Car and Collapsed Categories
Working with the budget for the first time was very difficult. I started by looking at cars because I like cool cars. I chose a BMW 328i as my car and ended up spending $438.85 as the monthly payment which might have been a little too much. After I picked a car, I realized I couldn’t get a nice place to live and save money. So, I decided to get a roommate. The total expenses for my car were $688.85. The cost of my clothes, personal care/hygiene, pets, data services, and groceries are $364 total. The groceries are $50 instead of $75. I am keeping $1113.80 for my retirement and savings. I have no money owed to anyone for student loans or credit cards and $385 for other things or categories. Some of those categories are giving or donations, miscellaneous, and fun or entertainment. Lastly, the taxes are made up of federal and state taxes, Medicare, and social security.
Once I realized I was spending too much, I decided to get a roommate not only for company but also for lower costs. The mortgage price is divided by two and the utilities’ price is also dropped. Instead of paying $75 for groceries, me and my roommate can pool money or split the cost to get groceries for $50.
I had to compromise on my list of “wants” because my monthly car payment was a lot and I wanted to save money. For instance, instead of getting cable TV, I can just get Netflix and share the family plan with my parents for a gym. Instead of starting a new cell phone, I can share my parents’ data plan and pay them. I want a pet but it might have to wait. I can go to restaurants and movies but I can’t go every day or week… I have to reduce my spending. In my savings, I kept more than enough money and it is kept in the bank so I get interest. The interest will increase my savings over time and that will be good for my future.
Home and 50/30/20 Budget
The first time I tried the 50/30/20 budget strategy, I exceeded 50% on needs because I spent too much on my car and my house. To even my spending out, I decided to get a roommate for company and also, the prices for the house and utilities lower. The price for the house cuts in half because there are 2 people paying for it instead of one and the utilities are 10.5% of the house cost. If I got a roommate, some of my needs would be reduced like my grocery costs dropping from $75 to $50 because two people are pooling/sharing money to buy groceries. The house I chose is at 1021 Brighthurst Drive and my share of the mortgage cost is $547.56.
After I figured that out, I ended up spending too much on my wants which made me need to reduce my spending on pets, TV, and entertainment. Everyone wants a pet but for me, it will have to wait. Cable TV might cost too much so I’ll get Netflix because it is just as good and costs less. Movies are amazing so I can watch some in theatres and some when (or if) they get on Netflix. And nice restaurants and vacations have to wait until I am more settled. I can do restaurants every few weeks but vacations start at once or twice a year for me.
