The motto of the Baglady Budget is: viagra stories I consider the past to be the total debt you have accrued. Since you already spent money you did not have in the past, you need to pay it off in the present. The future is long term savings, a retirement fund for yourself or a college fund for a child all qualify as the future. The goal is basically to live every month with less debt and more savings.
So it actually works more like a savings plan or debt elimination system than a budget. First, you write down your total savings under “future” as a positive number, and then write down your total debt under “past” as a negative number or 0. Then, you can categorize your spending into three basic categories: viagra stories, viagra stories, and viagra stories Needs include things like housing, food, automobile expenses, and healthcare. These are things you absolutely need to spend money on. Wants include all types of entertainment, including games, new clothes when your old clothes are fine, or a new car. These are things you don’t need to survive, but would like to have. Gifts include donations to charity, or gifts for special events such as birthdays and Christmas. The total of the needs, wants, and gifts categories should hopefully be less than your monthly income. If you spend more than you make, it is still helpful to see how much you are spending in each category, and you might change your lifestyle to accomodate your income.
Next, record your actual spending and saving at the end of the month. If you are under budget in the wants,needs, and gifts categories, the money saved can be rolled over to the next month in the same category, applied towards your future, or used to eliminate the debt of the past. If your debt has a higher interest rate than your investment accounts for your savings, generally you would want to pay the debt first. So eventually the absolute value of your past should get smaller and the absolutely value of your future will grow. Sometimes you do want to keep the categorical budget rolled over to the next month so you have a mini savings account for that category of expenses. For example, if you don’t give gifts every month, you can still budget 50 dollars for it every month, and at the end of the year you will have a nice Christmas fund.
So what happens if you overspend in any category? Your savings would be smaller or your debt grows, which may not hurt you at all in the short term, but in the long term, too much debt and too little savings could definitely kill you when you no longer have enough to satisfy your basic needs. I think of the Baglady Budget as a financial weight loss plan. Too much debt, just like too much weight, can crush you. Just like any diet, you need some personal discipline to stick to the system.
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This is our current budget breakdown without revealing our actual incomes. The percentages are in terms of gross income:
Needs: 28% including housing, food, automobiles, insurance, utilities
Wants: 2% includes entertainment, games, movies, gaming peripherals
Gifts: 10% donations & other gifts
Past: 0 We are currently debt free
Future: about the same as 1 year gross income so far, and contributing around 30 to 40% of gross income to it per month in various accounts like 401ks, 529s, bonds, money market, and individual investment accounts. The rest of the money goes to taxes.
My fiance is always responsible about his money and balances his accounts regularly and managed to pay off his car and school loan completely and buy an engagement ring. So I am very proud of him. Yet, he hates my budget because he feels it’s restrictive to his spending on games and other entertainment. In actuality, I think it gives him more purchasing freedom in the long run. So far we have recorded our combined entertainment spending for 5 months now, and we didn’t go over the budget once. The Baglady Budget allows roll over of unused funds in a liquid fund, so now we have enough in our “entertainment fund” for something bigger than just a single game or movie.The Baglady Budget basically creates guiltless spending because the money is already earmarked for entertainment. The Budget definitely changed my fiance’s purchasing decisions. He looks for things on sale instead of buying it at full price, and is more patient in his wants, though he still complains that I dampen the shopping experience for him.
For us, life events such as having a child or purchasing a home could change the budget dramatically, but at least we are saving as much as we can right now. I think people of any income can adapt this system to their situation.
This post is the beginning of a series of articles about my love-hate relationship with California, and especially the San Francisco Bay Area. I have lived in the Bay Area for more than ten years now, and most of the major events in my life are happening here and that is why I have a lot of strong opinions about this crazy place. So here it goes.
Reason number one — viagra stories
The most obvious taxes associated with California are the state sales and state income tax. The sales tax in California is anywhere from 7% to 9% depending on the county you make the purchase in, and the individual income tax is tiered from 1.0% to 9.3%. Unprocessed foods are untaxed, but restaurant services are. So on average, just the state taxes cost somewhere between 10% to 17% for a Californian. Compared to states where there are no income or no sales tax, Californian’s purchasing power is lowered just by state mandated taxes.
The next big tax in California dealt by many homeowners is the property tax. California’s property tax is actually not very high. limits the amount of property taxes Californians pay to only 1% of the assessed value of the property. Lower taxes should be a good thing, but in my mind it actually creates a lot of inequality. For example, if I buy the condo I am living in today, I would have to pay approximately $8000 a year in taxes, but my landlord, who bought this place in the 1980s, only pays $1325 on his taxes. This tax law in California greatly benefits corporations and landlords because as long as their corporation does not change name, they can still enjoy the benefits of the lower assessment.
Finally, what I consider a hidden tax is the federal income tax. You may say, wait a minute, don’t all Americans have to pay according to the same federal tax rules? Well, yes, but Californians receive less in federal funding than the federal taxes they pay. According to The Tax Foundation, on average, of federal tax the state contributes to the federal coffers. California is considered a huge “tax-donor” state. So by living in California, we’re paying for the construction of other states when the money could be used to improve infrastructure in California. The worst thing is, a lot people aren’t aware of this fact, and I’m not sure how they would feel if they found out that 21% of their money went 500 miles away to a school in New Mexico, the state that receives two dollars in funding for every dollar contributed.
I am sure there is another whole array of California taxes that I don’t know about, but they’re all making the cost of living here a little more unbearable. Additionally, it doesn’t seem like our tax dollars are well spent. So I end this with a haiku:
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(as of this writing a dollar is worth about 11 Mexican pesos)
