The Infinite Kind Blog

The Infinite Kind Blog

European Budget 2.0

I’m currently in Milan, enjoying the gorgeous architecture and fabulous fashion. I could quite easily blow the rest of this months budget on clothes, and that isn’t even including the shoes! I’ve been traveling for 2 months with 4 left to go, and I feel like I’m finally getting into the rhythm of long-term travel. Except for the setup of my budget.

I was working on my budget review when I realized that my budget just wasn’t working for me. One week I would go way over budget on eating out, but underspend on entertainment, the next week the opposite. Other weeks I’d be way under budget on all of my categories. I realized I needed a new budgeting strategy. Welcome to my new budget setup: essentials and everything else.

I realized that there were a few categories where I really care about spending, and everything else I really don’t. Here’s what I track closely- my savings contributions, my slush fund contribution, lodgings, travel, and groceries. Everything else doesn’t matter; I have a certain amount of money available but I don’t care if it goes to sushi or shoes, massages or marzipan.

I’ve shifted my budget setup accordingly- I have fixed budgetary amounts for categories which will keep a roof over my head and comfortably fed, and everything else falls into a category I’ve called “Stuff.” Stuff might be 5 star cuisine, a pedicure, or Italian leather gloves lined in cashmere. I’ve budgeted the category by month, instead of weekly as I had budgeted the many categories I rolled into it. This better reflects the nature of my spending; I tend to spend a few days shopping and eating indulgently and then a week or two cocooning.

This new budgeting strategy has also had the happy side effect of greatly streamlining my data and transaction entry. I tend to pay for travel and lodgings with my debit card, but use cash for everything else. I set the default category on my cash tracking account to “stuff,” and now I only need to deal with categorizing when I buy groceries. I’m experimenting with using tags to track my larger purchases (over 50 euros or so), but I might lose interest in this eventually.

When I made these edits to my budget, I also moved all the transactions in the categories I was rolling together into my “Stuff” category. I edited my budget as well, so now I can review November’s spending using the new budgeting guidelines. I did a good job of sticking to my budget- the only category where I went significantly over was my contributions to my savings account. There are a number of categories (future months’ expenses) where it looks as if I am running far under budget, but this is because of the oddities of my budget.

{% photo Nov-budget-report.jpg %}

I’ve also been promising a sneak peek of one of our new reports, and this is one I’ve THRILLED to be able to use. It’s called the “Detailed Transfers” report. This report allows me to select source and target accounts for a very customized report.

{% photo Detailed-Transfers-1.jpg %}

I enjoy this report almost as much as the budget report- it makes it easy for me not only to track my spending and savings goals, but also to create a very targeted report. I could, for example, create a report which doesn’t include interest income, or income from my investment accounts, or expenses which are attributable to my business. In this view I’m looking at the piece of the report which shows how much I have transferred from my checking to my savings account in November.

{% photo Detailed-Transfers-2.jpg %}

This report is still a work in progress but we’re anticipating including it, and several other new reports, in our next stable release. We’ll post more about when you can expect to see that in the next few weeks.