That’s the exclamation I heard out of my friend last night.
She comes to me for PF advice (I have no clue why, of course) and wanted to kind of go over her budget and how she can improve.
She gave me what her budget was, and then told me where she went over budget and by approximately how much.
When she finished she said: So, whaddya think!?
FB: Uh. What do I think!? LOL!!
Let’s see, she went over budget in all of the following categories:
Eating Out
Makeup
Starbucks
Toiletries (Shampoo, Conditioner)
Alcohol
Cellphone
Every single “fun” budget category she had was BUSTED up like a broken down doll. Not by huge amounts in each section, but they added to a total of an overage of $400!!!
I told her: Girl, you have got to learn how to cut back on something somewhere because you are overspending by way too much.
Her reply was: But you told me I could splurge! How cute are these PF newbies??!
FB: Yeah honey. I said that. ONCE in a while. ONCE. I am not talking about splurging on Starbucks as a treat each day, and then going out and buying Cargo’s whole line of eyeshadows!!!! Or Tarte’s lip glosses!
See, that’s the thing.
She can splurge. Sure! We all do it. Hell, I do it then I guiltily confess on here. I am not as frugal as a fanatic by any means.
I am not the Money Police trying to tell her or anyone else how to spend her money, but if you’re really into trying to budget and make your money work for you and pay down debt.. then you have to have a little, eensy, teensy bit of restraint when you’re spending on fun things that aren’t necessities like Rent or Food.
My rule of thumb is being allowed to splurge in ONE category each month if I have to. Can’t quit all Cold Turkey now can we?
But if you splurge in one category, you gotta cut back on another.
You can’t overspend by $50 on Makeup and then assume that buying a $6 latte at Starbucks is still OK because you have money left in that category!
If you have to sometimes pinch and steal from other categories to make it work, then do it. But don’t imagine that if you overspend in one area, that it’s okay to spend up to the limit in another Fun area.
A budget is FLEXIBLE, that’s the beauty of it, but you also have to obey the final rule of constraint: Your net income.
Can’t spend more than you make especially when you have debt…. Just can’t. It’ll never turn out good in the long run.
You need to make choices and set priorities, but you have to cut back in other areas.
Anyway, I explained all of the above to her, and she (adorably) tells me that she’ll sell me one of her Cargo eyeshadows to get under budget in at least one of her categories.
HAH!
Love it.
Anyway she’ll be fine.
She’s just learning the ropes of personal finance, and I’m happiest about her even taking an interest in it in the first place.
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saverchic
on Feb 22nd, 2009
@ 9:10 AM:
Aw! You taught her well. I wish I would have had a friend help me a few years back.
hklover86
on Feb 22nd, 2009
@ 11:31 AM:
she’ll sell YOU one of the eyeshadows?? LOL
Curtis
on Feb 22nd, 2009
@ 1:05 PM:
I’ve been going through something interesting on the flip side of splurging that I thought would share as an interesting contrast:
I tightened my budget so much that I made myself feel worthless. My live-in sig other is looking for work, so I am covering our living expenses. (Noble.) I would sacrifice so much and deny myself so much that I was effectively saying I wasn’t worth the extra $2 for some “splurge” that was unnecessary.
I discovered an emotional aspect to budgeting. While I earn a relatively comfortable salary and can afford both of our living costs, I didn’t feel entitled to treat myself to a splurge, *once in a while.*
Keys I was missing:
k1. Feeling entitled to even want something nice for myself in light of tightening a budget.
k2. Recognizing how much money I earn and save even with our present situation.
k3. Acknowledging my hard work and self worth as deserving a reasonable reward.
I like that you advise the OK-ness of splurging on yourself once in a while, let alone having a fun-bracket in one’s budget. There’s a healthiness to being able to spend something for yourself:
h1. reward your good work in PF
h2. recognize your self worth
and lastly,
h3. consciously acknowledge the treat’s expense: it is within your fun-budget to treat yourself for having made the effective budget.
I realize bullet h3 is a bit of circular logic, but that takeaway is there every time you effectively budget and stay emotionally healthy at the same time.
Your friend may be nervous about being conscious of spending. Perhaps she came from a background of well-to-do financial comfort, where considering the impact of a daily treat was foreign. Maybe she is nervous about calculating an indirect self worth. Whatever the case, I hope she finds a healthy balance in her budget.
I hope my thoughts are useful to anyone else who reads this article. I came from a very financially comfortable family, and now that my live-in sig other is looking for work, I can’t feel as comfortable with my income. I learned about the emotional aspect of a budget, and found an appropriate balance that doesn’t break the bank or break my back.
Converting A Spendthrift
on Feb 22nd, 2009
@ 5:59 PM:
My co-worker is leaving her husband who alone makes $100,000 a year. She makes half of that and is still budgeting like she has those six figures at her disposal. Her budget is bare bones but has a clothing allowance of a few hundred dollars, no savings or other long term expenses. She won’t listen to reason, at least your gf is willing to listen.
Miss M
on Feb 22nd, 2009
@ 10:46 PM:
Well awareness is the first step, it’s a good sign she is interested in taking control of her finances. Sometimes people don’t grasp how those little overages add up. If I go over I always pilfer the money from another part of my budget. If I’m tapped out then it has to come from savings, which kills me. Good motivation to keep my spending under control. You’re great for helping her, she’ll be a pro in no time.
e.jay
on Feb 22nd, 2009
@ 11:15 PM:
I’m trying to get there myself. I give myself too many “treats” at once. I’ve been looking at this thing called mint.com…have you heard of it? What are your thoughts?
Sense
on Feb 23rd, 2009
@ 3:12 AM:
how much is CARGO eye shadow?? is selling one really going to make that much of a difference?!
way to lay the smackdown on the PF newbie!
Saver Queen
on Feb 23rd, 2009
@ 11:02 AM:
Wow. I’m not sure what she really gets the point of the budget quite yet. I really like your idea of splurging on one item a month.
suzie wuzie
on Feb 28th, 2009
@ 7:35 PM:
heehee that’s funny! sometimes u gotta treat yourself tho- but i agree, not TOO much