Wednesday, May 27, 2015

may budget + budget FAQ

Loft blouse: originally $44, on sale for $31
Birkenstocks: originally $100, with credit: $0
Anthropologie top: $88

May total: $119  ($381 left for June and July)

So not a ton of shopping this month, which is not surprising. My favorite purchase of the month is this top from Anthropologie. It's so pretty! The sleeves are a bit looser than I had hoped, but I actually did a little DIY fix that made it exactly what I wanted - I'll share more next week! The Birks were purchased using a Modcloth credit I've had for yeeeeeaaarrrs. While slightly bulky and hideous, they are very comfortable and will be perfect for a few of the concerts we are going to this summer!

No real big plans for June except to find a pair of comfortable black ballet flats - my first rotation is family medicine, so I'll be in dress clothes all month. While I love my TB Revas, they aren't broken in enough yet to wear for full days at work. I'm thinking something like these from Naturalizer, but I would love to hear any of your suggestions for comfortable and supportive black flats!

This month I received the following from my sponsors - a pretty black dress from Nordstrom for the wedding I went to last weekend, the perfect pair of white jeans (seen here), a striped dress that will double as a swim cover up that's currently on sale (seen here), and a beautiful floral skirt from Kohl's (seen here). Thank you for supporting those who support me :)

I had a bunch of budget questions during my recent survey, so I figured this would be a good time to answer some of them!

How do you pay for all the clothes you buy and send back? Do you float the balance on a credit card?

I no longer have any credit card debt, which I'm really proud of, so I don't use credit cards anymore. I keep a bit of larger balance on my debit card so that I can buy a few hundred dollars worth of clothes, knowing that the majority will be put back into my account within the next few weeks. It does get to be a bit of an annoyance though, but luckily I am moving closer to a few larger cities which means less online back and forth and hopefully more time in stores!

How are you so good at not going over budget? How long did it take until you weren't overspending anymore?

I've been on a clothing budget for three years now, so for me it was definitely a time thing. There aren't many times where I've actually gone over my budget - I've always given myself a fairly large budget though (depending on who you ask ;) ), which I suppose makes it easier to stay under. I think the biggest thing for me is thinking about better uses for that money. I paid off my credit card debt, I bought myself Invisalign to fix an insecurity I've had for a long time, and now I'm saving up for a down payment on a house. Those are the things I think about when I am close to going over budget, and it usually helps to reel me in :)

Since you're using loans to buy your clothes, it doesn't seem accurate to list the price of the item as the actual price. I understand it would be less fun and appealing to say what the item will cost you to repay, but it would be more accurate (e.g. a $25 shirt is actually will cost me X, at a 4% interest loan with a 10 year repayment).

Well, first, I suppose that's a true statement, but the same could be said for people who use credit cards to buy clothes...

Secondly, and this is totally my fault because I've never actually cleared this up, but I no longer use my student loans to pay for clothes. I use a portion of my blog income to pay for the clothes I buy. While I could spend all of my blogging income on clothes (and therefore have a lot more fun ;) ), I have been trying to use this blogging income opportunity to benefit myself in the long run - by paying off debt, straightening my teeth, and saving for the future.

Third, I know it's hard for people not to judge me for buying certain things while being a student on loans, but you have to remember that all graduate students with loans are adults. We are all putting off certain life things (buying houses, going on nice vacations, starting families), so I really can't spend the last four years of my 20s constantly being plagued by my future loan repayments. I'm 27 years old, and I get $16,000 a year to pay for my life. I don't know anyone who is my age who lives on that amount of money, so if I buy myself a few shirts a month as the only real treat of the month, while still being able to pay the bills I owe, I won't really feel bad about it.

Do you think your approach to shopping and budgeting will change when you're a doctor and have a bigger income?

I'm sure it will, but it's a realllllly long time until I'm making a "doctor's" salary - I have two years of school left, plus 3-5 years of residency pay, which depending on what you do doesn't really top $50,000/year. I also think that though I have always loved getting a good deal on items, so that probably own't change - I'll just have a nicer bag to go along with it :)

Where in your budget do you account for things like makeup and underwear, since those don't seem to come out of your shopping budget?

