Boston Trip Sum Up

Wow, I feel like I need a vacation from my vacation! I got back from Boston late Sunday night (well, I technically got home early Monday morning...), and have been feeling absolutely exhausted since. Apparently I can't stay up late like I used to! But of course you don't want to hear me complain; it's time for me to report the "damage" from this trip.

I had always really only accounted for the airfare and hotel portion of travel and not pay much attention to cash flow while I'm traveling. This time around, it's the perfect opportunity for me to get a better understanding of what/how I spend during my trips. As I explained in my last post, I promised myself to only go on this trip if I didn't have to pay for airfare and housing. It worked out, so my entire focus was on where my money went while I was in Boston (and at the airport).

I came up with a very rough budget of $200 before the trip. It was kind of a worst case scenario situation. I estimated 10 bucks per meal for 4 days and assumed that I'd eat every meal. That's $120. I left myself another 80 bucks for transportation, drinks, and other miscellaneous spending.

Turns out I overestimated by quite a bit. I spent a total of $148.49, about 75% of my budget. After coming out of the airport terminal, I put $5 on my Charlie Card for use on the T (subway) and buses for the next few days. Instead of taking a cab, I rode the T to my friend's place. However, I was too tired to do the same on the way back, so I took a cab. That set me back by $32. As predicted, the rest of the money went to food and drinks. I didn't eat every meal I budgeted for, nor did I shell out $10 for each meal. Lucky for me (and my wallet), I managed to get some free food out of organized reunion events. It turns out my traveling habits are very similar to how I usually spend my discretionary fund. I ate multiple small meals (and coffee, of course) and shared food with friends in order to maximize my time/budget for socializing. This way, I still had some money left to go out at night and buy a few drinks.

Now that I know what my spending patterns are like while traveling, I’ll be able to budget my two upcoming trips better. Hopefully, this will help me save more money in the future.

Boston Trip Budget

Hey guys! I didn't have time to load this before I left for my trip, so now that I have "down time" and internet access, I can post it. Please note that this budget was established before the trip. I'll report my results ASAP!

If you've been reading my blog, you'll know that I've been planning a total of 3 trips this year. Two of which are reunions to see my friends; the other one is to attend to a wedding. In order to travel without going broke, I came up with a monthly discretionary budget of $100. The intent is to set a limit I can base my spending off of. If I can manage to do this for even just a few months, I'd be able to save a good amount of money for traveling and still leave some cash in my savings.

It's been 4 months since I implemented the plan and finally, the time has come for my first trip. This trip takes me back to my Alma Mater in Boston, MA. It's a weekend to reconnect with old friends and meet/network with older alumni. However, because I'll see some of the same people at the class reunion in July, I was kind of iffy on whether to go or not. After a lot of thinking, I promised myself to only go if I can avoid paying for the biggest expenses of traveling to Boston: flight and housing.

I managed to find a way to receive enough mileage points on United's Mileage Plus program to exchange for one round trip air ticket (I'll share how I did it in a later post). As for housing, having graduated just a few years ago, I still have quite a few friends in the area. When I decided to try to make this trip happen, I let them know and asked whether I can crash with them. Within a few days, I received confirmation of several places to stay for free.

Compare to finding free flight and a place to stay, deciding on an amount of money to budget for the rest of the trip seemed harder. When I made travel plans in the past, I didn't really keep track of how much I was spending. I mean I know how much I paid for flights, hotels, and other forms of transportation, but I had never really tracked how much I spent on everything else related to those trips. So now I can only guesstimate the damage to be $200. I came up with this number by budgeting about $10 per meal. I'll be spending a total of 4 days away, so that will set me back by around $120, assuming I eat every meal. I left $80 to use on drinks and other miscellaneous expenses such as cab fare, souvenirs, or anything else that may come up. This time around, I'll be more active in noting my own habits for future references and improvements. Hopefully, I'll spend less than I budgeted for!

