Why I’m calling it a day with eBay

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When you’re in the early stages of decluttering, it’s very likely you’ll discover lots of near-perfect items (or ‘gently used’ ones), which easily be sold online.

From clothing and accessories to electronics or children’s toys, sites such as eBay can be a brilliant way of moving stuff along to a home where it will be used and enjoyed. Plus, you’ll make a bit of cash in the process.

For my part, I’ve been a member of eBay for almost exactly 15 years. In that time, I’ve sold far more than I’ve bought, although I have purchased a few things. And it’s true that some have been better than others….

My eBay dashboard

My eBay profile tells me that I have 284 ratings and a mint green star. When it comes to gamification, I really don’t care very much what colour it is, but that star suggests I’m doing OK.

Nonetheless, I have made some mistakes over the years. I share them here, so that you can avoid them if you’re considering selling via this channel. If you’re a well-established e-Bayer, read on and enjoy a wry smile or two at my expense!

Mistakes I’ve made

Selling

  • Wrong description  – I once listed a well-used but perfectly decent laptop, believing that the box my husband had given me was the actual box for the device. It wasn’t. Instead, I had used the box of the device that had superseded the one to be sold.Lo and behold, my poor buyer (who was tech-savvy when I am not) realised my mistake and we quickly reached an amicable solution: He kept the machine but we agreed a sensible price for what it actually was versus what I thought I’d sold….
  • Inadequate packaging – If you’re going to send something breakable, make sure you use a lot of packaging. I tried to send an Orla Kiely ceramic bread bin to a buyer.  It should have been triple-wrapped in a wodge of bubble wrap, lovingly encased in several boxes, before being parcelled up in brown paper (taped a gazillion times with sturdy parcel tape). Instead, I sent it with only scant wrapping and a prayer in would arrive in one piece. Of course, it didn’t. 

    I should have been more accomplished at this stage in my eBay career. Needless to say, my buyer was justifiably disappointed and I swiftly provided a full refund. Here’s where you get hit by a ‘double whammy;’ eBay still charged its commission.

  • Accepting a buyer’s plea to have me despatch a bulky and large item by courier was another example of ‘not a terribly good idea’. We owned an electric piano, which was already secondhand when it came to us, but we sold it for a reasonable price on the basis that this would be Collection Only.
    The problem came when I discovered our winning-bidder was in Brighton. Did she realise that Kenilworth to Brighton would be a round-trip of over 300 miles? Our buyer, however, had other ideas. If she paid, would I send the instrument? Reluctantly, I agreed to do it, but there followed a rather chaotic sequence of events.

    First of all, the piano had to be despatched in two large packages. Cue Julie Andrews singing ‘My Favourite Things’. These packages were, indeed, brown paper and tied up with string. They were also extremely heavy, exceeding both the courier’s weight and size guidelines. Still, we (buyer and me) agreed to take the risk.

    Off went the parcels and we waited to see what would happen. By some miracle, some days later – in two separate consignments – the piano arrived at its destination. It turned out my buyer had been a past contestant in the Eurovision Song Contest, so I was bemused to have been able to contribute to her potential future musical adventures.

  • Calculating postage costs can be problematic. You have to be very focussed when it comes to understanding not only weight, but also volume. eBay provides estimates and guidance on this, but you can have some ‘fun’ trying to weigh a bulky item. My usual trick is to balance a large mixing bowl on my kitchen scales, then place the item to be posted on top of that. This way, you can usually view the weight easily. Remember to weigh the item once it has been wrapped; packaging can add to weight and volume.
  • Finally, seeing other stuff to buy when I should have been focussing on the selling has also been a feature of my experience with eBay. This leads me onto Buying.

Buying

  • Getting too attached to an item is a foolhardy thing to do. Some years ago, a “pine” wardrobe – located just up the road – turned out to be a terrible bit of tat (I should have “viewed it, before bidding…). Don’t get into a bidding war. Assess your item, put in your maximum bid and walk away. If you win it, you’ll find out soon enough.

More recently, I bought something whose quality was inadequately described, resulted in a ‘to and fro’ dialogue with the seller to persuade them to accept the item as a return. To me, this felt like a case of obfuscation; the item was in very poor condition and I was dismayed to see this on unpacking it. Happily, I have been able to return it with the (reluctant) agreement of the seller. Let’s hope I get my money back!

