a peek inside the fishbowl

09 Sep, 2011

A different kind of diet

Posted by andrea tomkins in: Misc. life

Many of you know that we’re planning a reno (you can read past posts about that here). The plans are almost final but in the meantime, we’re tightening our belts because guess what, haha!, we’re spending more than we planned! (And I want a really nice stove! And a new bed! And a really cool shed!)

This may sound completely crazy, and it’s embarrassing to admit this publicly, but we’ve never adhered to a personal spending budget. We never thought we really needed one. Mark and I aren’t terribly big shoppers, and thankfully we’re on the same wavelength about money and consumer goods. We share a bank account and we talk to each other before making big purchases. And we’ve been doing our annual Shopping Embargo long enough now that the questions we ask ourselves before point-of-purchase are practically automatic:

  • Is this a need or a want?
  • Is it well made?
  • Overpackaged?
  • Will it last?
  • Is it a good buy?

But otherwise we just, um, spend. And we don’t think much about it.* Groceries! Clothing! Sushi! The debit card gets a workout, and lately, the credit card, because I’ve fallen into a point-related trap. :( It’s time to change all of that, at least for a little while. Bye bye points, farewell spontaneous takeout, it’s time to buckle down and get serious about superfluous spending.

We started three weeks ago. Mark took some cash out of the bank machine and gave me the lion’s share of it. That was our spending money. That amount had to last us the week. No plastic allowed, at all. That means I have had to think doubly hard about each purchase we made. I put back pricey groceries and refused various pleas for treats. Our money had to last.

I realize that there are many people who live this way, full time, seven days a week. It’s real life for them, not some kind of personal challenge. These are people who really and truly don’t have money in the budget to buy a pricey hunk of cheese or a new school outfit for their kids. That’s why I’m not going to make this into a big bloggy challenge or post weekly updates here on the blog. I need to be sensitive to the people for whom this is a way of life.

There’s something about having ACTUAL cash in your wallet that seems to be making a difference here. And to part with it a bit at a time, seeing the number of bills get smaller and my coin compartment get fatter (and having to dig around for coins at the cash register) that really puts things into perspective.

I am not going to reveal the amount we’re working with because I don’t want to be judged, but I will say that it was a challenge. Everything came out of that amount. And you know what, it’s been very hard. That first week I had to buy a wedding gift, some school supplies, groceries for a Sunday dinner with our inlaws and some clothing for Emma. Other expenditures included Mark’s snacks at work (which turned out to cost more money than either of us had thought) and a round of golf.

We spent every dime, and then some. The other day we had to buy printer cartridges ($150!) and it blew us out of the water. (Mark argues that it’s a business expense, and it IS, but still.)

Now that we’re gearing up for another week of the “cash diet” I can safely say that it has definitely affected us. I declined a brunch date because I hadn’t budgeted for it. I’ve been putting off purchases and raiding my closet. I’m bringing my boots to be repaired instead of springing for a new pair. That hurts.

* I need to mention that we do follow the main rule we learned reading the Wealthy Barber (you can find that book using my affiliate link here). We pay ourselves first, and this money goes into RRSPs and things like that.

I think I’ll switch to a different grocery store and see how that goes. I sense more meatloaf in our future and some budget-driven dinners that feature less meat.

Do you live on a budget? I’d love to hear more about it if you do. Give me tips! I need tips! How do you stay on budget?


15 Responses to "A different kind of diet"

1 | Ron

September 9th, 2011 at 12:59 pm

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A cash diet is actually uneconomical (assuming you pay your credit cards at the end of each month.) Because you are spending cash now instead of saving it and spending it at the end of the month (to pay CCs) you are losing out on potential interest.

If you REALLY want to be organized and economical… set aside the cash you will spend and put it in a SAFE short-term investment (GIC for example). Then, once the GIC expires, use that cash to pay your CC (on time… no fees!) and pocket the interest.

True, the amount you’ll make on a short term GIC is very small, and it will take a lot of organization/planning so it may not ultimately be worth it. But this would be the most economically sound “cash” diet.

2 | Mary V.

September 9th, 2011 at 1:05 pm

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Your post really resonated with me because lately I find myself wondering ‘where does all the money go?’. I think the act of physically having to take the cash out of your wallet really makes one carefully consider the value of each purchase. As hubby and I are saving for a family European vacation, I’m thinking of doing the same…

Some things I’ve found useful for saving – if you see meatloaf in your future, then check out http://www.fitzroybeeffarmers.com. You can get 10 packs of local ground beef for $29 – cheaper than the grocery story.

