Unexpected expenses and savings: Our Budget March 2014

bust-our-budget-budget-updateSAVINGS ARE IMPORTANT

 

We’ve talked about having emergency savings and the budget over the years here at Canadian Budget Binder and for good reason. You need savings for unexpected expenses that pop up.

Savings whether a small amount or a larger amount are important not only to keep stress levels down but also so you aren’t creating debt.

Debt is created because one doesn’t have the cash to pay for a service or product that they need.

Just this month as you will read down a bit further we have purchased a product for our home and required emergency services which were paid from our projected expenses account.

The reality is that things happen whether it’s this year or the next and being prepared for expenses with some savings in the bank is much better than creating debt. Some people as I wrote about the other day don’t mind carrying debt as they see it as a number on a piece of paper and others like us despise it.

I don’t mean mortgages, student loans and car payments because the majority of people do carry debt to pay off some of the largest debts most people will ever have.

I’m talking about all the little things that we should be saving up for before putting them on credit, especially if it’s an emergency. You never know what will pop up so it’s better to be prepared by saving even a few dollars a week or month than nothing at all.

Have you had an emergency come up where you had to put the expense on credit?

 

Where the money went

 

We got out and about a bit this month with a trip to the Home Show at the Direct Energy Center in Toronto. The excursion was mainly to research some house upgrades and get some ideas for renovations and the kinds of new products out there. Tickets for the Home Show were free from a friend but we had to pay for parking although that’s nothing new in Toronto.

The wife splurged and it’s unusual for her to do so, on a brand new hair styling kit for half price but the results were phenomenal. I do have to mention that my wife doesn’t go to the hair salon and gets the odd trim a couple of times per year.

We also bought a much-needed Central Vacuum system of which I will install myself once we receive the shipment. The deposit has been paid but the full amount will probably come out next month. We negotiated a great deal on the system and I’ll likely write a review on the product including how the installation went.

I have started attacking projects around the house that need completing. This has increased our home maintenance category for this month although I haven’t managed to venture outside yet and see what projects there are in the yard as it’s far too soggy at the minute. I have set goals for the month of April to include all of my outdoor maintenance.

 

Unexpected expenses

 

The furnace decided to go wrong overnight during the month and we woke up to a rather cold house. Luckily enough for us the service call only lasted the one hour and the problem was fixed with no parts. There’s another reason that our projected expenses account works as we instantly had the money available to pay for these expenses.

Our clothing budget took a hit too, mainly due to our foot wear purchase because of leaking soles. I definitely got my investment out my last couple of pairs of shoes but now the weather is getting warmer and wetter I thought it would be best to invest in some new ones.

We both picked out 2 new pairs of shoes and managed to get a 30% discount on top which was great. I bought a new pair of casual shoes to wear when I go out or dress up and a pair of walking shoes. The wife bought a pair of walking shoes and dress shoes as well.

We have also been a little under the weather lately which is not like us at all, not sure if it’s a seasonal thing that everyone else has got? You will see our Healthcare/Prescriptions a little higher than normal because of it although a percentage is covered by our benefits company.

Other than that I’m still working my two jobs for the moment although the new job is seasonal and will resume in September.

How did you make out with your budget for the month of March?

 

Get your free budget

 

I’m currently offering 2 versions of our budget and the reason behind it is simple. Firstly, read the disclaimer because what you do with it is your own business so if you mess it up you need to sort that out.

I have not closed off any cells so you can make all the changes you like to the budget to reflect your lifestyle which is what the fans wanted.

Although I would love to help every single fan with their budget I am unable to do so but I am always willing to answer any emails you send me so don’t be shy.

This was after all meant to be our personal budget and although I would love to customize it for every fan that wants to use it but, I’m afraid I cannot.

I’m not selling this budget or hope to make any money from it so enjoy this free budget and I hope that it works for you as much as it does for us.

 

Canadian Budget Binder Budget Spreadsheet

 

Canadian Budget Binder Spreadsheet Screen shot

You can download the free budget spreadsheets here.

  • Budget 1– You can use the pre-existing categories or you can use your own if you wish and you have the option to use projected expenses or not. Please read all notes left around the budget for tips.
  • Budget 2-Everything is pre-set so you have to use the pre-defined categories but this budget will generate year-end budget figures where the other one won’t but you must use the categories already in this budget. If you change anything you will mess up the formulas and year-end figures. Please read all notes left around the budget for tips.

I’m always open to feedback but be polite as you don’t want to hurt my feelings :) Get started and don’t procrastinate. Test it out for a month and see how it goes. There is never any harm in trying something new in life.