April Budget Sum Up

First off, I want to apologize for slacking off a bit this past week. I've been feeling pretty tired lately, and before I knew it, it's May already! Crazy. Anyways, it's time for my April $100 discretionary budget summary. Because I did a lot of resting on weekends instead of going out this month, I managed buy 2 new shirts and still come out below the budget. Most of the cash spent were on coffee and other beverages (seeing a pattern here?)

Another reason why I was ultra careful with my fund this month is because I was looking forward to my trip to Boston the next few days. The fact that I know I'll be traveling means that I wanted to save as much as I can in April for that purpose, even if it's a separate budget. That's another thing that I have become aware of when it comes to budgeting money: mental accounting. It's basically a tendency for people to create categories in their mind, thinking that money from different sources can be used differently when, in fact, they're all "your money." For example, someone may spend his tax refund freely while being extremely stingy with his salary from work. At the end of the day though, his net worth is based on the collective amount he has, no matter the source. WellHeeled wrote a great detailed explanation of the concept on her blog a while back; I encourage you to go check it out.

For the month of April (excluding boot camp again) I spent a total of $72 even. Here's a breakdown:

• $33.82 on coffee
• $34.42 on other food/beverages
• $3.51 on socks
• $0.25 on parking

Besides this discretionary fund, I've decided to start a fitness budget. After weighing the cost and benefit of boot camp and other exercise activities, I think fitness is such an important part of my life that it deserves its own attention. This budget will include gym membership, classes (like boot camp), race registration, gear, and equipment. I'm not sure what amount to set this to though. Right now, boot camp is costing me $127 a month, but my rock climbing gym membership that's currently on hold is $55 dollars per month. I'll spend some time thinking this through and report back. Any suggestion is welcomed!

A Different Understanding of Budgeting

In the beginning of this year, the CEO of my company announced that every quarter, our small startup of less than 15 people will set aside a budget to partially subsidize an activity for all of us to "bond." In February, a ski trip was planned for this very reason. It took me a long time to decide whether to attend or not, but I ended up not going. The main reason was my discretionary budget. Although the company subsidizes part of the cost of food and stay, I'd still have to pay $25. On top of that, I'd have to pay for lift tickets, equipment rental, and gas. It hardly seemed to be worth it since I would have for sure exceeded the fund.

I was only 1 of 4 people who didn't go on this trip, and was pestered by questions of why I was not attending. Talk about peer pressure! Well, for the most part when I told my co-workers that I couldn't work it into my budget because of the additional cost of lift tickets etc., they readily accepted the answer. But one of the people I gave that response to proceeded to ask me: "Isn't the point of a budget to spend it?" Hmmmmm...I guess I never really thought of it that way, but I must disagree.

March Budget Sum Up

Another month, another $100 discretionary fund. Well, I actually started this month in the red. Why? If you remember my dilemma in February, I ended up deciding to sign up for another month of boot camp (2, actually. I'm continuing in April). It set me back $127. I was almost inclined not to include it as discretionary spending seeing that the line between need and want here is blurry for me. To me, whipping myself into shape and working through an 18 month plateau is a need, but in the spirit of full disclosure, I ended up adding the cost anyways. It’ll also motivate me to find savings elsewhere.

The $127 turned out to be a disappointing investment. Not because the class isn't good. If it wasn't I wouldn't have signed up. The reason it was a disappointment was because I got sick for 2 weeks, so I wasn't able to attend half of the classes in March. I'm not beating myself up over it, though. Let's just count it was an "unforeseen circumstance." Life is full of surprises. Now I'll just have to make sure to take care of my body, and hopefully, this episode doesn't repeat.

The good thing about being sick though, was that I didn't go out much which resulted in the lack of chances to spend money. Excluding the boot camp, I spent a total of $84.47.

