November 4, 2009
The guest post on Money Tips from Poker at Bargaineering gave me a different perspective on the conversation we’re having at Fabulously Broke about personal spending limits.
As a once and former overachieving student, I like rules. Not because they’re limiting and I like to obey, but because they offer a benchmark to measure performance and the opportunity to go you one better, much like the Stretch goal is to the SMART goal. You’ve got to set the original goal first before you can beat it. [Note: I like my rules best. Who doesn’t?]
That’s why I kept moving my savings goals up as soon as I reached them – it’s boring not to have something to reach for. That’s not to say my rules don’t know how to limbo, they totally do. And have. And probably will again. It’s ok, as long as I don’t completely shatter the major ones.
When talking about the upper spending limits we set and why, it seems we all have a personal comfort level up to which we can spend. Spend more than that and we’re big squirmy excuse-making babies trying to justify the price tags. Or maybe that’s just me ……
But I don’t know anyone who has a mathematical reason for why this can cost up to $100, but that can only cost $15. The general levels rise and fall according to the feeling that one set of pricing is ok and the other is not, but why not set rules with a basis in fact? Mathematical rules? Ones that are rational? I’m talking about the bankroll management from the article.
I love the idea of setting your levels of spending by multiples of your available cash. In the article, the example is between 30-50 multiples of the bankroll. I’d like to steal that formula as is, but it doesn’t quite work out because my expense budget is vastly smaller than my entire bankroll. I’m protective of my savings, the multiple would be something insane like 300.
In our cases, that formula could translate into a percentage of the clothing budget. If you’re planning to save $100/month for clothing, perhaps each season gets 25%, or a weighted percentage because coats on sale tend to cost much more than bathing suits on sale. By a ratio of 5 to 1, in fact. If I were doing this, Winter would get 40%, and the other 3 seasons get 20%. That’s not precisely fair, but it’s probably more true to shopping reality than people realize. Breaking that down:
Winter: $480
Spring: $240
Summer: $240
Fall: $240
Right off the bat that tells you not to spend $400 before tax on a winter coat unless that’s the only thing you’re going to buy.
Of course, seasonality is only one way to break that down. You could just take that whole annual budget of $1200 and allocate 80% for staples like jeans, daily wear shoes, accessories, etc.; 20% for specialty items.
Truthfully much of this is hypothetical for me because I don’t yet have a clothing budget. I’m definitely still just saying “$100 is too much for jeans, I’ll pay up to $40 for them” and “No summer dress can cost more than $20.” As soon as my budget changes, though, I think it’d be great to implement a set of rational rules that I didn’t just make up as I encounter sales.
November 2, 2009
Kelly’s hosting the Carnival of Personal Finance at The Centsible Life this week, go check it out!
My money this weekend was the opposite of my five No Spend weekdays.
My haircut (months overdue) and eyebrow wax (weeks overdue): $25 after tips
Snack: $3.72
Tailor: $37
Returned items: -$32.86
Fruit: $0.98
Pizza: $5
Total: $39.88 [I’m not using the return to offset the spending, it’s part of another transaction entirely.]
October 19, 2009
As the weeks go by, engagements are piling up right and left, and my travel obligations are too. New York, Hawaii, New York for a wedding (?), Greece for another (?), and now a fishing trip?
I had to say no. Though, it was my own darned idea! I haven’t gone fishing, properly fishing, since I was eight. And I hadn’t seen these friends in 3 years, they wanted to go fishing, perfect, no? But I didn’t realize that even though the timing was right, a 24-hour fishing trip in Ensenada, the money was not. It was estimated to run right around $75 or more, and this after I’d already committed to a thing on the East Coast in two weeks, and Hawaii two weeks after that. The travel fund is already gasping, I don’t have the extra $75.
