he has a good income.

 

[nunzia]

I am not blaming the workers. Afterall, they negotiated hard and got management to agree to a contract that they had no way of honoring if consumers taste in cars changed dramatically (and they have changed in a very big way over the past 40 years).

My point was not to blame to workers, it was to simply state the the retiree obligation was too great of a burden for those corporations to survive. And we are just beginning to see this take hold in the public sector (Wisconsin's plight of the last few months being the most notable).


I have to agree with Disneylicious... being a landlord is not an easy task... and in NYC it can take 9 months (of no rent) and $3000+ in legal fees to evict.

Yep..they kicked it down the road..and down the road..and then a little more..and now the whole pyramid scheme is collapsing.

We were landlords once and that was enough..Person didn't pay, person trashed stuff, person wouldn't even buy a can of raid to kill bugs..insisted WE do that..nightmare to have her evicted..not for me and so glad that is well behind us.

<<<Its true that income is out of whack in the NY metro area (heck, the avg public school teacher in my district makes over $100k)... but expenses can easily get out of whack here as well (my property taxes are $16k/year for 1800sqft on a 107'x43' lot). >>

HOLY COW...Our annual property tax was $482..I have a veteran credit so that cut off about $100. I think I will stay here

 

[Ciao Mickey]

Although I don't usually post I have spent a lot of time reading this board because I like finding money saving ideas. I am intrigued by all of the discussions on strict budgets, down to the penny spending tracking, and even people following "methods". Recently a friend mentioned something about her grocery budget, and I said that we don't budget and she seemed truly confused. So, I have been wondering....am I really so unusual in my money habits? I have no budget and I track nothing--I frankly couldn't tell you what I spend on groceries or anything else. I am just naturally thrifty(some might say "cheap") and we spend less than we make. Maybe being "cheap" is the best budget you can have?

Just because you don't track what you spend doesn't mean you don't have a budget. It just means you follow your budget without thinking about it.

Unless you are Melinda Gates???

I don't budget. But I do in reality. Because I live within, or really, below my means. I don't think about how much I spend when I go to the store. But I really do *subconsciously* or else we'd be broke.

Do you understand what I am trying to say?

I think some people automatically calculate costs without having to think about it as they go along.

 

[SaraJayne]

of course, but noooo..the point with the uncle was he had NO CASH and had to FINANCE a $500 item even though he has a good income.

It's still his money that is paying for the finance charges, right?

 

[IUTBAM]

Although I don't usually post I have spent a lot of time reading this board because I like finding money saving ideas. I am intrigued by all of the discussions on strict budgets, down to the penny spending tracking, and even people following "methods". Recently a friend mentioned something about her grocery budget, and I said that we don't budget and she seemed truly confused. So, I have been wondering....am I really so unusual in my money habits? I have no budget and I track nothing--I frankly couldn't tell you what I spend on groceries or anything else. I am just naturally thrifty(some might say "cheap") and we spend less than we make. Maybe being "cheap" is the best budget you can have?

I am exactly the same way.

 

[MrsPete]

You have twice as much in just discretionary income than most people have for everything including paying the bills. You don't have to budget. You just want to.

You're wrong. DVC Girl IS saving almost what my husband and I earn together, but that's not the whole story: How many people, as they earn more, simply spend more? No matter how much (or how little) you earn, you need a savings plan.

What you're failing to mention (which you've posted about briefly in the past) if you have no debt due to a substantial inheritance.

So you're saying that it's just not possible to "get there" unless you inherit money? Not true. My husband and I have been debt-free for the last 5-6 years, and we haven't had an inheritance. We just choose to live beneath our means.

That sounds like sour grapes to me.

Yep, LOTS of sour grapes on this thread.

 

[MrsPete]

If that opinion applies to dvcgirl, then it applies to her Uncle.

It's his money...he earned it and can spend it however he wants, regardless if others think it's reckless.

I don't think that post was saying we shouldn't be able to enjoy a treat now and then -- the post was about how a man who's near retirement couldn't pay for a $500 item straight-out; rather, because he hadn't saved, he found it necessary to make payments on his treat.

So others can post that they make 40K, 50K, 80K and it's fine? But when you post that you earn 300K....then it's of no use to anyone?

I think it's that a lot of people can relate to people earning a little more than they do, and they can understand that a person would still need to be cautious financially if he had a little more . . . but they can't fathom why someone who earns double or triple their salary would EVER have problems.

OP, I used to track everything in an excel sheet that would tell me how much I had spent and how much I could still spend in like 30 categories. When I was single and childless, it was loads of fun to track.

Now that I have DD and 2 jobs, I'm more "meh" about the whole thing. I take my income from my main job, max out my 401K (38%) then spend the rest over the year. I sell kid's fluff for my second job and it is super low paying (more crafty hobby than money maker) and add any sales to my spend column. I do have some padding in my checking because I have more bills that income the first 4-5 months of the year. Then it gets built back up in the summer and levels off at the end of the year.

