Friday, 13 November 2015

Where There Once Was Four, There is Now Five

For about a year now I have had four wallets that I use, yesterday I have added another. Okay it is empty now as it is not payday yet, but it will have something in it soon. 

The wallets I use, I do so to have cash on hand and so not to dip into my bank account. These are cheap dollar store wallets with labels on them. You could also use envelopes, I suppose but taking a wallet to the store and putting the change back in it is less strange than an envelope. Not only that, but wallets are sturdier.

I use my wallets because, much as possible, I want to avoid buying things with my bank card.  When you pay by a debit or credit card, it is far too easy to not be shocked at what you are spending. It feels like it is not real, some video game or other non-real form of money.

As I have said before, buy buying with cash you feel the pain of that spend. As well, buy using my wallets I can budget my money on each area that I spend on a regular basis. This way there is a disconnect between my regular operations and my bank account. This lets me budget effectively. 

Each payday I look at what I have left in each wallet and compare that with how much I want to keep in each wallet. I either top it up all the way to my budgeted amount or I put in just what I think I will need to get by. This way any savings that I have been able to achieve during the last pay period will carry forward and benefit me in this pay period.

The other thing I do is budget in amounts divisible by twenty, as it is easier to get a bunch of twenties from the bank rather than a few different denominations. So if I look in my wallet and there are bills less than twenty, I disregard them. If there are lesser bills totaling twenty dollars, they count. The change I never count or consider as those are my “oh crap, I really need to scrounge” area.

The first wallet I use is my “Grocery Wallet.” This one is self-explanatory as I use it to buy my groceries. Mostly I buy stuff on the weekends when I am in my western home. This lets me just pop in and get a loaf of bread or some milk or what have you. Knowing that there is a fixed amount in that wallet helps focus me not to buy what I don’t need. 

The second wallet I use is my “Utilities Wallet.” This one is perhaps the start and core of my wallets idea. I never ever, ever wanted to get to a place where I was out of cash and propane in the middle of winter. This one is what I use to buy propane with, pay for dumping fees with and also buy extra gas for Jenny, if needed. This way, no matter how little is in the bank, I can always get a tank of propane.

The third wallet I use is my “Contingency Wallet.” This one I will admit that I haven’t really used much at all. This one is just a bit of cash put aside in case something happens and I need a bit of extra cash for one of my other wallets. Either that or I need to buy something that I didn’t budget for. I don’t keep a lot of cash in here, but a bit. Up until now it has mostly been my receptacle for my Canadian Tire Money.  I gotta tell you, if I am down to my Canadian Tire Money, I am seriously scrounging.

The forth wallet I use is my “Main Wallet” this is the wallet that contains my ID, credit and banking cards and other membership cards that I use on a regular basis. I don’t carry this one as I don’t want to lose it, and by not carrying it I can’t do those impulse spends. At least I have the time it takes to walk to Wanda to get it and back to the store to talk myself out of it.

The wallet I added yesterday is my “Entertainment Wallet” This one is as a bit of a reward for paying my credit cards off. With the pressure to get these things done now off, I am not able to relax and go and do things. I don’t know what or how much, but I will put a bit aside into this wallet for me to go for dinner, go to a movie (haven’t done that in two years) or who knows what. The idea is for me to go and do something, and have a bit of cash to do it. 

By using my wallets and my pay period budgeter spreadsheet, I am able to manage my cash flow. By managing my cash flow I am able to get a handle on my finances. Once you have a handle on your finances you can direct them in any direction you want to go. You will no longer be a slave to the whims and impulses of what happens to you, but you will be able to weather the storm and your finances will still steadily get better.

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