And if I did, honestly, I’d rather it went to Rina’s best friend who just lost her husband. The donation I could send seems too paltry. So even though it was my big mouth that started the ball rolling on planning a fishing trip, you’ve got to pick and choose sometimes, and this is one of those times. And every other invitation that involves more than $10 a pop will likely be one of those times, too.
August 27, 2009
Just when I’d gotten the whole anti-wedding rant out of my system, we’re confronted with a rather astounding creature: the only child, Miami bride who is marrying our dear friend.
Full disclosure: Literally the only things we know about this individual is that a) she’s an only child, b) she evidently likes him pudgy, and c) our friend is staying in Florida to be with her.
But if we may amateurishly practice the art of psychological profiling via behavioral observation to ascertain a little more about this mystery woman, let’s do!
Tell me, folks, what make you of this?
No registry information was listed in the invitation. The invite itself was classy, understated, printed on VERY nice card stock that shimmered. Since we’re associated on the groom’s side, there was no handy brides/maid of honor/bridesmaid grapevine from which to glean the shopping 411. Normally, I just give cash. But since we’re flying out there, we’re already spending a whole heck of a lot of money and frankly, I’d rather find a good deal that costs less than the $200 cash we’d feel obligated to give.
I cracked my knuckles (not really, I hate the sound of that) and went to work online. My first foray was to the Macy*s gift registry because what couple doesn’t register there?
And my-my-my! I had to double check the date to make sure we really ARE still in a recession. Also, I know our friend and he’s an REI dude. Like, a dude who has seen fine china but would be hard-pressed to identify the various implements and doodads involved in fine dining. I’m just going to go whole hog on the assumptions here and guess she never let him handle the registry gun but once.
A sampling for your pleasure:
Every single piece of Kate Spade china and flatware made or sold by Macy*s
~ A Platinum teapot — $238
~ A sugar bowl — $105
~ A salt and pepper shaker set — $82
~ A Platinum creamer — $90
~ A gravy boat and platter — $180
Every appliance known to man, platinum pricing
~ DeLonghi coffeemaker — $375
~ DeLonghi espresso maker — $140
Bedding must not be neglected ~ Hotel collection comforter — $760 [someone actually purchased this, btw]
~ Duvet — $470
~ Sheets (5 sets) — $95/each
~ Pillowcases (2 sets) — $95 each
~ Pillows — $220
Does it surprise you that my next hunch also panned out? Where else would this couple be registered? Bloomingdale’s? YES. Target? NO.
At Bloomie’s, we’re Monique Lhullier all the way:
~ 5 pc place setting, we’d like ten — $140 each
~ Creamer — $115
~ soup bowls, we’d like ten — $80 each
And Vera Wang for the flatware, of course.
Our friend is not in a profession where he’s going to be pulling down six figures a year, ever, so my faint hope is that she either simply is unaware that some of us po’ folk can’t spend rent money on a few objets d’art for the kitchen, bathroom or bedroom, or that she’s tailoring the registry to the style her friends and family are accustomed to giving. I find the latter hard to believe, though, because the wedding’s in three days and most of those selections are still wide open for purchase.
Whatever the reason, the registry seems to imply that this lady is waaaay out of his income league, and I can only cross my fingers that Daddy or Mommy’s money will be subsidizing their lifestyle if this demonstrates her idea of normal.
By the by? I did check REI. And Bed, Bath and Beyond. And Linens’n’Things. Nope on every single one.
I finally did find a decent combination of kitchenware that wouldn’t break the bank, found a 10% off coupon via retailmenot.com, and added a little ebates.com action to boot. All told, with gift wrap, it’ll be about $75 which is still way too much for a few baking pans. But what did they really expect? A bi-coastal wedding and they registered for nearly all $100+ items? *sigh*
August 24, 2009
After years of business travel, you’d think my packing skills would be solid. Guess that only applies if you’re paying attention!
For a week-long trip to a clime easily thirty degrees cooler than home, I packed two pairs of jeans, a long sleeved shirt, a few short sleeved shirts and a couple light cardigans. They can barely even be called sweaters because they’re super lightweight and one is cropped.
