September Mortgage Update and I hate budgeting

Last month (August):
Balance: $75,266.62
Years left: 6
P =$912.18, I = $302.22, Escrow = 613.58

This month (September):
Balance: $74,178.15
Years left: 5.9167
P =$916.47, I = $297.93, Escrow = 613.58

One month’s prepayment savings: $0.68

Many of the pf bloggers we read talk about their budgets on a regular basis.

I hate budgeting.  I hate sitting down before the month starts and trying to figure out how much we’re going to spend at the grocery store or wherever.  I never remember everything and that always irritates me when I have to pay the bill of the unexpected thing that costs me that month.  These days, those emergency or forgotten fixed expenses tend to even out and are about the same amount every month, or at least are about the same amount averaged over 3 months.  I don’t need to put a name to each dollar so long as the dollar amounts are predictable.

The worst thing about budgeting is that it makes me think about spending money and that makes me want to spend money.  Suddenly I feel like I must make purchases I’d been putting off for sometime in the future, or wouldn’t it be nice someday.  Which means either I spend money that I wouldn’t have spent otherwise, or I feel trapped and poor because I can’t spend that money.  Even if it’s for things I wouldn’t have thought about normally.

Technically we’ve never really budgeted. At first we didn’t spend anything that wasn’t fixed or necessary, so no need to budget. I kept mental track of how much every purchase and kept a sharp eye on how much was left in savings to make sure we didn’t go over.  We never spent more than we had, so there was sort of a budget, but only in a very loose sense.

Then when we had more money, any time I wanted to spend on something optional I’d look at how much we had in savings compared to how much we’d need before we got paid next (plus a month cushion) and if we had more than we needed, I’d feel fine about the spending. If we didn’t have enough we wouldn’t buy anything.

Then we had so much extra money (60%+ take-home pay saving rate, dropping to 40% after baby #2) that I could just buy whatever and not worry about it.

Now, with DH no longer bringing in a large paycheck, we’re back to our spending being similar to our earning so I’m still trying to figure out how to deal with budgets going forward. We’re in flux and, as you may have noticed, I keep changing my mind about what to do.

I’ve been playing with Mint, but it is unsatisfactory.  I don’t like the way many of our expenditures don’t show up until days later, so even if we end the month “under-budget” it often turns out a few days later we’re over-budget in one category or another, and we can’t go back after the month is over to rejigger categories.

Most likely we’ll move to a look-back approach, “did we overspend last month”, or we’ll use a “is there enough in savings” approach. I dunno. Last time our earnings were this close to our spending, I’d keep stuff in savings and every time our savings got over a certain amount I’d put that money into the stock market, either into IRAs or taxable.  That way I never felt rich enough to go on a spending spree.  And I could do that again if I un-automated my extra 403(b) and the kids’ 529s, because that would allow an extra monthly income cushion in case of accidental overspending.  But it’s harder to re-automate those accounts than it was to buy an IRA.

Right now I’ve calculated how much money we need in savings by next May (because of the unpaid summer and next year’s tuition) and I’ve set-up stop-losses.  Once we drop below a certain number, I undo the 403b, then the 529.  Then below another number I undrip taxable stocks for their income flow.  It isn’t straight budgeting, but I hope it will do.

I don’t have the mental power to guess what we’re going to need on the first of the month or to research how much it will cost, especially with DH doing most of the grocery shopping.

[Breaking news update:  I got a COL raise this year !  Woooo!]

Do you budget?  How do you keep your spending below your income?  How do you decide what you can afford?