  • Clothes can be a mixed blessing when you buy them via eBay. I do advocate second hand but I should point out that there are some caveats associated with this. There are a great many reputable commercials sellers on there (who also sell directly via their own websites) e.g. Carobethany whom you can trust, as well as many super sellers of their own stuff. Look carefully at their feedback if you’re going to buy and only purchase brands whose quality and fit you can rely on.

Taking a rain check

So, to coincide with the change of British weather, I’m taking a raincheck with eBay. For now. Since we all acquire stuff we don’t need, it’s likely I’ll return to it some time in the future. But, for moment, we’ll let the sun set over this useful but rather complex way of letting go of stuff.

What’s your best way to get rid of clutter? Do you simply let go via the charity shop or doorstep collection? Perhaps you prefer a local selling platform such as Facebook? Do please share below. It would be fantastic to know what works for you.


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My first month with EveryDollar

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I’ve written before that we follow a ‘dual account budgeting‘ approach when it comes to personal finance. This simply means running two current accounts in parallel.

One account is for all regular payments (e.g. our household standing orders and direct debits). The other is for all other “discretionary spending” for other items in the budget that will vary, so which require a higher degree of control.

Simplify your finances

By running two accounts, managing our monthly budget becomes much simpler. The first account is topped up on pay day, then it pretty much runs itself.

This leaves only the second account to manage whose spending categories are reduced to a small sub-set of headings, as follows:

  • Food/groceries
  • Transportation
  • Mobile phones (I’m on a pay-and-go arrangement, not a contract)
  • Lifestyle (costs associated with hobbies, pet care, hairdressing, clothing etc.)

So far, I’ve normally used a spreadsheet to manage our finances. However, as a regular listener to Dave Ramsey’s podcast, I was curious as to whether or not the EveryDollar app would work for us.

What’s different about EveryDollar?

EveryDollar is designed around a zero-based budget. That is, every month you decide (in advance) how you’re going to allocate money to each of your particular spending categories.

The name stems from Dave Ramsey’s approach to budgeting: if you give every dollar a name and tell your cash where to go, you’ll win with money.

In my case, I need an app called ‘EveryPound’ but that doesn’t quite have the same ring to it! So, EveryDollar it is!

Creating your budget

When creating your budget, the idea is that you input your income, then allocate your expenditure by category so that the latter totals the former. It’s a bit like a contemporary take on double-entry book keeping: both income and expenditure have to balance.

This allows you to:

  • Pay down debt
  • Allocate money for savings, including a sinking fund
  • Plan for upcoming monthly spending
  • Stick to your budget

I was already creating a zero-based budget with my own spreadsheet, but the EveryDollar app has a simple and visually-appealing user interface, so I decided to run both systems in parallel throughout March/April to see which one I preferred.

What’s a sinking fund?

One option you can select when setting your budget in the app is to establish a sinking fund. This is essentially a mini savings “pot”  for things you know you’ll be paying for at some point in the year. It’s like a virtual piggy bank.

In our case, that’s £125 per month towards the annual service for our family car (plus anything else car-related)/, as well as a fund for Christmas. I trust that £1500 in total will be more than enough for both vehicle and Santa, but we’ll see!

By establishing a sinking fund, you don’t have to raid your emergency fund if, for example, you suddenly need a complete new set of tyres. You can also budget throughout the year for bills such as a your annual travel insurance policy or car insurance (cheaper than paying monthly).

With EveryDollar, I wasn’t sure if I needed to account for the £125 as a transaction (in which case, would this be “income” or an “expense”?). So, I experimented and found that the app just accounted for the £125 going into the ‘fund’; I didn’t have to record it as a transaction at all.

A slice of the cake

Another feature of EveryDollar is that it shows you what proportion of the whole a particular budget heading represents.

So, if you’re nerdy like me and you want to check what percentage of your total budget you’re devoting to a particular category, you can check. The app tells you what proportion of the ‘cake’ you’ve planned to spend, as well as how much you have remaining. That’s esimportant if you’re paying down debt and are intentionally on a tight budget.

By splitting my expenditure across two accounts, it makes it a little more tricky to work out what I’m spending as a proportion of the whole on each category.

I had a mini moment of panic when I saw the percentage apportioned to food and groceries, but when I did the maths (across the two accounts), I was relieved to see that what I’d allocated was less than 10% of the whole.

If you’re curious what Ramsey recommends, you can find a guide on the EveryDollar website.

Linking up your accounts

One thing I can’t do is link up the EveryDollar app’ to our bank account. To do this, you need to pay for EveryDollarPlus (and I don’t believe this would work across the Pond).

