July is No Spend Month in our house.
The premise (borrowed gratefully from Rachel at Small Notebook) is that you pay all your bills, and set a limit on spending for the remainder of your expenses. If you don’t know what you spend in a typical month, try tracking your expenses at Wesabe. You can see the last few month’s data and come up with a game plan.
Rachel’s family spends $250 for the month on everything they need. I wish that we could spend that little! We have more expenses that tend to be more expensive, so I’m setting out limit at $800 for the month. You should set your limit based on your typical expenses minus a bit. For example if you normally spend $500 a month at the grocery store try cutting it back to $400. (most US families waste 25% of their food anyway!)
This breaks down to:
$450 for groceries
$70 on pets
$80 on gas
$100 on allowances ($50 for the kids, and $25 each for us)
$100 misc. (household repairs usually)
Hopefully we’ll stick to it!
Will you join me? If so, share how much you are budgeting and make sure to check back in next month for my results.
Kelly
[…] likely there will be a few surprises when you start tracking spending. You can use my method of a No Spend Month or Week to really get a handle on how much you are spending, or take cut back gradually like Ramit […]