Thursday, January 2, 2014

New Year, New Plan

I've talked about budgeting and over shopping many times on the blog before, but never followed through to the end. I've never been able to stick to a budget before. I always start out very motivated and while my true personal beliefs align  with minimalism and frugality, I always seem to lose my grip after a few months and go back to consumption and less saving.

I developed a problem with spending too much/over-shopping back in late 2008 when my husband and I went through a very painful, stressful, and depressing 7 month separation (not in the relationship- physical distance due to circumstance/necessity). To cope, I developed a shopping habit that got a bit out of control, even spending money I didn't have and, yes, hiding purchases. I did fix the debt issue almost immediately, but often spent all my extra money on clothing and still hid purchases out of a sense of guilt for buying so many things. I don't remember having any need to shop or thinking about shopping often before that awful time period, and I certainly never spent too much on clothing. Just recently I've been able to admit the whole shebang to myself. 

The hard part is that like any habit or addiction, it is very difficult to change your behavior even when the source of the problem is long gone. I still kick myself thinking about all the wasted $ I spent. Even recently I binged, spending $800 after returns on clothing (at least now I have a better sense of what I need/will use/proper fit). And the sense of shame for the hiding is too painful to admit to anyone in person yet.

This year, I want to finally succeed at sticking to my budget. I've thought a lot about my previous failures and hope to start fresh with a clearer perspective and free of some of the shame and guilt. 

What I did really want to share today is 
my new budget and the strategies I am using to stick to it.

2014 Budget
$1800/year. $109.09 per month, $600.01 for November.

I came to this number after much thought and research. I've set the bar higher and lower than this number in the past and have never succeeded either way. One reason is that the number I chose had always been arbitrary and represented nothing more than a number to me. The drive to get everything I wanted/imagined was deeper than some magic number and I really wasn't ready to confront the root of the problem or why I hated limiting myself. I came up with excuse after excuse and used some creative budgeting. Lately I've read a few articles about budgeting and most experts recommend staying at or under 6% for clothing, and some like the MMI have guidelines are even lower- 4% of your take-home pay (after taxes). I personally always spent way more than this, but I didn't ever have a real guideline or clear plan. When I set this new budget, I decided firstly that the number had to be one that was reasonably achievable for me, because I don't want to fail. I set it as a percentage of my personal net pay (I did not include my husband's salary, but I went with the higher net and not my take home). I won't say the exact percentage but it is higher than 4% (again, I need it to be reasonable). I'd like to reduce more next year and one day meet the MMI guideline but let's get through this year first!

I also looked at all of my items both for an idea on cost per wear but also to see trends in my spending. I tend to spend the most in November- I love the sales and fall is my favorite season for clothing because I love jackets and light layering. I decided to keep 1/3 of the budget just for November sales, because I am likely going to buy a lot despite having only one month left in the budget and I don't want to overspend, so this is my way of saving for the event.

I still dislike the idea of no or extremely limited shopping. My excuse of course is rebuilding/refining my wardrobe into one that fits my new career path. If I go cold turkey I will binge when done, that much I have experienced in the past. But I at least have a clearer view and a focus now. I know I could do much better/closer to my ideal, but I'm not ready/fully committed yet. I do hope to get there one day.

New Budget Rules
*I can apply gifts towards the budget (including gift cards or cash).
*I can apply net earnings from selling old clothing on ebay towards the budget.
*I cannot accept gifts from my husband, as we budget everything else together and it comes out of the same pot of money regardless of intention
*Tights and necessary underclothing items come out of the grocery budget as always. I don't buy these unless I really need them and have never used this as a spending loophole.
*ETA: Shop strategically, more to follow in another post

One of the ways I have thought about to keep on track is to use a prepaid visa only for spending on clothing/accessories. It's a way to keep myself from spending any more than what I budget for. I can't do cash since most of my spending is online, but this is a great alternative. And I conveniently have a $100 prepaid visa (reusable) gifted to us from my parents... I also want to hold myself accountable and do a monthly budget progress report.

I've done a lot to try to reduce my drive to spend (and still looking for ideas and tips). I've unsubscribed from e-mails from all but my 4 favorite retailers. I'm trying to focus on other activities, tracking my cost-per-wear, and even have eliminated from my blogroll the most triggering blogs I read. I've also searched for and added new blogs to read that focus on minimizing, budgeting, and fighting over-consumption and shopaholism.

Do any of you have advice for me or would like to share your personal strategy?

2 comments:

  1. This is a great post! Congrats on getting back to blogging and making such wonderful commitments to yourself. I could identify with so much of what you wrote! I have never been able to stick to a budget before this year. Doing accountability updates on my blog each month definitely helped me to honor my commitments. While I did get off-track a few times, being honest about my mistakes helped me to get back on track and do better the next month.

    I really like how you decided to dedicate a larger portion of your budget to November shopping. I also like to shop the fall sales, so I may opt to do the same thing. Last year, it got very "touchy" toward the end of the year and I BARELY stuck to my 2013 budget, so having extra money for Nov/Dec shopping would be helpful.

    Unsubscribing from triggering emails and blogs will help you to shop less. I also used to visit fashion forums a lot and that made me want to buy the items that other members were posting. I still sometimes visit those sites but not as often, as I become more unhappy with my own wardrobe when I see the fabulous outfits that others are posting. However, I also learn from their posts, so I try to balance it and just limit how much I visit such forums. I think that balancing the fashion/style information with the other types of blogs you mentioned will be helpful. I know it's helped me. I plan to add a list of such blogs to my site soon and will invite others to chime in with blogs they find helpful.

    I look forward to reading your updates. Best of luck with your plans for this year! You can do it!

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    1. Thank you for your thoughtful reply and encouragement! I've found a few great sites through your blog and would love to see a post on the topic (though honestly I get excited about all of your posts, I love your blog).

      I hope to continue to blog, though I know posts will be fewer due to being a busy working mommy lol. I think this will help me in the long run to keep on track :)

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