Instead, I track my spending by recording a transaction every time one hits my account. This way, I can keep a close eye on that particular category and check what I’ve got left.

A new month

As the new month rolled around, you’d expect me to have done the budget for April. However, I’m waiting until pay day (the third week of the month) to prepare my budget for April/May.

I know that some EveryDollar users are comfortable running their budget to align with the calendar month, but my ‘fiscal month’ is 24th to 23rd. This means my monthly headings are going to lag behind; until 24 April, we’ll still be in “March”. Maybe that’s a good thing. It still feels like winter!

Setting an intention

Of course, one of the aims of the app is modify users’ spending habits. Right now, the jury’s out. So, I’m going to carry on with my comparison of app versus spreadsheet. Let’s see, as the rest of April unfolds.

Do you have a favourite way of managing your budget? Perhaps you use an app like EveryDollar or have tried my dual account budgeting approach. Let me know by replying to the post, below!


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Going car free

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Reading about others’ experiences of going car-free is always inspiring.

Advocates of two wheels

In her book, You Can Buy Happiness (and It’s Cheap): How One Woman Radically Simplified Her Life and How You Can Too, Tammy Strobel writes about the positive benefits of cycling around her local community. 

More recently, in her article for The New York Times, Elaisha Stokes describes touchingly how her cycling adventures in NYC helped her through a sad and extremely challenging period in her life.

Getting around under one’s own steam

We recently took the decision to go down to one car,  with the idea that I’d be able to use my bicycle a little more regularly. Indeed, there have already been days during the winter months when I’ve cycled to work. It’s not far: 4.88 miles there and a long, uphill 4.88 miles home.

My alternative mode of transport would be the bus for days when neither the weather nor my legs would countenance transport on two wheels. There’s a regular service to and from work, so the bus and cycling seem to be a good combination.

When the ‘beast’ roared

For me, 1 March was the first day in a new job. It was also one of my first car-free days. However, on this particular Thursday, the UK was in the midst of the ‘beast from the east’, a dramatic and unusually severe weather event that plunged the nation into sub-zero temperatures. On top of this, ‘Storm Emma’ clashed with the polar vortex to create widespread disruption across much of the country.

The Met Office recorded plummeting temperatures as low as -15C whilst the snow continued to fall, resulting in significant delays on the roads, with some devastating fatalities and severe disruption for many.

My homeward journey

On this particular day (the joint second coldest March day on record), our cockapoo, Ollie, was in doggie day-care. My plan was to return home from work by bus, alighting earlier than usual to collect him from our dog walker’s home (she lives on the east side of town; we’re on the south side). Ollie and I would then walk the rest of the way home together.

The reality was a little different.

Trudging through the storm

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After alighting the bus, as planned, I descended a steep hill before walking up the other side of the valley to fetch Ollie.  This 10-minute walk was along snow-covered pavements, with the biting wind beginning to pick up, making progress was more challenging than normal.

Following a few brief words of grateful thanks, I grabbed Ollie to catch another bus that was due imminently. This one would take a route across town, dropping us nearer to home. This worked well; the bus arrived within minutes and both pooch and I were somewhat protected from the elements. By this time, the snow was really coming down blizzard-style and the traffic had built up.

Eventually, after proceeding through Kenilworth in very slow-moving traffic, we got off at our usual stop on the south side of town.

We then took our 10-minute walk to our house in what I can only describe as Siberian conditions. The whole trek took just under 2 hours… for a 5-mile journey.

What have I done?!!

This experience forced me to remind myself why we’d made the decision to relinquish our second vehicle:

  • No car payment, road tax, fuel costs, insurance or servicing fees
  • Better for the environment
  • An efficient and cost-effective bus service runs between home and work
  • Cycling to work is fun!
  • We really don’t need two cars, having previously resolved that our teen would take the bus to school for the remainder of her secondary schooling

Day 2

The next day (Friday) proved to be a little more straightforward. There was no doggie daycare to factor in, which made my journey simpler. In spite of the overnight covering of new snow, I jumped on the morning bus at 07:55, arriving in my office at 08:18. That’s more like it!

So, I’m going to carry on. We’re doing this for the right reasons. But it didn’t feel so at the time.

Have you taken the decision to ‘trade down’ in transportation? Perhaps you cycle, use an electric vehicle or have a public transport alternative to a car that works for you? I’d love to know how you get around if you, like me, are now car free!


