Budget Within A Budget


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Budget Within A Budget

budgetHaving a budget in place is smart; managing it is even smarter.
Someone once told me I budget within a budget when I taught a couponing class, I didn’t quite understand what that meant but apparently I was doing it. He explained that I break my budget down so fine that I know where all of our money goes on a regular basis and I am very good at moving money budgeted for one thing to pay for another if a deal is right without causing any ripples in my bi-monthly budget. He was right. I am using groceries for this example.

I budget everything that affects our finances every 2 weeks. I try to be as realistic in my numbers as I can be, including food and gasoline. I tend to buy the same types of products regularly and once I stabilized our finances and spending habits, everything pretty much runs smoothly on it’s own with one exception, groceries. While I rarely go over budget, I would like to stabilize the cash flow better.

Some weeks I spend $50.00 and some weeks I spend $200.00 so I challenged myself and turned my purchasing habits into a game to see if I could even this out a bit. It ended up being interesting for a couple of reasons. I was able to see how much I spent on different food items on a regular basis and more importantly, I was able to see the price fluctuation in each department of the store pretty clearly.

Too much time involved

You might think this takes too much time, but it doesn’t. If you already have a budget in place and you coupon, then you are already watching products and prices. You should know by now how much milk or produce, for example, that you generally buy regularly, but do you actually know how much you spend on it? This just breaks it down one step further and shows you what your own spending habits are within the store overall. That’s the biggest lesson I got from my¬†little game that I didn’t expect.

What I did

I took my bi-monthly grocery budget and broke it down within itself. I allotted a certain amount to spend on dairy, meat, produce, snacks etc. My challenge was to stay within the guidelines I set for myself and I managed that pretty quickly.

It didn’t take long to see where I was still spending too much money and I was able to get that under control rather quickly which created a cushion within my budget. Instead of reducing my budget I diverted that money toward the two items I struggle with the most. Meat and paper products are my budget’s greatest expense, we all have something right? These are two items I just don’t get at rock bottom prices often enough.

By diverting the ‘cushion’ to meat and paper products I am able to stockpile them a little more efficiently now and I don’t risk going over my budget anymore by buying larger quantities when a good deal does come along or going without an item waiting for a sale. I still spend the same amount bi-monthly, I’m just getting more of what I actually need regularly. If I have any cash left over at the end of 2 weeks I divert it toward our debt.

That’s another game I play with our money….¬† Valerie

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