Sunday, November 15, 2009

My fall project - straightening out finances

Ever wonder where your money goes? I have and finally got fed up enough to do something about it. I guess this has been my big project for the Fall.

As background, I had an expensive Spring this year. I paid full rent for a two bedroom place for two months while I tried to find a new roommate and figure out what I wanted to do for a living situation then shelled out for moving costs. Prior to that I had my "rubber ducky" debt - every time I thought I'd started getting control and paying it down it would pop up again, like a rubber duck pushed under bath water - so this just added to it. It was frustrating to see all the money going to paying off (or in this case not paying off) debt when I could spend it on so many more worthwhile things.

At one point I was even convinced Visa was messing with me as there was no way I could be that fiscally irresponsible.

I tried budgeting but kept forgetting things like haircuts and bus passes so I was always way off.

Tracking backwards didn't seem to work either, so I decided to start tracking forwards, noting every single purchase I made and every penny I spent when and as I spent it.

I started in the beginning of September, initially writing things down in a notebook then I graduated to a spreadsheet, on which I then included my budget and debt tracking and now I have the urge to create account codes and pie charts (I need to spend less time with our company Accountant!).

By tracking what I spend every pay period I could more accurately estimate my budget for the next and I could see where my money was going. It's been interesting, not least because the desire to buy a chocolate bar is now frequently (but not always) outweighed by the desire not to have to write the purchase down - who knew laziness could work in my favour!

What has been far more interesting is discovering that a good budget actually works: my spending is in check without greatly impacting my lifestyle and, mostly importantly, my debt has shrunk appreciably and should be non-existent in the near future.

This is probably a terribly dull post for most readers, especially as this is ostensibly a tri training blog, but as the child of a banker this is a fairly big deal for me. And freeing up that money that was going to debt means I can use it for things like race wheels, or a new wetsuit, or going to a training camp. Can't wait for the 2010 training season!

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