You either love it or hate it, that is a fact with anything.

What type of budget do you use?

 

Our budget plan

 

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.

One of the most important things we did for our personal finances was that we never let the budget deter us from reaching our goals.

Sure we’ve had crap months but we made up for it or we learned from our mistakes just like anyone else would. 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 living on 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 our numbers.

I’m just a regular guy just like everyone else; some might call me a budget or numbers 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

 

Budget changes

 

There were no budget changes for the month of March.

 

Budget percentages March

 

March 2014 Household Budget Percentages

 

Our savings of 12.29% includes savings and investments. Our projected expenses this month is at 26.57% which now includes some increases due to overspends explained in the 2013 year in review. The total March 2014 Household Budget Percentages comes to 100%.

 

Budget percentages month by month

 

Year to Date Percentages

 

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.

  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: $5352.51
  5. Monthly Net Income Total$7004.11
  6. Total Coupons Used: includes every discount attained during the month = $0
  7. Projected Expenses: These are expenses we know we will pay for throughout the year = $1860.68
  8. Total Expenses Actually Paid Out$5091.05
  9. Total Expenses Actually Paid Out: Calculated is $7004.11 (total net monthly income) – ($52.38 (cash savings) + $1860.68 (projected expenses)) = $5091.05
  10. Actual Cash Savings Going Into Emergency Savings: Calculated is $7004.11 (total monthly net income) – $5091.05 (actual expenses paid out for the month) + $1860.68 (projected expenses) = $52.38

 

Saving money

 

What are Projected Expenses? – We project expenses throughout the year so we have the money saved. 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 $1860.68 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

 

If for example our clothing category was a projected expense we have a budget of $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. I’m hoping to put together a projected expenses spreadsheet to track the expenses all year-long otherwise you need to do that to make sure you don’t overspend what you haven’t saved or will save over the course of the year.

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.

 

Our numbers

 

Below you will see two tables one is our budget and the other is our actual budget for the month of March. This budget represents 2 adults and no children and includes all of our investments.

 

Budget for March 2014

 

March 2014 Budgeted Expenses

If it is highlighted in blue that means it is a projected expense of ours. You will also see our budget does not include the emergency savings as this is factored in at the end.

 

Actual budget expenses for March 2014

 

March 2014 Actual Expenses

You will notice we didn’t put the amount going to emergency savings as we have in the past into the actual budget which was a total of $52.38.

 

March 2014 goals

 

Sometimes I think I am being too optimistic about by numbers but if I don’t reach them I try harder the next month. Stay positive and that’s all you can do apart from bringing the best you can for your readers.

  • Start garden seedlings- Pass
  • Complete projected expenses tracking sheet for budget-Fail
  • Reach 2600 Twitter Followers-Pass
  • Reach 6260 Facebook Followers-Pass
  • Reach 1620 Pinterest Followers-Pass 1718
  • Reach 1225 Blog Followers- Pass
  • Read a chapter in my personal finance blog-Fail
  • Help a new blogger with a task or question-Fail
  • Get moving with renovations when I can find time-Pass
  • Start Spring cleaning-Pass
  • Update budget spreadsheets on blog-Pass
  • Connect with a new blogger-Pass
  • Reach 1500 Followers Facebook for The Free Recipe Depot-Pass

 

April 2014 Goals

 

  • Get the backyard cleaned up
  • Finish front yard reno with a few plants, rocks
  • Swap out winter tires
  • Hang two flat screens in spare bedrooms
  • Complete projected expenses tracking sheet for budget
  • Reach 2700 Twitter Followers
  • Reach 6265 Facebook Followers
  • Reach 1750 Pinterest Followers
  • Reach 1230 Blog Followers
  • Read a chapter in my personal finance blog
  • Help a new blogger with a task or question
  • Get moving with renovations when I can find time
  • Continue Spring cleaning
  • Connect with a new blogger
  • Reach 1550 Followers Facebook for The Free Recipe Depot

 

Budget updates month by month

 

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

That’s all for this month check back at the beginning of May 2014 to review our April 2014 budget to see how we made out with our numbers and if any changes were made.

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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. Expect the unexpected. It really is inevitable. My last major emergency fund raid was last year when I had to get a tooth extraction and dental implant. Spending $2,000 on my mouth did not make me happy (I definitely cried when I heard the price), but at least I was prepared financially.

  2. That’s good that you were able to cover the unexpected. People laugh when I let certain parts of my budget accrue; for example, I have “travel” as a monthly expense even though I don’t travel every month, but it’s good to know I’ll have a little extra put away when I need it.

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