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Old 09-16-2009, 07:37 AM   #61
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I have evolved on this. Before I FIRE'd, I kept an annual Excel spreadsheet of expenses using about 25 categories along with income and taxes. I have long used Quicken to keep track of everything.

After I FIRE'd, I started doing an expense budget for the next calendar year just to see how the numbers might move, but I didn't budget income.

After the market meltdown, I started paying more attention, especially since I shifted from a financial plan based on the assumption that sale of appreciated equities would cover my expenses to one that covered expenses through dividends, interest, etc. without ever having to sell anything. So then I started also budgeting income.

Along the way, I broke the expense categories down further, which yields quite a number of subcategories. Part of this exercise is to that my wife, who is not very involved in the financial stuff, can see how the money flows. I also started doing things quarterly instead of annually.

So now, I have essentially an "income statement" budget I do on an annual basis that is broken into quarters. After a quarter ends, I compare actual to budget.

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Old 09-16-2009, 01:48 PM   #62
Recycles dryer sheets
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My budget is invest first, paying fixed expenses before spending the remainder as desired.

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Old 09-17-2009, 11:13 PM   #63
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I simply add up all the money that goes out of my bank account each month excluding mortgage, holidays, tax and investments. So long as the resulting expense number is at or below the level needed to hit my target savings rate for the year, I do nothing further. If it is more than a trivial amount above expectation, I dig deeper.

My wife keeps a separate and very detailed spread sheet for her spending.

All this will change on 1 January 2010 when we start running a detailed consolidated spreadsheet as part of our planning for the last few years before we retire. Needless to say, I intend to let my wife to all the work
Budgeting is a skill practised by people who are bad at politics.
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Old 09-18-2009, 02:00 AM   #64
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I keep three budgets:

1. Current Budget

2. Projected Retirement Budget

3. Worst-Case Scenario Budget
No man is free who is not master of himself. --- Epictetus
Enjoy Yourself (It's Later Than You Think). --- Guy Lombardo
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Old 09-18-2009, 11:41 AM   #65
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No budget. Detailed tracking of expenses, however.

Maybe when we get to retirement, we'll budget. But I doubt it -- we're both frugal and hate shopping.
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Old 01-02-2010, 12:11 PM   #66
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The end of 2009 marked the first full year I lived with a budget while retiring. Glad to say that after looking at my totals, the numbers were very close. I spent about $1800 less than I budgeted for during the year.

Naturally, some categories I spent more and some less, so I'll have to adjust for 2010. However, the exercise of keeping track and entering my spending was worth it to keep myself honest!
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Old 01-02-2010, 01:28 PM   #67
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I used a monthly budget and the "envelope" system for the first time last year. That allows me to live on what's left of my salary after maximum contributions to retirement accounts, and to test drive my retirement budget (I based the spending amounts on the pension I'd have been eligible for if I'd retired already). This year will be the real test. Our union voted to take ten days off w/o pay as a way to reduce the number of City employees who get laid off, so my income will be lower this year than last, but I still want to max out my 457 and Roth. It is going to be pretty slim pickin's.
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Old 01-02-2010, 01:53 PM   #68
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Not a specific budget per se, but I do have an "upper limit" of what we should spend each year. We have always stayed well under that.

We do track expenses in detail using Quicken categories. I reviews these at least once a year - generating an "annual report" for DH and me. I usually look at our spending patterns once a quarter.

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Old 01-02-2010, 06:29 PM   #69
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Man, I feel like a slacker on this thread. I have an estimate of what I spend per month, and know what I spend to the '000 in the last couple of years. Never tracked expenses, really. Just kind of deducted what we must have spent based on how much we earned, paid taxes, and was invested.
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Old 01-02-2010, 08:03 PM   #70
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I, being the great procrastinator, have not done this either. I did this for 1 month last year and quit. I told my DH that I am really going to try to do it this year. He is starting to talk more and more of retiring and I need to see how much it costs of us to live. I might go back and reconstruct how much we spent every month last year by looking at checking acct statements and the credit cards. It would not be exact, but would be pretty close.
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Old 01-03-2010, 01:18 AM   #71
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I have a spreadsheet I call my cash flow budget, it looks like a check register. I have a current balance the columns with dates, income and expenses. I also have columns for my HELOC. I have it out several years with known upcoming expenses like mortgage payments, utilities, property taxes and known income like paychecks, interest and dividends.

So I can look and see if I have too much and transfer some to HELOC or need to borrow on the HELOC. I pay some bills like insurance, cell phone and cable so I budget in my expected credit card payments like 1K in months with insurance and 300 every month. I don't track little expenses that go on my credit card like gas or food.

I have cash income I put in another bank when I have too much cash and if it has much I will pay a credit card payment from there. I have another account with a little money at a branch of my grocery store so if I feel my credit card is going too high I will take cash to buy food.

This month was bad, no insurance but my credit card bill had a nearly 400 Christmas gift and a garbage bill so with the other bills and spending is about 900 when I budgeted 600. But I am paying 150 from other accounts and will get an unbudgeted check I forgot to put in for unused sick leave this week. If my cash flow won't handle it I might reduce my expected 401K payment. I write the paychecks so can adjust my own each check without a problem.

I guess it is a budget but I couldn't tell you how much I spend in cash for things like hair cuts or food or gas or even clothing. I change my cash flow spreadsheet to actual so never over or under budget. Like I put in 200 for natural gas this month but the bill will only be 162.75 so I just change it. I guess high on utilities so they always come in under.
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Old 01-03-2010, 09:00 AM   #72
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I did track my spending for many years .This helped me determine the monthly amount I needed from my pension & savings . Now I just have so much money a month and when it is gone it's gone . I also have a large amount set aside for trips ,taxes,insurance , big purchases and gifts . This system has worked for me . I tried writing down everything I was spending and it got too tedious .
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Old 01-03-2010, 09:37 AM   #73
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We do not keep a strict budget, per se - but we are always trying to LBYM. After reading "Your Money or Your Life", we tracked everything to the penny for a while - a good exercise to do initially, but not something I could keep on top of - too tedious. I did keep up with a strategy I learned from that book - tracking monthly income vs. monthly expenditures - EVERY month.

This allows me to see how much we have saved/spent every month. If we are getting out of line with our savings goals, we kick our heels in and become more scrooge-like for a while. It's very effective in keeping us on track.
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(48, married; DH 52. I am fully retired as of 2015 (well ok, I still work part-time but only because I love the job and have complete freedom to call off if I want to travel with hubby for work), DH will fully retire 2018 when he turns 55 to access 401K penalty-free)
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Old 01-03-2010, 11:01 AM   #74
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Originally Posted by old woman View Post
I have a spreadsheet I call my cash flow budget, it looks like a check register. I have a current balance the columns with dates, income and expenses. I also have columns for my HELOC.
Ours is in Excel and it looks exactly like a check register except there is an added leftmost column that calculates month and an added rightmost column where we select an associated expense category (dropdown set by a list). It is a snap to modify, but after a few years we pretty much have it set. From that, we do pivot tables that tell us exactly how we are doing vs budget at any time. With retirement potentially only a few years away, knowing our expenses in detail was important to us, so the (minimal) effort has been very worthwhile. We were very pleased with our 2009 results, just completed. YMMV

No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
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Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
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