The Zen of Limits (or, minimalist budgeting)

Currently I have some financial issues, mostly relating to an ill-timed redundancy from the employer from hell (GlaxoSmithKline, I’m looking straight at you) and my decision to immediately do a Masters degree. My decision to continue on to a doctorate is probably not helping, and neither was my taking the opportunity to study overseas (Denmark) for part of my degree.


So I’m watching my pennies. And oddly enough, now that I’m living on Newstart (a grand total of $573 a fortnight) I’m now better than ever with money. It’s as if the zen of limits has had an amazing effect on my abilities with money.

Just over a week ago I had surgery, and I had a few out-of-pocket expenses associated with it (mostly medication, such as nose drops). A couple of years ago it would have put me into a panic; this time round, I had deliberately saved a little extra in my stash to cover for the cost. All I had to do was electronically transfer the funds to be available the next day. Easy.

So here are my current rules for balancing a budget. These are likely to change as I get more money — in fact, I very much hope they do, I do expect at some point in the future to have more income. But these are the rules:

  1. Always put aside minimum 10% into the stash. And this stash does. not. get. touched. Ever!
  2. The day before a payday — every payday — write out a budget. No budget, no spend. I find the very worst thing I can do is to start spending money before I’ve written out a budget. Know how easy it is to spend money that way? Too easy. So, NO BUDGET, NO SPEND!
  3. Use round amounts: budget in multiples of $10. This is just to make it easier: in Australia, ATM machines will only dispense in multiples of $10, which is a lot easier to deal with than amounts such as $35.76.
  4. Generally, round up. If a bill comes in for $47.80, round it up to $50. Exceptions are if the amount is really trivial; a four-week rail pass costs me $60.20 (Zone 1). I can scrape up 20 cents pretty easily. 😀
  5. If I really want to buy something (clothing, bedlinen), it goes into a “projects” pile of money. I can choose which “project” I spend money on. For example, right now I’d like a pair of sneakers and fill a few minor gaps in my wardrobe.
  6. Projects are a list — actually, a series of lists — of things that I would like to buy. It is not, and never is, spontaneous.
  7. All of the odd amounts of money left over (such as the $3-something from the Newstart allowance, because I budget using $570) plus the differences in billing amount all get electronically scooped up and put into the stash. Thus, instead of my stash routinely being $60 (10% of $570, rounded up), it’ll be something like $68.45.
  8. If money is going into my wallet for a designated purpose other than food or basic socialising (e.g., to pay a bill) then the banknotes get folded up double in my wallet. This means I don’t inadvertently spend money for a bill on food. A small thing, but handy nonetheless!

So those are my tips and tricks for minimalist budgeting. Please let me know your thoughts in the comments, and any other suggestions you have. Happy budgeting! (Yes, I mean that, I really do!)

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