Printer cartridges – I think they must be filled with gold dust for what stores charge. I buy them online at cartridgestore.com.

3 | Lara

September 9th, 2011 at 1:22 pm

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We NEED to do this. I keep saying we will and then…

Things have been far too tight and we’ve been spending more than we should. It’s so hard to say no to the things you want, and I KNOW that makes me sound like a spoiled brat but it’s so true!

I really need to do this. Sigh ;)

4 | SteveJ

September 9th, 2011 at 1:31 pm

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We have talked about doing this but never actually have. After reading about your experiences I think we will give it a try.
You’re right – it’s so easy to (over)spend when you don’t physically see the $ come out of your account. All of those small expenditures add up.
If you’ve ever watched the show “Till Debt Do Us Part” they recommend doing the same (putting away your plastic).
Thanks for the heads up about how hard it actually is to do!

5 | Marianne

September 9th, 2011 at 1:48 pm

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We live on a budget. At the start of each year, we work out what our budget should be for the year. After our savings and all of our fixed costs (savings, utilities, cable, phone, insurance, etc) we break down our remaining monthly expenditures into the following categories: food, entertainment, tangibles (aka “stuff”) and gas. We keep all our receipts and tally them up at the end of the month in our spreadsheet. If we’ve gone over in a category, we know we have to pull back the following month to make the costs work out over the year. We are financially stable enough that being over budget one month doesn’t hurt us … our goal is to have it all work out over the course of the year.

We don’t use a cash system, though. Any cash we do take out is counted towards our entertainment budget (as it usually gets piddled away for coffees, muffins, and things that fall into that category) unless it’s for a very specific purpose for which we can’t use our credit cards. We use our credit cards almost exclusively in order to gain rewards points for groceries. This works for us because we ALWAYS pay off our balance each month, and because after quite a few years of this system (7 years for me, over a decade for my husband), we spend responsibly. If you’re an impulse shopper, or just starting out on a budgeting system, I’d advise doing it with cash first — which is what I was doing before we got married and I switched to my husband’s system.

It’s amazing how much less you spend simply when you’re aware of how fast the money is going through your fingers and in which directions. And if you track things over time, you can see patterns emerge. We know, for example, that we always spend more than our monthly budget on tangibles in the fall months, as we sort of “nest” and get our yard and home ready for winter.

We are one of the most financially stable couples of our age
that we know because we save first, and live on a budget. We don’t live fancy, but we live well and happily. Right now it’s allowing me to take a leave of absence for several years to be at home with our young children.

I have plenty of cost-saving tips, and I love bargains, deals, coupons, and sales. I’m happy to share any of them you like.

And now my 3 year old needs me!

6 | Jennifer

September 9th, 2011 at 1:56 pm

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I LOVE cash. We have lived on a cash budget (not a diet by any means) for a lllloonnnggg time and it works. It does take alot of planning though. The brunch is a good example. I look at my monthly schedule of activities and I plan meals/budget around that. It takes some getting used to if this isn;t the way you normally do things, but it is worth it in the long run. You then know what you CAN spend your money on and how much you ARE saving.

7 | Ginger

September 9th, 2011 at 2:13 pm

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We talk about budgeting all the time and never sit down to do it. But in small ways I have started making it happen. For the first time since the boys were born I chose an amount to spend for their birthday and stuck to it. (They are only just 3 so it isn’t that I have been overspending for years and years.)

I have already set a budget for Christmas for the boys and we have used a Christmas budget with extended family and friends for several years now.

I don’t think we could do an all cash diet. I purchase too many of our gifts online because I prefer handmade, wooden, open-ended play type things for the boys. You just can’t find that stuff in Target or Toys R Us. But, I always get coupons and free shipping codes for my online stuff which ends up saving us money anyway. I usually buy less online than I would in a store because you see the shopping cart add up as you go so I stick closer to budget.

What I do want us to do is start tracking all of our spending so we can cut out the extra stuff that we don’t realize we are buying and spending on.

With the economy as it is we have certainly cut back and paid down debt before buying new things. Our cars are paid off and as much as I would love a new one we are taking advantage of no car payment. Our debt is almost completely gone which feels great and our savings is continuing to grow.