Yeah, when I was younger, I used to keep careful records . . . and when DH and I were first married, we talked about money frequently as we developed our joint sense of "financial rightness" . . . but now we have mastered those skills. We no longer have to stop and consider how much we should spend on Christmas or how much we can afford for a vacation. We no longer have to "do the math" on a constant basis. BUT if we hadn't done it when we were younger, we wouldn't be where we are today. Today it's become instinctive to us.

 

[nunzia]

It's still his money that is paying for the finance charges, right?

yesss..of course. But the subject here is budget and living within our means, etc. And..the Uncle's situation is reckless for many reasons explained. Of course it is his choice to be reckless, but that's still what it is, even when he pays for it. I've made stupid financial decisions and just because I paid for them doesn't mean they weren't reckless choices. I've driven reckless, even without crashing, but it was still reckless. And when this Uncle and family fnally crash who picks up the pieces? Loving family members and the government.

 

[punkin]

I think it's that a lot of people can relate to people earning a little more than they do, and they can understand that a person would still need to be cautious financially if he had a little more . . . but they can't fathom why someone who earns double or triple their salary would EVER have problems.

I think this is actually the basis of most of the dvcgirl bashing on this thread. However, in my experience, the more people earn, the more they spend. Big earners can wind up with nothing in savings quite often. Of course it is easier for them to save IF THEY WANT TO, but so many of them are just as reckless as lower earners.

Funny story...I live in the cheapest, smallest house in a VERY upscale neighborhood. One of my DD18's friends just asked her if we were secretly rich, because I am paying for DD's college and we travel a lot. She, on the other hand, had to take out loans (in addition to her scholarship) because her parents could not afford to send her to college. Shall I mention their HUGE house or their brand new cars or their younger child in an expensive private school or her mother's 5 carat engagement ring or their live-in maid?

Oh, did I mention we live on one income? We scrimped and saved and budgeted (for retirement and college) and now people whose annual income is 3X what we make are envious because we can afford things they cannot.

 

[Swan4Me]

Then why is it that I get private messages asking for saving and investing advice whenever I do post? Why? Because, when DH and I earned 100K, we wanted to know how you get to make 300K...and so we observed and studied those people....and read, and asked questions. Now that we make 300K...I'd like to know how to get to the next level, and so I read and ask questions of people who earn much more than we do.


I'm curious what you did to triple your income-if you can-why can't all of us?

And your comment...."I could triple my investment portfolio if we hadn't done 12 years of private school and 4 years of college....."......hey, that was your decision to have children. You can't be angry at those of us who decided not to have children.

I winked-I have a portfolio close to 3/4 Million-it would probably be 3 mill if i had stayed child-free. So very glad I am not child-free

The only reason I posted was to point out that the word "budget" isn't a dirty word....it's simply a plan for telling your money where to go based on a set of financial goals. And regardless of ones income.....we all need a budget.

One thing I am curious about-one financial thing about you I totally disagree.

DVC-I doubt any financial expert would say that is a wise decision-right?

 

[MrsPete]

I think this is actually the basis of most of the dvcgirl bashing on this thread. However, in my experience, the more people earn, the more they spend. Big earners can wind up with nothing in savings quite often. Of course it is easier for them to save IF THEY WANT TO, but so many of them are just as reckless as lower earners.

Funny story...I live in the cheapest, smallest house in a VERY upscale neighborhood. One of my DD18's friends just asked her if we were secretly rich, because I am paying for DD's college and we travel a lot. She, on the other hand, had to take out loans (in addition to her scholarship) because her parents could not afford to send her to college. Shall I mention their HUGE house or their brand new cars or their younger child in an expensive private school or her mother's 5 carat engagement ring or their live-in maid?

Oh, did I mention we live on one income? We scrimped and saved and budgeted (for retirement and college) and now people whose annual income is 3X what we make are envious because we can afford things they cannot.

Yes, high wager-earners might easily fall into the "Why not enjoy today? With my salary, I can wait to start saving for retirement" trap. But haven't we all heard of stories in which that high-wage job was lost and couldn't be replaced, or a person became disabled and hadn't saved? A high-wage earner NEEDS to save just like a person making less.

We'll be in the same situation when our oldest starts college in another year -- we live in a house much more modest than most of our friends, but we'll be able to write checks for college (though we're hoping for some scholarship money to alleviate the pain a bit).

 

[dvcgirl]

One thing I am curious about-one financial thing about you I totally disagree.

DVC-I doubt any financial expert would say that is a wise decision-right?

If you really have a 3/4 million portfolio.....careful, you might want to keep that to yourself.....there's some serious envy running through this thread and you just mentioned a pretty big number.