Bust our budget update: June 2013 #6 Bills and payments

Bust Our Budget Budget Update

When The Budget Numbers Make Sense

This was another one of those months where we had bills and payments come due that were big expenses so our budget took a hit on the nose. It won’t look as if we have any money going to our savings account for June as we spent $228.64 more than we earned but that’s not the case. The good part was that most of the big expenses were projected expenses so there will be a savings recognized in our net worth update for June.

As you know our dog had to have some extensive work done at the veterinarian this past month so you will see the pet category well over $500 for June not including the work he had done in May. This should be (fingers crossed) the last month for high pet expenses. On a good note, he’s doing very well so it makes the money that we spent and saved worth every penny.

We also had our annual tax installment due this month which was a bit higher than the last for this installment coming in at $935 although the money was saved. Other than that our home maintenance is still high as we just finished up the landscaping of our front property, for now. I still have to purchase some electrical wiring so I can put in the lights but other than that I’m finished until around September when I lay some new sod. Next year I will add some mulch but it’s not worth it for the 2013 season. 

Our grocery budget is still struggling from May as we try to catch up because of spending more than we were supposed to. It has been an eye opener for us and probably the hardest catch up period to date. You can read all about it in the grocery game challenge each week but moving forward we will try even harder to stick to our budget.

Since we are half way through the year we feel that we are on track but we can do better in some areas. There is always room for improvement but next year we will have an even better idea where we are headed with our budget. That’s all the fun stuff that happened in June although I anticipate even more good times rolling in for the month of July, so stay tuned for that update at the end of the month.

How we budget our monthly expenses

I often have fans ask me how to budget money and what we do in order to save so much money but the reply is that it’s not about the money it’s about the process involved. We don’t always save as much money as we would like every month but most importantly we are not going into debt because we are budgeting our money.

Budget failure only occurs when you give up on the budget which should not happen as long as you give 100% into making sure you reach your goals. Sometimes fans email and ask me if setting up a budget in Canada is any different from living in other countries. To be honest I’m going to say, probably not. If I still lived in the UK I could use this exact budget to meet all of my needs. Below are links to the budgeting series which I wrote while designing our spreadsheet.

I’m not a financial planner/advisor so I can’t tell you how you should budget but I can show you how we budget. I’m just a regular guy just like everyone else, some might call me a budget nerd. Please take the time to read through the budgeting series and I hope you take something away from the information.

  1. How We Designed Our Budget Step 1 Gathering All the information
  2. How We Designed Our Budget Step 2– Categories
  3. How We Designed Our Budget Step 3– Tracking Receipts
  4. How We Designed Our Budget Step 4- Note-taking
  5. How We Designed Our Budget Step 5– 5S Organization
  6. How We Designed Our Budget Step 6– Who Does What and When?
  7. How We Designed Our Budget Step 7– Balancing Our Budget
  8. How We Designed Our Budget Step 8– Knowing our Coupon Savings
  9. How We Designed Our Budget Step 9– Reading Our Bills
  10. How We Designed Our Budget Step 10 Projected Expenses

Free stuff

We also make use of all the Free Money Saving Lists that I have created to help keep us on track which you can also download for free because I’ve made those lists available to you.

Our Canadian budget binder spreadsheet

Canadian Budget Binder Spreadsheet Screen shot

Changes to the budget this month

For some odd reason I took out our extra mortgage payment category last month so that was added back in. Other than that our vehicle and home insurance was adjusted and the figure is now correct. It’s been a relatively quiet month for us.

June household budget percentages 

June-Pie-Chart-Budget-Update-2013

Our savings of 12.20% includes savings and investments. I’ve also went ahead and added in our projected expenses this month at 19.47% which brings the total May 2013 Household Budget percentages to 103.45%. The reason that this months figure is based on 103.45% is due to the overspend.

