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Blogging for Change Blogging For Change
by sitecore\kmcgrigg on February 18, 2010

Have you ever had a day where you just felt like spending some money? Maybe you have some “extra” money burning a hole in your wallet or you just feel like you deserve to treat yourself to “a little something.” While you definitely do deserve to treat yourself, the fact of the matter is that spending money on unplanned, unneeded items on a whim is a sure-fire way to break your budget. Lucky for you, I know a fact that is sure to burst your balloon: You’ve already spent a ton of money today.

Next time you feel the urge to splurge, take the time to figure out how much money today has already cost you. Maybe you haven’t done the slap-the-credit-card-on-the-counter kind of spending, but believe me, you’ve doled out your fair share.

To figure out how much exactly how much you’ve spent today, I invite you to do the math. Figure out what it costs you to live a day of your life. For example, divide your monthly home or rent payment by the number of days in the month to approximate what it costs to live in your home for a day. Then, do the same for all of your other expenses. Here’s a quick list of expenses you incur (though not necessarily pay for) daily to consider:

  • Mortgage or rent
  • Food (at home and away)
  • Clothing (plus the cost of cleaning your clothing)
  • Insurance costs (medical, dental, life, auto, home)
  • Transportation costs (car payment, registration fees, gas)
  • Utilities (phone, Internet, cable, gas, electric, etc.)
  • Cleaning supplies and personal items
  • Donations and gifts
  • Childcare or school expenses
  • Recreation/hobbies/lessons
  • Medicine and/or vitamins
  • Taxes

For me, the realization that—without buying anything—I’ve spent hundreds of dollars just to live through the day was a real eye-opener. How about you? Are you surprised at how much you’ve spent today? (And this doesn’t even take into consideration outstanding unsecured debts!) Does thinking about your expenses in this way change the way you feel about spending?

Comment(s)

Amy R says:
February 18, 2010

Great suggestion for saving myself from "treat" spending. I did the same type of calculation for my son when he had to make a choice for going to community college for 2 years then onto a more expensive private college. If he did 4 years at a private college financing $100,000 in student t loans. His repayments would be over $800.00 per month for 25 years, thus the private college was costing him $400.00 per day based on the actual number of days out of 365 he was in the classroom. Was he getting his money's worth...absolutely not. Community college is the best way to go for the first 2 years!!



Cecil Sparks says:
February 18, 2010

First off , of course I agree with you 100% … if fact not only have I personally consider that very concept / math … I believe I was thinking just this morning before coming to work … Thinking housing cost divided by 30 .. And knowing still had to add in all living expenses .. and still have enough for un-secured debt payments … Then after reading your write-up I recalled why many, like myself included, often resist budgeting and considering your example math … Darn depressing : ( in many cases … So lets include a minimum goal … in addition to a balanced budget, paying off short term debt (unsecured debt for example) and then having some money left for savings / investments / long term goals … here’s an additional idea. Set up our own personal bank!! And use daily math for goal projections!! Then in the future (ASAP) this will replace my other unsecured lenders and I will be my own creditor! Than I will pay back myself as a separate payment in my budget. That way my personal bank will have the money I borrowed from myself returned for future needs. Now, back to Your example of a daily-math minded budget … with the following template to show the possible forecast! Then you will have 0 % Interest credit ..And if needed .. Can do your own Temp. DMP  Daily Deposit Amount – to YOUR Personal Bank : ) Equals: Per Month Per. Year 5 Years 10 Years 15 Years 20 Years ~ 20 Yrs @ 3% $1 $30 $360 $1,080 $3,600 $5,400 $7,200 ~ $9,850 $2 $60 $720 $3,600 $7,200 $10,800 $14,400 ~ $19,698 $3 $90 $1,080 $5,400 $10,800 $16,200 $21,600 ~ $29,547 $4 $120 $1,440 $7,200 $14,400 $21,600 $28,800 ~ $39,396 $5 $150 $1,800 $9,000 $18,000 $27,000 $36,000 ~ $49,245 $10 $300 $3,600 $18,000 $36,000 $54,000 $72,000 ~ $98,491 $15 $450 $5,400 $27,000 $54,000 $81,000 $108,000 ~ $147,736 Just to add interest : ) The LAST Column is with accumulating Interest at 3% Cecil Sparks



George John Prinkey says:
February 18, 2010

I know what this week has cost me us. I recently recived my tax return and made substantial payments on our credit cards, paid one off, opened a savings account, paid ahead on several bills. I made a plan to get out from credit card debt especially and might be on my way.



Jennifer says:
February 17, 2010

Before I 'splurge' on anything, I figure out how many hours I need to work to pay for an item or service. Then I decide if that much of my time is worth less than the treat in question. The answer is almost always 'no'!



Kim at MMI says:
February 19, 2010
Website: http://www.moneymanagement.org/Community.aspx

Laura: Thank you so much for the kind words. I am so happy this post was helpful to you. That is really important to me.Jennifer & Amy: You are smart cookies! Cecil: Good luck with your plan! Let me know how it works. George: Congratulations!



Laura Vahle says:
February 18, 2010

I can not thank you enough for stopping me in my tracks as I was viewing something that was my idyll setting. You are a genius if you don't mind me saying so. Life costs and saving is the new spending!



molikachan says:
April 12, 2013
Website: http://www.financialliteracymonth.com/30Steps/Step18.aspx

how can i record the expenditure in website ?



sohel says:
February 18, 2010

Very good tips



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