Tuesday, August 12, 2014

A First Budget

Last night, daughter asked me to set up a budget for her living expenses, and we did that. She's been paying for her clothes, stationery, going out with friends, hobbies, etc. with her own money, but this will be the first time she'll be paying for her own groceries, toiletries, medications, cleaning products, etc.   I will be paying for her tuition, text books, health insurance, rent & utilities (included in the rent).

I budgeted $75 for groceries for her, but told her that the 1st couple of months might be more like $100 while she gets the staples like rice, oil, sugar, etc. But I've given her $50 from my July grocery budget and I'm planning to give her another $50 from the August grocery budget, too, to help defray the costs of stocking up, and no doubt, she'll receive some items from my stock pile, as well.

$25 per month for toiletries and household products.

Another $50 per month for going out with friends/eating out/entertainment. She thought that was too high, but I reminded her, a movie ticket is almost $15, a cup of coffee or smoothie close to $5, a lunch at a café can easily be $12.50 and so forth. I gave her alternatives for less expensive entertainment - rent a movie and invite friends over; have potlucks, etc. But, even with all that, there will be occasions when it would be necessary to have a cup of coffee with friends/classmates, especially when she first makes friends with others in her classes, etc. So, better to have a budget and be prepared.

$20/month for stationery/supplies: pens, printer ink, etc.

I suggested $20/month for clothing and $10/month for hobbies, as well, bringing up the total to $200/month.   Add in another $50/month for medications and she's looking at $250 for her monthly expenses.

She won't have transportation costs because her tuition includes the cost of a bus pass. 



Since she doesn't have a job at present, she'll be paying from her savings. She's planning to get a part time job once she's there, but that might not happen right away.  She will keep track of her spending and adjust as needed.

Anybody else has any good suggestions for setting up a first budget?  

4 comments:

  1. The grocery budget looks too small to me. That might do for someone with plenty of experience in shopping and cooking and it would still be little.

    I think it makes sense to add a "margin of error" for a first budget a percentage for lack of experience and another percentage because it's not a top priority. The top priority are her studies. No need to save on groceries with the amounts you spend on tuition!

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    1. The $75 is an initial guideline. It's quite possible that the budgeted amount might be insufficient. Grocery prices where she will be living are generally higher than they are where we live now.

      That's why I warned her that the actual costs might be closer to $100 and why I'll be giving her $50 from our last month's and this month's budget, to supplement her budgeted $75. Eventually, she will build up a pantry and things will even out.

      Of course, I'll be quite happy to give her grocery money, but it seems important to her to pay for some of her living expenses. She needs to have that opportunity to do so. But she knows that I'm there as a safety net.

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  2. Hi... Does the $75 groceries include her lunch at school? Because it is rather tight and I am curious to know if she managed to keep to the amounts you budgeted?

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    1. Hi...Daughter doesn't buy lunch at school; she either takes her lunch from home or comes home to eat. But, yes, the $75 is for all her meals - breakfast, lunch, dinner, and snacks. According to daughter (she's saving her receipts and keeping accounts), she spent $56.29 in August (mostly on stocking up) and $76.93 so far in September. She needs to buy some milk, bread, and rice, this weekend, so September spending will go up a bit more, but she'll probably be able to keep to the budget from October, onwards.

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