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Unformatted text preview: Overall, I’ve always been horrible when it comes to keeping track of my money. I’ve tried so many different ways to figure out where my hard earned bucks go, but I somehow always falter as my spending plan begins to disintegrate by day 4. Regardless of my crazed spending habits, however, I always make it a necessity to pay my bills on time and a nicety to have a couple bucks to throw around on the weekend. I guess I kind of already have a mental spending plan in my head, and I solely blame the under‐the‐table job market for the terrible habit that I’ve developed over the years. Its tough to keep track of your money, or even find the purpose to, when I know I will be receiving n amount of dollars every Saturday and Sunday. However to deter my hot hands from burning complete holes in my pocket, I recently opened a checking and savings account at Bank of America on Temple’s campus. I’ve already begun cashing, saving and of course withdrawing, respectfully. I also have completely done away with my Diamond Dollars as I quickly realized how evil they could be; I spent almost $25.00 in my first week on food alone, and that was the end of that. In my spending plan I will be keeping track of my expenditures between September 15, 2010 and October 14, 2010. The expenditures will be recorded and then placed into one of the five different categories I will be documenting: Bills, miscellaneous, food, transportation, allowance, entertainment and savings. Of the five types of spending I anticipate that my bills category remain constant; however, the other four have a great deal of wiggle room and may fluctuate. For example, I have a couple events (i.e. a birthday) coming up in the next month that could influence my estimated and actual values. My food and allowance categories may also seem integrated within each other (i.e. Spending at convenient stores); therefore, I will not be classifying minor food expenses in a food category but rather the allowance category. Likewise, I am predicting that the transportation, miscellaneous and entertainment categories to be much less than the bills, allowance and food categories, respectfully. There are six numerical values that I’ve predicted to have spent for the month duration for each category as well: Bills ($490.00), miscellaneous ($100.00), food ($200.00), transportation ($30.00), allowance ($120.00), entertainment ($50.00) and savings ($12.04). If my actual and estimated values seem skeptical at the end of the assignment, please note and realize that I’m going for a Buffetesque type of spending, which would for me to be the cheapest person alive for the next month. I feel as though I have a decent fundamental base to begin my spending plan, but more importantly, to save money. There are several ways I’ve adapted, and willing to adapt into, so I can save a couple hundred dollars this year. For example, by opening a bank account I will not be as tempted to spend money as much as I would if I had money in hand. The allowance I have given myself every week will be very helpful as long as I remain loyal to the spending plan. The allowance as mentioned before will be $30.00 per business week (Monday‐Friday), leaving me with $6.00 to spend during each day. Likewise, I plan on investing 10% of each paycheck from CVS/Pharmacy into my savings account: Either $3.01 or $6.20, depending on the check amount. Although these values are both insignificant and almost trivial to a savings plan, in retrospect it is actually a decent amount of change I will be saving every year, amassing a saving approximately $144.48 to $288.96 every year. However saving a few dollars during the year always looks good on the bottom line, it helps contribute to my affirmative action to change and encourage good spending and saving habits that leech onto me for life. $50.00 $120.00 $30.00 Estimated Spending
$12.04 Bills Food Transportation Allowance Entertainment Savings $200.00 $490.00 I am both excited and absolute terrified to begin this spending plan, but my short‐term goals should help me trudge through the assignment and help me break this malicious habit. I plan on having at least $120.00 in my new savings account (Initially $100.00), begin to pack lunches during the week and put all of my money earned into my bank accounts accordingly. For there, I will be getting all of my receipts from each day and placing them into a bin, where they are logged into Microsoft Excel every Sunday. Although the long‐term prediction is okay, I feel as though I will be able to better myself through short‐term goals. By targeting my objective in smaller portions, I should remain consistent, loyal and honest to my spending plan, but also show myself that with a little resolution I can break the habit and begin living a more structured and conservative lifestyle. Actual Spending
$96.74 $100.00 $330.00 $366.73 $164.36 $96.50 Bills Food Transportation Allowance Entertainment Savings After about one month of tracking my expenditures, I still have ceased to amaze me. Comparing my estimated and actual total values for the month, my guesstimate was off by approximately $152.29 (15.19%). I was aware that eating out was going to be the one to collapse and zero out my bank account, and it made up for $366.73 dollars of my actual totaled expenditures in my allowance category, encompassing 33.77% of my actual totals. Evidently, the allowance category surpassed my “Bills” category by $36.73; however, I did mention that I was going to have to take my girlfriend out for her 21st birthday dinner. Additionally, I am very content overall with my spending in the other categories with the comparative values for each as follows: bills (+$160.00), food (+$35.64), transportation (‐$66.50), entertainment (‐$46.74) and savings (‐/+ $87.96), respectively. The other accessory category I was surprised with was my ability to save $100.00 as opposed to my predicted $12.04 (Go ahead, LAUGH!) and transportation. I solely blame the transportation deficit on my ignorance, as I utilizing the “amazing” cab service the city of Philadelphia offered, as opposed to other cheaper forms of transportation such as the subway or my own feet. I would also like to point a finger at a fellow classmate, as I realized on October 5, 2010 that his clumsiness was in direct correlation with my bank account. After a couple days and a $30.00 cab ride back to Northeast Philadelphia, however, we still remain friends to this day. Considering this is my first semester at Temple University, I feel as though it is appropriate to call his a “transition” month; I had to become acclimated and endure this new college environment. This “transition” would include getting a feel how my expenses would be, the most efficient (and cheapest) ways to get around the city and realizing that the cheaper foods are located on the bottom shelf of grocery stores. This was a very busy month for my bank account and I, and I’m just glad that this is finally over so I can begin saving some money. Considering that my girlfriend’s birthday only comes once a year, I am assuming that I will be using this excess money to save for investing. Professor Lengkeek actually considered getting into a direct reinvestment plan, also known as a DRiP. According to fool.com’s article on DRiPs, it stated that: Companies offer DRPs as a way for their shareholders to buy stock directly from the company (usually through a transfer agent) in very small to large amounts, and usually on a monthly basis if desired. These plans get their name from the fact that they also reinvest dividends paid, using these dividends to purchase more stock: thus the name "Dividend Reinvestment Plan." This is a very beneficial and life‐setting assignment, as I still pull out receipts from my pockets two weeks after the assignment was to end. I was satisfied with my estimated and actual totals, and hopefully in months to come I can save up to $1000.00 to begin my investing plan and contribute more to my Roth IRA that I recently opened with Bank of America. And for those who say that spending that much on your girlfriend’s birthday is outrageous; I will tell you that it is an investment vehicle that will benefit you in more ways than money could ever provide ‐‐ trust me. Estimated & Actual Spending Plan Septe m ber 14, 2 010 – Oct o ber 15, 2 0 10 Category Bills Food Transportation Allowance Entertainment Savings Total $50.00 $120.00 $30.00 $200.00 $490.00 Estimated $490.00 $200.00 $30.00 $120.00 $50.00 $12.04 $1,002.04 Actual $330.00 $164.36 $96.50 $366.73 $96.74 $100.00 $1,154.33 Compare $160.00 (+) $35.64 (+) $66.50 (‐) $246.73 (‐) $46.74 (‐) $87.96 (‐) $152.29 (‐) Estimated
$12.04 Bills Food Transportation Allowance Entertainment Savings Actual
$330.00 $164.36 $96.50 $366.73 Bills Food Transportation Allowance Entertainment $100.00 $96.74 Savings $1,154.33 ...
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This note was uploaded on 04/19/2011 for the course EE 0822 taught by Professor Lengkeek during the Spring '11 term at Temple.
- Spring '11