My post today comes from an awesome experience this weekend helping the Thousandaire Girlfriend (Tag) make her first budget. If you remember Tag from my first music video, the way to win her heart in that video was to have a budget and be smart financially. In real life, she didn’t even have a budget herself! Bad girl Tag!
We used the same spreadsheet I use for my budget, and the first step was to pull in all her old transactions for the last three months and see where she has been spending her money recently.
If you’ve made a budget, you probably remember the first time you had that epiphany where you realized something about your spending habits that you wanted to change immediately. Tag had a hilarious epiphany just a few minutes into looking at her budget:
I gotta quit the ‘Bucks!
If you have no idea what she’s talking about, don’t worry. I think Tag is the only person in the world who refers to Starbucks as “The ‘Bucks”. In fact, I had never heard it before yesterday, and it was freaking adorable and hilarious at the same time!
I think the most popular personal finance advice on the internet is to “stop buying coffee.” I say that’s stupid advice. If you love coffee, you can afford it, and you are keeping things in moderation and staying healthy, then I encourage you to keep spending money on something you love. However, Tag sees that coffee as just a luxury and not really a necessity, so she is comfortable with giving it up to save money and cut calories.
Just before I made my budget, I bought a 350Z convertible. After I made my budget, I knew instantly that a car is like a money furnace; it literally burns money and gives you nothing except transportation in return.
Tag realized she had to “quit the ‘bucks.” I traded in my 350Z.
Today’s Thousandaire question: What did you do after making your first budget?
Kevin McKee is an entrepreneur, IT guru, and personal finance leader. In addition to his writing, Kevin is the head of IT at Buildingstars, Co-Founder of Padmission, and organizer of Laravel STL. He is also the creator of www.contributetoopensource.com. When he’s not working, Kevin enjoys podcasting about movies and spending time with his wife and four children.
Want to know how I know you are in a serious relationship? You think “The Bucks” is a cute name for starbucks LOL
When we made our budget the first thing I did was call every single fixed expense and try to negotiate down! Cable, insurance, etc.
It was definitely a “you had to be there” moment. Good idea on the negotiation. Do you have a post that talks about negotiating with those companies? I’d love to read it.
Agreed, don’t cut back on the things you love, cut back on the things you don’t care that much about!
That’s why I don’t have cable and haven’t bought a video game in a year. (although I’m in the market for something fun on PS3)
Are you kidding!? 🙂 I call Starbucks “The Bux” or “Bucks” all the time.
This is why it’s also just a line item on my budget as a treat rather than a daily thing. I found that out the hard way.
I guess I don’t really hang out with lots of people who go to Starbucks. I just thought it was the cutest thing ever.
I don’t even like coffee, so I never go there unless I get a strawberries and creme (mmmmmmmmm)
Yeah, I decided to quit starbucks too. I had enough money to do it, so it didn’t seem like a strain, but then I realized how much money I could be putting into savings instead of having a mocha every day. (Around $4 * 25 days a month buying mocha = $100 a month.)
I feel like a real addict about coffee shops though. If I cave an go once, chances are I’ll end up going again very soon after. It’s easier for me to quit entirely than to “reward” myself with it occasionally, because then I come with all kinds of excuses about why I need a reward every day, haha!
I definitely understand that. I have fallen in that habit of “rewarding myself” too often with other things. I should come up with some established criteria for what I do that deserves a reward so I can treat myself and feel like I deserve it.
When I did my budget I had to quit iTunes. For a while there if I heard a song on the radio, i’d just shazam it and buy it. Then I realized I was spending $5-$10 a month and I barely even listen to my ipod. I also reduce The Bucks, but couldn’t eliminate. Now I get Bucks about once per week or less.
Seems like a lot of people are reducing their Starbucks intake. I wonder if it’s affecting their bottom line? Good call on the songs, I only buy about 3 albums a year and I wear them out!
Love the vlog – you look good on camera.
I cut myself back to one Starbucks per week from the previous 4 to 5.
Thanks Clare. I think the camera makes me look better than I really am. Congrats on limiting your Starbucks! I recently gave up on giving up soda. (does that make sense?)