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Why I’m performing plastic surgery on my credit card

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Many years ago, I applied for a credit card that offered 2% cash back on all purchases. That was pretty generous, so you can tell how long ago that was!

Every month, we would use the card for all of our discretionary spending (that is, anything we bought on a week-by-week basis such a food, fuel and so on). We’d pay off the card every month in full. Then, once or twice a year, we’d get a decent cheque in the post with our cash back amount.

As we always paid off the balance in full, the credit card company actually made little money from us directly.

When I’ve used a credit card

I still have a credit card but I don’t use it for everyday purchases. Instead, I have used it for that one-off, occasional or unusual purchase such as our daughter’s prom dress.

However, because of the ease with which one can use a credit card in this way, there’s always a nagging thought in the back of my mind. Every time I do this (even for a relatively modest single item of expenditure), I‘m borrowing against next month’s income.

In effect, I’m creating a shopping hangover.

A change of heart

So, I’ve had a change of heart. The fact of the matter is this. If we’re going to win with money in the long term, this is what I’m going to do.

I’m going to perform plastic surgery on my credit card. Yes, I’m going to cut it into little pieces and throw it away.

Now, some of you still use your credit card in the way I used to. You tell me that you find it easier to track your spending this way (although, for me, I can’t understand this).

For me, it’s crunch time and here’s why.

What the research shows

Research shows that credit cards are ‘friction free.’ That is, handing over a card is less painful psychologically than handing over actual cash. In an article for Psychology Today, Scott Rick explains that people tend to spend more when they use a card than they do when handing over actual cash: “Experimental research….suggests that credit cards can stimulate overspending: People are often willing to pay more for the same product when using credit than when using cash.”

Indeed, Rick cites a range of psychological factors, which compel consumers to use a card over cash.

Even though I don’t put a lot on my card, I know that when I previously experimented by cutting up my card, I definitely spent less money overall.

Business Travel

“But what about business travel?” I hear you ask?

I once attended a work conference, which across the pond in Anaheim, California. I took my credit card for ’emergencies’ and actually ended up having to use it when I found my employer had failed to pre-pay my bill.

At my hotel’s reception desk, ready to check out, but fully expecting my account to have been settled, I learned that the transaction hadn’t gone through. Worse, the time difference between California and England meant that there was no-one in the office back at home to sort it out. I’ll admit that this was a time when I was glad I had my personal credit card.

However, this does not deter me from my plastic surgery. What I’d do in the future is request a corporate card, rather than rely on my own personal card, which required me to claim this expense on my return. No corporate card? No travel!

But a credit card’s for emergencies!

In my last post, I wrote about why I believe we all need an emergency fund.

In fact, a fully funded emergency fund should contain 3-6 months of expenses. So, if we have a fully funded emergency fund, we shouldn’t need to use the ‘shopping hangover’ method to cover unexpected bills.

The post-Christmas hangover

As the nation anticipates its post-Christmas credit card statements, I decided to do some research on card spending. What I learned really shocked me.

The UK’s spending habits

In October 2017, an article in The Independent warned that credit card lending was on the increase, in spite of warnings about the high levels of UK household debt. In the article, journalist Ben Chu cites regulators’ concerns about the extent to which households are turning to credit to finance their consumption.

Indeed, in the previous month, we saw headlines suggesting the UK was experiencing a ‘debt crisis’, as household debt had increased by 7% in the preceding 5 years.

Going slightly further back in time, the sheer volume of annual card sales is revealed in the UK Cards Association’s report of April 2017. I was staggered to read that, in the month of April 2017 alone, 315 million purchases were made on a credit card (up on the previous year’s figures by 41 million transactions). The overall total of money spent on a credit card that month was £16.8 billion (versus £15 billion the previous year).

What the hell were we all buying?

The report shows we’re using credit cards for a whole range of goods and services from food to fuel, with a marked increase in the use of cards (both debit and credit) over cash in these categories.

What if you have to use a card?

If you listen to Joshua Fields Millburn and Ryan Nicodemus’ podcast, you’ll have heard them say quite clearly: “If you have to use a card, you can’t afford it.”

In my case, if I decide to use a credit card, I’m swapping convenience for a shopping hangover. And I no longer want to do that.


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Why we all need an emergency fund

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Happy New Year 2018!

January’s blog post theme

During the month of January, I’m going to be thinking about money, as we have set some specific financial goals for our family in 2018.

It follows that my blog posts may follow a bit of a financial theme in this first month of the new year.

