Reader Questions

A friend of mine emailed a couple questions recently and I thought it might be helpful to post the answers for all to see. Feel free to email me any other "reader questions" you have and I'll do my best to answer them!

1. How do you budget for things like Christmas (or items that aren't necessarily in the normal monthly budget)?

Answer:

We put $100 away for gifts each month. That includes birthdays/anniversaries/Christmas/bdayparties. Before DR, we ad to wait until Jason's big paycheck on Dec. 10 to do any shopping (4 holidays in November!), but this year we have $600 waiting in our "gift fund" already! Makes it easier to shop sales. However, that's not to say that we'll just blow the whole $600 just because we have it. That's an important part of budgeting too. Last year, we didn't start saving until October for Christmas and STILL saved $800 in time (the bulk from that 12/10 check).

2. Along those same lines, what about items that only come up once a year (car registration as one example)? Do you split them up into 12 monthly amounts and then just put that money somewhere (savings account, cash it out for an envelope)?

Answer:

You're asking about "sinking funds". Divide those yearly/bi-yearly payments into what it would cost per month, and put it into your savings acct. We use Quicken to keep track of how much we have in our various sinking fund accounts, but in reality, it's all (including the Emergency Fund) in one savings account. You could also keep track of spending an deposits for those on paper. Just make sure you remember to, and reconcile your total amount to your account balance! When we need money from our sinking funds, we just transfer it ASAP, since our budget equals zero each month.

3. Any grocery shopping tips? I am not a huge couponer, I just don't feel like I have the time for it. I do cut the coupons out of the Safeway weekly since I do most of my shopping there and I'll use those if they are applicable to what I need that week.

Answer:

I've taken a BIG step back in couponing since The Big Kid is back in school, and usually just do what you do. However, if I see an awesome deal on some sort of meat (30-50% off, cheap per pound, BOGO, etc.) I stock up. Then on my "scrimp" weeks, I just shop in my freezer and only have to buy fresh veggies, dairy, and a couple dry goods to make meals. I also double cook some recipes and freeze second portions, which is good for busy days and it's cost effective. On months that have 5 weeks, I usually struggle to make it on my $400/mo, but this last month had 5 weeks and I had $30 left at the end of the month!! I'm also hosting Thanksgiving this month and have already bought all of my supplies except green beans and am still within my normal budget! It's nice to be able to provide the whole meal when I offer to host :)