Tuesday, September 14, 2010

It's My Budget! Part 1 of 3

Now that I’ve settled the car note stress, on to letting you folks now what’s going on with my budget. I earn $2778.02 a month and here’s the breakdown:

As I stated in the previous blog, I will ask for your recommendations for making financial decisions. I’ve divvied my budget into three categories: non-negotiable, maybe negotiable and negotiable expenses. Let’s start with the non-negotiable categories.

I spend $1919.21 each month for these non-negotiable expenses:

Car Payment**, $1045: Down from $1245/month to $1045/month, I am working on eliminating my car note in a “microwave minute”. Why am I committed to paying so much for an obligation that only requires $269.11/month? Because I ran the numbers for a few payoff scenarios and learned that I would be able to put more money away for savings and investment accounts by eliminating the car note sooner than later. Besides, life is better without a car payment :) Just think about all of the money NOT tied up to a note that can go to more fun stuff, like brokerage accounts, weekend trips, savings accounts, treating friends to dinner, etc. I just might have as much fun as the pup in this video...

Rent, $475: Having a roommate significantly cuts down on my housing expenses. Luckily, this amount includes utility payments, parking and Internet.

Student Loan, $229.21: Barring disability, bankruptcy or death - three very unfortunate circumstances- the federal government wants its money back, and, at a minimum, this is what I have to pay them.

Travel, $100: My close friend is getting married in April 2011 (congrats buddy!). In preparation for his destination wedding, I’ve been setting aside $100/month to pay for travel, accommodations and spending money (you know, for a wedding gift, jet skiing, over-priced adult beverages, group tours, etc.) I intend to save this amount up to April and commit to only spending cash will I’m enjoying the festivities (I think the theme song for the wedding party should be this). We’ll see where the $100/month will go afterward (Morocco anyone?).

Phone, $70: I have a no-frills plan with an equally non-frilly phone. I selected my service provider mostly because the people closest to me are customers of the same company. Translation: free mobile to mobile without worry of how many people I can put on a special list AND I don’t have to feeling guilty about them using THEIR minutes to talk during peak hours. I should mention that a friend recently put me on to another company...essentially, I could pay the same amount for my plan, but get more features. Since I’m smack dab in the middle of a contract, I think I’ll sleep on the idea of switching cell phone companies. Those cell phone termination fees are kinda nasty!

**Correction to 09.09.2010 Post: Previously, I stated that due to the change in my debt reduction plan "What’s more likely to happen is that I will finish off the debt in April 2011." After reviewing my 'debt reduction' spreadsheet, I am on track to complete this feat by the end of March 2011. I apologize for the oversight.

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