Holiday listening

In particular, I’ve been listening to Dave Ramsey’s podcast over the holidays. Ramsey’s consistent, straight-talking and sound advice has benefited thousands of people worldwide and his simple series of Baby Steps has helped his readers, listeners and YouTube watchers get a grip on their finances and – in Ramsey’s words – “Change their family tree.”

Baby Steps

The Baby Steps help break down Ramsey’s plan into manageable chunks and build momentum. Indeed, the small wins that can be achieved early on in the programme through these Baby Steps help psychologically with motivation.

Baby Step 1

The very first of the Baby Steps is to start an emergency fund of $1000 (or, in the case of us Brits, £1000).

This should be done as fast as you can.

If you’re already a seasoned declutterer, you may find this easier than you think. A good rummage through your garage, wardrobe or loft may yield some excess stuff you no longer need, so you may soon be able to pull together the funds to get started.

If, like me, you’ve already learned to let go of stuff, freeing up unwanted items to contribute to this initial £1k may not be too much of a challenge. It may take only the effort of cleaning them up, photographing them, then listing them online on sites such as ‘Things for Sale in Kenilworth’ (our local community site on Facebook) or eBay.

Why Baby Step 1?

Ramsey’s approach is to establish this beginner’s emergency fund so that if you have a genuine and unforeseen expense, you won’t have to go into debt to pay for it. In a later Baby Step (#3), a fully-funded emergency fund of 3-6 months worth of expenses is put in place, but this starter fund is where we begin.

When you need an emergency fund

Between Christmas and New Year, we had a sudden and unwelcome fall of slushy, grey snow. We came down for breakfast the morning after Boxing Day and noticed something was odd about the hedge that usually sits against the wall by the side of our kitchen window. The supports to the hedge had given way in the wind and snow, so the prickly shrub had lowered itself forward over the border, covering all of the smaller plants and herbaceous perennials beneath.

Thankfully, with some significant effort (and 6 hours’ commitment), my lovely husband managed to shore up the woody stems, drill new supports into the wall, and push the hedge back into place.

However, this unexpected job reminded me that we weren’t quite as lucky when the fence blew down.

When the fence blew down

On the other side of the garden, we share a boundary with our next door neighbours.

One very stormy night two or three years ago, our shared fence decided it was no longer fit for purpose, leading to an unexpected but essential replacement. This cost about £375 per family, which our emergency fund was able to cover easily.

The point of this is that, whilst you’re taking steps to get your finances into good shape, the last thing you need is a mini-emergency to set you back.

In 2016, research by the charity Shelter found that 37% of working families in England could not cover housing costs for more than a month in event of job loss. Ramsey’s approach is designed to mitigate against this and putting an emergency fund in place is a first step in the right direction.

Do you have your emergency fund in place?

If you haven’t done so already, I’d encourage you to get your emergency fund in place.

So, when the metaphorical fence blows down, you’ll have the financial resources to deal with it. Plus, there’ll be no call on your emotional reserves either, as you won’t be stressed about how you’re going to pay for it.


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Budgets and teens: controlling impulses

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As responsible parents, we are not only ‘mum and dad’, we are educators. We may directly – or indirectly – set an example to our young people that informs their approach on a variety of things: how to cooperate with others; how to handle difficult situations; or how to weigh up choices they have to make in life.

Personal, Social and Health Education

Life skills discussions at school are delivered on a variety of topics, many of which are also on the school curriculum. These include philosophical/ethical discussions or practical advice on issues such as staying safe online. These lessons spark follow-on conversations at home and form a useful part of every teenager’s personal development.

What about money management?

However, none (so far) has dealt with the matter of personal finance. As parents, how do we set an example to our teens on how they can manage their finances? Where do we begin in showing our young people how to manage their hard-earned money?

How to manage money becomes more pressing when our teens start making a little pocket money of their own, either through a part-time job or perhaps by earning a bit of commission on tasks they might do to help at home (Dave Ramsey’s preferred approach).

Lots of parents I know also provide a monthly allowance, so that their teenagers can make decisions on how to spend their own cash. This begins to instil some self-discipline; our own daughter commented that having a pot of money for which she was responsible helped control her ‘impulses’.

Under 19’s account

We found that opening a bank account was a great first step towards our teen developing financial literacy. There are some great accounts around, such as TSB’s under 19’s account. Opening a ‘proper’ bank account (as opposed to a savings account over which a ‘controlling adult’ still has full oversight) was a key milestone. A meeting with the bank manager was necessary and the formality surrounding the account-opening event signalled a step-change in the financial life of our teen.

