Living Paycheck to Paycheck

On Monday I almost won $1000.  I was listening to WMZQ, the country music station, when I heard the Cash Cow moo.  On my third try I heard it ring, only to hear a computerized voice say, “Caller Eight!”  They were looking for caller nine.  Drat.

I got a raise today!  It’s not very much because I’ve only been working here 6 1/2 months, but 2.89% is better than nothing.  Once my 3% contribution to my 401K and taxes are taken out, it’s less than $37/paycheck, but that’s still helpful, especially since I’ve decided to continue living by myself.

And Happy Independence Day to all!  This is a time not only to enjoy fireworks and cookouts, but to remember what our founding fathers wanted for this country when they signed the Declaration of Independence 232 years ago.  They wanted freedom for themselves and for all the Americans later to be born.  Unfortunately, we do not have the kind of freedom that they originally planned and we continue to have to fight for what should be ours in the first place.  I’ll get off my soapbox to end with a reminder to have  a safe, three-day weekend, and thank any soldiers that you see.

My take-home pay each month is $2,409.97.  Knowing that I have not been living within my means, I decided to make a “Bare Bones Budget”.  What always screws me up when keeping a budget is budgeting per expense, instead of grouping things together.  Each month when I pay my rent, I have to pay mandatory fees and my water bill together with it.  So that always varies between $1032-37.  I could choose a number within that range, but why not add my other utilities in?  And if I’m adding necessary utilities, why don’t I add in the unnecessary ones like cell phone and internet?

So I’ve broken my budget into a few categories:

Category 1:  Rent/Utilities/Phone/Internet/Food — $1345
Category 2:  Savings — $250
Category 3:  Loans — $262.72
Category 4:  Gas/Tolls/Car Insurance/Car Maintenance — $480
Category 5:  Entertainment/Gifts/Clothing/Donations/Miscellaneous — $70

The only problem with a bare bones budget is that it doesn’t leave room for surprises (unless you count Category 5’s “miscellaneous” option.  Already this month I paid my county car tax for $64.39…technically, that could go in either Category 4 or 5…or 2, “Savings”.  With my $250/month, I want to put $200 into the savings for paying my car loan, $25 into an “Emergency Fund” which I don’t really have yet, and another $25 into a Gift Fund.  It seems like every month, I have another gift to buy, and sometimes more than one.  In July, I have two weddings and my grandmother’s birthday.  I want to start putting money aside specifically for that.

To do that, I’m going to start splitting up my bank accounts.  I have two checking accounts, two savings accounts, and one Money Market account.  The Money Market has the most money in it and is the savings for paying off my car.  My most often used checking account will stay the same pretty much; it’ll be used for Categories 1, 3, and 4.  One savings account will be the Emergency fund, one will be the Gift fund, and the lesser used checking account will just hold whatever money is leftover at the end.

If this is too hard, I may I have to fiddle with the numbers as I go.  For example, $250 is more than 10% of my take home income, and I already have 3% of my salary before taxes going into a 401K (with 50% match), so it might be best to put more into travel as this summer approaches and gas gets higher.

In other news, this weekend my boyfriend went grocery shopping for Saturday night’s dinner so that he could cook for me.  I told him that I didn’t want him to buy food so that I could stick to the pantry diet, but apparently he disapproves and didn’t want to stick to it himself.  So he bought me a package of lunch meat and bread for this week’s lunch while he was there.  I’m so used to not having that kind of food that I cooked lunch and came to work before remembering.  That’s the best part of this diet-that’s-not-really-a-diet:  I’m finally learning how quick cooking can really be.  This gives me hope that in the future, when I’m a parent, my children won’t starve to death.

I’ve updated my Net Worth since it’s the first of the month.  For some reason, it won’t show up as a picture on my side bar, so I have a link to my page under the blogroll.  I may end up moving it to a more prominent spot.  Right now you can access it here.  My net worth has risen $1,978 in the last month to -$9,406.  This is for a few reasons:

1.  Last month I didn’t take into account my 401K from my current employer.  At this point, I’m only contributing 3% of my salary (they match 50% up to that point), so it’s less than $800, but it’s still something.

2.  I contributed $1000 to a traditional IRA and it’s already gained more than $20 in interest.

3.  I changed my car loan agreement with my dad, lowering my interest rate to 6% and extending the length of the loan.  My car loan total is a little misleading because I have down the entire balance plus the interest I’ll be paying, assuming I pay exactly $88.71/month (until November 2010), $5000 November 2008, and $500 November 2010.  So my balance is lower than indicated, but I don’t keep my amortization schedule sheet on hand to determine exactly what my balance is each month.  I might start doing that in November after I pay the big lump sum.  My student loan balance is calculated for me, so that is correct.

Soon I should be receiving my $600 tax rebate and my over $1600 tax refund, which will be nice.  I’ve thought about changing my withholding, but I haven’t yet worked a full January-December year yet, so I think that I’ll wait until next year to look at that.

This month I’m also going to track what I spend, which I’m looking forward to and dreading all at once.