8.20.2010

I am not to be trusted

I think the postulation that I will one day be able to be financially responsible and not have to work off a set of rules aka "budget" ("budget free" as they highlight here) is bonkers.

Is that seriously sad or what? I can't imagine living my life unexamined without frittering my monies away on boots, handbags, eating out or kitschy stuff.

Atomic ashes


I am not to be trusted.

The silver lining about that article is that I finally passed a financial litmus test! After failing Elizabeth Warren's 50/20/30 test I can truthfully say I passed the 60% or less of your take-home salary being put towards must-haves.

"Reasonable overhead. Most of the people Yeager polled, a self-selected group of cheapskates who ranged from poverty level to wealthy, kept their spending on essentials to 60% or less of their take-home pay. My take is that it's tough to live a budget-free life if your must-have expenses exceed 50% of your after-tax income. (Must-haves include stuff like shelter costs, utilities, food, transportation, insurance, child care, minimum loan payments.) You simply don't have enough flexibility when much more of your money is eaten up by your overhead."
I consider my must-haves to be: rent, utilities, cell phone (no land line), internet, food for me, food/litter for the cats (indoor/outdoor), money to do laundry

What about you? Do you work off a budget? Do you just wing it? And more importantly if you're winging it - are you financially stable/saving? How do those people do it?!

3 comments:

  1. I live pretty much how that article says. I save automatically, I don't have debt, and I don't really have any set amounts that I have to spend on things. I *absolutely* cannot just buy anything I like, but I don't have a written "I can spend X on dining out, X on shopping, X on home goods, X on entertainment" etc. sort of budget.

    I just prioritize, I guess. Obviously things like rent, food, health insurance, utilities MUST be paid. After I pay all the things I MUST pay, and put money in savings, then I spend any leftover money on things I want (like clothes, movies, trips) or things that I "need" (like furniture, washer/dryer, etc - not necessities but much more important than clothes or movies)

    I have always been relatively frugal, and I was raised in a penny-pinching household, so I've just never had a problem with spending beyond my means and therefore have never found it necessary to have a formal budget. Of course, it helps that I've always made at least enough money to pay for the absolutely necessities. I'm not totally scrambling to pay rent or insurance. So even in my tightest times, I'm not starving or homeless.

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  2. Wow, Kelly - that's really awesome. Good for you! I'm starting to wonder if this is just the way I'm genetically wired? I was also raised in a frugal household but I think I just rebelled - and kept on rebelling? I am not nearly as bad as I was and now I no longer have debt but I either have to be OCD about $$ or I ignore it. I aspire to have these things (prioritizing) be innate!

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  3. i don't have a "budget" per se, but i know when enough is enough and then i start reevaluating how i've been spending (or more likely: start ebaying my closet like crazy). i wish i could be some super minimalist clothing shopper who doesn't get sucked into sales and has a set style that prohibits trends but alas, it never works for me.

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