June budget expenses breakdown

This is simply a breakdown of our expenses which has helped us to understand where all of our money goes. I appreciate that you enjoy this budget update each month but I do hope you view this as an educational tool rather than comparing your own financial numbers as we are all unique. Sometimes we wish we had more money to budget with but understand that we only have what we earn and if we want more, we need to earn more. Spending less than we earn and budgeting our money has been the easiest way for us to pay down debt and save money.

Coloured-budget-chart-June-2103

  1. Chequing– This is the bank account where all of our debt gets paid from.
  2. Emergency Savings Account– This is a high-interest savings account.
  3. Regular Savings Account– This is a savings account that holds our projected expenses.
  4. Monthly Budget Total: $4459.07
  5. Monthly Net Income Total$6626.35
  6. Total Coupons Used: includes every discount attained during the month = $80.71
  7. Projected Expenses: These are expenses we know we will pay for throughout the year = $1290.44
  8. Total Expenses Actually Paid Out$5564.55
  9. Total Expenses Actually Paid Out Calculated is $6626.35 (total net monthly income) + $228.64 (total monthly savings/overspend)–Projected expenses $1290.44 = $5564.55
  10. Actual Cash Savings Going Into Emergency Savings$0 Calculated is $ 6626.35 (total monthly net income) – $5564.55 (actual expenses paid out for the month)–$1290.44 (projected expenses)= ( –$228.64)

What are Projected Expenses?

PE= A projected expense is money which is automatically saved each month so it is ready when the bill comes in or when you need it as in the example below. We review our projected expenses at the beginning of the year to set up our yearly budget and adjust as we go along if a new projected expense arises and needs to be added to the budget. Sometimes we remove a projected expense as well so it’s very important to keep an eye on your expenses.

This has happened on many occasions but it’s bound to happen as we can’t predict everything we have to pay for over the course of the year. The important part for us is that we are saving for these expenses and we no longer have to stress about taking money from our savings to pay for them. To learn more about projected expenses read Step 10 in my budgeting series.

When we spend the money in a projected expense category we move that money to our chequing account in order to pay for that incoming expense. We pay money into the projected expenses account continually throughout the year even when bills come due as it’s revolving so as one bill gets paid the money continues to come in from the other categories all year-long. So the$1290.44  gets paid into the projected expense account every month no matter what. It seems to be easier to track our money this way but you can do what works best for you.

Projected expense example

In our clothing category we budget $50 per month for the two of us. If we spend $30 on clothes for the month that means we need to pull $30 from the projected expenses account to pay for this expense or we move only $20 to projected expenses for the month and leave the $30 in your chequing account. It’s up to you how you do it as I mentioned above.

It’s a fairly easy process and becomes a lifestyle change for your finances but the most important part is that the money is available and saved, which means potentially less stress. This means we should have $600.00 per year for clothing to spend. We have to track that expense as we spend it manually but hopefully for our 2014 budget I can incorporate that into our spreadsheet so it tallies the numbers up as we go along. That way we will be able to know exactly what we’ve spent as an ongoing total.

Budget for June 2013

If it is highlighted in blue that means it’s a projected expense.

June-budgeted-numbers-2013

Actual budget expenses for June 2013

Actual-June-2013-Budget-CBB-2

June 2013 goals

  • Guest Post for an awesome personal finance blog (if you want me, email me) – FAIL 
  • Have a couple of awesome bloggers guest post on Canadian Budget Binder ( if you are interested read my guest post guidelines (<<That’s the way I like it) then email me with your blog post pitch)- PASS 
  • Read 3 chapters in my Rules of Wealth Personal Finance Book- PASS
  • Sort out the paperwork to pay off the mortgage (fingers crossed)- FAIL (working on it still)
  • Finish the landscaping out front- PASS (except the lights)
  • Seal the driveway- PASS
  • Seal and protect the new steps- FAIL
  • Re-caulk garage window- PASS
  • Swap the garage lights around- PASS
  • Install spot lights out front- FAIL
  • Reach 5700 Facebook LIKES- PASS
  • Reach 1700 Twitter Followers- PASS
  • Reach 1075 Blog Subscribers (this may fail once I move my site as I may lose my wordpress subscribers unless they re-subscribe at the new site)- PASS
  • Start splitting plants in the back garden- PASS
  • Fix the fence post- FAIL
  • Roll The Back Lawn with my free lawn roller I found on the side of the road with a FREE sign! I love free stuff!-FAIL
  • Fix the deck lights- FAIL
  • Find our dog a full-time job to earn extra money to pay for his vet bills ;-) FAIL