Then, it all went into an enormous tote. Great for avoiding baggage fees, terrible for day trips into the metro area or going out for meals. It’s half my size!
I wasn’t planning to shop, so I’m doing my level best to avoid buying warm clothing, a lightweight travel purse that scrunches down easily, and a pair of shiny leggings a la Flashdance. Wait wait, no no, not shiny leggings. Just regular ones so that if I end up going horseback riding … or given the state of my hands, horseback sitting…. my knees won’t be terribly abused by the seams of my jeans.
Actually, I’m skipping the horsey sidetrip entirely because I’d need appropriate pants and boots, neither of which came with me.
Lack of preparedness, folks, it can destroy your budget in a BIG WAY. I’ve made do so far, but feeling deprived (and COLD), I could so easily have bought three different sweaters and extra shoes that I’d ultimately be annoyed about packmuling home.
August 19, 2009
They’re back, now.
As a former FatWallet Grocery Forum frequenter, and a fairly avid couponer for some years, I
know the value of a price point. Knowing the best price you should get for products keeps shopping levelheaded and budget-friendly. Even if the gimmes strike, the impulse buys are tempered by the internal price book. [Or the little black book where the best TP prices (after double coupon and sale) are recorded.]
For example, $3.99 is the usual price for a pound of asparagus: too much. When stores are motivated to move the asparagus, they’ll sell for as little as 99 cents per 1-lb bundle. That’s usually the lowest the supermarkets go around here, so $1.99 is an acceptable off-season price when the pantry is decidedly starch and protein-heavy.
For other products, clothing, accessories and the like: almost-broke student budgety price points. There are slight variations depending on the merchant, ie: Target versus department stores. Still, that doesn’t excuse the Macy’s version of merchandising where a junior’s day dress might be priced anywhere from $60-$100. In my book, page 4 of the Clothing section, that’s a no go since when the sales and coupons roll around? You can get those very same dresses, assuming your sizes are still available, for as low as $12-$16! Dresses are not a necessity, I’m willing to take the risk.
My few purchases before the layoff, though, whew! I upsold myself in Richter scale fashion.
- There was the much beloved bag purchase several months ago for 60% off = still above my price point by a factor of ten.
- There was the dress from Gilt.com [$150], plus the cost of tailoring [?].
- There was the bespoke dress from a dressmaker on Etsy [$192], which also required tailoring [$22].
And there’s the netbook I’ve been yearning after. Priced out at~$400, I’m still safe from that imprudent purchase, but all the travel of late had got me thinking that $200 was a reasonable price. [As my friend said about a shoulder bag, “if you like it.” Um, what?? It’s a purse!]
Granted, the netbook is a piece of technology so it’ll cost more than Payless shoes, but when on earth did my price points migrate to “$200 is an acceptable price” on more than just electronics?
(I can’t even blame it on the Recessionary Sales a la Free Money Finance.)
Well, I’m just glad they’re back now, I can’t afford that luxuriant lifestyle quite yet!
July 20, 2009
Sitting in the cab, sweaty and frustrated over the thwartion of the subway, I wondered how much money I’d spent foolishly in NY.
The biggest hit was the cab fare to JFK: $52 after tip, plus $2.50 for a drink that I only half finished but desperately needed during that hour-long ride.
Aside from that, though, most stupid offenses were of the minor variety: $20 flats from Target that were Blister City, $8 for Blister Block which got me through 3 days of walking, $5 for two pairs of flip flops that I could have avoided spending if I’d just brought my trusty Rainbows.
Then there’s the $56 of makeup from Sephora. If I’d only the prescience to realize that I’d shop there, I could have redeemed Sephora gift cards from Thank You points and avoided spending that out of pocket.
Total spending came to just under $550 for 18 days, or an average of $30/day, so you can either say I didn’t spend much at all anyway, or that I managed to waste 20% of the total.