8 | Alison p-h

September 9th, 2011 at 10:58 pm

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I use a budget and really like it. Although I like to call it money monitoring instead. I don’t use the cash system but I do pay off my credit card every month. The tracking is to ensure there is positive cash flow every month.

Here are my tips
* find a way to track what you spend that works for you. I use http://www.pearbudget.com but there are some other great tracking tools out there. Tracking is not always fun but needs to be done to figure out WHERE the money is really going.
* there will be slip ups and that is okay, just keep going.
* find blogs to help you stay motivated. http://www.gailvazoxlade.com and http://www.getrichslowly.org for example. Or for another crazy thought- early retirement http://blog.canadian-dream-free-at-45.com

Next steps for me is to start some more targeted savings account. E.g. Travel. Baby steps for me.

Good luck.

Alison

9 | andrea

September 10th, 2011 at 8:35 am

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Thanks all!
FWIW, tracking isn’t an issue for us. Mark is a big fan of Quicken (home accounting software) and is positively religious about keeping it updated. So we know EXACTLY how much we’re spending on groceries and dining out, it’s just too much!

10 | Tina

September 10th, 2011 at 3:23 pm

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I really like http://www.soscuisine.com to keep my food spending in check.

It offers weekly menu planning features based on the flyer specials, but I rarely use that feature.

What I do use every week when I’m making up our grocery list is the compilation of the flyer specials. I just uncheck the stores that I don’t go to, and then compare across 4-5 stores and make a list for 2-3 stores that I plan on going to that week. I can also see if it is worth it to go to a store that I don’t normal go to based on whether they have a really good deal on something. I also subscribe to the online flyer from Produce Depot which is the one store in our city that isn’t included in the list from soscuisine.

11 | Tina

September 10th, 2011 at 3:25 pm

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I have also found, after years and years of living on a very restrictive food budget, that having a ‘treat of the week’ is essential to not feeling completely bored, dissatisfied and hemmed in by my budget. It is usually no more than $10 a week, but the occasional treat makes all the difference.

12 | lala

September 10th, 2011 at 4:38 pm

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I can put you in touch with a farmer in North Gower who sells,1/4 and 1/2 cows, I think the ground beef comes out to just over 2$ a lb. It’s very convenient to have a freezer full of frozen beef in various cuts. also i like Gail Vaz Oxlade jar system.

13 | Dee

September 11th, 2011 at 1:14 am

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Ron’s post made me laugh a bit. Nobody else? These days, the interest earned in one month is far less than the money the family is saving by spending less! Either way…up to the Quietfishies. My trick is to live on a lower income; when each paycheque arrives (which has already had RRSPs deducted), I put even more into another account. When I had debt, I carried my balance on a (this is important) *low interest credit card* which is super easy to find for a 6- to 18-month period. When it ends, transfer to another. Do this until the debt is gone.

14 | Mary @ Parenthood

September 11th, 2011 at 7:47 am

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I’ve heard the trick to reducing food bills is to plan your meals ahead around the flyers for the week. Also to go to multiple grocery stores. Not that you go to a whole bunch in a single week, but that you increase the the number of stores over the month so that you can take advantage of where certain items are cheapest.

Ideally, you keep track of grocery prices (is there an app for that? Hmm I wonder now!) and use coupons.

Not that I do that! We have a budget but I confess we treat it more as suggestion than goal! Mostly because our priority currently is maximizing time and something had to give! We do spend less than we earn though.

15 | Financial literacy for kids: part one of two >> a peek inside the fishbowl

October 8th, 2011 at 9:40 am

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[…] the wash. Should we buy it?” Clip coupons. Show them the hydro bill. Do up a basic budget. Try a cash diet, or a Shopping Embargo. Talk about how much dinner costs when you make it at home vs. going out for […]

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My name is Andrea and I live in the Westboro area of Ottawa with my husband Mark and our dog Piper who is kind of a big deal on Instagram. We also have two human daughters: Emma (20) and Sarah (18). During the day I work as a writer at The Royal Ottawa Mental Health Centre. I am a longtime Ottawa blogger and I've occupied this little corner of the WWW since 1999. The Fishbowl is my whiteboard, water cooler, and journal, all rolled into one. I'm passionate about healthy living, arts and culture, family travel, great gear, good food, and sharing the best of Ottawa for families. I also love vegetables, photography, gadgets, and great design.

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