My Budget

Every one's budget is different. Mine is a lot different than most of yours because I don't have a house payment, or rent, or any other debt payments. Because of that I have a lot less to pay, and I get to save all that money for stuff like a car, or a better house, or backpacking equipment.

When I do my budgeting I do it in excel, and they are getting to look more and more the same so the time I spend on it is very small after the initial setup. I do my budgeting for each paycheck, so here is a typical paycheck budget:

• Gross Pay : 2375
• Taxes: -237.71
• Black Hole -175.57 (social security)
• Medical - 99.72
• 401k - 95.00 (I get up to 4% matching)
• Take Home 1777.52

• Savings
• Roth IRA 250.00
• Car 500.00
• House 200.00
  
• Other 116.00
• Total 1066.00
  

• Cash out each Paycheck
• Food 100.00
  
• Gas 80.00
• Entertainment 20.00
• Household 20.00
• Clothes 20.00
• Total 240.00
  

• AutoPay Monthly
• Auto Insurance 48.50
• Utilities 25.00
• Cell Phone 23.00
• Water 23.00
• Phone/Internet 21.00
• Garbage 15.00
• Therapy 15.00
• Meds 15.00
• Netflix 7.50
• Total Autopay 433.00
  

• Checks Paid
• Tithing 237.50
• Offerings 15.00
• Total Checks 253.50

This leaves in between 20 - 25 dollars a paycheck as cushion in case we forget anything or want to splurge on something. We do our best to follow the pay yourself first principle. I am certainly doing that with my 401k, my Roth, and the car. The house is a little more flexible. This budget has served us well for the last year, and we have gone over our budget only a handful of times on a few accounts.

For those of you who say we are living on practically nothing, you are partially true. We don't go out to eat hardly ever, we rarely go to the movies, but we do have a lot of fun with our hobbies. We also don't have any kids, which makes this time the best time to pile up on cash. Later on I will talk about the magic of compounding interest but we are taking as much advantage as we can.

For having a budget like this and paying our self first, I estimate we are on a monthly basis coming 1500.00 dollars closer to being wealthy. If we keep this up and even if we save nothing else by the time I'm 55 that will mean 3,390,732 dollars ahead of someone who is not following this plan. I will be able to perpetually take out an average of 8% a year which means about 270,000 a year closer to saying screw you to your boss and saying no thanks to social insecurity.