Tuesday, February 10, 2015

The Cash Flow Problem, Part Two

In case you've ever wondered, I think I have just given a graphic example of why a written budget is necessary for all of us.  When writing out our monthly expenses yesterday, I somehow went temporarily senile and left out ALL OUR MONTHLY UTILITY COSTS!

You, me, our Mamas, and our crazy Aunt Ethel ALL NEED A WRITTEN MONTHLY budget if we ever hope to be financially stable.  Trying to figure out your expenses off the top of head, (or the seat of your pants), won't cut it!  If you don't believe me, read this post, then reread my attempt yesterday to quantify our monthly spending.

Yesterday I had estimated our average monthly expenses to be $4,500 .  Let's assume that the figures I pulled out of the air for the costs I identified are more-or-less accurate, and add in all the average utility costs which I somehow completely overlooked:

19. iPad internet connection (Verizon)  -  $30

20. Cellphones (AT&T)  -  $140

21.  Satellite TV  -  $100

22.  Internet access (AT&T)  -  $60

23.  Water  -  $50

24.  Garbage tax  -  $20

25.  Natural Gas  -  $50

26.  Electricity  -  $200

27.  Terminex termite treatment  -  $50

Add all these guys up, and I get $700.  So we need to add $700 to $4,500 to come up with a more accurate account of our monthly expenses.


This is much closer to our average monthly income of $5,300, and in fact gives us a "float", or margin of error, of only $100.

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