Those just come out of my normal "allowance" money. I buy underwear when I need it, and I buy the make-up I need when I need it. While I LOVE makeup, I rarely buy something that I don't use every single day, so I just consider those everyday expenses like buying gas or getting groceries.

How did you decide on your yearly number for your budget? 

I started my budget when I was working full time, and I had read you should spend 8-10% of your salary on clothes. Shopping was really my only hobby at the time, so I felt $150 a month was appropriate. It did help curb my spending a lot! When I started school, I wasn't getting paid every 2 weeks anymore, so I figured breaking up the semester pay into two blocks would allow me to buy more when I needed it, and less when I didn't find anything. Now that I don't use my student loans anymore for my clothing purchases, I decided to still stick with the $500 for every three months because it gives me the freedom to buy things when I want to, without going overboard. Plus at this point, I really have more than I need, so it's not like I need to go out and buy another 4 white blouses every month ;)

This is none of my business, but as a medical student, how do you afford such nice things. I have been teaching for 13 years and am married (double income) and find myself not being able to pull the trigger on finer items - Michael Kors watch for example. Just wondering how you do it.

There are so many ways to answer this question, that it really depends on what things in my closet we are talking about! So, for example, my Michael Kors watch I purchased on eBay with a bit of money I had saved up to buy myself a present at the end of first year. It originally costs $275, but I got it for $100. A few of the other nicer items I own were presents from my family over the years - my parents gave me a Coach bag for my birthday, and my grandmother and sister came together to buy me a Kate Spade bag for Christmas. My other Kate Spade bag is one I got during a flash sale three years ago. A few others things I do is that every month, I put $20 from my blogging income into a "birthday" fund, so I can buy myself something nice for my birthday - last year it was my Tory Burch Revas, and the year before that I added it to the money I made from selling a Burberry jacket I found at Goodwill to buy my Burberry trench coat. Back when I still got a tax refund, I also allowed myself to use a small portion to buy something. That's how I purchased my Hunter boots. This is all over many years - I didn't buy all of the nice things I own within a few months.

Another part of it is that I don't have a lot of time, so my "fun" money currently goes towards things rather than experiences. I'm sure there are things you enjoy doing that uses money but you get to have those experiences because you have the income and time to do it. I go on one trip a year tops, I rarely go out for drinks, and I cook at lot at home.

Is your budgeting approach enough to restrain you from impulse purchases? I find that with the purchasing power of the web combined with blogs of stylish ladies, wanting to achieve various looks is compounding my impulsive nature. Maybe you aren't afffected by this?

I don't know if my budget really curbs my impulse purchases, so much as just allows them. That's the nice thing about having a budget - I can spend the money on whatever I want, as long as I stay within that set amount. So this month I impulsed bought this top - I love it, and am so glad I bought it, and I only don't feel guilty about spending that much on one shirt because I hadn't spend much else that month. Do blogs sway me more to buy things? Probably, but I usually end up loving those things too ;)

How do you budget for life overall while living on student loans?

As a med student (and I assume most students who take out loans), I get money twice a year - at the beginning of each semester. I calculate how much I will owe in that time period + 1 month (as a safety net), so rent, car payment, phone bills, utilities, and so on, and I put that amount into a savings account that will I've set to automatically transfer money to my checking a few days before each automatic payment goes through. This way I never run out of money for bills, and I also never have to think about it. I roughly calculate how much I will spend on school that semester (books and board exams are the big ones), and put that into a separate account, only to be touched for those uses. The rest of the money I put into another savings account, and have it automatically transfer me an "allowance" every 2 weeks. This money is used for food, gas, and any other expenses. Doing it this way has meant I've never ran out of money at the end of the semester, and I can live comfortably without worrying about any of it.

Any questions I didn't answer? Let me know in the comments! I am moving today, so I apologize if I don't respond immediately but I promise I will answer within the next few days!

Don't forget to check out all of the other budgeting bloggers below! I love seeing how everyone works their budgets to work for them. Thank you all of you who come back month after month for our little "self help" group ;)