Here's a breakdown:

Making a Mental List Goes a Long Way

A few years ago, while I was on break from college, I went grocery shopping with my parents. It wasn't a particularly exciting event (duh!), but I still remember it well. The reason is because I was surprised and extremely impressed by my parents' ability to spot overpriced items. They seem to have a mental database full of prices, which is completely different than the way I shopped for groceries back then.

When we walked down the produce isle to look at peaches, my mom immediate told me that it was too expensive and cited the price at another grocery store. Then, it was the lettuce, the ground pork, and the fish. They look at each product and pointed out whether it was worth buying at that particular store or not. My mom specialized in the vegetables and seafood while my dad knew the prices for meats and fruits. They'd say things like, “wait until the shrimps go on sale. They'll be almost as much as half off sometimes.” They should be hired by the Bureau of Labor Statistics to take data for the consumer price index (CPI)…and no computer spreadsheets necessary!

February Budget Sum Up

Helloooo March! You know what that means...a review of my February budget, of course. If you saw my tweet a few days ago, you'll know that it was a very successful month of spending (or the lack thereof). My monthly discretionary total came out to be...drum roll please....$76.22. Almost 25 bucks under the $100 budget. Woot!

Here's a breakdown:

• $18.67 on coffee (Starbucks and Peet's)
• $49.25 at other restaurants
• $8.30 round trip BART tickets (public transportation)

My estimate of shelling out $20 on coffee for February was on target. I know what you're thinking...you only have $100, and you wasted 20% on coffee??? Well, this month, I'll work on lowering that amount to 15 bucks. Baby steps...baby steps...

My Health/Spending Dilemma

Remember the boot camp that inspired a "buddy system" post a while back? Well, I'm finishing up week 3, and it's no joke. The trainer leads the class through drill after drill for about an hour, four days a week. Classes are fun, the people are encouraging, and I'm definitely seeing results, which is much more than I can say for other things I've tried.

Let me give you a little bit of background, first. At the end of my first year in college, the freshman 15 turned into more of a freshman 30. I tried exercising and dieting every year during break, but couldn't really get my weight down due to stress, work load, and all of the crap I feed my body daily. It became my goal after graduation to get back into shape and maintain a healthy weight. I lost all of the 30 pounds I gained and am less than 10lbs away from my weight goal. That's great and all...but I hit a wall in the fall of 2009. My weight's been fluctuating around the same place ever since.

Using the Buddy System in Your Financial Life

Boy, am I tired right now. It’s almost been three days since I updated, but I certainly haven’t been slacking off. In fact, I’ve been “working” way too hard. So what's this complaining about, you ask? Remember that group training membership I spent more than 30% of my "fun" budget on? I’m currently in the middle of my first week of classes. It’s been brutal, but I'm definitely going back for more tomorrow. Why torture myself? Well, there are three main sources of motivation for me: fitness, the chunk of my budget that I already invested, and my workout buddy.

Not only did I bring my own buddy, the class is set up for attendees to mingle and encourage each other. The idea is that by building a community, we'll be more accountable and more driven to keep going. I can tell you that it’s working. I haven’t felt this sore since I first started rock climbing, but I’m excited to go back there every night.

And this has to do with personal finance how…?

Go Ahead, Live a Little and Splurge

I stumbled across the Ask the Readers section on Wisebread yesterday. What do you splurge on? They ask. Well, that’s simple enough, good food, of course! With food trucks, unique ethnic cuisine, and all of those fancy schmancy Michelin Star restaurants, the SF Bay Area attracts foodies (me included!) like a giant magnet. But the more I thought about it, the more complicated this question seems to get. Maybe I just like going on tangents or maybe there’s actually something to this. The problem with the word splurge is that it’s relative. In my current state of only have a $100 discretionary fund, almost everything can count as being extravagant. Buying lunch with friends for $12 plus transportation costs? Well, that’s 1/5 of my monthly budget spent in one (half) day! Splurging? You can say that.