Do apps help?

As well as the online banking app provided, I suggested that an app like Spending would be useful. By using the app, our daughter could immediately record transactions she had done. She soon realised that a transaction could take a few days to show on her actual account, so being able to keep a record that was bang up to date was incredibly useful. Now that she is more accustomed to checking her own bank’s app, she has let go of the need to do this cross-check but it can be useful at first.

Controlling those impulses

Amy from More Time than Money wrote a really good post on impulse buying, which links really well with these thoughts. As adults who care about sticking to a budget, we already know it’s important to be super-intentional with our spending.

It’s no different for teens: they soon begin to appreciate the value of things when they have to pay for it themselves. The cost of eating out, for example, (something our girl’s group enjoys), can be expensive. Choosing to go out to eat might mean passing up another opportunity or deciding not to purchase something new for a party.

So, when I think about teens and spending, there are a number of things I’d say:

  • Keep some for a rainy day
  • Be intentional with your cash
  • Know that buying X may preclude you from buying Y
  • Just because everyone else is buying one doesn’t mean you have to
  • Do you really need it?
  • How useful will it be?
  • Would you buy it at full price, if it wasn’t on offer now?
  • Would a lower-priced item do just as well?
  • Can you get it at a lower price second hand?
  • Can you borrow one?
  • Do you already have one that would do just as well?

Hmm. Maybe this is good advice for all of us – for kids of all ages – as we enter the ‘season of acquisition’.

What advice would you give your teenage self on money matters? Do let me know by replying to this post, below.


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An update on sticking to your budget – week by week

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Earlier in September, I wrote a post on Sticking to your budget – week by week. I thought it might be helpful to provide an update on how it went. What went well? What didn’t go so well?

As you might recall, I break our spending down into categories and track each one really carefully week by week. You can read about how I do this by clicking on the link to the post, above.

What went well

Our spending categories for September were as follows:

  • Food/groceries
  • Fuel/transport
  • Dog-related expenditure (gotta feed the hound!)
  • Mobile phones
  • Teen allowance
  • Sports
  • Miscellaneous

We don’t worry about regular expenses such utility bills because those are taken care of from our second account with regular standing orders and direct debits. What we’re dealing with here is discretionary spending.

Food and groceries

The ‘food and groceries’ part of the budget went really well. Because I’d analysed our spending over the previous few months, I knew how much to budget for our weekly food and groceries shopping.

As the month progressed, I tracked what we’d spent so I knew that I’d allocated the right amount of money to this particular pot when ‘actual’ amounts were pretty much what I had anticipated.

Other pots – dog-related stuff, eating out, phone bills etc. were also on budget.

What didn’t go so well

I knew instinctively that my ‘miscellaneous’ category might be where the greatest ‘sticking-to-the budget’ challenge lay. This opaque and potentially confusing category was where I’d record things such as clothes (we don’t buy many), books, haircuts, cash withdrawals for general use and so on. At the beginning of the month, I was clear what we could spend per week under this heading.

The Miscellaneous category

This opaque and potentially confusing category was where I’d record things such as clothes (we don’t buy many), books, haircuts, cash withdrawals for general use and so on. At the beginning of the month, I was clear what we could spend per week under this heading.

I also knew myself: most of this spending happens at the weekend, so I have to be more vigilant on Saturdays (in particular) to guard against a modest splurge! However, at the beginning of the month, I was clear on what there was to spend per week under this heading.

Emergency fund required!

Then, we had a leak under the sink.

£124 later, the leak was repaired and a new part fitted, but that blew the budget for the week and significantly impacted on the following week.

This is where having an emergency fund is essential Dave Ramsay’s Total Money Makeover advocate a series of 7 baby steps, the first of which is to save $1000 to start an emergency fund (in our case, that’s 1000 GBP!). That means no spending on anything that isn’t absolutely essential and doing everything possible to build that fund before tackling all other baby steps (the next of which is to pay off any debts via Ramsay’s ‘snowball’ method).

Happily, our emergency fund is in place, but this shows that the ‘miscellaneous’ category really needs to cover only those spends that are considered or well-thought-through, rather than unplanned ‘surprises’. And you do need to control those spending urges, otherwise it’s easy to overspend mindlessly.

What about you?

How do you manage your monthly budget? Have you tried my dual account budget approach, or do you use another system? Maybe you use a particular app that works really well for you. Do share by replying below!


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