AKA setting up my budget
Here is how I use my discretionary budget and how much extra I decided to pay on my loans. I planned on having all of this stuff laid out on my site before I even started making blog posts. Cart before the horse?
Sometimes I just get a little too excited.
Since I'm also new at this... it's just a rough outline, but it's been a good starting point. After deducting my monthly re-occuring bills from my take-home pay I divided up the remainder. I'm choosing to focus on necessities only, but I know that sometimes clothes, gifts and even vacation funds can become necessities. Therefore, in addition to putting as much money as possible towards my debt snowball; I'm also putting as much money as possible into savings. It would be ideal if I could divide my savings account into separate funds of monthly allotments for emergencies, car maintenance, gifts, etc. but that will just take some self-discipline on my end.
Monthly Discretionary Budget
I have been tracking my finances on Mint.com for the past year and a half so I was able to get a really good feel for my little unforseen expenses. Looking at my food budget, I could see what portion went to groceries and what astronomical portion went to dining out. :s I know that if I stuck hard and fast to planning meals I could easily get by on $20-$30 a week. And if I ate only potatoes and cabbage? Even less. Haha, I'm not quite that desperate. yet... 0_0
Food - $200: While I am striving to save money to work towards my goals, I also want to get out, have new experiences and enjoy life. I choose to allot myself $200 a month towards food, but on a weekly reoccuring $50 budget. That way I never have to suffer for too long. ;) I'm planning $20 for groceries and $30 for dining out, with give and take from either end.
For all of you guys out there that can eat an entire large pizza... that probably won't go quite so far. But stay tuned because I've got posts in the works about saving money at the grocery store too.
Gas: Gas also falls into my budget, because it is one of those weekly reoccuring things. It's not something I can always control, but it will help me to be more mindful of my consumption. Since I also live in an urban area it will be a good incentive for me to walk or bike whenever I have small errands to run.
Doctor: Living with multiple autoimmune diseases can get pretty costly. Thankfully I have good insurance, but I still needed a monthly allotment to cover my perscriptions, over the counter medications and copays. I am also hoping to work at yoga mat into there too... Sometimes I'm just a champion about justifying my own expenses, so please feel free to give me a nice slap with reality (or something equally as hard) every time I start getting off track.
Unexpected - $200: Let's face it, we can only plan ahead so far. This might be used towards things like a friend's birthday dinner, household goods, personal care products, minor car maintanence, fashion emergency - jk, etc.
Savings: Either set up your accounts to automatically deposit your funds, or manually move them as soon as you recieve your paycheck. You will miss them less if they were never there to begin with, but you also be immensely relieved when they are there when you need them.
Snowball - $486: I'm estimating about $326 to be the remainder of my discretionary budget. The extra $160 is a temporary boost explained below. The $486 is the additional money each month that will go towards my loan with the smallest balance. After that loan is paid off I'll roll that former payment into my snowball and shift my focus towards knocking out the next loan and so on and so forth.
*Thankfully I am blessed to be a borrower of the Bank of Grandma. I bought my car from my Grandparents on an interest free "pay what you can" system. After my Grandma heard about my new loan repayment efforts she told me I could divert my car payment into my snowball until my first loan is paid off. How awesome is that? Extra $160 towards my snowball. Thanks Grandma!