But like I said, it’s all relative. These are small ticket items in my tiny budget. The things that will truly impact my finances most immediately are the big ticket items. I guess this means small gadgets, food, coffee, and occasional clothing items are out of the picture. That leaves…oh! The thing that I’ve been budgeting FOR!

Curb Spending By Using Cash

I talked about how cash is still a superior form of payment in my last post. Now is the opportunity for me to put my money where my mouth is. It's the beginning of the month, and I haven't used any of my discretionary fund yet. This morning, I will go to the ATM and take out $80 in cash (out of my $100 budget) to spend for the rest of the month. What about the rest of the budget? Well, because I have to swipe my Chase debit card a total of 5 times a month to avoid a checking maintenance fee, I left that $20 out for that purpose. Besides that, all of my "fun budget," including food (non-grocery), clothing, and going out money will be spent in cash.

So what do I hope to achieve? I'm not purposely trying to piss off the people standing in line behind me, for sure. It's really to test the theory that using cash can help you to relate more closely to your money. By spending (almost) only cash this month, I'm hoping I'll be more aware of how much $$ is physically disappearing from my wallet. It might hurt more, but hey, I call that tough love!

Have you ever used this method to curb spending? Did it help? If you've never tried this cash only spending method, I encourage you to join me. It'll be more fun with more people =D

Why Cash Still Reigns as King

Okay, I have to admit, I used to be one of those people who roll their eyes when someone fumbles through their wallet to count their cash so they can pay with exact change. Wouldn't it be easier if everyone just swipe their card? As an engineer, the question of efficiency constantly lingers my mind. In this case, card swiping wins against cash, especially when there are 7 other people standing in line behind me and we’re all waiting for the person in front of me to finish paying.

Well, efficiency often comes at a price. In this case, the tradeoff presents itself in the form of interchange fees and wasteful spending.

Interchange Fee
If you’ve ever gone to a store that tells you it doesn't accept credit cards or that there’s a baseline spending you must reach before you can swipe, you probably have the interchange fee to thank for your inconvenience.

January Budget Summary (and Happy 1 Month!)

Wow, today marks one month of blogging! It's been a great month. The blog helps keep personal finance on my mind constantly, which is awesome because there’s still so much more I need/want to learn! Not only that, I learned a lot about blogging and social networking, too.

Remember that I mentioned setting a non-discretionary spending budget of $100 a month earlier? Well, the results are in: drum roll, please...I spent $116.11. Not a total success, but not a complete fail, either. I felt so guilty for spending more than a quarter of my budget less than a week after setting it that I returned something I bought in December.

1.11.11 Resolutions and Goals

If you haven't made any new year's financial resolutions, set financial goals for yourself, or have broken a few already, all is not lost. Today is a new day. It's 1.11.11 to be exact. Sure no ball will be dropped in Time Square, but it's a good excuse to get the ball rolling (again). Hey, this many 1's must signal a new beginning or something. Why else would Verizon decide to make a certain big announcement today, of all days?

Alright, too much? In all seriousness, there is no better day than today to get your finances in order. If you don't know where to start, here are a few suggestions to get things going:

The Budget Experiment

Beginning with the new year, I started a little experiment on myself. I decided to take up the challenge of limiting my discretionary spending to $100 per month. This includes food, entertainment, gifts, clothing, etc. There are a few specific exceptions: I didn't include gym membership in this amount, mainly because of the complications that would result due to the fact that I'm on a family plan. I also did not add two possible reunion trips and a wedding I'm attending this year. They will have a separate budget. In fact, the trips are part of what prompted me to cut my spending.

Okay, to be honest, it's not the most well thought out plan ever, but I want a plan that's challenging yet still doable. I have a general idea that it's going to be a long term experiment without a set ending date. I figured that if I do this for at least 6 months out of 2011, I will definitely come out ahead of my savings goal. The trick, however, is not to go on a spending spree afterwards. That'll defeat the whole purpose.

What other reasons, besides the potentially costly trips, prompted this experiment?