July 2013 goals

  • Guest Post for an awesome personal finance blog (if you want me, email me)
  • Have a couple of awesome bloggers guest post on Canadian Budget Binder ( if you are interested read my guest post guidelines then email me with your blog post pitch)
  • Fix the fence post (did you read about my fence post?)
  • Roll The Back Lawn with my free lawn roller I found on the side of the road with a FREE sign! I love free stuff!
  • Fix the deck lights
  • Seal and protect the new steps
  • Read 3 more chapters in my personal finance book
  • Sort out the mortgage
  • Reach 6025 Facebook Fans
  • Reach 1750 Twitter followers
  • Reach 1125 blog followers
  • Install garden spotlights
  • Start to tear main bathroom for renovations

Our year-to-date percentages 2013

Year-to-date-percentages-June-2013-chart

In case you missed our budget updates from the start of the year I will list them all here each month.

Money-quote

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Mr. CBB
Mr. CBB was born and raised in the United Kingdom who then moved to Canada where he is a permanent resident. He recently became a father to a very busy toddler who allows him to be a kid at heart. He bought his first house at the age of 21 after University and his second at the age of 24. Both Mr.CBB and his wife are Debt and Mortgage Free and they did it all in under 5 years using a Budget. Canadian Budget Binder is a place where he shares their financial experiences with his readers and hopes to learn about theirs. Welcome to CBB!
Mr. CBB
Mr. CBB

Comments

  1. I love what you said about “Budget failure only occurs when you give up on the budget”. We have found this to be SO true! Choosing to budget every month really has changed our financial life. Regardless of the high DTI, the massive amount of debt and expenses, budgeting has allowed us to see where our money goes and make adjustments accordingly. If there’s one thing you have to do to be financially successful, it’s to track your spending via a budget. Great post, Mr. CBB!

  2. I’m glad to hear the pups is doing better! Hope he continues to mend…I get how pet expanses can really add up but it’s hard not to do everything you can to help your pet feel better.

  3. June was a big expense month with buying a new TV and camera, but it was money already set aside, so as you said, not a bust. I do hate to spend the money, though, It’s a mental thing, I guess. We did sell about $400 worth of old stuff so far, which makes spending easier to take.

    • Welcome to the PF world of numbers. I think once we REALLY understand what’s going on it gets harder to spend. That or we try to make up for the spend by making more money or selling something. Not sure why that happens but it does.

  4. Christine Weadick says:

    Things are looking good for you…. I’d not be too fussed about what didn’t get done last month as you really did get a boatload done last month with the landscaping and all. I still need to get at those weeds in the garden… got some the other day before it got too hot again, one bag full. We can see the lily of the valley again as the bindweed has been ripped up.. I got through Gail’s new book and I’m almost done a book on TFSA’s by Gorden Pape, the newest edition from the library. Gail’s book might find it’s way to my Chapters wish list!!! We are in a new month so there is a new to-do list to work on…….. I count the things that get crossed off not the ones that didn’t get done…

    • I took all the books out of the library just to read but I wouldn’t bother buying them when you can get them free. What did you learn about TFSA that you didn’t know before?

      • Christine Weadick says:

        Given that I didn’t know much of anything about TFSA’s before I got the book out I have picked up a few good points. The book is due tomorrow but I’m thinking I might go to the library site and renew online tonight. Gail’s book I had to wait as the copy at the library in town was out and this one was sent in….. It’s the kind of book I want to read again and again, plus make my own notes in the margins. Just because the book is on the wish list doesn’t mean anyone will get it for me!!! Lol!!

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